Do insurance companies deny care or unfairly question care to make a profit?

This is the issue in a Twitter debate I am having; mostly from the physician’s  perspective. They appear convinced that making a profit by denying care is fairly routine among insurers.. and also caused in large part by Obamacare. 

What do you say? Where is the balance among health care providers, patients and those who pay the bills (insurers, government, taxpayers and yes, patients)? 

What has been your experience?


  1. Insurance companies that provide ‘managed care’ do require prior authorization for certain tests and procedures. Yes, there are denials- refusal by the insurance company to authorize the test/procedure (i.e., pay for it) based upon factors such as the ordering physician not providing the required documentation to justify the test/procedure or the test/procedure is not the standard medical management for the diagnosis in question.

    Insurance companies that provide Medicare Part C also deny, based on criteria established by CMS, inpatient hospitalizations and skilled nursing home stays. Ideally, the denial occurs prior to the event.

    Do insurances companies deny care? Yes. Do they do it unfairly to make a profit? There are laws against that and there is the grievance and appeal process as Benefitjack mentioned (above).

    Here are the facts (I work for a major insurance company in a department that works with Medicare Part C policies):

    Yes, insurance companies deny care.
    Yes, insurance companies ‘question’ care.
    Yes, insurance companies make a profit.

    If the insurance company denies care, does it make a profit? Well, if the insurance company denies care, it doesn’t incur the cost.


    1. Not incurring the costs and not the same making a profit & if they were to practice arbitrary denial too often they would be out of business.


      1. Premiums minus the cost of care (plus administrative costs) does not contribute to a net profit or loss?

        Also, did I say the denials were arbitrary? No, I did not. The denials that I am aware of are based upon an established set of criteria that is accessible to the providers.


      2. The issue was arbitrary and unjustified denials. My point was there are other factors in profit other than denying claims like volume of customers.

        Liked by 1 person

  2. Definitely do. I had a root canal with the prep done in December and the crown in January and Aetna would not pay for the crown as they insisted it could not be split between two years. I got nowhere myself and had to enlist the help of HR who set them straight. Telling Aetna that this was MY money, not theirs. They paid.


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