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Obama Administration Rolls Out New Health Insurance Appeals Rules for Employer Self-Funded Plans

Source: WSJ Health Blog

Posted on 23 Jul 2010

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If you want to appeal an health insurer's denial of services or coverage, you now have the right to present your case for independent, outside-of-your-insurance-company review, no matter what state you're in. The Obama administration today announced the new regulations spelling out the appeals guarantee. Here's the administration's fact sheet on the new regulations.

As Kaiser Health News and the Washington Post report today, five states currently don’t provide for external reviews. And “states are all over the lot in terms of what the right to an external review means,” Ron Pollack, head of consumer advocacy group Families USA, tells the Health Blog. “So this is very meaningful.”

The new rules apply to health plans that are self-funded by employers, which haven’t always been subjected to external-review requirements, says Pollack. They do not, however, apply to plans “grandfathered” in under health-care overhaul legislation, which means they’re not subject to some of the provisions of the law.

Pollack says another program detailed today, which offers $30 million in grants to set up ombudsman programs, will help people advocate for themselves during the appeals process even if they are weakened by illness. “You need someone who can truly help you” to prepare, frame and assist with an appeal, he says. State agencies, nonprofits and other groups can apply for the grants.

Other provisions of the new rules:

* New health plans must have an internal appeals process that, among other things, requires plans to tell consumers how to begin the process and offers an expedited review in “urgent cases.”

* An external review must be paid for by the insurer, and consumers won’t pay more than “a nominal fee.”

* There must be an emergency review process, as well as a process “for experimental or investigational treatment.”

* The external review is binding.

* The review process applies to rescissions — wholesale dropping of coverage — as well as denial of claims.