Appeal Writing 101

Taryn Schraad | April 5, 2022

Not to mince words, but medical insurance claim denials are a “thorn in a provider’s side.” Meticulously getting the admission or diagnostic services authorized or approved, then providing care and treatment to the patient, followed by submitting the claim and often records to support the payment, is not a guarantee of payment. The claim may still deny for a variety of reasons. To name a few, denials may be for coding, code sequencing, medical necessity, lack of authorization, and whether you are a participating/non-participating provider. Regardless, every denial creates a tremendous amount of work on the back end to collate and develop an appeal. Many providers have resorted to devoting tons of resources and personnel dedicated solely to denial reviews and appeal development. Providers who don’t address payer denials end up writing off hundreds if not millions of dollars in denied payments.

Recent reports in the industry put the average claim denial rate between 6% and 13%. The costs to respond to claim denials are significant. The impact of these denied dollars and response resources can run into millions of dollars each year, depending on a provider’s number of discharges.

Recently I had the privilege of assisting a payer with their provider payment complaint and inquiry response plan. It soon became apparent that both payers and providers combat issues related to vendor non-compliance, workflow management, contract limitations, and, unfortunately, minimal performance metrics and standards holding all facets of revenue integrity accountable.

Common errors I have seen are simple to fix and help guide each party in their investigation of the issue denied. Aside from getting down into the nitty-gritty of clinical indicators, documentation improvement, and code assignment, the following is a checklist of proper letter formatting and logistical appeal details that every provider should include in their appeals. This checklist may seem simple, but these details streamline the payer’s ability to find the case on their end and conduct a proper investigation and possibly reverse the denial.

For starters, use your organization’s official letterhead to write your appeal on. Always include the following at the beginning of the appeal:

• Date of the appeal
• Provider name, address, and to the attention of whom the appeal response should be directed
• Fax number or portal link to send the payer’s decision letter to

Mail goes in different directions when it arrives at provider and payer locations. A vendor or offsite location may be handling the correspondence. Include the payer’s personnel, team, or department stated within the denial to ensure the appeal arrives at the correct payer location or department for review.

Reference the following details at the top of the appeal:

• Member or patient’s name
• Member’s insurance ID
• Claim number
• Dates of Service
• Encounter or account number of the service
• The disputed dollar amount that the payer is denying
• Authorization number (if applicable)

Of course, as the provider, you might have many reasons why you disagree with the denial and wish to write an appeal to dispute those reasons. Writing the body of an appeal should flow in a manner that is easy to understand and digest.

• First and foremost, write the appeal and direct the language at the main point of the payer’s denial, detailing why the medical record supports the services received, and include citations to evidence-based criteria, journals, or other medical resources.
• Second, if the denial is a DRG Validation denial, cite the ICD-10-CM Official Guidelines for Coding and Reporting and Coding Clinics that support the code assignment and sequencing. Request a peer-to-peer review of the denial, so the case is an apples-to-apples comparison and not apples-to-oranges. If the denial takes a clinical validation spin, defend the requirement that a licensed professional familiar with the services provided is the only one allowed to conduct a clinical validation review.
• Third, cite contractual rules, protocols, policy requirements, or state and federal regulations the payer and provider must abide by.
• Fourth, use footnotes, citations, and page numbers so reviewers and auditors can quickly find the documentation supporting your position. It is tempting to avoid doing anything helpful to payers as they review your appeal, sort of a tit-for-tat, but you’ll land on the good side if you make information easy to find and access.

As providers write appeals, know the appeal timeframes outlined in your contract with the payer or mandated by state and federal payers. If the contract or rules and regulations state a provider has 60 or 90 days to respond to a denial, unless there are extenuating circumstances, do not expect a reversal of the denial if the appeal has passed that timeframe. Watch the payer’s remittance advice or Explanation of Payment (EOP) closely for the exact reason code(s) for the denial. Common denials can be for “No medical record received,” or the provider is out of network, and payment may be denied or lower than expected. Perhaps the service requires authorization or is past timely filing, or for other more complicated issues such as clinical support and code assignment. Break the denial down into digestible parts. Is there a conflict in your contract language or a breakdown in systems that transfer accurate information? Are you a participating or non-participating professional or provider? Is the denial solely focused on clinical criteria and medical necessity? Write the appeal and stick to the critical areas of the denial; highlighting your stance from an appeal perspective is the best format to follow.

As a final footnote, make sure your appeal is HIPAA compliant. Submit only the documents requested by the payer and necessary to support your appeal. Frequently, the provider throws the entire legal record and the whole day’s remittance advice at the payer for review. Do not send pages and pages of the remittance advice containing multiples entries of claims data when only a tiny portion is associated with a specific patient and the denial is at hand. Too much information is a HIPAA violation and not necessary. The minimum necessary standard[1] outlined in the HIPAA Privacy Rule is based on the practice that “protected health information (PHI) should not be used or disclosed when it is not necessary to satisfy a particular purpose or carry out a function.” In other words, the Privacy Rule requires covered entities to take reasonable steps to limit the use or disclosure of and requests for protected health information to the minimum necessary to accomplish the intended purpose. Providers should have policies and procedures that they strictly follow to use and disclose PHI.

My last bit of advice is to set up parameters and performance metrics around the denials and appeals. Track and trend payers and the issues they are denying and the success rate of your appeals. If your organization uses a vendor to perform the denial review and appeal response task, make sure the vendor’s contract speaks to several performance metrics and improvement objectives related to the timely filing of an appeal. Include metrics that measure accurate correspondence information, professional formatting of the appeal, appeal success performance, revenue lost and recovered, and insight into areas ripe for education and improvement. Auditing the vendor’s performance may be necessary, including implementing a performance improvement plan (PIP) or corrective action plan (CAP) if performance standards are difficult to achieve.

Linked below is a simple but effective appeal letter template for your reference. Expand upon it, edit and modify it to fit your needs and appeal purposes.

Sample Appeal Template

About the Author:

Taryn Schraad is the President and Founder of BAC10 Solutions, LLC. A compliance and denials and appeals consulting company linking complicated regulations to practical workflows.

Contact the author:

[email protected]

[1] HIPAA Privacy Rule, 45 CFR 164.502(b), 164.514(d)