Decoding the Language of Insurance Denials

Making sense of your insurance denial can be very tedious, overwhelming, and stressful — and even more so when you do not understand the “language.” Sifting through confusing legalese (and what seems to be bizarre and unreasonable logic from insurance companies) can make advocating for your health feel unmanageable. Not only are you fighting for your health and wellbeing, but you must also fight to make sense of confusing terms and explanations.

Insurance companies are notorious for using ambiguous and misleading language when communicating with their members. Below is a short list of words that are frequently used in the group (employer-provided) insurance world. Understanding these terms will empower you as a more effective advocate for the health benefits to which you are entitled, and hopefully simplify the task ahead of decoding the language used by your insurer.

1) The Plan: In simple terms, this is the benefit plan established by the employer under ERISA (Employee Retirement Income Security Act) to provide employee benefits. The Plan itself is actually a separate entity. The benefits provided under the Plan are usually funded by an insurance policy. Occasionally, the employer funds the Plan itself with its own money, and/or with employee contributions. In ERISA terminology, both the legal entity, and the insurance policy specifying the terms of coverage, are commonly referred to as “the Plan.”

2) The Administrators: There are two types of administrators in an ERISA plan. The Plan Administrator is the entity establishing the plan and is typically the entity upon which legal process is served. The Claims Administrator is the entity that decides eligibility for coverage and benefits. Where the Plan is insured, the Claims Administrator is also the insurance company who issued the policy to fund the benefits under the Plan.

3) The Claimant/Participant/Insured/Plaintiff: An individual insured under a policy is commonly referred to as “the insured.” Under ERISA, individual employees are “participants” in an ERISA plan. If the dispute involves coverage for an employee’s dependent, they are referred to as a plan “beneficiary.” Once a claim is filed, the insured, participant or beneficiary might also be referred to as the “claimant;” and once a lawsuit has been filed, “the plaintiff.”

4) The Administrative Record or Claim File: The Administrative Record consists of all papers and evidence presented to and generated by the Claim Administrator during the claim and pre-litigation appeal process. (The pre-litigation appeal process must be timely completed or a plan participant may lose his or her right to file a lawsuit. The “appeal” of a denial of a claim is sometimes referred to as a “request for reconsideration of a claim denial.”) Practically speaking, the Administrative Record is usually the claim file maintained by the insurer related to the particular claim. In any subsequent civil action for benefits, it is likely the only evidence to be considered by the trial court on the merits of the claim is that which is contained in the Administrative Record. Thus, it is very important that all evidence and history of your eating disorder be sent to the Plan (or insurance company) so it will be included in the Record during the claim and appeal process.

5) Independent Medical Review (IMR): This is a review arranged by the insurance company, with a physician of its choice, for the purpose of evaluating an insured’s medical condition and symptoms. There is usually nothing “independent” about it. Insurance companies are known to utilize the service of the same doctors over and over, and have an expectation as to the results of the report before the doctor has ever seen the insured.

If you find that you need further support in making sense of your insurance claim, please do not hesitate to contact our office for a no-cost consultation.

We understand, and we can help.