Dealing with health insurance denials

for people with idiopathic hypersomnia, narcolepsy types 1 or 2, or Kleine-Levin syndrome

When you buy health insurance, your policy is a contract with the insurer. You pay the cost for being a plan member (your premium), and the insurer agrees to pay their share of the costs for covered health services you get. 

Denials happen when the insurer says they’re not required to pay for your medicine or other health services you think are covered under your plan policy. By filing an appeal, you’re entering into a contract dispute. You must build a case that the policy requires the insurer to pay for the medicine or service your doctor ordered.

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Avoid denials with successful prior authorizations 

Hypersomnia medicines often need prior authorizations, also called pre-approvals or precertifications. You may have more success getting prior authorizations approved by asking:

  • Your doctor to prescribe your medicines as early as possible and regularly following up on each step in your insurer’s prior authorization process
  • Your doctor to use your ICD-10 diagnosis code that matches FDA approval for your medicine — for example, if you have both a diagnosis of idiopathic hypersomnia (IH) and narcolepsy type 2 (NT2), use an NT2 diagnosis code if the medicine is FDA-approved for narcolepsy but not IH
  • Your insurer for urgent or expedited (fast) processing of your prior authorization

After you’re approved:

  • Save copies your approval letters because they can help you if you’re denied in the future
  • Mark your calendar with the date your approval expires, so you’re ready to update your prior authorization

What are the different types of appeals?

There are 2 types of appeals for private insurers: 

  • An internal appeal is reviewed and decided by your insurer
  • An external appeal is reviewed and decided by a group of doctors who are not employed directly by your insurer 

By U.S. law, you have the right to 1 internal and 1 external appeal for each denial for a covered health service, such as a medicine. Some insurers may offer 2 or more internal appeals. You usually have to use all of the internal appeals before you can do an external appeal. 

Ask for an expedited (fast) appeal if your medical need is urgent and you could be harmed if you had to wait weeks for a decision. This is often the case for hypersomnia medicines. 

What if I have Medicare?

The coverage and appeals processes are different for each part of Medicare (Parts A, B, C, or D). You can learn more and get help from your State Health Insurance Assistance Program (SHIP). Look up your local office on SHIP’s website or call 800-633-4227.

What if I have Medicaid?

Each state has different rules for appeals. For more information, visit your state’s Medicaid website or your local Department of Human Services. 

Some states have ombudsman programs that can help you. Find a listing of state programs on CMS’s website.

Who should file the appeal?

Since you’re the policyholder (the person who has the contract with the insurer), you always have the right to file appeals. If you’re unable to file for any reason, you can fill out a form called an authorized representative form so that a family member or caregiver can file appeals on your behalf.

Sometimes your doctor will file an appeal about your case. The insurer may ask you to sign an authorized representative form to give the doctor the right to appeal on your behalf. Don’t sign this form! If you do sign the form, the insurer can claim that the doctor’s appeal used up your right by law to appeal. By refusing to sign the form, you have gained another appeal by the doctor, and you still have the right to both an internal and an external appeal of your own.

What are the usual steps to appeal?

Step 1Make a folder to store everything about your appeal

  • Include all letters, bills, emails, notes of phone conversations, and more. Date everything. 
  • Get a copy of your policy, which you can find on the insurer’s website or by calling customer service. It may be called by another name, such as a benefits contract, benefits book, certificate of coverage, or evidence of coverage.
  • Each policy has a formal appeals process. Look for an appeals section in your policy, with required forms, steps, and response times.
  • Write down the name and contact information for anyone involved in the appeal, including customer service representatives you talk to on the phone.
  • Keep your receipts if you pay out-of-pocket for your medicines while you appeal. You can submit the receipts as claims to your insurer if you win your appeal. 

Step 2Find out the reason for the denial and your contract’s rules for appealing

If your insurer denies coverage, they must give a reason and information on how to appeal. Pay close attention to the number of days you have to file an appeal.

Get this information from:

  • The denial letter from your insurer
  • The insurer’s Explanation of Benefits (EOB) form for the denied service
  • Your policy
  • Calling your insurer

When you call, ask:

  • For all the information they have on the reason for denial. They can sometimes explain what happened in more detail than the denial letter or EOB.
  • Were there any errors or problems with the claim or prior authorization request that could be fixed quickly and resubmitted?
  • If there is no chance for a correction and re-submission, then what are the next steps for appealing the decision?
  • For help finding your policy and the section that explains the entire appeal process. They should be able to send you a copy or help you find it on their website.

Step 3Tell your doctor about the denial and ask if they’ll file an internal appeal 

If your doctor agrees to file an appeal: 

  1. Ask for an urgent or expedited (fast) appeal and share your insurer’s instructions. The insurer usually requires your doctor to write a brief letter. The letter should explain that a delay will be harmful to you and ask for urgent or expedited appeal processing.
  2. Offer to help write a draft appeal letter for the doctor to edit. For example appeal letters, visit:
  3. For prescription medicine appeals for people with idiopathic hypersomnia (IH), share with your doctor the links to the medical journal articles in the section “Example medical journal articles to list or quote in appeal letters” on this page. These articles will help show that the medicine is safe and effective for treating you. This is especially important if the medicine isn’t FDA-approved for IH.
  4. Follow up with your doctor to confirm the appeal has been submitted.
  5. Follow up with your insurer to confirm they received it and to find out the results. 
  6. Remember, you have a deadline for filing your own appeal.

Peer-to-peer reviews

Your insurer may offer a peer-to-peer review to your doctor. This type of review requires your doctor to talk with your insurer’s “peer” doctor. Your doctor can make verbal arguments for your case and try to get helpful information for your appeal. 

However, this isn’t an appeal. Also, insurer’s doctors aren’t usually familiar with hypersomnias, so it’s hard to have a true peer discussion. Don’t worry if your doctor prefers not to take part in a peer-to-peer review unless the insurer requires it.

Step 4Prepare your own internal appeal

If your doctor doesn’t appeal or their internal appeal is denied, then you will need to file your own internal appeal. To get you started, here is a brief summary of what to put in your appeal packet:

  • Your appeal letter, which should have:
    • A specific request that the insurer reconsider their decision and approve the prescribed medicine or procedure
    • A brief history of your medical condition
    • A list of previous treatments and outcomes (did they help, and if not, why?)
    • Evidence that the denied medicine or procedure is needed for your condition — the usual way to give evidence is to list or quote from medical journal articles written by doctors and researchers who have shown that the medicine or procedure is safe and effective 
  • Your doctor’s expedited appeal request letter
  • A copy of the denial letter or Explanation of Benefits (EOB)
  • A copy of appeal forms, if any, required by the insurer
    • If the denial was because the medicine is not on the policy’s list of covered medicines (called a formulary), include a request for formulary exception (which may require a specific form)
  • A copy of the sections of your medical records that relate to your appeal arguments — include any second opinions or specialist reports
  • A Letter of Medical Necessity from your doctor stating why the medicine or procedure is required and why other treatments are not appropriate (to learn more about the format and contents of these letters, visit patientsrising.org)

Submit your appeal and follow up

  • If you mail your appeal, use certified mail to prove that you submitted before the deadline. If you fax, save a copy of your fax receipt.
  • You should get a notice from the insurer that they got your appeal. If you don’t hear anything, call to confirm the date it was received and that it’s being processed. Ask for a status update and when you will hear the decision. Document who you talk to and all details. 
  • Mark your calendar to follow up if you don’t hear anything by the due date.

What if I lose my 1st internal appeal?

  • Review the new denial letter to see if there are new reasons for denial that you need to address in the next appeal. 
  • Contact your doctor to ask for their support in filing this appeal and if there are any other arguments or evidence that you can add to make your appeal stronger. 
  • Choose one of these options:
    • A 2nd internal appeal (not always available)
    • An external appeal
    • Follow the advice in the book “APPROVED: Win Your Appeal in 5 Days”

Follow the advice in the book “APPROVED: Win Your Appeal in 5 Days”

If you’ve lost your 1st internal appeal, we recommend following the advice in this book as the best next step. Insurance appeals expert Laurie Todd wrote this short and helpful book. It tells you how to successfully argue your appeal and prove that your policy covers the medicine or service that you need. It also teaches you how to send your appeal to higher level decision-makers. 

By using specific strategies to ensure your appeal gets their attention, you should have a better chance of quickly winning your appeal. 

Even if you think you’ve used up all your appeals, you may find success with this advice. Find out more and get the book on Laurie’s website.

Ask for an external appeal

You must ask your insurer for an external appeal, also called an external review. Usually, you must send a written request by a certain deadline after your internal appeal is denied.

Your appeal is reviewed by a third-party reviewer (someone who doesn’t work for the insurer). However, this process is often not “independent” since the third-party reviewers are hired and paid by the insurer. It’s also likely the reviewers won’t have training in sleep medicine.

Example appeals to use for denials of hypersomnia medicines

Example appeal letters

People with IH and their doctors wrote the example appeal letters in the table below. Some are quite long, so we suggest just skimming them first.

Xyrem Example Appeal A Two brief letters written by a doctor — an initial appeal and a follow-up appeal
Xyrem Example Appeal B Written by a patient using the process outlined in the book “APPROVED: Win Your Insurance Appeal in 5 Days”
Xyrem Example Appeal C Written by a patient using the process outlined in the book “APPROVED: Win Your Insurance Appeal in 5 Days”

These letters include several examples of arguments to overcome insurer reasons for denial and have references to relevant medical journal articles:

  • Many of the arguments can be used for different medicines or medical services, so review these example appeal letters no matter what you’re appealing.
  • Use the arguments, language, references, and more from these examples, but change the diagnoses, health information, medicines, gender, age, and other details to fit your own situation. 
  • The appeal letters written using the “APPROVED” book are very long, but a shorter letter (5 to 10 pages) will likely be good enough for your appeal. Choose the arguments that work best for you.

Example arguments to use for hypersomnia medicine appeals

The medicine isn’t FDA-approved or isn’t considered medically necessary 

Give your insurer proof that:

  • Doctors commonly use the medicine for your diagnosis even if it’s only FDA-approved for a different diagnosis (treating “off-label”).
  • The medicine is appropriate for you given your health history, other health conditions, and issues with other types of medicines.
  • The medicine is safe and works well for your diagnosis.

You and your doctor will need to:

  • Give your medical records.
  • Refer to medical journal articles that give proof of the appropriate use of the medicine to treat your diagnosis. The insurer may require 1 to 2 articles.

Example medical journal articles to list or quote in appeal letters:

Click on a medicine name below to find articles that support its use to treat IH.

Oxybates

Stimulants

Other treatments

Some medicines are very similar and are therefore grouped or classed together. They work in nearly the same way and are generally expected to be similarly effective. You can use the linked articles above to argue for using these similar medicines.

Oxybates (such as Xyrem, Xywav, and Lumryz) 
Lower-sodium oxybate (such as Xywav) is FDA-approved to treat both idiopathic hypersomnia and narcolepsy. Sodium oxybate (such as Xyrem) and extended-release sodium oxybate (such as Lumryz) are FDA-approved only to treat narcolepsy. However, you can argue that these medicines also work well for IH because they are so similar to lower-sodium oxybate.

Modafinils (such as modafinil and armodafinil)
Armodafinil is very similar to modafinil, so you can use the linked modafinil articles above to argue for its use. You may also want to argue that armodafinil lasts longer than modafinil.

If other medicines won’t work well for you, include the details in your appeal, and submit medical records that show:

  • When you tried other medicines before, they didn’t help your symptoms enough
  • You have side effects from other medicines
  • You have other health conditions that may get worse by taking certain medicines.

For example, pitolisant is a medicine that may be safer for people who can’t take stimulants or other wake-promoting medicines due to health reasons, such as heart disease. A good medical journal article to include in your appeals for pitolisant is “Pitolisant, a wake-promoting agent devoid of psychostimulant properties: preclinical comparison with amphetamine, modafinil, and solriamfetol.” This article summarizes research that shows pitolisant works differently than commonly-prescribed stimulants (such as amphetamines, modafinil, and solriamfetol) and doesn’t cause certain side effects common to stimulants.

Other medicines may have similar medical proof why they shouldn’t be used with your particular health conditions. Talk with your doctors to learn more about which medicines might have more risks for you.

If you have IH and write an appeal letter asking for approval for an off-label prescription that is FDA-approved for narcolepsy, you and your doctor may choose to point out that many experts think IH and NT2 are the same disorder. You can argue that coverage for IH should be approved as it would be for narcolepsy by showing: 

  • The overlap between the 2 sleep disorders 
  • Doctors often prescribe the same medicines to treat IH and NT2 

The “Example appeal letters” section above includes examples and medical journal articles related to this argument.

Use a sleep/wake journal or data from a wearable device in your appeal. We recommend that you record 7 to 14 days of data and give your journal and data to your doctor. They can include the data in your official health record. Your insurer may be more likely to consider data from your official health record than data you send to them yourself.

Here are some examples of how to collect personal health data to use in an appeal:

  • Note the bad effects — If you’re taking a medicine and having side effects, start a daily journal about the medicine and its side effects. For example, if you’re on a stimulant and you think it’s raising your heart rate or blood pressure, record your heart rate and blood pressure before and after taking the stimulant. Talk with your doctor about the best times for testing. Give your journal notes to your doctor to include in your medical record as proof the medicine doesn’t work well for you and may harm your health.
  • Note the good effects — If you’re on a medicine now but think you may someday be denied coverage for it or may have to change insurers, take notes on how the medicine works well for you. For example, if the medicine allows you to wake up earlier in the day or take shorter naps, journal your sleep and wake times while on the medicine for 30 to 60 days. If you do lose coverage for the medicine in the future, journal for another 30 to 60 days while you’re not on the medicine. By comparing your sleep patterns with and without the medicine, you can show its benefits.
  • Use a wearable device — Consider using a wearable device (such as an Apple watch or Fitbit) that has sleep tracking. Certain models can track your total sleep time and the amount of time in NREM3 (deep) sleep. You can use data from the device to show that your medicine increases your amount of deep sleep, lowers your sleep disruptions, or lowers your total sleep needs. 

Visit our web page “Sleep-wake journaling” for an example journal you can use.

Flumazenil comes only as a liquid for IV use (in a vein). Doctors must send prescriptions for people with IH and related sleep disorders to a compounding pharmacy where liquid flumazenil is made into a skin cream or lozenge. As of 2023, only 2 compounding pharmacies in the U.S. do this:

You won’t find compounded flumazenil on any formulary. However, some insurers will pay for it as part of their coverage for compounded medicines. Review your policy to see if it covers compounded medicines. Since very few pharmacies in the U.S. can make compounded flumazenil, some people have successfully argued that their insurer must cover those compounding pharmacies as in-network, because the insurer hasn’t given any in-network options for coverage.

If your claim is denied because your insurer says that flumazenil is experimental (isn’t FDA-approved or medically necessary for your diagnosis), you may argue that doctors use flumazenil, especially for people who have tried many other medicines without success. For medical journal articles to help your appeal, see the section above, “The medicine isn’t FDA-approved or isn’t considered medically necessary.”

You may also argue that flumazenil is less expensive than many other current treatments for IH and therefore less expensive for your insurer to cover. You may be able to learn more about appealing successfully through support groups, such as Facebook’s Flumazenil for Hypersomnia.

If you can afford to pay for a small sample of flumazenil, you may want to first see if flumazenil helps with your symptoms. If it does, you’ll know it’s worth your time and energy to try and get your insurer to cover this medicine for both the sample and ongoing treatment.

Step therapy programs require you to try cheaper medicines first, before “stepping up” to more expensive medicines. You may appeal to avoid step therapy if:

  • You’ve already tried the cheaper medicines and they haven’t worked for you
  • The cheaper medicines may be riskier for your health, such as worsening your other health conditions or causing side effects

If your medicine isn’t in your insurer’s formulary (list of covered medicines), they’ll deny coverage for it. 

If this happens, you may apply for a formulary exception. A formulary exception is a request filed by your doctor with your insurer. It should explain: 

  • Why you can’t take the medicines on the formulary 
  • Why the requested medicine is medically necessary for your diagnosis 

Check your policy’s section on how to make a formulary exception request. Find out what you need to provide in your request, such as:

  • A letter of medical necessity from your doctor
  • Copies of medical journal articles that prove this medicine is medically necessary for your diagnosis (learn more about proof in the appeal arguments below)
  • Language from your policy saying that medically necessary medicine is covered 
Mid-year formulary changes

If your insurer changes their formulary in the middle of the plan year, your medicine may no longer be on the formulary. You may then have to ask for a formulary exception or file a formal appeal for your medicine. 

If you have a Medicare Part D plan, your insurer usually must continue covering your medicine for the remainder of the plan year (learn more at medicareinteractive.org). Some states have laws against mid-year formulary changes, but these only cover insurers that the state regulates.

What if I lose all my appeals?

Even if you think you’ve used up all your appeals, follow the advice in our section above about the book “APPROVED: Win Your Appeal in 5 Days.”

If you have insurance through an employer who self-insures, your employer uses an insurer to administer the claims, but the employer actually pays the claims. In this case, your employer may have some influence on the final claim decision. If you feel comfortable sharing your medical information with your employer, you can make a “compassionate appeal” to your Human Resources department or top executives, asking for their approval to cover the medicine or procedure.

Your state may have a Consumer Assistance Program through your State Department of Insurance. In addition, your state or federal elected officials may be able to investigate denials and potentially influence an appeal decision, particularly for federal insurance programs or insurance policies governed by the state department of insurance.

Consider changing to a new insurer at the next chance, either during annual enrollment or if you have a life event (such as a job change or marriage) that qualifies you to switch insurance plans outside of annual enrollment. Before you change:

  • Look at the insurer’s formulary to see if your medicine is covered.
  • If possible, choose an insurer that has covered your medicines in the past. This will give you a good argument for precedence (a prior example) if your coverage is denied.
  • Be careful when considering any health plan that doesn’t cover the 10 essential health benefits required to be a qualified health plan, as defined by the Affordable Care Act (ACA). These limited plans, often called “junk” plans, may not cover pre-existing conditions, or they may have other coverage limits, such as very low amounts they’ll pay per year or over the lifetime of the policy. Read more on Verywell Health’s web page “10 Essential Health Benefits Under the ACA.”

Published Feb. 26, 2021 |
Revised Jan. 30, 2024
Complete update Dec. 15, 2023