Consumers groups applaud new insurance reforms

Consumers groups are cheering the arrival of new rules making it easier for patients to appeal health insurance denials. 

Ron Pollack, head of Families USA, a health consumer group, said the changes are “essential so that consumers are not improperly denied needed care or forced to spend unaffordable amounts for such care.”

“For many years, America’s consumers wanted the right to appeal adverse health plan decisions to an objective and unbiased decision-maker,” Pollack said in a statement. “With the new rules issued today, consumers throughout the nation, irrespective of the health plan they are in, will be empowered to contest wrongful decisions.”

The new guidelines — unveiled Thursday by leaders of the Labor and Health and Human Services departments — will create a national standard by which Americans can contest claims denials passed down by their health insurance companies. Although many states already have an appeals process in place, "there's no guarantee that this process will be swift or objective," Phyllis Borzi, an assistant secretary at the Labor Department, told reporters Thursday.

The program also provides $30 million in state grants to create new — or bolster existing — independent offices to oversee the appeals process. States can tap the grants to (1) help consumers enroll in health plans; (2) educate consumers about their appeal rights; (3) track complaints to pinpoint problem areas; and (4) help consumers lodge complaints or appeals.

Final decisions by the external review office are binding, Borzi said, and if a denial is overturned, the health plan will be responsible for the cost of review. 

Although the new rules won't apply to "grandfathered" insurance plans — those existing when healthcare reform became law in March — the administration estimates the program will benefit 41 million Americans next year and 88 million in 2013.

Nancy LeaMond, executive vice president of AARP, said the changes will help "anyone who has had to go it alone against an insurance company."

"Providing a standard external review process should bring more transparency and accountability to Americans across the country who may have been unfairly denied coverage by their insurers," LeaMond said in a statement.  

Thursday's announcement is the latest in a series of White House efforts to publicize each new benefit of the controversial reform law that comes along.

This post was updated at 3:45 p.m.