Health insurance denial for treatment and "self-funded" plan rules?

My doctor tried to get preauthorization for treating a medical condition of mine more than nine months ago. My insurance stubbornly denied it time after time after time. Between these 鈥渢ime after time鈥?periods, the requests were lost in the mail (if you believe that), papers were 鈥榤isplaced鈥?by them, and there were delays because of practically every little thing. Eventually, my case went to an external review board that ruled in my favor, over-turning the plans denial; the insurance has to pay for my treatment now. This ruling in my favor came just last week, the same week that my coverage with this health plan ended as a result of my COBRA continuation coverage expiring. I believe my insurance should still have to pay for the treatment, because I would have had the treatments months ago, when I was covered, if it weren鈥檛 for the insurances negligence and incompetence.

I am getting mixed answers, however, as to whether my insurance is in fact responsible for paying for treatment since I am no longer a member. I have called up several regulatory agencies, all unable to assist me because of the nature of my health plan. My health plan is something called a 鈥渟elf-funded鈥?plan. A self-funded plan means that an employer has set up an account from which all medical claims are paid. The plan is administered through an insurance company like Aetna or Healthnet however. The caveat is that by them doing this, the plan is not legally an insurance plan and therefore is not bound by many state and federal regulations that govern insurance policies. In fact, many large employers set up these so-called self-funded plans, which look and act (almost) just like regular policies. Subscribers often don鈥檛 find out of this insurance loophole until it is too late. My question is does anyone know anything about ERISA, the (Employment Retirement Income Security Act), which allows these types of plans to elude regulation?

Please cite legal or other sources. Any reasonable person knows, of course, that the insurance should pay for the treatment. To deny paying for treatment because I am no longer a member is preposterous since I was fighting to get the treatments for so many months when I was a member. So, not only did I have to postpone treatment, actually forcing me to suffer longer, but as a result, I may not even get the treatment!

What should I do and what are my rights?

I live in America by the way; where else would such corrupt politics and shoddy health care administration take place?

Many insurance companies will deny a claim simply to make you go away. In a self funded situation it may be that the employer wanted to stall until your COBRA ran out. My suggestion is that you contact an attorney regarding this. You have suffered needlessly for too long and the company has successfully kept your claim at bay. They have benefited by keeping their contributions to the fund at a minimum. This is why many self funded companies seem to have a much younger set of employees as well. Younger people usually have much less need of serious health coverage.

Well, it's going to sound like a lame answer, but all of these self-funded plans have customized and different rules, there are no concrete answers because each plan is different.

There was probably plenty of fine print for you to read through when you signed up. You're probably in need of a lawyer if you want to decipher all of your rights in the plan. You need first to get a copy of the plan agreement that you signed, and read over it yourself, but the lawyers will probably need to hash out the finer detail and decide if you have a chance of getting your treatment.

Just a note for you to consider.....A self funded plan is NOT managed by the employer. There are laws against just that. A third party, just like you're saying, is in charge of deciding what all gets covered (such as Aetna, or Healthnet, or whoever), but it's most definitely not the employer making the decisions.

Also, the reason why there are these self-funded plans to begin with is because the price of health insurance has gone through the roof in the past 3 to 5 years. There aren't enough regulations to control superfluous law suits against doctors, thus causing them to purchase expensive insurance, and causing them to over-treat and protect themselves by ordering tests for every single possibility of potential ailments that their patients may incur for fear of missing something and thus face a lawsuit, therefore driving up health care costs. It has quite literally doubled and tripled for employers. Employers are not able to pay as large a percentage of the insurance bills as they used to, and employees get disgruntled about the larger portions they have to pay.

There truly needs to be health care reform in this country. We pay much more for health care per person than any other country in the world, and we don't get as good health care than many. Prescriptions are no exception. United States citizens pay much more than any other country because our country hasn't put caps on prescription costs...unlike all other countries. It's a political issue, that's why you're facing some of the problems you are.