The ACA Marketplace Plans' Claims Denials And Appeals

​Transparency data was revealed by Medicare and Medicaid Services Centers (CMS) to examine the claims in denial and appeals for the individual accepted health plans being proposed on HealthCare.gov. Around 18% of claim denials in 2020 across insurers with complete data. The rate of insurer denials ranges from 1% to 80%.

Reasons for Claims Denials
According to Medicaid Services Centers (CMS), insurers must report the causes for denied appeals to the planned extent. Around 16% of excluded service claims have been denied, 10% for reasons of preauthorization insufficiency, and 2% for medical necessity reasons. Of the 2% for medical reasons, 1 out of 5 was behavioral health service concerns. 72% of denials have yet to have a precise reason.

In the prior analysis of denied claims, It was found that customers infrequently appeal, and most insurers verify their options when they appeal. 

Claims Denied in 2020
In the 2020 plan year report, 213 major medical issuers on HealthCare.gov reported, and 144 show complete data on the in-network claims received and denied. With an average in-network claims denial rate of 18.3%, the issuers reported receiving 230.9 million in-network claims, of which 42.3 million were denied.

Appeals
The number of denied claims appealed to the plan through internal appeals, and the number of denials overturned are both shown in the ACA transparency data. Consumers rarely file an appeal for claims that are rejected. In 2020, less than 61,000 marketplace enrollees appealed, and HealthCare.gov issuers denied over 42 million in-network claims.

Additionally, marketplace consumers also rarely file external appeals. Based on ACA transparency data, marketplace enrollees are estimated to have filed over 2,100 external appeals in 2020.

ACA Marketplace
To show regulators and customers the important aspects of health plans that need to be clarified, the ACA implemented reporting requirements. Agencies must execute this clause to limit the data utilized for oversight and the enforcement of consumer protection laws, including Mental Health Parity and the No Surprises Act.

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