Home Health & Hospice Week

Question: We've discovered that a patient overpaid us on her copay. We collected $20 per visit, which was the last copay we had on record. It turns out that the patient's plan changed and her copay is now only $10 for a visit, however. Can we just credit her account or do we need to issue a refund?

Answer: You do need to issue a refund to the patient, but how you do that is up to the patient, experts say. As soon as you discover that a patient has overpaid you, you should notify the patient. You cannot hold onto the money indefinitely.

You can credit the patient's account, but only if the patient agrees to that. If the patient's care is continuing, you can suggest that you apply the overpayment as a credit toward the patient's future copayments.

If the patient doesn't want to apply it toward future visits, however, you must return the overpayment. You should offer two options:

• A credit on the patient's account that you will apply to future services.
• A refund of the overpayment.

Tip: For discharged patients, you may find it easier to just send the overpayment amount back to the patient with a letter explaining the situation, rather than notifying the patient and discussing repayment options.

Bottom line: You cannot and should not keep an overpayment -- from a patient or a payor. That practice may get you into big trouble. The agreement to return any overpayments is fundamental to a provider's eligibility to participate in the Medicare program.

Section 1866(a)(1)(C) of the Social Security Act (42 U.S.C. § 1395cc) requires participating providers to furnish information about payments made to them and to refund any monies incorrectly paid. The 2010 Patient Protection and Affordable Care Act creates new obligations under the False Claims Act whereby a Medicare provider who fails to report and refund an overpayment within 60 days may be subject to substantial damages and penalties (see Eli's HCW, Vol. XIX, No. 18, p. 137).