Medical Coverage Denied.
Each year legions of ill people in North Carolina get the bad news from their health insurer: Their surgeries, medicines and other treatments – some costing tens of thousands of dollars – aren’t covered by their health insurance policy.
An increasing number of these patients opt to fight their insurance company’s decision. And many are winning – with the help of the state.
This year North Carolina is on track to set an all-time high for the number of people taking on their health insurers, according to data provided by the N.C. Department of Insurance. The agency’s consumer advocacy program, called Smart NC, has seen challenges of denied claims double since 2014, when the Affordable Care Act’s health insurance mandate went into effect and brought health insurance to greater numbers of people.
Smart NC has won challenges for 143 people against health insurers in first nine months of this year, requiring the insurers to pay $1.2 million for services they had initially denied. At this rate, Smart NC could well surpass last year’s total of 174 victories against health insurers, which currently stands as an annual record.
Smart NC, with six state employees and a $603,447 annual budget, has helped patients win health insurance coverage for cancer treatments, genetic testing, knee replacements, spinal surgeries, gastric bypasses, medical devices, medications and air ambulance services. Since its inception in 2002, the program has forced insurers to pay for $19.2 million in services they initially denied and subsequently lost on appeal.
Lisa Satterfield Shank of Raleigh relied on Smart NC to challenge a denial by Blue Cross and Blue Shield for intravenous immunoglobulin infusions and for a stem cell transplant operation to treat a rare auto-immune disease. Shank’s “stiff person syndrome” left her immobilized, unable to speak and confined to a wheelchair.
During her ordeal, Shank, 52, and her husband Doug, 59, were in regular contact with their Smart NC advocate, Connie Richeal, who handled their appeal. Richeal helped with assembling materials – doctors’ letters, medical records and medical journal articles – and submitted the challenges.
“I honestly wouldn’t be sitting here if not for her,” Shank said. “I could go on for two days talking about all the good things she did for us.”
The Smart NC program represents a just small fraction of people whose insurance claims are denied, said Smart NC director Susan Nestor. The program doesn’t oversee federal insurance, like Medicare or Medicaid, and does not represent patients whose insurance is not regulated by the N.C. Department of Insurance.
Many people don’t use the free service, even though health insurers provide information about it in their denial notices. In past years Smart NC has advertised its services on billboards as well as on the radio and TV. Still, some try to fight their insurance company on their own. And some, overwhelmed or confused or just inattentive, miss the deadline to appeal a denial.
“This is so small relative to the number of denials issued by insurers,” Nestor said. “The requests we get are a drop in the bucket compared to total denials.”
This year, through Sept. 30, Smart NC has won 55 percent of the insurance denials the program challenged. It has received 372 cases from patients for “external review,” which is when the denial is looked over by an independent medical professional. It is the third and final appeal a patient is entitled to under North Carolina law. Smart NC accepted 262 of these cases as eligible, and successfully got 143 overturned or reversed.
Why coverage is denied
Insurers deny payment for medical treatment typically because they determine it isn’t medically necessary, or because it’s experimental, investigational or cosmetic.
Kay Crouch of Lenoir is one of 30-plus women in North Carolina who have been denied insurance coverage for a 3D mammography in recent years on the grounds that the procedure is experimental. Crouch, 62, was diagnosed with breast cancer in 2013, and Blue Cross denied payment for a 3D mammography the following year. She appealed the decision and lost twice, then turned to Smart NC to seek coverage of the $60 procedure.
After Smart NC got involved, Blue Cross paid for the January 2014 procedure in October 2016. Then this past February, Blue Cross denied payment for another 3D mammography, this one performed in January. This summer, however, Blue Cross changed its policy and routinely started covering 3D mammographies.
“I felt like I couldn’t get on with recovery until I settled this,” she said. “It was my full-time job for a week – 60 hours on the third appeal alone.”
Blue Cross, the state’s largest health insurer, said it approves more than 90 percent of all claims. Most claims are denied because of eligibility, such as lapsed coverage, not because of disputed interpretations of coverage terms, said Blue Cross spokesman Austin Vevurka. “Overall, roughly one ten-thousandth of one percent were overturned on external review by DOI,” Vevurka said by email.
Brendan Riley, a health policy analyst at the N.C. Justice Center in Raleigh, said that in an era of spiraling health care expenses, insurance companies are vigilant about preventing unnecessary medical treatment. Sometimes they can be too vigilant.
“Insurance companies can play an important role in trying to make sure their members are getting high value care and not using unnecessary services,” Riley said. “While insurers obviously do have a stake in managing the health of their medical members, they have an interest in keeping their costs low, and sometimes those come into conflict.”
This year, through Sept. 30, Smart NC has won 55 percent of the insurance denials the program challenged.
Joan Lund, a nurse by training, was Blue Cross’s director of appeals from 1997 to 2010 and oversaw a staff of 97 nurses and four doctors.
Lund, who is now retired and lives in Apex, said Blue Cross made the right decision much of the time when it denied claims, even in cases where the denial was later overturned on appeal. She said she was frustrated by patients and doctors – and even lawmakers calling on behalf of constituents – trying to get the insurer to pay for unauthorized medical treatment.
“I can’t tell you how many things that were – now I can say it – stupid,” Lund said, recalling a particularly egregious example: “’My patient has arthritis, she needs a swimming pool, and you denied paying for a swimming pool.’ ”
North Carolina began assisting consumers in external reviews of claims denials in 2002, as part of the state’s Patient Bill of Rights law, passed in 2001. In 2010, the N.C. Department of Insurance qualified for a consumer assistance grant under the Affordable Care Act, and the department launched Smart NC in April 2011 to provide consumer health insurance counseling, as well as to handle complaints, appeals and external reviews of denied insurance claims.
The ACA grant, which totaled nearly $1 million, ran out in March 2016 and has been replaced by state appropriated funding, Nestor said.
Smart NC doesn’t always win for the consumers it’s trying to help. When it loses, the individual’s only option if they want to continue to fight is to hire a lawyer and file a lawsuit.
That’s the option being considered by L.J. Whitmire, a 69-year-old real-estate contractor in Conover whose wife Elizabeth was denied coverage earlier this year for a $21,000-a-month opioid pain killer for intense migraines. Fentanyl, the medication she sought, is primarily designated for cancer patients, and cost the Whitmires $103,500 for a five-month supply.
Elizabeth Whitmire, 56, is back to using an opioid patch that costs just over half that price; her use of opioids has been covered by Blue Cross and Blue Shield since 2000. Whitmire says his wife needs the fentanyl to function, and said the patch is not as effective as the costlier formulation that Blue Cross denied.
“It’s the only time that I ever lost,” said Whitmire, who has relied on Smart NC several times. “If it had been a medicine that cost $10 a month, they (Blue Cross) wouldn’t have said a word.”
Need help with your insurance company?
Q. How do I get help?
A. You can reach Smart NC through its website /www.ncdoi.com/Consumer/Health/Smart_NC.aspx, by calling 855-408-1212, faxing 919-807-6865 or writing: N.C. Department of Insurance, 325 N. Salisbury St., Raleigh, NC 27603.
Q. What will Smart NC do?
A. If your coverage is denied, Smart NC staffers will help you through two appeals reviewed by your insurance company (these are called medical appeals) and an external review heard by an independent medical expert.
Q. What is the difference between an appeal and a review?
Q. Will Smart NC help anyone in North Carolina with insurance?
A. No. There are certain types of insurance that is not eligible for representation. They are: Dental or vision, Medicaid, Medicare or Medicare supplements, specified disease insurance, long-term care insurance, workers compensation, credit or disability insurance and medical payments under homeowners or auto insurance.
Q. Who can get help?
A. Anyone who has bought their health insurance through the Affordable Care Act or purchased it directly from the insurer, small business coverage, large business coverage and the State Health Plan will be helped through the appeals and external review processes noted above. It will handle appeals but not external reviews for people who work for businesses that have self-funded insurance plans, because self-funded plans are not regulated by N.C. Department of Insurance.
Q. What is a self-funded company?
A. A self-funded company is typically a large business that pays an insurance company to administer health benefits for its employees but the company funds its own insurance program. A fully-insured business, on the other hand, is one that pays an insurance company to insure its employees. If you’re not sure what your company’s plan is considered, ask your Human Resources department.
Q. Does Smart NC cost money?
A. Smart NC does not require a filing fee or a minimum dollar threshold of a denied claim to represent a consumer in a dispute with an insurance company.