Understanding your rights when a health insurance company does not pay all or part of your medical bill is very important. This guide explains the basics of how the health insurance claims process works and what you can do if your claim is denied.
How the Claim Process Works
After you receive medical care or fill a prescription, a claim is sent to your insurance company. If your doctor, hospital, or pharmacy is in-network, they usually submit the claim for you. The insurance company then reviews the claim to decide:
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Whether the service is covered
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How much they will pay
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How much you must pay
Claims are processed in the order they are received.
Key Costs You May Be Responsible For
1. Deductible
A deductible is the amount you must pay out of pocket before your insurance starts paying.
Example:
If your deductible is $1,000 and you’ve already paid $750, you still need to pay $250 before insurance starts covering more costs.
Some services may not require a deductible, so always check with your insurance company.
2. Copayment (Copay)
A copay is a fixed dollar amount you pay for certain services.
Example:
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$20 copay for an in-network doctor visit
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$40 copay for an out-of-network visit
Copays may apply even after you meet your deductible.
3. Coinsurance
Coinsurance is a percentage of the cost you pay after meeting your deductible.
Example:
If an X-ray has an allowable cost of $150 and your coinsurance is 20%:
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You pay $30
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Insurance pays $120
Explanation of Benefits (EOB)
If your insurance pays only part of a claim — or denies it — they must send you an Explanation of Benefits (EOB).
An EOB explains:
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What was billed
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What insurance paid
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What you owe
⚠️ Important: An EOB is not a bill.
Coverage vs. Adverse Decisions
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Coverage Decision: Service is not covered under your plan
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Adverse Decision: Insurance says the service was not medically necessary
Appeals and Grievances
If you disagree with the insurance decision:
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File an appeal (for coverage issues)
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File a grievance (for medical necessity issues)
Your healthcare provider can help with this process.
If denied again, the case may be reviewed by an independent medical expert.
Maryland Insurance Administration (MIA)
If the insurer still refuses to pay, you can file a complaint with the Maryland Insurance Administration (MIA).
They will:
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Review coverage issues
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Send medical necessity cases to an independent review organization
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Take action if the insurer is found wrong