New Department of Labor regulations on health benefit claims and appeals procedures reduce the time allowed for processing claims and reviewing claim denials. The rules apply to claims filed on or after Jan. 1, 2002, under all ERISA-governed health plans including employer-provided health programs such as dental and vision coverage, disability plans and HMOs.
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Strict Time Limits
Here are highlights of the new rules:
- Urgent care. Decisions on urgent care procedures must be made within 72 hours. For example, if a doctor discovers a suspected cancerous growth and decides it should be removed immediately, the health plan must notify the patient within 72 hours whether it will pay for the surgery. The rule also allows 72 hours for appeals of urgent claims.
- Advance approval. The health plan has 15 days to certify whether it will cover a routine procedure. If the plan refuses and the patient challenges the denial, the plan has 30 days to respond to the appeal.
- Services rendered. If a patient has already received some treatment and the plan refuses to cover all or part of the bill, it must notify the patient within 30 days. The patient can appeal the decision and must receive an answer within 60 days. Group plan participants have up to 180 days to appeal a claim denial.
- Disability claims. Initial decisions on disability claims must be made within 45 days. An appealed disability claim must be decided within another 45 days.Brief time extensions are permitted for pre-service, post-service and disability claims but not for urgent claims. The rules also specify how to calculate the time limits.
Other Provisions
The final benefit claims rules include a number of other requirements:
- Appeals must be handled by different decision makers.
- Consultation with health care professionals is required for appeals involving medical judgment.
- Specific reasons must be given for denying a claim.
- Information must be provided about participants’ rights under the appeals process.
If the plan fails to follow reasonable claims procedures, claimants can go to court to enforce their rights. You or your insurer will need to incorporate these new rules into summary plan descriptions by Jan. 1, 2002.