CLEVELAND, Ohio – As many as one out of five in-network claims made for Ohio patients with Obamacare are denied, according to research by the Kaiser Family Foundation.

When a health insurance claim is denied, that leaves patients or providers to cover the cost, leading to unexpected medical bills for patients or unpaid debt for health systems.

J.B. Silvers, a professor of healthcare finance at the Weatherhead School of Management at Case Western Reserve University, said patients are usually not at fault in claim denials, but still can pay the price.

“Patients are mostly collateral damage,” Silvers said. “It’s between the provider and the insurance carrier at this point.”

Obamacare marketplace plans are typically purchased by those who are not insured through work, Medicaid or Medicare. Per the Ohio Department of Insurance, 10.9 million people in Ohio have some kind of health insurance. About 230,000 people have Obamacare plans, roughly 2% of insured Ohioans.

Insurers nationwide denied about 19% of all Obamacare claims, just below Ohio’s average, according to the Kaiser study, which analyzed data from The Centers for Medicare and Medicaid Services for Obamacare providers in 2017. Denial rates across the country ranged from a high of 41% in Kentucky to a low of under 8% in Oregon.

In Ohio, denial rates peaked at 33% for Molina Healthcare of Ohio and were as low as 10% for AultCare Insurance Co. and Summa Insurance Co. in 2017, the last year data was collected at the national level.

“This needs to be dealt with,” Silvers said. “Even if it’s just mistakes, the patient is the one that gets caught.”

The reasons claims are denied are many. Insurers can deny claims for services that aren’t covered by a patient’s policy, were coded incorrectly, had clerical errors, didn’t have the required pre-authorization or were not considered a medical necessity.

CareSource, which denied 17% of its Obamacare patients’ claims in 2017, said it wants to be a “good steward” of all of its members’ money.

“We work to do what is appropriate, while not reimbursing for a service that is not a part of a member’s policy,” the company said. “We do track denial rates and use the data as a trigger to research the root cause.”

Molina said it works closely with “medical and pharmacy providers to ensure timely claim payments.”

“Occasionally, a claim may be denied because it does not fit within the approved guidelines or due to nonpayment of premiums,” the company said in a statement. “Molina closely monitors denial rates to verify all claims are appropriately handled, and is committed to ensuring members have proper access to care.”

The Ohio Department of Insurance received 1,090 denial complaints for health insurance in 2017, 19% of those were for marketplace plans.

Historically, information on health insurance claims wasn’t made public, but requirements in the Affordable Care Act are changing that.

The ACA requires insurers to provide data on their marketplace plans, including information on enrollment, claim denials and appeals. The data still isn’t complete. It doesn’t include information on why claims were denied, nor does it include out-of-network claim denial statistics, but it does give some insight into a previously private industry.

The ongoing struggle between insurance companies that want to keep costs low and providers that want to provide comprehensive medical care perpetuates a system in which denials remain high, Silvers said. But efforts for more transparency in health care are leading to the creation of alternative methods, such as accountable care organizations. These are networks of providers coordinating care to reduce costs.

“It’s basically inviting ways to overcome that natural clash of perspectives,” Silvers said.

Challenging a denial

Those who want to challenge claim denials can file complaints with the Ohio Department of Insurance’s consumer services division at 1-800-686-1526, or by visiting the department’s website, www.insurance.ohio.gov. The department will review each claim and assist consumers with the appeals process.