Many individuals are dependent on certain medication, treatments, or procedures for survival.
This may be a chemotherapy drug, or surgery. But what happens if your health insurance company denies or suspends medical treatment that is not only necessary, but essential to your survival? Sadly, this is a scenario that we have seen play out before.
Why Are Essential Medical Treatments Denied or Suspended?
It is common if not expected for a health insurance company to pushback against treatments that are therapeutic or elective. Treatments aimed at management of non-life threatening conditions are often the type of treatments that health insurance companies reject or suspend to manage costs.
However, sometimes (and we have seen it happen) a health insurance company will reject critical or even life saving treatments. The reasons for denial can be extensive including lack of medical necessity, not consistent with the insurer’s medical guidelines, and the availability of better/cheaper options.
When treatments are denied, the insurer tends to ignore or give little weight to the opinion of the treating physician who has recommended or prescribed the treatments as being medically necessary and often life saving.
Rather, the insurer relies on guidelines often implemented by non-physicians to make determinations about its policyholder’s health and well-being.
The sad reality is that health insurance companies sometimes deny treatment that doesn’t simply make the policyholder uncomfortable – but instead – the denial causes a substantial risk of permanent harm or death. When faced with this situation, it is important to understand your options.
Options to Fight Back Against an Unjust Denial
1. Administrative Appeal
Most privately purchased health insurance policies have provisions for appealing a denied claim. If your coverage is paid for through your employment, ERISA generally requires you to complete an administrative appeal before filing a lawsuit.
As we have discussed in the past, if your health coverage is governed by ERISA, complying with its appeal requirements is important. However, if it is a critical or life-threatening situation, the appeal process may not be an immediate or viable option.
2. Pay for Treatment and Sue
If your health insurance claim has been denied you may pay for the medical treatment out-of-pocket and file a lawsuit for breach of contract and possibly for bad-faith insurance. Of course, not every person has the financial ability to pay for medical treatment out-of-pocket.
Indeed, that is the reason people purchase medical insurance. However, sometimes paying for the medical treatment out-of-pocket is the best way to get the treatment that is needed. In that situation, you can always file a lawsuit along with a claim for bad-faith insurance claim handling.
As we have discussed before, bad-faith claims are only available to health plans or policies that are not governed by ERISA, i.e. were purchased by you directly.
Typically, if you establish that the claim denial was in bad-faith, you can recover penalties, attorney’s fees, and other damages on top of the money owed to you for the medical treatment. However, even ERISA-governed plans/policies permit you to recover attorney’s fees for wrongfully denied claims.
3. Seek a Restraining Order or Injunction
If critical or life-saving treatment has been denied, you have options. Simply filing a lawsuit may not be enough. If you have been denied critical or life-saving medical treatment, you need fast action to have your treatment approved or reinstated. The law provides a mechanism for obtaining fast relief in the form of a temporary restraining order or injunction.
The purpose behind injunctive relief is to prevent immediate or irreversible harm. To obtain a restraining order or injunction, a petition or complaint needs to be filed in court along with a request for an emergency hearing.
Normally, the hearing will be set within a few days of filing the request. In most circumstances, you do need to give the insurance company notice of the hearing so it can oppose your request for a restraining order or injunction.
If a judge orders the insurance company to pay for the denied medical treatment, you will still need to continue to pursue the insurance company for a breach of contract and potentially bad faith claim. You also may need to schedule a second evidentiary hearing to obtain an injunction that will last until the case concludes.