Welcome to the Back to School for Writers blog series. Every Wednesday until the end of September, a guest poster will share their knowledge and expertise on a specific topic. Today’s guest is Liana Mir, who takes us behind the scenes of the insurance industry.
The Big, Bad Insurance Company
The insurance industry has been demonized a lot over the years for good reasons and bad, all painted with the same nasty brush due to several common misconceptions about how it works and due to the fact that insurance is not what I would consider the best way to pay for regular health care. Insurance should generally be kept for emergencies
That said, I went to work for the largest national health insurer maybe five years back and stayed there for three years. In that time, I learned that many of my own misconceptions about insurance, particularly dental insurance, were wrong.
Myth #1: Claims are Processed by People
This is startlingly false and is the foundation for most of the horror stories that circulate regarding insurance.
Reality: Your insurance claims are processed by a system and are then troubleshooted by people. That means that most claims never get a pair of human eyes. The computer reads what is dumped in by your health care provider, interprets the claim with varying degrees of accuracy, then uses a set of rules generated from your plan, your group (i.e. employer, association, etc.), and your state’s laws. Unless the system finds an error it cannot resolve or you or your provider call in about the claim or explanation of benefits, that baby will never see the light of day.
Myth #2: Insurance Companies Don’t Care
We have all heard of the big bad that does not want to pay for “cosmetic” or experimental procedures that are actually necessary. We know that insurance companies drag their feet over coughing up the money you have paid into their coffers for such a time as this. What we rarely hear about is what the people behind that computer system are actually up to.
Reality: The truth is that insurance companies do care about your satisfaction and wellbeing. Quite a lot, as a matter of fact! They have competition.
Insurance companies make money off of their customers being well and healthy and will gladly pay for any reasonable preventative care they can convince you to use. They scrutinize their bottom line and reputation extremely carefully and evaluate any mishandled claim that comes to their attention. They try to train their customer service representatives to be genuinely helpful and knowledgeable, even though those same reps will not be able to grant you an exception to the rules.
Insurance processors, in particular, scrutinize every problem claim with two things in mind: preventing fraud (you would be surprised how many billions of dollars are lost on health care fraud each year) and helping patients get their money. We read those handwritten notes (though the computer doesn’t, so don’t hedge your bets) and research their validity. If you told me that for health reasons you couldn’t get any x-rays taken to prove you need an expensive procedure, then I would most certainly send back a request for more information on why we just paid for x-rays three months back. And that brings me to…
Myth #3: Your Provider Knows What He’s Doing
Often times, you would rather not submit an insurance claim if the provider can fill it out for you. After all, they know how to fill it out correctly, right?
Reality: The biggest issue I ran into with paying claims was that providers entered information in the wrong fields, skipped fields altogether, failed to provide their address or keep their account with the insurance company up-to-date, or worse, repetitively returned a request for more information with a copy of the same information-less claim. What could I do for their patient? By the rules, nothing. If we had low call-volume in customer service, every once in a while I could get someone to call and drag out the information we needed. To say nothing of the claims sent in to the wrong insurer altogether.
When I got my own dental work done, I filed my own claim.
Myth #4: Insurance Companies Don’t Pay Up as Promised
This comes back pretty solidly to the issues inherent with using a computer system and a lot of human error. Computer systems will screw up payments due to human error on the claims, and human error is rampant.
Reality: Insurance will pay according to those nasty little things called rules. And trust me, as an insurance processor, it was a pain to try to go around the rules to get something paid anyway. Computers aren’t very flexible.
There are three main aspects to getting a claim paid:
- Know what your benefits are before getting treatment. Get a pre-certification or pre-approval on your claim or call up the company and ask them whether said treatment is actually covered. If it isn’t, ask whether there is another plan that will cover it. There usually is.
- Fill out the form correctly. If your provider fills it out, ask to look it over before he or she sends it and make sure it’s as accurate and complete as possible.
- Use the phone. Want to make sure a human sees that claim and processes it correctly? Call up customer service and follow up on your claim. You can get a status report and most minor errors corrected. If you have too much trouble, escalate the claim. You can get almost anything paid once it hits a senior manager.
Insurance companies do pay up, but only what has been promised.
Myth #5: All Insurance Companies Do It the Same
For a long time, I believed that dealing with one big, bad insurance company that refuses to pay without giving you a hassle is the same as dealing with any other one. The more I coordinated with other companies’ benefits and received health care myself, the more I realized this idea is patently false.
Reality: Every insurance company has its own way of trying to protect the bottom line. Automation is primary, but automation leads to glitches. Systems can be set up to pend the most expensive varieties of glitches or automatically pay or deny according to what will cost the least. My insurance company ate several thousands of dollars annually to pay for any duplicate requests for a particular kind of x-ray because it would have been significantly more expensive to pay for a human to look at every incident of such a common claim.
Some insurance companies deny all expensive or major procedures without really looking at them, then pay literally anything if the claimant calls in. Some insurance companies hold all such procedures and have them manually reviewed for necessity or prerequisites, denying for more information as needed. One is a reactive strategy, and the other is preemptive, but most strategies can all be gotten around by one thing: a phone call.
Unless your claim looks suspicious, most processors and customer service agents want to pay your claim, but they won’t do it if the plan you picked says they can’t unless you’ve got a great reason they can take to their boss for an exception. Most claims will never be seen by a human, so if your claim got denied, read the explanation of why and make sure the computer or your provider didn’t screw up on the form. And as a writer, please take these things to heart when you write about the little desk job insurance employees who will never see their customers in person but who do want to help. If you really want that evil insurance overlord, just make it the computer.
Liana Mir reads, writes, and wrangles the muses from her mundane home in the Colorado Rockies and, occasionally, from the other side of the Barrier. Visit her online at http://www.lianamir.com.
As health insurance takes an increasingly large chunk of our income it is somewhat comforting to know that in the end it is the people who can help untangle any mistakes. I’ll keep that in mind with future claims.
But I do agree, health insurance should be reserved for large emergencies, not day-to-day health issues. Unfortunately, much of the population seems to disagree, and refuses to pay out of pocket for day to day medical issues, preferring to wait until the situation is dire to seek medical attention. I’m not sure how to approach this problem!
Anyway, this was really interesting to read. Thanks for the enlightening post!
Liana Mir says
I’m glad it was helpful to you. It was fun reliving all the issues we dealt with.
Patricia Caviglia says
This was a really informative post. Thank you.
Liana Mir says
Thanks for this post, Liana. I did not know just how automated the insurance claims process was.
My funniest insurance story: My husband was laid off work 5 days before our first child was born. Luckily, our insurance was paid up till the end of the month and Sir I. decided to come early so we were covered for the labor & delivery. However, a few weeks after I got a letter from the insurance company saying my claim for the hospital stay was declined. Of course, this was for oodles of dollars (that we did NOT have). Panicked, I placed a few calls and discovered that someone had input he wrong code in the computer–instead of saying I’d been in the maternity ward, they’d put in the code for the PSYCH ward.
Folks, I did not hallucinate having this baby! See. *holds up squalling child*
Luckily, it was cleared up pretty easily. But that’s human error plus automated systems for you. 😀
Liana Mir says
Amen. And that is funny.
Sorry about all the typos, though. 😛 I squeezed the comment in during a teeny break in school.
Liana Mir says
We have all been there. 🙂
Tami Clayton says
Such helpful information here. Timely, too, because our state supported health care insurance was just merged with a for-profit insurance company to oversee not only the physical health side of things, but also the mental health side. Sadly, this means less and less mental health services to those who are most in need of them because the insurance co. has made it VERY clear to providers that the bottom line is about making money, not about making sure the suicidal kid is stabilized or the severely abused (as in being in the ICU for a month) child is able to begin a life long healing process and start to trust adults again. Our clients are repeatedly denied legitimate and needed services that their policies cover by the people at the insurance company. It is so immensely frustrating.
Sorry for the rant. I really am appreciative of you sharing what it’s like on the inside and how a person can go about getting claims processed correctly. It is good to know for my own purposes and in advocating for my kids when they need something.
Liana Mir says
I’m glad this was helpful to you. And when you have a hard time getting an exception, really just keep pushing it up the line. Once senior management says, Thou shalt pay, the little worker-peoples can get a lot more done.