Insurance Claim Denied USA: How to Request an External Review (Free)

Insurance Claim Denied USA: Your Free Right to External Review

If your health insurance claim has been denied in the United States, you have a powerful right that most people don't know about: the right to a free, independent external review under the Affordable Care Act (ACA). This means that after your insurer's internal appeal fails, an Independent Review Organization (IRO) — with no financial relationship to your insurer — can review the decision and overrule it.

External review programs overturn insurer decisions in approximately 40–50% of cases that reach them. This is not a minor administrative process — it is a legally binding pathway with real teeth.

This guide explains exactly how external review works, who qualifies, how to request it, and what to expect.

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What Is External Review?

External review is a process mandated by the Affordable Care Act (ACA) for most health insurance plans. An Independent Review Organization (IRO) — a third-party company with no affiliation to your insurer — reviews your denied claim and can:

• Overturn the insurer's denial
• Require the insurer to pay the claim
• Issue a decision that is legally binding on the insurer

Unlike internal appeals, which are conducted by the insurance company itself, external review is genuinely independent. IROs are certified by accrediting organizations and prohibited from having conflicts of interest.

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Who Has External Review Rights?

You likely qualify if:

• Your plan is covered by the ACA (most individual, small group, and marketplace plans)
• Your plan is offered by an employer that is subject to state insurance law (fully insured large-group plans)
• Your denial involves a medical necessity decision, experimental treatment denial, or coverage determination

You may have different rights if:

• Your employer is self-insured (ERISA plans): You still have federal external review rights under ERISA regulations, though the process differs slightly
• You have Medicare or Medicaid: Different appeal processes apply
• You have a grandfathered health plan: May be exempt from ACA external review requirements

Check with your State Department of Insurance or call Healthcare.gov at 1-800-318-2596 to confirm which process applies to your plan.

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Step 1: Exhaust the Internal Appeal Process First

Before you can request external review, you must complete the insurer's internal appeal process — with one exception for urgent cases (see expedited review below).

Your insurer must provide:

• First-level internal appeal: decided within 30 days (non-urgent) or 72 hours (urgent/expedited)
• Second-level internal appeal (if offered): within the same timeframes

You should receive a written final denial that states your right to request external review and provides instructions on how to do so. If you don't receive this notice, your insurer may be in violation of federal regulations.

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Step 2: Request External Review Within 4 Months

You have 4 months (approximately 120 days) from the date of your insurer's final denial to request external review. This deadline is strict — missing it typically forfeits your right.

How to request external review:

1. Contact your insurer: Your denial letter should include external review instructions. Follow them explicitly.
2. Complete the IRO request form: Your insurer or state department of insurance will direct you to the appropriate IRO.
3. Submit all supporting documentation with your request:
   • Medical records related to the claim
   • Specialist reports and physician statements
   • The insurer's denial letters and appeal responses
   • Any additional clinical evidence you have gathered

Cost: External review is free for consumers by federal law. If anyone asks you to pay for it, that is a violation.

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Step 3: The External Review Timeline

Once your request is accepted, the IRO has strict timelines:

Review Type	IRO Decision Deadline
Standard external review	45 days
Expedited (urgent) external review	72 hours
Experimental treatment review	30 days

The IRO will request your complete claims file from the insurer. They may also request additional medical information from your physician.

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Step 4: Expedited External Review (For Urgent Cases)

If your health situation is urgent — meaning waiting for a standard review could seriously jeopardize your life, health, or ability to regain maximum function — you can request expedited external review simultaneously with your expedited internal appeal. You do not need to wait for the internal appeal to complete first.

Expedited external review must be completed within 72 hours. This is particularly important for:

• Hospital discharge disputes (you're in the hospital and the insurer wants you discharged)
• Ongoing treatment that will be interrupted by the denial
• Emergency care authorization
• Cancer treatment prior authorization denials where delay is dangerous

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Step 5: What Happens After IRO Review

The IRO issues a written decision. If they overturn the denial:

• The insurer must cover the service or reimburse the claim — the decision is legally binding
• The insurer cannot internally overrule the IRO decision
• You should receive payment or authorization within the timeframes specified in the ruling

If the IRO upholds the denial:

• You can still file a complaint with your State Department of Insurance
• You can pursue litigation if the denial involved bad faith or ERISA violations
• Some states have additional state-level appeal rights

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State-Level External Review Programs

In addition to federal external review rights, most states have their own external review programs that may offer additional protections:

• California: Independent Medical Review through the California Department of Managed Health Care (DMHC) — includes mental health parity protections
• New York: External appeal process with the New York State Department of Financial Services
• Texas: Independent Review Organization process through the Texas Department of Insurance

State processes sometimes offer stronger protections or cover plans that federal external review doesn't reach. Contact your State Department of Insurance to understand both options.

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What Types of Denials Can Be Externally Reviewed?

Federal external review covers:

• Medical necessity denials: Insurer claims the treatment isn't medically necessary
• Experimental or investigational treatment: Insurer claims the treatment is experimental
• Coverage determinations: Disputes about whether something is covered under your plan

External review generally does NOT cover:

• Billing disputes (amounts charged by providers)
• Eligibility disputes (whether you qualify for the plan at all)
• Administrative denials (late claim filing, missing paperwork)

For non-medical denials, your State Department of Insurance complaint process is the appropriate channel.

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Success Rates: The Evidence

External review programs produce meaningful results:

• States with mature external review programs report overturn rates of 35–50% for medical necessity denials
• The American Journal of Medicine found that patients who pursued external review won approximately 40% of cases
• Experimental treatment denials are overturned at particularly high rates — often over 50% — because medical science evolves faster than insurer guidelines
• Cancer treatment denials have high overturn rates due to the weight of clinical evidence that physicians typically provide

The key insight: IROs are medical professionals reviewing clinical decisions, not insurance company employees protecting a bottom line. When you bring strong medical evidence — specialist reports, peer-reviewed literature, physician statements — IROs often disagree with insurer determinations.

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How to Maximize Your Chances of Success at External Review

1. Get a letter from your treating physician. Your doctor should write specifically to the IRO, addressing why the treatment is medically necessary for you specifically — not just clinically appropriate in general. Personal, case-specific clinical reasoning is far more persuasive than generic medical literature.

2. Submit peer-reviewed clinical guidelines. If your treatment follows recognized guidelines from organizations like the American Cancer Society, American College of Cardiology, or relevant specialty societies, attach those guidelines and show that your case fits them.

3. Address every specific denial reason. If the insurer gave three reasons for denial, your submission should address all three. Don't leave any denial reason unanswered.

4. Use the right terminology. Frame your submission in medical necessity terms: "This treatment is the appropriate, evidence-based standard of care for [condition] because..." rather than "I really need this treatment because..."

5. Include comparative effectiveness data. Show that alternative treatments the insurer might prefer are less effective or appropriate for your specific clinical situation.

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Common Mistakes in External Review Requests

1. Missing the 4-month deadline. This is the most common and most costly mistake. Set a reminder immediately.

2. Not submitting all medical evidence. The IRO reviews your submission — they don't independently gather evidence. Incomplete submissions get incomplete review.

3. Failing to request expedited review when appropriate. If your situation is urgent, escalate to expedited review immediately.

4. Giving up after the first internal appeal denial. Many people don't know about external review rights and stop appealing after the internal process.

5. Not documenting the insurer's delays. If the insurer fails to respond to your internal appeal within required timeframes, document this — it may be an independent violation you can report.

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Getting Help With Your External Review Submission

Preparing a strong external review submission requires understanding both medical evidence and regulatory language. ClaimBack can help you generate a structured appeal letter that presents your case compellingly, references the appropriate regulations, and addresses your specific denial reasons. Visit claimback.app to get started.

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Summary: Your USA External Review The Full Fight

1. Complete the internal appeal process within required timeframes (or use expedited process if urgent)
2. Request external review within 4 months of the final denial
3. Submit all medical evidence with your request: specialist reports, clinical guidelines, physician letters
4. Request expedited review if your situation is time-sensitive or life-threatening
5. Follow up with your State Department of Insurance if the IRO upholds the denial
6. Consider legal consultation for ERISA plans or bad-faith denial cases