Payment Recoupment Protection
Medical associations say private health plan recoupment is an increasing source of complaints from physicians. It is important that providers be aware of the availability of insurance protection that responds when a physician or practice faces an audit followed by a demand for return of previous reimbursement payments emanating from CMS or a private insurer. The names identifying the insurance provisions vary ‑ Fraud & Abuse Coverage, Billing Errors and Omissions, Regulatory Affairs, Legal Defense and any number of other terms depending upon the source.
Many of the traditional indemnity insurance companies here in Massachusetts have developed an addendum to the Professional Liability insurance policy that includes a measure of protection or reimbursement of expenses incurred when defending allegations of Billing Fraud and the threat of “payment recoupment” or “clawback.”
- Report early – alert your insurance company or institution as soon as you have received the notice of an audit finding with payment demand, as the trigger for coverage is often subject to the date you are notified.
- Your insurance carrier or risk management office may be able to provide a list of attorneys and forensic specialists best suited to assist with your response. Be sure to inquire as to the level of legal fee reimbursement the policy will provide for your investigation and defense.
- If you don’t know whether you have coverage to respond to Fraud & Abuse allegations, find out by talking to a knowledgeable insurance broker or speak to the Claims or Risk Management representative at your institution.
- Membership in an ACO or similar healthcare group may require that you maintain insurance coverage for Fraud & Abuse or Privacy Breach at a high limit – check your contract language.
- If a practice is insured under a “captive insurance plan” associated with an institution, the presence of this coverage varies widely, but we note that some of the self-insured groups allow for a basic limit, where others have no identified coverage but may assist you or even require that they manage the claim through their own institutional coverage plan.
Some of the insurance carriers will allow you to increase the limit of liability, and practices with a need for higher limits due to their size or annual revenues may also purchase separate insurance policies from other carriers to supplement the basic coverage.