Jul 19, 2024
Caitlyn Mai, 27, has struggled with single-sided deafness since middle school — a condition that spurred from an infection that impacted one of her cranial nerves.
Mai, who lives near Oklahoma City, got a letter from her insurer saying she was pre-approved for cochlear implant surgery last year. She checked that her doctors and the hospital were part of the approved network and that she met the out-of-pocket deductible before going ahead with the surgery in December.
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The procedure was successful — but Mai was shocked when she received a bill for $139,362.74.
"I almost had a heart attack when I opened the bill," Mai told CBS News. “The stress and anxiety was huge.”
Here’s what happened
Mai started her inquiry by calling the hospital billing office, but the representative didn’t know why her claim had been denied. When she called her insurer (HealthSmart, a provider owned by UnitedHealth Group), she was told the hospital didn't correctly itemize the charges or include billing codes.
So Mai called the hospital back and told them how to rectify the bill, along with providing the insurance employee’s name and fax number. A hospital staffer allegedly promised they would fax the corrected, itemized bill in two to three weeks — but weeks went by, and in late February, when Mai checked with her insurer, a representative said they still hadn't received the bill.
Mai contacted the hospital again and decided to send the bill herself. But the next month, she was served with another payment reminder instead, offering an $11,000-a-month payment plan.
A 2023 report from public accounting firm Crowe found that more than 30% of claims submitted to commercial insurers early last year weren't paid for more than 90 days. In comparison, only 12% of inpatient claims and 11% of outpatient claims experienced the same delays with Medicare coverage.
According to the report, delayed payments can be caused by requests for information (RFIs) that halt the claims process. This can include a request for a signature, medical record or an attachment for the claim to be processed. The RFI is largely why the claim denial rate is 12 times higher among commercial payers compared to Medicare.
Unfortunately, data from the Kaiser Family Foundation show that consumers rarely appeal when their insurance claim is denied. And when they do appeal, insurers often uphold their original decision.
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What do you do when your claim is denied?
Mai took the right steps to figure out why the claim was denied. First, it’s important to review your explanation of benefits and make sure the service is covered by your insurance, you meet the deductible and your medical care is in-network.
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Next, you can contact your doctor and insurer to find out what’s going on. Insurers are required to tell you why they’ve rejected your claim and provide your claim file on request. Like Mai, you can request the itemized bill with the billing codes so you can review it for errors.
If you still think your claim should have been approved, you have the right to appeal. An internal appeal means you can ask your insurance company to conduct a full and fair review of its decision.
Or you can take the decision to a third party for review — this external appeal means the final decision is out of the insurer’s hands.
Fortunately for Mai, her insurance finally paid off the claim more than 90 days after her surgery — but it came at the cost of her peace of mind and time.
She estimates to have spent at least 12 hours on the phone ensuring the bill was adequately coded and that the insurer had all the details to process the payment.
"It's outrageous that the patients end up umpiring the decisions," Elisabeth Ryden Benjamin, vice president of health initiatives at the Community Service Society of New York, told CBS News. "Bravo for Ms. Mai for having the energy to keep at it and get resolution."
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Serah Louis is a reporter with Moneywise.com. She enjoys tackling topical personal finance issues for young people and women and covering the latest in financial news.
