Internal appeal vs external review: what is the difference?

What is the difference between an internal appeal and an external review?

In an internal appeal, you ask your own insurance company to do a full and fair review of its decision.

In an external review, an independent third party looks at the denial. External review means the insurer no longer gets the final say on whether to pay. If the reviewer decides in your favor, the insurer is required by law to accept it.

These steps describe most private health plans. Medicare has its own appeal process, and it works differently depending on the kind of Medicare coverage you have. Medicaid and some other plans may also have different steps. Your denial letter should tell you which process applies to you.

Who decides my appeal?

For an internal appeal, your insurance company reviews its own decision. At the end, it must give you a written decision.

For an external review, it depends on your state and your plan. Your state may have its own process that meets federal standards. Where it does not, the federal government (HHS) oversees the process. If your plan is not part of a state or federal process, it must contract with an independent review organization.

You do not have to do this alone. The Consumer Assistance Program in your state can file an appeal for you.

How long do I have to appeal a denied claim?

For an internal appeal, you generally must file within 180 days (6 months) of receiving the notice that your claim was denied.

For an external review, you generally must file in writing within 4 months after the date you receive a notice or final decision from your insurer.

These are the general rules for private health plans. Medicare and some other plans use different deadlines. Your denial letter should list the dates that apply to you. Mark them on a calendar the day it arrives.

How long does the insurance company take to decide?

For an internal appeal, the insurer generally must finish within 30 days if the appeal is for care you have not received yet, and within 60 days if it is for care you already received.

If it is urgent, the decision must come as quickly as your medical condition requires, and no later than 4 business days after your request is received.

For an external review, a standard decision comes no later than 45 days after the request is received. An expedited one comes no later than 72 hours, or sooner, depending on how urgent your case is.

Does an external review cost anything?

If the federal (HHS) process handles your review, there is no charge. Otherwise, the charge cannot be more than $25 per external review.

Can I skip the internal appeal and go straight to external review?

In urgent situations, you may file an internal appeal and an external review request at the same time.

Outside of urgent cases, you usually finish the internal appeal first. Because the rules depend on your plan and state, call your state insurance department or consumer assistance program before you skip a step. We are not lawyers, and this is not legal advice.

How do I file my first appeal after a denial?

Here is a simple path. Take it one step at a time.

• Step 1: Find the dates. Read your denial letter. Write down the date you received it and the appeal deadline it gives.
• Step 2: Ask for the reason in writing. Make sure you have the exact reason for the denial and the name of the plan, claim number and member ID.
• Step 3: File the internal appeal. Send your written appeal before the deadline. Add anything that supports it, such as a note from your doctor. Keep copies and proof of when you sent it.
• Step 4: If it is denied again, request external review. The insurer's final decision must tell you how to ask for an external review. Follow those directions and send your request in writing before the deadline, generally within 4 months.

Your checklist

• Write down the date I got the denial letter
• Mark the appeal deadline on my calendar (generally 180 days for an internal appeal with a private health plan)
• Find the claim number, member ID and denial reason
• Ask my doctor for a short supporting note
• Send my internal appeal in writing and keep proof of the date
• If denied again, request external review in writing, generally within 4 months
• Call my state insurance department or consumer assistance program with questions

A letter you can copy

[Date] [Insurance company name] Attn: Appeals Department [Insurer address or fax] Re: Request for internal appeal Member name: [Your full name] Member ID: [Member ID] Claim number: [Claim number] Date of service: [Date] Date of denial letter: [Date] To the Appeals Department, I am appealing the denial of the claim listed above. The reason given was: [reason stated in the denial letter]. I believe this decision was wrong because [one or two sentences in your own words]. I have included [doctor's note, records, or other documents] to support my appeal. Please review this decision fully and send me a written response. If you uphold the denial, please also send me the instructions for requesting an external review. Thank you, [Your name] [Phone] [Address]

Which rules apply to you?

The steps and deadlines on this page can differ by the kind of plan you have. Your own denial letter always comes first.

• Coverage through a job:ask your HR team whether the plan is “self-funded” or “fully insured.” It can change who you can ask for help. Most private-sector job plans fall under a federal law called ERISA, and the U.S. Department of Labor’s EBSA takes health plan questions at Ask EBSA or 1-866-444-3272.
• Marketplace plan: follow the appeal steps at HealthCare.gov.
• Medicare or Medicaid: each has its own appeal process, listed on your notice.
• Dental-only plan: your plan contract sets the appeal rights, so read it and your letter.

Related answers

• How to request an independent external review of a denied claim
• How to write an insurance appeal letter
• How to read an insurance denial letter
• All answers

Free tools for the next step

Keep your appeal papers in one place. Take a photo of your denial letter, EOBs and insurance cards with GetPreCare, so they are on your phone when the insurer or the office asks. Free. Open GetPreCare. Helping a parent or partner? Set it up for them.