The dynamic among insurance companies, their employees, policyholders, doctors and lawyers rages and swirls together like a category five hurricane. At times it blows away our optimism, we despise the greed and insensitivity of insurance companies. This blog is to explore why this happens and what the future has in store after the Affordable Care Act is fully enacted.
First, what causes this storm of conflicting interest?
The goal of a corporate entity is to provide returns to shareholders, to make profits, to grow their business. Insurance companies are corporate entities and, as the AAJ puts it: “Unfortunately, that dedication to shareholders comes at the expense of policyholders.” Policyholders want their safety net and want to be covered when the unexpected accident occurs. What we’ve seen leading up to the health care reform is the gradual shift to insurance companies behaving like a consumer product based corporation instead of thinking in terms of the service they provide to their policyholders.
Their desire to constantly bring in more money and cut costs lead to the need for health care reform and, in large part, is what built the personal injury law industry. Lawyers have to fight the insurance company’s desire to deny claims for the policyholder who needs them.
What percentage of claims are denied?
This information get’s hard to find. There are plenty of horror stories out there about people who have had to suffer tremendously before they could ever get the money they deserved. There are companies who use manipulated computer systems to determine lower rates. The majority of insurance companies have continued to see increases in profits while also raising their premiums. But putting a percentage to the number of people with denied claims changes from study to study because of bias.
The most unbiased research I could find was research done by the American Medical Association, mainly influenced by doctors, in their 2013 National Health Insurance Report Card. The percentage of denials ranges from 1.38%-5.07% amongst different companies. Of course this does not include the percentage of people who are denied health insurance coverage at all.
What is the Affordable Care Act going to do for people with denied claims?
During the health care reform debate, insurance companies spent over 85 million trying to keep the reforms from taking place. A year after the reforms of 2010, insurance companies were still increasing profits and achieving their highest levels of profitability yet.
However, the ACA has implemented much to improve the transparency and integrity of the health insurance industry. Insurance companies have to provide clear, plain language instructions to appeal a denied claim. Any time a company wants to raise its premiums it must provide policyholders with clear explanations first. Eighty percent of premiums must be used for healthcare purposes.
On January 1, 2014 the final stages of the ACA will take place and although there has been a boom in lawsuits against the enactment of the ACA, one question remains: how will this affect lawyers representing denied claim victims?