Practice Management Alert

Answer: Depending on the circumstances, you may need to return the money. But you shouldn't give in right away. It's a good idea to develop and use a standard letter that informs the payer unless it's a government payer you do not return money paid in error.

From there, though, the payer may have one or many reasons why you must return the money in this case. There are three key pieces to this puzzle: your contract with the payer and your state's laws on insurance and contracts.

Start by knowing your contract with the payer and the laws in your state regarding mistaken payments.

If an employer has retroactively terminated its policy with an insurance company, a disclaimer in your contract may require you to return the reimbursement. You can then bill the patient for the services.

If a second request for a refund comes in, call your state medical society. It should help you find out which state laws are on your side. You may want to work with your lawyer to determine whether your participation agreement with the payer addresses this question directly.

Either your contract or state contract or insurance law will give a statute of limitations for such requests. In addition, your state may have a law that addresses mistaken payments. How much they protect you will vary according to the circumstances of each claim.

If the payer alleges your practice has misled it or has committed insurance fraud, then this refund request definitely needs the attention of an attorney. $ $ $