This is the standard procedure of medical claim :
(this is for G.E and I'm not very sure is it applied to all, but should be no much different)

1)Unfortunate Happen
>>>>>>>>> PLEASE INFORM ANY INSURANCE AGENT IF POSSIBLE

2)Admission
>>>>>>>>>Here policy holder and specialist will sign Admission Guarantee Letter

3) Hospital will fax application to insurance company
>>>>>>>> Here where initial decision will be made!
*if standard case(known situation/accident caused/emergency condition), GL will be issued and claimt should be no problem
**if not standard(unknown situation/diagnosis/new medical card), we may get declined of GL
(doesn't mean claim decline, but will be confirmed again with medical/specialist report)
~hospital will let patient know if GL declined > they may ask for deposit/payment
~G.E will inform agent if GL declined

4) SMS will be sent to agent and policy holder if approved

During discharge
1) hospital send i)Final Bill,ii) Itemised Bill & reports,iii) Discharge GL Form for G.E

2)G.E will issue
i) discharged GL
ii) Excess amount to be collected from patient
iii) SMS for agent and policy holder

3) Hospital collect excess $ from policy holder to discharge

There are EXCLUSIONS section in every policy, we should aware.
Hospitalization primarily for investigatory puposes, diagnosis, Xray eamination, General Physical or medical examinations, NOT incidental to treatment or diagnosis of a COVERED Disability...........

There are always clauses, so please inform agent(that why i always tell my clients to have few agents), any agent, we may could help.
Some doctors are aware about clauses, some don't.
Hence communication between agent and doctors are VITAL.

For your case, you may appeal actually, ask doctors to write a letter about "reason of hospitalization" if possible.
State your condition before/during admission and possible causes of it.

ONE IMPORTANT MESSAGE
Insurance Company DID NOT earn extra a dime from NOT paying claims, they earn from investment.
But what insurance companies' responsibility is to WELL-Manage the medical pool fund.
Appointed-underwriters will do decision either approved or not, and they don't get commissions for not paying a claim.
***Not to offense this thread but I'd think a lot of consumers did misunderstanding about claims***