Deny And Delay: The Practices Fueling Anger At U.S. Health Insurers

After a UnitedHealthcare executive was gunned down on a New York City sidewalk, an eruption of bitter online commentary celebrated the killer’s presumed motive: avenging the denial and delay of health insurance coverage.

Many spoke from personal experience. Every year, health insurance companies deny tens of millions of patient claims for medical expense reimbursements, and the tide of those denials has been rising, according to surveys of doctors and other health-care providers. Insurers also have been increasingly demanding that doctors obtain approval before providing treatment, similar surveys show, causing delays in patient care that the American Medical Association says are “devastating.”

While several states have passed legislation trying to restrict such practices amid growing public anger, insurers defend the coverage denials and “pre-authorization” requirements. They say those measures are meant to contain rising costs and that their methods comply with federal and state regulations. According to information the insurers report to regulators, there have been only small increases nationally in the frequency of denials in recent years.

Most frustrating, according to patient advocates, is that insurance companies often act without explanation, sending denial letters that offer only sparse justifications. The patient “gets a cryptic message saying ‘it’s not medically necessary,’ but without any other explanation,” said Elisabeth Benjamin, a vice president at the Community Service Society in New York, which runs a program that helps consumers appeal denials.

“People are mad because it’s all a big secret,” Benjamin said. “It’s unfair for us as a society, on something that’s so visceral, to trust giant corporations that make money when they deny care. This is why people are so, so very angry.”

Exactly why and how often claims are being denied or medical procedures are getting early scrutiny is difficult to know. Statistics regarding denials and pre-authorizations are scant, at best, and most of what is available reflects only one state or one type of insurance. Nationally over the last five years, the rates of denial have been between 14 percent and 16 percent, according to data from the National Association of Insurance Commissioners.

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