We’ve all heard the horror stories of insurance companies withholding funds, not paying in a timely manner, etc. But, what happens when an insurance panel says “Oops, we paid you when we should not have, and we want our money back?”
This is called a recoupment. A recoupment is a request for a refund when a payer has issued an overpayment of funds.
There are a few reasons that a recoupment may occur:
• The patient has another insurance plan that should be billed as primary
• A duplicate payment for the same claim/service date/service code
• The claim was paid when the patient was not eligible for services (e.g. after termination of coverage)
• The wrong provider was paid
Most of the time I hear providers grumbling about a recoupment happening to them I notice that they seem to accept the decision for funds to be withdrawn or withheld (from future payments).
There are a few options you want to consider if you find yourself in this situation:
You can apply for a hold on the recoupment for investigation. This is not merely a stalling tactic but time for due diligence to occur. You want to ensure that the recoupment is indeed valid. Insurance companies, like anyone else, makes mistakes. Many insurance companies will allow for 60 days for a recoupment related investigation.
You want to explore the following during your investigation:
First and foremost, ask for documentation from the insurance company of what the reason for recoupment is, the patient account (s) involved, dates of service and procedure code.
Second, you want to reference your contract to identify if the recoupment request is within the guidelines identified in the contract terms.
Third, you also want to check with the insurance commissioner for your state to determine the state laws and regulations regarding recoupments. Some states have stricter timelines that limit the amount of time an insurance company can recoup funds. The state law, generally, trumps the contract terms.
Fourth, identify who breached the contract terms. If the client/employer breached the contract, I typically make the case with the insurance company that the client/employer is liable for the recoupment since you honored your terms of agreement and provided services in good faith.
Fifth, if the recoupment is triggered because the client has insurance under another plan and the refilling deadline hasn’t passed then you should resubmit those claims to that plan and attempt to be paid from the correct plan and make arrangements with the company requesting the recoupment.
**Don’t assume the recoupment is valid. Know your rights as the provider. **
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