Health insurance claim turned down? Complain to the Ombudsman

If your health insurance claim is turned down, you can complain to the Financial Ombudsman Service. Here are some examples of the cases it sees, and the final decisions it makes.

Health insurance is there to help you cover the costs of getting private medical treatment. But what happens when you make a claim and your insurer says no?

If you complain and your insurer refuses to budge, one option is to go to the Financial Ombudsman Service (FOS), which is responsible for adjudicating on financial complaints that have not been resolved satisfactorily.

The Financial Ombudsman Service has just published a series of case studies that demonstrate the sort of complaints it has to assess when it comes to health insurance policies and how it arrives at a decision.

Two of the main things it is asked to adjudicate on are whether a procedure is covered by a health insurance policy, and whether the policyholder’s condition meets the policy’s definition. While the FOS does not have in-house medical experts, it does consult doctors and relevant specialists to come to what it believes is a fair conclusion.

So let’s take a look at some of the claims it has received lately, and whether the complaint was upheld.

Second operation: a separate procedure?

Mrs B had a mastectomy after being diagnosed with breast cancer, undergoing breast reconstruction surgery a month later. The reconstruction was authorised and carried out under her health insurance policy.

Some months later, her surgeon wrote to the insurer, explaining he planned to carry out a follow-up reconstructive operation. This time the claim was rejected, with the insurer arguing the policy would cover “initial reconstructive surgery” only.

The FOS noted that in the surgeon’s initial letter to the insurer he pointed out that Mrs B would likely need more than one surgery to complete the procedure. This was in line with guidance from the National Institute for Health and Care Excellence (NICE), which explains that most women need anything up to four procedures for a complete reconstruction.

The FOS decided that the second operation was simply part of one reconstructive procedure so told the insurer to meet the claim, as well as pay £350 compensation for the upset and inconvenience caused.

Get a free health insurance quote

Unclear restrictions

Miss R fractured her back, leading to chronic pain and limited mobility, and meaning she was regularly seeing a consultant. When she fell pregnant years later, her consultant warned that, as the baby was big, a natural birth would aggravate the injury and worsen the pain, recommending an elective caesarean section.

The insurer refused to cover this, arguing that while a caesarean section was medically necessary, the health insurance policy only covered situations where the woman’s life was at risk.

In its response, the FOS looked carefully at the policy documents for pregnancy-related claims. Here’s what it said: “We may pay for eligible treatment for delivering a baby by caesarean section. However we need full clinical details from your consultant before we can give our decision.”

The FOS argued that the policy document didn’t reflect the cover available; it suggested the decision would be based on the consultant’s recommendations, but made no mention of a requirement that the mother’s life be in danger.

The insurer was instructed to re-assess her claim. The insurer also said it would be reviewing its policy documents to clarify the cover on offer.

Get a free health insurance quote

Pre-existing conditions

Mr K took out private medical insurance through a broker with Insurer C. He had a heart condition and diabetes and wanted the policy to cover both pre-existing conditions. Three months later he made a successful claim for treatment related to his diabetes.

As a result of that claim, when the policy came up for renewal Mr K was quoted much higher premiums. So the broker shopped around and they eventually settled on Insurer D.

Months later when Mr K phoned his insurer with a question, he was told his policy didn’t cover his heart condition or diabetes.

Mr K complained to his broker. The broker discovered that during the application process Mr K should have been asked “Have you ever had any cancer, heart or psychiatric conditions?” but was actually asked “Have you had any cancer, heart or psychiatric conditions in the past five years?’’

Mr K answered no because his heart condition had not been treated in the past five years. The broker accepted the mistake had led to an unsuitable recommendation, offering to arrange a different policy (which would cost more) and cover the extra expense for the first year.

Mr K refused, saying he felt the broker should refund all the money he’d paid towards the unsuitable policy.

The FOS sided with the broker, arguing that its mistake had not left him out of pocket and that the broker’s attempts to make things right (as well as an offer of £100 compensation) was reasonable.   

Getting it right

What these case studies clearly demonstrate is that when it comes to picking the right health insurance policy, a lot more than just price needs to be taken into account. You need to be confident that you understand exactly what the policy covers and does not cover.

That means reading the small print, boring as that may be. You can save yourself a lot of heartache later on if you do your research from the start.

It's also well worth reading The best private medical health insurance policies and providers.

That’s not to say you shouldn’t try to keep the costs as low as possible. For tips on how to get your health insurance as cheaply as you can, check out How to pay less for private medical insurance.

Get a free health insurance quote

More on private medical insurance:

The best private medical health insurance policies and providers

The best added perks of private medical insurance

How to pay less for private medical insurance

Is private medical insurance about to get cheaper?