Payor Recoupments - What Leverage Do You Have?
Are you experiencing payor recoupments or refund demands? Did you know that the Department of Insurance for your state actually has guidelines on how far back a payor can go to recoup a payment that they paid in error? Some payors call these "Adverse Benefit Determinations (ABD)." The good news is that you have some rights!
My first suggestion is to know what your state's guidelines are regarding payor recoupments/refund requests. Second, you should immediately reply back to all recoupment and/or refund requests in writing asking for an appeal and that the payor provides you with a complete explanation of how they determined the payment was made in error. Finally, make sure you research the payors recoupment process and follow their guidelines for appealing payment discrepancies. One such example is the Humana Payment Integrity Group. They have a process that allows providers to submit an online request for a review of how the claim was processed and paid and how they determined that a claim was overpaid. Other payors may have a similar process. and you should be familiar enough with your payors website and/or process to identify when it is beneficial to use this method of appeal.
If you receive a request from a payor that you are contracted with, review your contract for the time frame that you agreed to follow. Often you will see that the language in the contract merely refers to their 'current' policy which you may have to go dig for on their website. My recommendation to you is that you review this piece of each contract closely and challenge this section in your contract negotiations. We have seen payors update their policies and provide minimal notification via an online announcement, payor bulleting where it is buried, and/or no notification related to this modification at all if the language of the contract does not require pre-notification. We have never seen a payor reduce the length of time to allow for a recoupment period, only allow a longer recoupment period.
If the request comes from an out of network payor, use your state laws to your advantage. When payers don’t follow that provision it is considered an unfair payer practice, so you definitely want to challenge the payor and be sure you include your state Department of Insurance or the Department of Managed Health Care. If this doesn’t work, bring the ERISA regulations into the discussion. All payors must comply with the federal ERISA Regulations which allows you to request that the payor share their full investigative file on how they determined that you were overpaid and/or incorrectly paid. This includes their internal memos, policies, emails, etc. For this to work, you must make sure that you have an executed Assignment of Benefits from the patient/guarantor that references that the assignment authorizes you to "pursue claims against the payor" on their behalf. With this in place, you are then considered a "beneficiary" under the ERISA guidelines.
One thing to keep in mind is that if this is a payor that you would like to contract with, you may want to use this situation as a stepping stone to acquire an agreement on the recoupment amounts, look-back period, in addition to securing a potential contract.
Have any questions? Feel free to email me at firstname.lastname@example.org!