Insurance What Everyone Should Know

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Navigating and Understanding
Health Insurance Issues

This guidance is intended to assist people looking for help when accessing care and when insurance
denies coverage for treatment of eating disorders. The information here was compiled from research
by ECRI Institute and the experience of parents and treatment providers who have had experience
obtaining coverage for eating disorders care. In a separate document are sample letters to adapt to various
insurance situations related to obtaining appropriate care. This information has not been prepared by attorneys and is
not intended as a legal document. This information does not guarantee success. If you have suggestions, feedback, or personal
additions to share (e.g., submit a sample letter you’ve used with your insurance company with all identifying information
removed), please email National Eating Disorders Association at nfo@nationaleatingdisorders.org with “Insurance Issues” in the
subject line.

The National Eating Disorders Association fields many questions very day that focus on how to gain access to care and navigate
insurance issues. While there is little argument that early intervention offers the best chance for recovery, insurance and the
healthcare system can pose barriers to accessing prompt, comprehensive treatment.

Accessing the full benefits a patient is entitled to under his/her health plan contract requires understanding a few things
about all the factors that affect access to care, coverage, and reimbursement. Navigating the system to find out what the
patient is entitled to receive also takes a lot of energy. While parents can legally act on behalf of children younger than age 18,
they need permission from a child older than age 18 to act on his/her behalf.

Because treatment usually involves both mental healthcare and medical care aspects, a well-rounded care plan must address both
types of care. The overall healthcare system has long treated medical care and mental healthcare separately. The result of
that care model is that health insurer benefits plans have often followed suit by separating mental health benefits (also called
behavioral health benefits) from medical benefits. This split has created great difficulty for people with an eating disorder because
they need an integrated care plan. Ways to steer through these difficulties are offered here in an 8-step plan.
Another issue is the level of benefits for mental healthcare. For years, many health plans provided few or no mental health
benefits. When they did, most subcontracted those benefits through “mental health carve-out” plans. Such plans are administered
by behavioral health service companies that are separate from health plans. This approach made well-rounded care by
a multidisciplinary team very difficult to achieve. Even when a psychotherapist and medical doctor want to integrate services
and case management to treat the patient as a whole person, the healthcare delivery system in the United States poses barriers that
prevent that from happening.

For example, when a service is provided by a doctor or facility, a billing code is needed to obtain reimbursement for services.
Certain rules and regulations govern how services must be coded and who can perform those services. Different types of
facilities and different healthcare professionals must use codes that apply to that type of facility and health professional. Also,
if codes don’t exist for certain services delivered in a particular setting, then facilities and health professionals have no way to
bill for their services. Codes used for billing purposes are set up by various entities, such as the American Medical Association,
U.S. Medicare program, and the World Health Organization’s International Classification of Diseases. Thus, even a patient
with good health insurance may face barriers to care simply because of the way our healthcare system is set up.
The system is slowly changing. Sporadic improvements have come about as a result of lawsuits and state legislation prompted
by individuals, legislators, clinicians, support groups, and mental health advocacy groups. The U.S. federal government and most
U.S. states have passed some form of mental health parity law.

Generally these laws require insurers to provide benefits for mental healthcare that are equivalent to benefits for medical care.
These laws do, however, vary widely in their provisions. Landmark lawsuits brought by families of patients with bulimia
nervosa and/or anorexia in two states—Wisconsin in 1991, and Minnesota in 2001—were watershed events that set legal
precedents about what insurers should cover for eating disorders.

These lawsuits also raised public awareness of the problems faced by people seeking coverage for treatment of eating disorders.
Nonetheless, the system today has a long way to go to improve access to care and adequate reimbursement for care for a sufficient
period for a patient with an eating disorder.

Given that appropriate well-integrated treatment for eating disorders can easily cost more than $30,000 dollars per month,
even with insurance, an insured individual is usually responsible for some portion of those costs.
The first-line of decision making about health plan benefits is typically made by a utilization review manager or case manager.
These managers review the requests for benefits submitted by ah ealthcare provider and determine whether the patient is entitled
to benefits under the patient’s contract. These decision makers may have no particular expertise in the complex, inter-related
medical/mental healthcare needs for an eating disorder. Claims can be rejected outright or approved for only part of the recommended
treatment plan. Advance, adequate preparation on the part of the patient or the patients’ support people is the best
way to maximize benefits. Prepare to be persistent, assertive, and rational in explaining the situation and care needs. Early preparation
can avert future coverage problems and situations that leave the patient holding the lion’s share of bills.

1. Educate yourself.
Read the other information in the Parent Toolkit to learn about
eating disorders, treatment, current clinical practice guidelines,
and how you can best advocate for and support the family
member who has an eating disorder. Refer to the latest evidencebased
clinical practice guidelines in this toolkit and have them
in hand when speaking to your health plan about benefits. Be
prepared to ask your health plan for the evidence-based information
they use to create their coverage policy for eating disorders.
Find out if your state has a mental health parity law or mandate
and what the terms of that law or mandate are. Mental health
parity simple means that your insurance company must not
limit mental health and substance abuse healthcare by imposing
lower day and visit limits, higher copayments and deductibles,
and lower annual and lifetime spending caps than they do for
medical care. The website www.bulimiaguide.org has detailed
information about which states have mental health parity laws
or mandates and what those laws and mandates cover. See the
Eating Disorders Coalition for Research, Policy & Action web
site for how to get involved in the effort to influence federal
policy at: www.eatingdisorderscoalition.org.
2. Get organized.
If a patient’s first encounter with the healthcare system is admission
to an emergency room for a life-threatening situation with
an eating disorder, whoever is going to deal with insurance issues
on the patient’s behalf will need to get organized very quickly to
figure out how to best access benefits. Patients who are seriously
medically compromised will likely be in the hospital for a few
days before discharge to outpatient care or a residential eating
disorder center. Those few days are critical to negotiating reimbursement
for the longer-term care.
If the situation is not an acute emergency and you want to find a
treatment center, consider whether you have authority to act on
the patient’s behalf or whether the patient must give you written
authority to act on his/her behalf. If a child is 18 years of age or
older, parents will need the child’s written permission to act on
the child’s behalf. Healthcare providers have forms that require
signatures to allow free flow of communication and decision
making. A spouse, partner, friend, or other person who wants
to act on behalf of the patient will need to have the patient sign
appropriate authorizations. Medical confidentiality is discussed
later in this section.
3. Read the patient’s entire insurance benefits
manual carefully to understand the available
benefits.
Obtain a copy of the full plan description from the health plan’s
member’s website (i.e., the specific plan that pertains to the
insured), the insurer or, if the insurance plan is through work,
the employer’s human resources department. This document
may be longer than 100 pages. Do not rely on general pamphlets
or policy highlights. Read the detailed description of the benefits
contract to find out what is covered and for how long. If you
can’t understand the information, try talking with the human
resources staff at the company that the insurance policy comes
through, with an insurance plan representative (the number is
on the back of your insurance identification card), or with a
billing/claims staff person at facilities where you are considering
obtaining treatment. If hospital emergency care is not needed,
make an appointment with a physician you trust to get a referral
or directly contact eating disorder treatment centers to find
out how to get a full assessment and diagnosis. The assessment
should consider all related physical and psychological problems
(other documents in this toolkit explain the diagnostic or
assessment process and testing). The four main reasons for
doing this are:

to obtain as complete a picture as possible about everything
that is wrong;
to develop the best plan for treatment;
to obtain cost estimates before starting treatment; and
to obtain the benefits the patient is entitled to under his/
her contract for the type of care needed—for example, many

insurers provide more coverage benefits for severe mental
disorder diagnoses. Some insurers categorize anorexia andbulimia nervosa as severe disorders that qualify for extensive
inpatient and outpatient benefits, while others may not.
Medical benefits coverage also often comes into play to treat
eating disorder-associated medical conditions, so diagnosing all
physical illnesses present is important. Other mental conditions
often coexist with an eating disorder and should be considered
during the assessment, including depression, trauma, obsessivecompulsive
disorder, anxiety, social phobias, and chemical
dependence. These coexisting conditions can affect eligibility
for various benefits (and often can mean more benefits can be
accessed) and eligibility for treatment centers.
Steps to maximize insurance benefits

4. Keep careful and complete records of
communications with the insurance company
and healthcare providers for future reference
as needed.
From the first call you make, keep a complete record of your
conversation. Treatment often occurs over a long period
of time. Maintaining a log book—whether computerized
or in hard copy—can be important for future reference if
there are questions about claims. Decide where all notes and
documentation will be kept for easy access. Create a back-up
copy of everything, and keep it in a safe and separate place.

The record log of conversations should contain the following:
notes taken of each conversation with an insurer or
healthcare provider
date, time, name, and title of person with whom you spoke

person’s contact information
As a courtesy, you may wish to let the people you talk with know
that you are keeping careful records of your conversations to help
you and the patient remember what was discussed. If you decide
to tape record any conversation, you must first inform and ask
the permission of the person with whom you are speaking.
5. Call the insurer to discuss benefits options.
With documentation of the patient’s diagnosis and proposed
care plan in hand, it’s a good idea to call the insurance company
before the patient formally enters a treatment program. Quite
often, preauthorization for a treatment facility or healthcare
provider is needed. Ask for a case manager who has credentials
in eating disorders. This will improve your chance of getting one
contact person to talk with over the longer term of treatment
who better understands the complexities of treatment. Confirm
with the insurer that the patient has benefits for treatment. Also
ask about “in-network” and “out-of-network” benefits and the
eating disorder facilities that have contracts with the patient’s
insurance company, because this affects how much of the costs
the patient is responsible for. If the insurer has no contract with
certain treatment facilities, benefits may still be available, but
may be considered out-of-network. In this case, the claims will
be paid at a lower rate and the patient will have a larger share
of the bill.
You may also want to consider having an attorney in mind at
this point in case you need to consult someone if roadblocks
appear; however, avoid an adversarial attitude at the beginning.
Remember to keep complete written records of all communications
with every person you speak with at your insurance
company. Other things to remember:

Thank and compliment anyone who has assisted you.
You’re more likely to receive friendly service when you are
polite while being persistent.
Send important letters via certified mail to ensure they can be
tracked and signed for at the recipient location.
Set a timeframe and communicate when you would like an
answer. Make follow-up phone calls if you have not received
a response in that timeframe.
Don’t assume one department knows what the other department
is doing. Copy communications to all the departments,
including health, mental health, enrollment, and other
related departments.
Don’t panic when and if you receive the first denial. Typically,

a denial is an automatic computer-generated response that
requires a “human override.” Often you need to go up at least
one level, and perhaps two levels, to reach the decision maker
with authority to override the automated denial.

Your insurance company only knows what you and the

treating professionals tell them. Make sure they have all
information necessary to make decisions that will be of most
benefit to you or your loved one.

Make no assumptions. Your insurance company is not the

enemy – but may be uninformed about your case. Treat each
person as though he/she has a tough job to do.

Be aware that if the patient is a college student who had to
drop out of school to seek treatment and was covered by school
insurance or a parent’s insurance policy, the student may no
longer be covered if not a full-time student. While many people
will continue working or attending school, some cannot. If this
is the case, it’s important to understand what happens with
insurance. Most insurance policies cover students as long as they
are enrolled in 12 credit hours per semester and attend classes.
Experts in handling insurance issues for patients with eating
disorders caution that patients who have dropped out of school
should avoid trying to cover up that fact to maintain benefits,
because insurance companies will usually find out and then
expect the patient to repay any benefits that were paid out.
If coverage has been lost, the student may be eligible to enroll in
a Consolidated Omnibus Budget Reconciliation Act (COBRA)
insurance program. COBRA is an Act of Congress that allows
people who have lost insurance benefits to continue those
benefits as long as they pay the full premium and qualify for the
program. See www.cobrainsurance.com for more information.
A person eligible for COBRA has only 30 days from the time of
loss of benefits to enroll in a COBRA plan. It is critical that the
sign up for COBRA be done or that option is lost. Be sure to get
written confirmation of COBRA enrollment from the plan. If
the student is not eligible for COBRA, an insurance company
may offer a “conversion” plan for individual coverage.
If the patient is in the hospital and will be discharged to a residential
treatment center, discuss how the medical and behavioral
health components of benefits will work. Although a patient may
be “medically stable” at discharge, he/she may not be nearly well
enough to participate fully in psychotherapy at the residential
NEDA TOOLKIT for Parents Insurance I s s ues PAG E 4
center. The patient’s medical condition, though not life-threatening
at this point, affects mental health and ability to participate
in treatment. Restoring physical health may take days or
weeks. Therefore, before the patient is admitted to a residential
eating disorder center or placed in outpatient treatment, contact
the patient’s health plan or employer (if applicable and the health
plan is self-funded by the employer) and ask for the early claims
for psychotherapy to be paid under the medical benefits instead
of the behavioral health benefits. The language to use is: “Will
you intercept psychotherapy claims and pay them under medical
benefits until the patient is stable enough to participate fully
and assist in her treatment?” Not all health plans will do this,
but some do, so it’s worth asking. Going this route can save the
behavioral health benefits for the time when the patient is better
able to take part in the psychotherapy.
Another way to get the most out of benefits is to find out
whether chemical dependency or substance abuse benefits are
included in the mental health day allotment or if it is a separate
benefit. If it is separate and the patient does not really need this
benefit, find out whether the insurer will “flex” the benefit to
apply it for treating an eating disorder.
6. Find out the authorizations for care that the
insurer requires for the patient to access care.
Once insurance benefits are confirmed, be sure to obtain the
health plan authorizations required for reimbursement for the
care the patient will receive. Sometimes authorizations and
referrals are sent electronically to the concerned parties. Always
confirm that they have been sent and received by the appropriate
parties. Ask for the level-of-care criteria the patient must meet to
be eligible for the various levels of benefits. Again, keep a record
of the authorizations received.
7. Communicate with key caregivers to give
any needed input and devise a treatment plan.
Obtain the names of the people who will be providing care and
having daily interactions with the patient (including lower-level
staff such as aides). Try to meet with, or talk by phone, to each
caregiver on the team. Discuss the diagnosis (and whether there
is more than one primary diagnosis) and treatments options, and
ask whether there is clinical evidence to support the recommended
treatment and what that evidence is. This information
can be useful when talking to the insurance company about
benefits, because insurance companies value evidence-based
care. Also, ask how the treatment plan will be coordinated
and managed, and who will coordinate the plan. In the case
of bulimia nervosa, the patient often has close to normal body
weight. However, serious, but less obvious medical conditions
may also be present (e.g., osteoporosis, heart problems, kidney
problems, brain abnormalities, diarrhea, reflux, nausea, malnutrition,
heartburn). Tests that are used to diagnose medical
symptoms and criteria for levels of care are listed in First steps
to getting help in this toolkit. Ask for “letters of support” from
the healthcare team. See Sample letter #6 in Sample letters to
use with insurers in this toolkit. Using language that is used by
insurance companies is helpful to have common ground. For
example, it’s important to point out care that is considered by
the doctors to be “medically necessary” for the patient’s recovery.
Documentation like this is useful to provide to the insurer when
discussing reimbursement, because it gives both you and the
insurer a framework for discussion. With regard to the healthcare
providers, ask them how to and who can obtain copies of the
patient’s medical records, who will provide progress reports, how
often they will provide them, and to whom. Ask the healthcare
provider (whether a facility or individual therapist) for an itemization
of the estimated costs of care, which costs will likely be
paid by the insurer, and which costs will be paid by the patient.
Also ask how billing for reimbursement will be handled—ask
whether you have to submit claims or whether the healthcare
service provider submits the claims on the patient’s behalf.
8. Enlist support from family members
and friends you can count on.
Make a list of people you can count on for moral support
throughout the course of treatment. Keep their names, phone
numbers, and email addresses handy. For this list, identify people
who can help the patient remain focused and provide helpful
emotional support and encouragement while navigating the
system to obtain care and while receiving care. Find out from
each of them their availability (i.e., times, dates) for support and
the kind of support they can offer. Also consider distributing
that list among key people on the list so they know who is in
your support network. Also, list key healthcare provider (facilities
and healthcare providers) contact numbers on that list in the
event of an emergency.

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