You found a therapist you like, showed up for your sessions, and paid your copay. Then a letter arrives saying your insurance claim was denied.
Your first instinct might be to blame your practice’s billing team. But here’s the thing: a denied claim doesn’t automatically mean the Practice’s team did anything wrong.
Insurance claims can be denied for several reasons, including coverage issues, coordination of benefits, or paperwork that needs to be corrected. Understanding what happened can help you resolve the problem and avoid unexpected bills.
Here are three common reasons insurance claims get denied, explained in plain English.
Reason 1: You Have Two Insurance Plans, and They Need to Determine Who Pays First
If you’re covered under two health insurance plans — for example, your own employer’s plan and your spouse’s plan — the insurers need to determine which plan pays first.
This process is called coordination of benefits.
The plan that pays first is called the primary insurance, while the plan that pays second is called the secondary insurance.
Sometimes, one or both insurers need updated information before they can process your claims. They may ask you to complete a coordination-of-benefits form confirming your current coverage.
Until the issue is resolved, claims may be delayed or denied.
The sessions took place, and your therapist provided the service. The problem may simply be that the insurance companies need clarification about which plan is responsible for paying first.
What can you do? Contact both insurers, confirm which plan is primary, and complete any outstanding coordination-of-benefits paperwork.
Reason 2: The Claim Was Submitted to the Wrong Insurance Plan First
Even when you have two active insurance plans, a claim can be denied if it is submitted to the secondary plan before the primary plan has processed it.
Why? Because the secondary insurer generally needs information about what the primary insurer paid or denied before determining its own responsibility.
For example, imagine you’re covered under your own employer’s plan and also under your spouse’s plan. Your own employer’s plan will generally be primary for your coverage, subject to the applicable coordination-of-benefits rules.
If the claim goes to the secondary plan first, it may be rejected or denied until the primary plan processes it.
The solution may involve submitting the claim to the correct primary insurer first, then sending the primary insurer’s explanation of benefits to the secondary insurer.
What can you do? Make sure the practice’s billing office has accurate information for both plans and knows which one is primary. If a claim has already been denied, ask whether it needs to be resubmitted or whether additional documentation is required.
Reason 3: Your Insurance Coverage Ended, Even Though Your Therapy Continued
Insurance coverage can change without you immediately realizing it.
A job change, turning 26 and aging off a parent’s plan, a missed premium payment, or a change in eligibility can affect your coverage.
You might have attended therapy for months with no problems, only to discover that your insurance was no longer active on the date of a recent session.
When an insurer determines that your coverage was inactive on the date of service, it may deny the claim.
This can lead to unexpected bills, especially if several sessions took place before the coverage issue was discovered.
What can you do? Check your coverage after major life changes and ask your insurer to confirm your eligibility for your upcoming appointments. If a claim is denied because your coverage appears inactive, contact the insurer to clarify the effective termination date and whether the decision can be reviewed.
Three Checks That Can Help Prevent Insurance Claim Problems
You can’t prevent every denial, but these steps can help reduce avoidable problems.
1. Verify Your Benefits Before Starting Therapy
Call the member services number on your insurance card and ask:
- Do I have outpatient mental health benefits?
- Is this specific therapist or provider in-network?
- Do I have out of network benefits?
- What are my copay, coinsurance, and deductible responsibilities?
- Do I need a referral or prior authorization?
- Do I have a session limitation?
Keep in mind that benefit verification is not a guarantee that every claim will be paid. Coverage depends on your plan’s terms and the circumstances of each service.
2. Tell Your Billing Office About Every Active Insurance Plan
If you have coverage through your employer and another plan, make sure your billing office knows about both.
Confirm which plan is primary, provide accurate insurance information, and respond promptly to requests from your insurers. If you receive a coordination-of-benefits questionnaire, don’t ignore it.
Keeping your insurance information up to date can help prevent unnecessary delays.
3. Check That Your Coverage Is Still Active
Don’t assume that because your insurance covered last month’s sessions, it will cover this month’s sessions.
After a job change, a birthday that affects dependent eligibility, a premium issue, or another major life event, contact your insurer to confirm your current coverage.
If anything changes, notify the practice’s billing office as soon as possible.
The Bottom Line
An insurance denial can be frustrating, especially when you’re trying to focus on your mental health.
But a denial doesn’t necessarily mean the practice made a mistake or that you have no options. Some denials can be corrected, some require additional documentation, and others may need to be appealed. The right next step depends on the reason for the denial and the terms of your insurance plan.
At Talking Works, we understand that insurance billing can be confusing. Our billing team works with insurance-related questions, including coverage issues and coordination of benefits, and can help clarify what steps may be available when a claim is denied.
Have questions about an insurance denial or an unexpected balance? Contact the Talking Works billing team so we can help you understand the issue and determine the appropriate next steps.
Please note: Insurance benefits and claim decisions vary by plan. Always confirm your coverage and financial responsibilities with your insurance company.