Getting a denial letter from your insurance company about mental health care is demoralising. It often arrives in dense, vague language at the worst possible moment — during a hospitalisation, while you're trying to get a new medication, or when a course of therapy is finally working. The good news: most denials can be appealed, and a meaningful share of appeals succeed. This guide walks you through the process for US health plans.
You have a federal right to appeal almost any denial of mental health care, and federal parity law gives you a strong argument that the denial standards must match those used for physical health.
Step 1: Read the denial letter carefully
The letter must tell you three things:
- The specific reason for the denial
- The clinical criteria the insurer used (often called "medical necessity criteria")
- Your appeal rights and deadlines
If any of those are missing or unclear, call the insurer and request the full denial documentation in writing. Under the ACA's claims and appeals rules, you are entitled to it.
Step 2: Note the deadlines
You typically have:
- 180 days to file an internal appeal with the insurer
- 4 months after the internal appeal decision to request external review
Urgent care appeals (where waiting could seriously jeopardise your health) must be decided within 72 hours. Hospitalisation and treatment for active psychosis usually qualify as urgent. Mark the relevant deadline on a calendar immediately.
Step 3: Get the medical records
Ask your prescriber and any treating clinicians for relevant chart notes, the treatment plan, and a "letter of medical necessity." A strong medical necessity letter explains:
- The diagnosis (with DSM-5-TR or ICD codes)
- What treatment is being requested and why
- What has been tried and failed (or the clinical reason it cannot be tried)
- The risks of not getting the requested care
- Citations to clinical guidelines (APA, NICE, NIMH)
Step 4: Use the parity argument
The Mental Health Parity and Addiction Equity Act (MHPAEA) requires that financial requirements and treatment limits for mental health care be no more restrictive than those applied to physical health care. If the insurer is using stricter criteria, requiring more prior authorisations, or denying more frequently for mental health than for comparable medical care, that may be a parity violation.
In your appeal letter, you can request the insurer's "comparative analysis" — federal law now requires insurers to maintain documentation showing that their non-quantitative treatment limits comply with parity. Asking for it sometimes prompts re-review.
Step 5: Write the appeal
A strong appeal includes:
- Member name, ID, and claim number
- The decision being appealed and the date
- A clear request: "I am appealing the denial and requesting that [specific service] be approved."
- The clinical case (or attached letter of medical necessity)
- A parity argument if relevant
- References to the insurer's own clinical criteria, if those criteria support coverage
- Deadline expectations and your contact information
Send by certified mail or insurer secure portal — keep proof of delivery.
Step 6: Use external review if internal appeal fails
If the insurer upholds the denial, you have the right to an independent external review by an Independent Review Organisation (IRO). The IRO is not affiliated with the insurer. Their decision is binding on the insurer. About 40-50% of external reviews overturn the original denial in some studies.
How to request external review depends on your plan type:
- State-regulated plans: your state insurance department handles it
- Self-funded employer plans: federal DOL through the Employee Benefits Security Administration
- Marketplace plans: healthcare.gov has the process
Step 7: Get help
You don't have to do this alone. Free help is available:
- NAMI HelpLine (1-800-950-NAMI) — coaching on appeals
- State health insurance assistance program (SHIP) for Medicare appeals
- State insurance commissioner — every state has a consumer assistance line
- Patient Advocate Foundation — free case management for insurance appeals
- Mental Health America — appeals templates and support
- Legal Aid — free legal help if you qualify financially
Common denial reasons and how to push back
"Not medically necessary"
Most common. Counter with a strong medical necessity letter, clinical guidelines (e.g., APA Schizophrenia Practice Guideline), and documentation of failed alternatives.
"Step therapy required" / "fail-first policy"
Insurer wants you to try cheaper drugs first. If the alternatives have already been tried, are contraindicated, or are clinically inferior, document it. Several states have step therapy override laws for mental health.
"Out of network"
If no in-network provider was reasonably available, request a "network gap exception" or "single case agreement." See our guide to finding in-network psychiatrists for documenting access problems.
"Care can be provided at a lower level"
Common with hospitalisations and partial hospital programs. Counter with safety risk documentation, prior failed step-downs, and clinical guidelines.
A short template opening
"Dear Appeals Department: I am writing to appeal the denial of [service] dated [date], reference number [X]. I disagree with the determination that [reason cited]. The enclosed letter from my treating psychiatrist documents medical necessity. I also note that the standards applied appear stricter than those used for comparable medical-surgical services and may not comply with the Mental Health Parity and Addiction Equity Act. I am requesting [specific outcome] and reserving my right to external review."
This article is for educational purposes only and is not medical advice, legal advice, or financial advice. Rules and benefit amounts change; verify current details with the relevant agency or a qualified professional. If you or someone you know is in crisis, call or text 988 in the US, or your local emergency number.