Pre-authorization vs. Denied Claims: Know the Difference
If your health insurance company will not pay your claim, you can take legal action. Health insurance claims denial attorney Nick Quincey at Quincey Law fights against large insurance companies for policyholders like you.
Insurance companies have many ways that they try to control their own costs, even for care that is covered by your plan. They build in numerous steps in the coverage and payment processes that you must navigate before you can receive care and have it paid for by the insurance company. Pre-authorization and claims payment are two related but distinct steps in the coverage and reimbursement processes.
If your health insurance company is giving you the runaround, or they have denied your claim, speak to an insurance claims denial attorney by calling Quincey Law today at 866-945-9175. We can help you fight back when the insurance company is making your life more difficult and denying necessary care.
Your Care Must Be Both Pre-Authorized and Paid For
Before you can receive certain types of medical care, you must obtain pre-authorization from the insurance company. Then, once you have received the care, the insurance company receives a claim for payment. Even though the insurance company may make a decision in both processes, there is a distinction between a pre-authorization and a denied claim.
In many cases, the doctor would need to submit a pre-authorization request to the insurance company before they can treat you or prescribe certain medications. Pre-authorization requirements apply to routine and non-emergency care. In a pre-authorization, the health care provider submits the request for coverage to the insurance company. They would include:
- The specific medical treatment that they recommend
- Information about the patient
- The medical need for the treatment
The purpose of the pre-authorization is primarily for cost control. The insurance company wants to review the care to ensure that it is medically necessary. The insurance company would review the request, and they would usually respond within thirty days with a determination about whether they would authorize the care. They may respond sooner if there are circumstances in which the care cannot wait for a full review period. The insurance company would answer with a decision about whether to approve the care. If the insurance company will not authorize the care, the patient has the right to an appeal and fair hearing.
A Pre-Authorization Is No Guarantee of Payment
A pre-authorization does not guarantee that the claim will actually be paid when you file it. The insurance company explicitly states that their pre-authorization should not be taken as a promise of payment, and they still reserve the right to deny your claim. In other words, the insurance company may authorize the treatment, but they do not conclusively commit to paying for it. They only decide whether to actually pay for it when they are presented with the actual claim.
A pre-authorization could still result in a claim denial. There could be issues with the actual claim itself, or the insurance company may still believe that the treatment is not medically necessary. The insurance company may claim that the initial pre-authorization was improperly obtained. When the insurance company denies a pre-authorized claim, you would be stuck with the bill as the patient. When you obtain medical treatment, you give your own guarantee that you will pay, even if the claim is denied.
How a Claim Denial Works
The insurance company would make an actual decision about whether to pay the claim once the provider has presented them with the bill. Then, the insurance company would review the claim itself and the documentation to determine whether to reimburse the medical provider. In some cases, the insurance company would deny the claim for administrative reasons, such as improper coding. Their systems may be set up to automatically deny certain claims, even when they have given pre-authorization. However, the insurance company could still deny a claim for lack of medical necessity, even when they authorized it in the first place.
There is nothing that says that the insurance company is right when they either deny a pre-authorization or refuse to pay a claim that they have received. You maintain the right to go through the internal appeals process. If you are not successful, you can even file a lawsuit seeking to force the insurance company to pay for your medical care. If the insurance company’s claims practices are particularly egregious, you may even be able to fight for bad faith damages.
Contact a California Insurance Claims Denial Law Firm Today
Call Quincey Law when the insurance company will not pay for care that you are entitled to under the terms of your policy. You can schedule a free initial consultation with an insurance claims denial lawyer by calling us today at 866-945-9175.
Nicholas Quincey is the founder of Quincey Law, and has over a decade of experience of handling insurance claims denials and personal injury matters for people throughout California. We have pursued insurance bad faith claims for people involving life insurance, health insurance, homeowners and disability insurance. We also work with clients and families who need assistance filing and pursuing a personal injury matter. Learn more here.