Appeals and Grievances

Appeals and grievances are the two formal channels members use to challenge a health plan's decisions or raise a complaint about service. An appeal disputes a coverage or payment decision; a grievance addresses quality or service concerns.

What Is Appeals and Grievances?

Appeals and grievances are the regulated processes health plans must offer members who disagree with a decision or experience a problem with care or service. An appeal challenges a specific decision, most often a denied claim, a denied prior authorization, or a coverage determination, and moves through defined internal review levels before an independent external review becomes available. A grievance addresses a different category of concern, typically about the quality of care received, wait times, network access, or how a member was treated by plan staff or providers, and does not involve a coverage decision. Medicare Advantage, Medicaid managed care, and ACA marketplace plans all operate under specific federal or state timelines for how quickly a plan must respond to each type of complaint. Because both channels generate data on where a plan's decisions or service are breaking down, appeals and grievances functions increasingly feed back into utilization management and provider network oversight rather than operating as a purely administrative back office.

Why It Matters

Appeals and grievances performance affects far more than the individual case in front of the plan. Overturn rates on appealed denials, when high, signal that upstream utilization management decisions are inconsistent or overly conservative, generating rework and member frustration that a stronger first-pass decision would have avoided. Because very few members file an appeal even when a denial would likely be overturned, most of the friction a poor decision creates never surfaces in appeal volume at all. It shows up instead in member satisfaction scores, disenrollment, and complaints to regulators. Our perspective on how agentic AI is being applied to payer prior authorization and appeals shows how plans are turning this data into faster, more consistent decisions. A well-run appeals and grievances function turns that pattern into an early warning system plans can act on before it becomes a compliance or retention problem.

Fewer than 1% of in-network claim denials in ACA marketplace plans are appealed by consumers, yet internal review overturns roughly 44% of the denials that are challenged, according to KFF's analysis of 2023 marketplace data.

How Appeals and Grievances Works

• Intake and classification: The plan determines whether a complaint is a coverage-related appeal or a service-related grievance, since each follows a different regulatory timeline.
• Internal review: A reviewer not involved in the original decision reassesses the case, often with input from a clinician for medical necessity disputes.
• Expedited pathways: Urgent cases involving immediate health risk move through a compressed timeline, sometimes as short as 72 hours.
• External review: If the internal appeal is denied, the member can request an independent review by a party outside the health plan.
• Trend analysis: Plans track overturn rates and grievance themes by provider, service line, and decision type to identify systemic issues.

Appeals vs. Grievances

Appeals and grievances are often used interchangeably, but they resolve different kinds of problems and follow different rules. An appeal always involves a coverage or payment decision, such as a denied prior authorization, a denied claim, or a reduction in a previously approved service, and it follows a structured multi-level review that can end in external review by an independent party. A grievance covers everything else a member might want to formally raise: a difficult interaction with staff, a long wait for an appointment, a network access problem, or dissatisfaction with the quality of care delivered. Grievances typically resolve faster because they do not require the same clinical or coverage analysis an appeal does, but they still carry regulatory reporting requirements and, particularly in Medicare Advantage, feed into plan performance measures. Getting the classification right at intake matters, since routing a coverage dispute through the grievance process, or vice versa, can create compliance exposure. Clear intake logic and well-trained staff keep each case on the right track from the start, which protects both the member's rights and the plan's standing with regulators.