Get Help with Medicare Coverage Denials
The United States has a notoriously complex healthcare system, and Medicare is no different.
In the early months of the pandemic, the Medicare Rights Center received a large number of calls to its telephone help line from people over 65 who had suddenly been laid off and lost their employer coverage. Even when there isn’t a crisis, the center’s staff and volunteers answer all manner of questions about Medicare enrollment rules, insurance options, and what to do when an insurance company denies them coverage.
Sarah Murdoch is the center’s director of client services and oversees the helpline. She spoke with Squared Away about the common issues retirees face and how they can address them.
Question: Your helpline fielded 42,000 questions about Medicare in 2020 and 2021. How does that compare to past years?
It’s in that ballpark year to year – around 20,000 questions. But we saw, within that 42,000, a shift in the actual trends.
Throughout the pandemic, particularly in 2020 when there were lockdowns and people were getting laid off left and right, we got a lot of calls from people who unexpectedly had no income. We heard from people who had insurance through their job and that was not an option anymore. Or they were already on Medicare and were trying to figure out how to pay their costs, or they were laid off and had to figure out how to get into Medicare. That has eased up but was a big thing we saw in the beginning of the pandemic.
We also had questions related to benefits for low-income people. We told people who suddenly had zero income about the income requirements for the Medicare Savings Program, Medicaid, and the state pharmaceutical assistance programs – anything that can lessen the hardship.
In 2020 and 2021, nearly a third of the complaints on your helpline were about service denials by insurers that provide Medicare Advantage or Part D drug plans. Start with Advantage plan denials – are they a big issue for retirees?
The Medicare Advantage plans often have doctor and hospital networks, whereas original Medicare doesn’t have networks. People may be denied coverage by an Advantage plan if they have an out-of-network provider. It could also be a denial of a medical service or a prescription medication. We do see it more but it’s hard to tease that out from the fact that more people are just enrolled in Medicare Advantage.
Do Medigap supplements to Medicare have similar issues with denial of coverage?
Medigap is different – the plans are never making their own claim determinations. If something is approved by original Medicare, then Medigap is going to pay for it as long as the retiree has a Medigap plan that has that type of coverage. In the Medicare Advantage policies, however, insurers are making the claims determination. All of the insurance companies have their own claims adjusters making those decisions – as opposed to contractors who process claims for the Medigap plans on behalf of the Centers for Medicare and Medicaid Services. The Medigap insurer isn’t making any decisions as to whether something is covered or not – it has already happened at the government level.
Given that retirees are a medically needy population, service denials must come at a big cost.
Yes. Some type of health issue, along with a denial of a medical service, can be stressful to navigate. Then you have to – if you’ve been denied seeing a doctor or getting a treatment – appeal the denial. The doctor can help document that this service is medically necessary either to the insurance company – for Medicare Advantage plans – or to Medicare – for Medigap plans. There are also several layers of appeals. When people are deep into an appeal, it can feel overwhelming and they get anxious.
Do you help with actually filing appeals?
We counsel people on how to do it. We often ask them to read the notice of a denial and make sure they’re meeting deadlines. We have a variety of guides and flyers that people can reference to make them aware of the timelines and the documentation they’ll need to collect. People typically are at a loss as to next steps. We’d encourage people to work with their doctor who has your medical history and can justify a particular treatment. We often get calls from caregivers calling on behalf of a family member who is helping with the appeal.
Your report gave an example of a woman who had been in the hospital for severe injuries from a fall. But her Advantage plan denied coverage for a skilled nursing facility for physical, speech and occupational therapy. Isn’t this exactly the type of thing Medicare is intended to cover?
We do frequently get calls from people who get denials for skilled nursing facilities for rehabilitation. Either the facility or the plan will say this rehabilitation is no longer medically necessary or your recovery has plateaued or you’ve returned to some baseline level, even though the person is still in need of medical care.
Is the appeals process more difficult if the cost of service is higher?
Whether the denial is for a very expensive service or something that’s $100, the appeals process is the same. But there’s often a sense of urgency about getting the care when it’s extremely expensive, and people really need to do it. In terms of the difficulty of appealing, a lot of it is being able to make the case – with help from your doctors or providers in question – that the service is medically appropriate and that they need to cover it.
How fast are appeals?
They can take some time. At every step in the standard appeals process, the beneficiary has 60 days to reply to a denial notice. Then the insurer has 60 days to get back to you. So if someone’s in need of a skilled nursing facility, they have to make a hard decision: do I pay for this out of pocket in hopes I win on appeal or do I cease the services and pick it up whenever they pay it? On the other hand, some services – including coverage of a skilled nursing facility – have a shorter appeals process. For example, if care is set to end, beneficiaries will receive a notice at least two days before that. They would submit an expedited appeal immediately before they are scheduled to be discharged. The same for a medication denial – you can ask to have that expedited.
Do some insurers issue more denials than others?
Some insurance companies are large and have a lot of members. But it happens across the board, and coverage denials are not unique to anyone.
How common are denials of drug coverage by Part D plans?
We do get a lot of calls about Part D denials. One we regularly see is that the drug is not on the formulary for the particular Part D plan the retiree has chosen. If they call, we may recommend that they seek a formulary exception. They might also need prior authorization for a medication or their plan might have a medication quantity limit. Everything on a Part D denial is appealable, and we encourage people to appeal because if you’ve been prescribed a medication, you need it.
Do you get a lot of calls from people who cannot afford their drugs?
If someone is calling because the copay is too expensive, we would always see if they’re eligible for Extra Help, which is a federal program that is income- and asset-based. We screen people for that, and it can have a huge effect on lowering costs. If they aren’t eligible, many states have a pharmaceutical assistance program. If they’re in New York, where we’re based, we can direct them on how to apply. If they’re in a different state, we direct them to their state SHIP program. If they’re not eligible for either of those, they can look into something called a tiering exception. Drug plans sort drugs into tiers – the lower the tiers, the lower the copays. Retirees can request their drug be moved into a lower tier if similar medications are also in that lower tier.
You said it’s difficult to appeal a coverage denial by a Part D plan. Why?
People often find out a medication is denied when they walk up to the pharmacy counter, and the pharmacist says this isn’t covered. It can be confusing in that moment and you think, “Now what do I do?” Knowing how to even initiate that first step can be confusing and knowing you need to get in touch with your doctor so they can help you with the appeal process. But there is an expedited appeals process if you’re going to be harmed by not taking this medication right away.
If you have to fight for coverage of your health care needs, it seems like a lot of work!
Yes. It is a complicated system, and it’s a different system than people are used to dealing with prior to turning 65. Throughout our working lives, we have one or two options through an employer. You get into the Medicare world where there are 10 Medigap plans and dozens of Medicare Advantage and Part D plans in New York State, for example. When people do have pitfalls or receive a denial of some sort, you have to take action as quickly as you can. Our goal is to help people navigate that as best they can.
Nobody has a crystal ball and the system expects you to be able to predict your needs, which is obviously not possible. It’s important to make important decisions about the coverage you pick right out of the gate. You don’t pick a Medicare Advantage plan because your neighbor said it’s great. Make sure your doctors, providers and drugs are in the Medicare Advantage plan prior to enrolling or go with original Medicare paired with a Part D plan and a Medigap plan, which can have the downside of higher premiums. It’s easier to try and head stuff off than it is to fix it after the fact.
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I work frequently with people with employer health coverage and aging into Medicare. They are often confused about who needs to enroll in Medicare at 65 and who can safely delay enrollment. There are several situations, which I've encountered recently.One couple, both 75 and leaving his large group plan, already had Part A and B, enrolling when they turned 65. However, they could have delayed enrollment in Part B due to their group coverage and avoided paying 10 years of Part B premiums! Thankfully, they still had Guarantee Issue rights to enroll in a Medigap plan without having to answer medical history questions due to a qualifying loss of coverage.Another pitfall is the reverse of the above if they’re covered by a “small employer plan'' (an employer with fewer than 20 full-time employees or their equivalents). In this case, Medicare is deemed “primary” to the employer plan and the group pays as secondary coverage. The danger is insurers are allowed to “carve out” what Medicare would have paid, even if the employee didn’t have Medicare! This exposes the employee to unexpected and potentially unlimited out-of-pocket costs.Another “mistake” to watch out for is staying too long on COBRA. There is a rule stipulating you must apply for Part B within 8-months of the COBRA effective date to be eligible for a “Special Enrollment Period” or SEP. Go past that date and you must wait for the next “General Enrollment Period” that runs Jan. through March for Part B coverage starting July 1.It is worth noting there is never a Late Enrollment Penalty for Part A since it is “free” if you or your spouse worked at least 40 quarters and paid Medicare taxes. All issues of Medicare coverage delays or penalties relate solely to enrollment in Part B. Part B is not free and subject to a monthly premium scaled to the person’s tax filing status and income.