Health Insurance Claim Denied: Your Appeal Rights and How to Use Them

Under the Affordable Care Act’s claims and appeals rules (building on the older ERISA claims procedure regulation for employer plans), most health plans must give you at least one level of internal appeal — a re-review by the insurer or plan itself — before you can take the claim outside the company.

If the internal appeal also denies you, you generally have the right to an external review: an independent third party, not employed by your insurer, reviews the denial and can overturn it. Under federal rules, an external review decision that overturns the denial is binding on the plan — the insurer is legally required to pay for or authorize the service once it loses.

This two-stage structure applies whether your denial is for a pre-approval, a service already received, or an ongoing course of treatment — the deadlines and decision timeframes differ by claim urgency, described below.

Most employer health plans are either "fully insured" (the employer buys a policy from an insurance carrier, which bears the financial risk) or "self-funded" (the employer pays claims directly out of its own funds, often using an insurer only to administer the plan). You can usually find out which applies to you by asking HR or checking your plan’s Summary Plan Description.

Fully insured plans are regulated by both the ACA/ERISA federal floor and by your state’s insurance law, and external review is often handled by your state Department of Insurance or a state-contracted Independent Review Organization.

Self-funded plans are governed by ERISA — a federal law — and are generally exempt from state insurance regulation. These plans still must follow the ACA’s internal and external review requirements, since that part is federal law, but external review for a self-funded plan typically runs through the federal external review process rather than a state agency.

Grandfathered plans — those that existed before the ACA’s March 23, 2010 enactment and haven’t made significant changes to benefits or cost-sharing since — are not required to offer external review, though they generally still must offer internal appeal rights under pre-existing law. Grandfathered status is now rare. verify current grandfathered status of your specific plan

Short-term, limited-duration insurance and certain excepted benefits (standalone dental/vision, some fixed-indemnity plans) are generally not subject to the same ACA appeals framework. verify against your specific policy type

Medicare, Medicaid, and Veterans Health Administration coverage have their own, separate appeal systems — this page describes the ACA/ERISA private-insurance framework, not those government programs.

Internal appeals succeed often enough to be worth filing every time, especially where the denial was based on a documentation gap, a coding error, or a "not medically necessary" finding a treating physician’s letter can directly rebut.

External review is a genuine, binding check on the insurer, but it is not guaranteed to overturn the denial — outcomes depend heavily on the specific medical evidence and plan terms.

This page can tell you the process and the deadlines; it cannot predict whether your specific denial will be reversed, and it is not a substitute for a letter of medical necessity from your treating provider.