Most U.S. adults don’t know they can fight insurance denials, new study finds

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Despite laws in states like Pennsylvania, New Jersey and Delaware that aim to ensure people have access to affordable health care services, research shows that patients still receive unexpected medical bills and face insurance denials — and few of them choose to take action.

A new national survey report released Thursday by the Commonwealth Fund shows that fewer than half of people who experienced insurance denials and billing issues actually fought the decisions.

The biggest reason why? Because they didn’t know they had a right to do so in the first place.

“Consumers need a lot more information about what their rights are regarding their insurance policies,” said Sara Collins, vice president of Health Care Coverage and Access at the Commonwealth Fund.

New data from the nonprofit health care research foundation show that people who weren’t aware of their rights to challenge medical bills or coverage denials tended to be younger and have low or moderate incomes.

The report also looked at experiences and outcomes by race and ethnicity. Hispanic residents were also more likely to not know their rights in challenging bills or coverage decisions compared to Black and white residents.

States like Pennsylvania have worked to implement programs that encourage people to take action when they get denied coverage for care or get billed for potentially erroneous medical charges.

The state Insurance Department’s Independent Review Program, launched in January, assigns eligible patient cases to teams of doctors, specialists and other experts who determine if an insurance denial was correctly or incorrectly issued.

If incorrect, the review program requires that insurance companies reverse their original denials and apply coverage to a patient’s health care services, procedures, or medications.

In its first six months, the independent review program completed 194 decisions, according to state officials. In more than half of cases  — 104 reviews — the original insurance denials were overturned and coverage was applied.

“In the past, too few people challenged insurer denials through internal or independent external review processes,” said Insurance Commissioner Michael Humphreys. “But the data is clear. With over half of denied claims being overturned by an independent review, health insurers can do a better job of reviewing requests for services.”

Delaware and New Jersey also have independent review or arbitration programs designed to help residents with these appeals and challenges.

However, the national survey report shows that one in four people didn’t go through with the process because they didn’t even know who to contact at the start.

“When you think something is wrong, you not only may not know that you have the right to challenge it, but you may not even know who to contact,” Collins said. “That speaks to a lack of information that shows up on an insurance plan or explanation of benefits.”

Researchers looked at responses from 5,602 people who had health insurance when they participated in the Commonwealth Fund Health Care Affordability Survey in 2023.

Nearly 60% of people said that an insurance denial for their health care services ultimately led to a delay in care overall, and nearly half reported that their health conditions worsened as a result.

The survey report recommends policies that strengthen monitoring laws around insurance company denials in both the public and private markets.

The authors also recommended stronger penalties for insurers that repeatedly and wrongfully deny coverage or issue medical bills for services that should be covered.

Collins and her colleagues also said there needs to be more public awareness about a person’s health care rights related to their insurance plans and billing practices and the programs that can help consumers file appeals and challenges.

“Putting phone numbers on denials,” Collins said. “That would clearly tell people that they not only have a right, but here is a person who you can actually call.”