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How Do Self-Insured Health Insurance Claims Work in Texas?

A self-insured health insurance claim in Texas is an application for a benefit made by a claimant or their authorized representative in accordance with the plan’s procedure. The claimant may be a participant or a beneficiary of the plan. Before filing a claim, you should review the Summary Plan Description (SPD) and Summary of Benefits and Coverage (SBC) of your self-insured health plan. They provide the following information:

  • How the plan works
  • The benefits that the plan provides
  • How to file a claim for plan benefits
  • Limitations, exclusions, or restrictions (whichever applies)
  • Your rights and responsibilities under the Employee Retirement Income Security Act (ERISA) and your plan

Reviewing your SPD and SBC will help you know if you meet the plan’s requirements and provide you with the steps to take when filing a claim. You can contact your employer or plan administrator for a copy of your SPD, SBC, or claims procedure. A licensed insurance agent in Texas can be helpful if you need help with reviewing your SPD and SBC. Ensure you keep copies of your claims request.

Unlike fully-insured health plans, self-insured health plans are not regulated at the state level. It is the U.S. Department of Labor that regulates self-funded plans. Thus, if you have complaints about your self-funded plan, you can file them with the Department of Labor’s Employee Benefits Security Administration (EBSA) online. You also can contact their Dallas Regional Office at:

525 South Griffin Street
Room 900
Dallas, TX 75202
(972) 850-4500

How Do I File a Claim for Self-Insured Health Insurance in Texas?

There are three types of claims in self-insured health insurance:

  1. Urgent care claim: It is a unique pre-service claim that requires a faster determination since your health would be jeopardized if the plan took the standard amount of time to decide on a pre-service claim. A pre-service claim must be treated as an urgent care claim if a physician with knowledge of your medical condition advises the plan that it is urgent.
  2. Pre-service claim: It is a request for approval required before medical care. For example, pre-authorizing or determining whether a treatment or procedure is medically essential.
  3. Post-service claim: It comprises all other claims for benefits under your plan, such as requests for reimbursement or payment for services supplied and claims made after medical services have been provided. Most claims for health benefits are post-service claims.

Before you report a loss or make a claim, check your SPD and SBC to ensure that you qualify to receive the benefits you want to claim. These documents will provide you with all the information you need to make a claim. They will provide you with the requirements for filing a claim, such as what and where to file, and who to contact if there are issues with your plan. Keep copies of documents that you send during the claims process. You might also want to send the letter certified mail with the requested return receipt so that you can track who receives it.

Common claim reporting practice of self-insured plans require you to complete a claim form and provide information regarding:

  • The policy owner
  • Their health insurance ID number
  • The person who received treatment or service (if it is not the policy owner)
  • The treatment or service received
  • Receipts or documents that serve as proof of the treatment or service and its cost

Your plan may stipulate certain rules in your SPD or SBC. For example, it may stipulate that you must wait a specific amount of time before enrolling and receiving benefits or that a dependent is not covered after a certain age. If an authorized representative is filing your claim, your plan may ask you to fill out a form naming the representative. According to the SPD, the authorized representative must follow the plan’s claims procedure. In the event of an urgent care claim, your treating physician can act as your authorized representative without you having to fill out a form. After filing it, you should keep a copy of your claim for your records. Know that most plans are prohibited from charging fees for filing claims and appeals.

Is a Claim a Bill in Self-Insured Health Insurance in Texas?

Yes, a claim is a bill in Texas. A health insurance claim is a bill for settlement or reimbursement submitted by you or your health provider to your plan for the medical services or items you received. Usually, your healthcare provider files the claim to your plan on your behalf, especially when you receive services within your plan’s network. However, if you received services outside your plan’s network or your healthcare provider fails to file a claim on your behalf, you may have to file it yourself. Your plan uses the information provided in your claim to pay your provider for the service or reimburse you for covering it out of pocket. Insurance claims are addressed following your policy.

You get a report from your plan provider called an Explanation of Benefits (EOB) periodically. It could be monthly or quarterly. EOBs are not bills. They are reports that inform you about the services you received, what part of its costs was covered, what you have to pay for, and any other related information. You should review your EOBs to ensure that your claims are correctly filed and processed.

How Much of the Provider’s Bill Does Self-Insured Insurance Cover?

Once you or your healthcare provider submits a claim to your plan provider in Texas, your plan reviews and investigates the claim. If your claim is approved, your plan pays its parts and sends you a letter with an Explanation of Benefits (EOB) in the mail. It is a statement from your plan that provides information on payment for a medical service you got. It details the part that will be covered by your plan and the portion you will be in charge of settling.

If your provider sends you a bill, double-check the services listed on the bill. Check to determine whether this bill has already been paid if you recently got an EOB. If not, contact your plan administrator or the Human Resources department of your company for help with the bill.

Participating or in-network providers may bill you solely for treatments not covered by your coverage or collect your deductible, coinsurance, or co-pay.

Non-participating or out-of-network providers may charge you for the difference in their fee and your plan’s coverage.

To fully comprehend how the self-insured health insurance bill is funded, we must first comprehend all the costs that may be involved:

Deductible, Co-pay, and Coinsurance on a Self-Insured Health Insurance Bill

The deductible is the amount of the covered service that the insured must pay out-of-pocket each year before the plan pays the primary benefit. In Texas, self-insured health plan deductibles usually range from $1,000 to $4,000.

A co-pay is a certain sum of money that you must pay before obtaining some covered treatments. The co-pay typically applies to doctor’s visits, specialists’ appointments, and medications. Co-pays range from $20 to $100 and are usually not considered part of your yearly deductible.

After your plan pays the provider, your coinsurance is the portion of the invoiced expenses you are responsible for paying. Your policy determines the cost-sharing.

Deductibles, co-pays, and coinsurance are calculated towards the yearly maximum out-of-pocket (MOOP) cost. In addition to the monthly premiums, the MOOP is your maximum yearly exposure for health insurance.

Coordination of Benefits in Self-Insured Health Insurance

Coordination of benefits arises when you have two or more active health coverages simultaneously. When you file a claim, coordination of benefits is used to determine the primary coverage that will pay for the service first. Then, the secondary coverage will cover the remaining expense, minimizing your out-of-pocket payments.

How Long Do I Have to File a Self-Insured Health Insurance Claim in Texas?

In Texas, plans usually expect you to file a claim within 90 days after the day you received the service. For appeals, you have at least 180 days to file an appeal. You can check your SPD, SBC, or plan’s claims procedure to determine if your plan offers a longer time.

If you have an old bill from a provider that was not filed on time for some reason, your plan administrator will assist you, provided that the claim is genuine and for services covered under your plan when it was still in effect.

However, most plans draw the threshold at a year and a half after the covered service is rendered. If you file the forgotten claim after 18 months, your plan’s administrator may deny it. Make sure to check your SPD and SBC for details on your plan’s deadlines.

What Happens After I File a Claim With My Self-Insured Health Insurance?

You wait for the decision on your claim. In Texas, the wait time depends on the type of claim.

  • Decisions on urgent care claims are communicated within 72 hours after the claim is received.
  • Decisions on pre-service claims are communicated within a reasonable period, usually not more than 15 days after the claim is received.
  • Decisions on post-service claims are communicated within a reasonable period, usually not more than 30 days after the claim is received.

During the waiting period, your plan’s administrator will review the information you provided in line with the terms of the plan. The decision may either be an approval or denial of your claim. An approval means that you will be settled or reimbursed according to the terms of the plan and your claim. A denial means that your claim is not approved. The reason for the denial will be provided through a notice in writing or electronically. It will include the following:

  • The particular reason(s) for denial;
  • A mention of any plan provisions that were used to justify the denial;
  • If your application is declined due to a lack of information, it will include a description of any further materials required and an explanation of why they are required;
  • An explanation of the plan’s review process, for instance, how appeals operate and how you can file an appeal;
  • If your claim was refused due to rules, guidelines, or protocols, either a description of the rules, guidelines, or protocols cited in denial, or a declaration that a free copy of such materials will be provided upon request;
  • If your claim is refused on the grounds of medical necessity, experimental procedure, or any similar exclusion, you will be given an explanation for the reason for the denial based on the terms of the plan and your medical circumstances;
  • An explanation of your right to initiate legal action to recover benefits due to you under the plan.

You can appeal the denial by following the instructions in your SPD and SBC or the written communication of the decision. The reason for the denial should be the grounds of your appeal.

How Do Self-Insured Health Insurance Companies Pay Out Claims in Texas?

In Texas, the plan administrator or your employer determines how your self-insured health claim will be paid out. It may be in cashless benefits, reimbursements, or bonuses. Cashless benefits allow you to receive extra benefits from your plan without requiring you to pay any additional sum. Reimbursement is when your plan repays you the amount you paid for the service as agreed in your policy. Furthermore, employers can pay out claims by giving employees under the business’ self-insured plan bonuses.

Can a Self-Insured Health Insurance Company Refuse to Pay a Claim and What Can I Do About it?

Yes. Your self-insured health insurance company can reject your self-insured health insurance claim in Texas. When this happens, your plan’s administrator will provide you with the reason for the decision. You can use this reason as grounds for appealing your denied claim. The timeframe for your appeal will be stipulated in your SPD, SBC, or plan’s claims procedure. Usually, you should have at least 180 days to file the appeal.

Prepare your appeal by using the information in your claim denial notice. You can request copies of documents, records, and any other material information related to your claim from your plan’s administrator. Make sure to include all relevant information about your claim in your appeal, especially any extra information or proof you want the plan to consider, and send it to the person listed in the denial notice before the 180-day deadline expires.

When your appeal has been submitted, your plan’s administrator will have a fresh person look at your information. The person will also consult medical professionals if a medical judgment is involved. The reviewer must not be the same individual who made the initial or the person’s subordinate. The reviewer must also not consider the initial decision.

The length of time it takes for your plan to examine your appeal depends on the type of claim you made.

Urgent care It is reviewed within 72 hours after your claim is received, considering your medical needs.
Pre-service It should be reviewed within a reasonable time, usually not more than 30 days after your appeal is received.
Post-service It should be reviewed within a reasonable time, usually not more than 60 days after your appeal is received.

Your plan may extend the timeline for reviewing your appeal, but they must get your consent first. These time limits are subject to two exceptions:

  • Single-employer collectively bargained plans may utilize a collectively bargained grievance procedure for their claims appeal process if it includes procedures on filing, determination, and review of benefit claims.
  • Multiemployer collectively negotiated plans have specific timelines that allow them to schedule post-service claim appeal reviews during their regular quarterly board of trustee meetings.

If you are a member of one of these plans and have questions concerning its procedures, examine your plan’s SPD and collective bargaining agreement, or call the Employee Benefits Security Administration (EBSA) at (866) 444-3272 of the Department of Labor.

Some plans may require two levels of review for a denied health claim before the claim is concluded. To complete the claims process, plans can need two layers of review of a denied health claim. In such instances, the maximum time allowed for each review is usually half of the maximum time allowed for one review. For example, a self-insured health plan with one appeal level must consider a pre-service claim within a reasonable time frame suitable to the medical circumstances but no later than 30 days after receiving your appeal. If the plan involves two appeals for pre-service claims, each review level must be completed within 15 days. If your appeal is denied after the first review, the plan must give you a reasonable amount of time (not more than 180 days) to submit for a second review.

The plan must offer you a written explanation of its decision after it has reached a final determination on your claim. It must include the following information:

  • The particular reason(s) for the denial of your appeal;
  • A citation of the provisions of the plan that were used to make the decision;
  • A description of any optional claim-resolution mechanisms offered by the plan;
  • An explanation of your right to get documents related to your benefit claim for free. This includes documents and records relied on to make the decision and other documents generated or utilized throughout the process, and
  • A description of your legal options for challenging the plan’s decision in court.

If you are not satisfied with your plan’s decision and feel they did not follow a claims system compliant with ERISA’s standards, you can do any of two things. You can make a complaint with the EBSA online or contact their Dallas Regional Office in Texas at:

525 South Griffin Street
Room 900
Dallas, TX 75202
(972) 850-4500

Alternatively, you can get legal counsel regarding your rights and the option to go to court.

Why Do Self-Insured Health Insurance Companies Deny Insurance Claims?

Self-insured health claims in Texas may be denied for various reasons, such as:

  • Ineligibility for benefits.
  • The plan does not cover the service.
  • Because inadequate information about the claim was provided.
  • Receiving “not medically necessary,” “experimental,” or “investigative” services or treatments.
  • Getting services or supplies from out-of-network providers or institutions.

What are the Top Reasons a Claim Might Be Denied for Payment in Texas?

Self-insured health claims are usually denied in Texas because the treatment, service, or supply received is not medically necessary or not covered by the plan. Another reason may be that you have reached the maximum amount of treatment permitted under the plan. If any of these form the basis for a denial, an explanation, applying the terms of the plan and your medical circumstances, will be provided.

How Much Does Self-Insured Health Insurance Pay Out?

There is no set fee or amount that your employer or plan’s administrator pays out for claims in Texas. The employer does not set the cap because it normally carries an additional type of policy, which covers the business from losses during the times when the employees have a spike in claims, or overall costs.

What if My Insurance isn’t Paying Enough for My Claim?

If you believe that your self-insured plan is not paying enough, you can talk to an attorney about filing a legal action. Be ready to provide as much relevant information and proof to help establish your case.

You can also make a complaint about your self-funded plan to the EBSA online or visit their Dallas Regional Office in Texas at:

525 South Griffin Street
Room 900
Dallas, TX 75202
(972) 850-4500

How Long Can a Self-Insured Health Insurance Company Investigate a Claim in Texas?

It depends on the type of claim. Generally, claims are processed, investigated, and settled between three to 30 days in Texas. If there are any problems or issues with the claim, the process can take significantly longer. For example, if your plan administrator requires more information or evidence about the service you got, they may request that you send the information, making the review process longer. If you do not include some crucial information, it might take longer because the claim will need to be updated or amended. Sometimes, your plan administrator may have to check with the healthcare professional who treated you directly.

The tables below provide information on the deadlines for reviewing claims and appeals.

Urgent care It is reviewed within 72 hours after your claim is received considering your medical needs
Pre-service It is reviewed within a reasonable time, usually not more than 15 days after receiving your claim.
Post-service It is reviewed within a reasonable time, usually not more than 30 days after receiving your claim.
Urgent care Noting your medical needs, it is reviewed within 72 hours after your appeal is received.
Pre-service It is reviewed within a reasonable time, usually not more than 30 days after receiving your appeal.
Post-service It is reviewed within a reasonable time, usually not more than 60 days after receiving your appeal.

How Can I Check the Status of My Self-Insured Insurance Claim?

You can check the status of your claim by contacting your plan administrator or the Human Resources Department of your workplace.

Do I Need to Tell My Self-Insured Insurance Plan if I Received a Service From an Out-of-Network Provider?

Yes, because you will almost certainly have to pay for the service at that time. You can inquire with your plan administrator about the likelihood of reimbursement. You can discuss the types of things you should tell your plan administrator with a licensed insurance agent in Texas.

Do I Need to Tell My Self-Insured Plan if I am Diagnosed with an Illness That My Coverage Excludes?

Yes. Although your self-insured plan in Texas may provide you with comprehensive (ACA-compliant) coverage, you should contact your plan administrator if you are not certain about what your plan excludes. It helps clarify the terms and coverage of your plan. This will also help guide you in making health-related decisions. If you know that your policy does not cover the treatment or service, you do not need to contact your plan administrator.

When Not to File a Self-Insured Health Insurance Claim?

When it comes to insurance claims, you should know your insurance policy well because typically, you should not file a claim for services that are excluded from or not covered under your plan. Although your self-insured health plan is tailored towards most of your health needs, there may still be certain benefits it will exclude. For example, most plans exclude long-term care. In situations where you know your plan does not cover the service, you should not file a claim. Also, you should not file claims for medically necessary or experimental services.

Your claims history does not affect your insurance prices in Texas, unlike other forms of insurance. However, remember that your employer is sponsoring and administering the plan. So it would be best if you considered covering small out-of-pocket expenses, like low-priced prescription medication, to help them prepare for the important health costs.