Thought Leadership Healthquake™: Insurance Gambits and Ways to Beat Them

Summary: By understanding the way that Insurance Companies use the tactics of Delay, Defend, and Deny, medical professionals can reduce denials and increase collections. This issue of Healthquake™ gives examples and ways to fight back.

Physicians are sometimes baffled by the way that Insurance companies dodge paying the amount owed to the medical practitioner – either by claiming they don’t have what they need, frustrating attempts to contact them, or refusing authorization for a procedure, just for starters.

It’s part of a strategy and there is a way to challenge it. These insurance shenanigans were documented by distinguished law professor Jay M. Feinman in his book “Delay. Deny. Defend.” His book is about how insurance companies (not just health insurance companies) often use a strategy developed by a well-known consulting firm to slow down payment or even prevent it.

A short summary of the strategy says that insurance companies can benefit if they follow these three steps when dealing with claims:

  1. Delay. Slow everything down. Ask for more documentation or files. Create lots of technicalities. Do whatever is necessary to stretch out the time to pay.
  2. Deny. Reject the claim. Just don’t pay it. Create policies that make it easy to do this. Hide things in the fine print. Denying creates delays. Often it results in non-payment because the person (doctor, patient, other providers) gets exhausted and doesn’t follow up.
  3. Defend. If Delay and Deny don’t work, go to arbitration or to court. This slows things down even more and puts a burden on the person trying to collect or get paid.

Before diving into the ways that insurance companies play the “Delay, Deny, Defend” game, let’s put one thing on the table. We’re not saying the insurance companies are doing anything illegal. Most of the time, they aren’t.

What we are saying is that whenever possible, they will try to take advantage of techniques to both reduce the amount of money they pay out, and the speed at which they pay it. By doing so, they increase their profits—and keep their shareholders happy.

Unfortunately, keeping shareholders happy creates a strong financial incentive for them to make it hard on patients, medical providers, and everyone else who bills health insurance for their services.

Based on discussions with patients, medical billers, and other professionals, here are just a few of the ways they Delay, Deny, and Defend.

We Didn’t Get It & There’s Something Missing

This one is easy for insurers. They just say they didn’t get something needed to collect on a claim.

This can include appeals, medical records, and corrected claims. Even when it’s delivered by a courier using priority service with a confirmed tracking number, the information still doesn’t get there. Or at least that’s what the billers are told.

This gambit goes hand in hand with another called “There’s Something Missing.”

The doctor diagnoses and treats the patient, then sends a bill to the patient’s insurance company. The insurance company says that documentation is missing from the claim.

They might say that the required records weren’t attached, or that there was insufficient information on the records they received. Or it might be that nothing was wrong at all, and the insurance company just made a mistake.

It might be that the missing information was as simple as the patient’s date of birth or a missing initial from their name. If the insurers don’t get the exact information they want, exactly the way they want it, they won’t pay.

Please Hold (Forever)

This is one of the most frustrating experiences for both patients and billers and is one of the reasons that people spend 12 million hours a week on the phone with health insurance companies.

Insurance representatives can put a patient on hold when they call, sometimes for an hour or more. And leave them there! When a doctor’s office or a hospital biller calls the insurance company, the same thing can happen. And, after being on hold for an hour, they can disconnect the call, so the biller or patient has to start all over again.

It Wasn’t Pre-Authorized

One of the most challenging gambits is centered around something called “pre-authorization,” an insurance rule that says, in certain cases, a medical provider can’t do a surgery or procedure or even prescribe specific drugs without getting the OK from the insurance company in advance. In other words, getting it “pre-authorized.”

To be fair to the insurance companies, in some cases there are legitimate reasons for this practice. However, it can also be used to delay and deny.

The more difficult it is to get something pre-authorized, the less likely the patient will be to get a possibly optimal (often more expensive) treatment. If it’s denied, it could mean a lot more suffering for the patient due to delays while the doctor or medical provider appeals the decision, an appeal with no guarantee of success.

Although there are dozens of gambits (which we will detail in upcoming issues of Healthquake™), there are some basic ways to fight back.

How to Fight Back and Beat Them

For Physicians and Medical Providers, here are 3 ways to increase the chances of success:

  1. Train and Get Trained. Keep an eye on pending changes in insurance policies or rules. Make sure you know what each insurance company wants and the format in which they want it. Train your support team (or have them trained) so that they are at the top of their game when handling patient eligibility and pre-authorization, just for starters. Make sure they get ongoing refresher training. Training isn’t an expense, it’s an investment. Process automation can replace this in large organizations and the cost is high, but the payoff is higher.
  2. Document Appropriately and Track Everything. Provide necessary notes from doctors and others. Make sure they are accurate. Double-check patient information at the front desk and on claims. Proofread carefully. When you speak with someone at the insurance company, get their name and document the day and time you spoke with them. This increases the odds of beating the insurance companies at their own game.
  3. Persist Relentlessly. Regardless of who does your billing, make sure they are aggressive in pursuing reasons for non-payment, especially denials. Call the insurers often, especially early in the morning. Plan to have some other work to do while you are on hold.

Denials can be especially tough on out-of-network doctors. Unlike an in-network doctor who can appeal the denial in the traditional way, they have another big hoop to jump through—the patient’s written OK to appeal.

Technically, an out-of-network doctor can’t appeal a denial unless they have the patient’s written authorization to appeal. Sometimes, it’s hard to get it. The patient may have moved or failed to read the doctor’s mail asking them to sign. The patient could be away for a month which might result in the doctor running out of time to file. Although not all insurance companies enforce this rule on the out-of-network doctors, many do.

This game of cat and mouse won’t go away so the best way to win is to practice these 3 techniques at every opportunity.