TUG OF WAR More and more payers are demanding refunds and givebacks from facilities.

It's hard enough to get your claims paid correctly. But to then receive a refund demand several months or even years after you submitted the initial claim presents a whole new challenge.

There is a way to fight back against medical record audit requests and refund demands from payers or their third-party contractors. Often, these attempts by insurers fail to meet various payer compliance requirements that help protect revenue rightfully earned for your services rendered in good faith. Compliance is a two-way street, and payers are not exempt from claim-handling obligations. If you're facing refund requests or notifications of recoupment, here's what you need to know.

A regulated process
Various state and federal laws protect healthcare providers and their 'entitled' revenue against inappropriate handling of Medicare and commercial claims by insurance companies. In other words, it's safe to assume that your facility shouldn't be receiving less than the reimbursements you expected to earn on the date you rendered those services to the patient.

A benefit denial is considered anything less than the contracted rate or clearly specified out-of-network benefit rate (for example, 60% or 70% of the total cost), taking into account any patient deductibles and reported co-insurance. A refund demand or recoupment is also considered a benefit denial. In fact, the No. 1 denial in recent years is the 'retroactive denial' that's then followed by a takeback demand by the payer.

Insurance companies tend to handsomely incentivize recovery departments and third-party auditors to find overpayments and issue refund demands. This is how it usually works: An insurer notifies the facility and other providers of an alleged claim review, or it sends a request to review numerous medical records. This is then followed with aggressive repayment demands using fabricated allegations, ambiguous adjudication errors and misleading insurance policies.

Regardless of whether the payer is contracted with your facility, there are explicit requirements that they must meet when it comes to denials and requests for recoupment. For example, when issuing a denial, payers must notify providers of their appeals rights, a requirement that often gets ignored. Paying close attention to the denial and recoupment process may help your facility catch these missed prerequisites, providing more opportunities to protect your revenue.

Check the validity of the denial
It's not uncommon for insurance companies to use creative, yet inappropriate, tactics to enhance their profit margins. Even though providers will sometimes dispute or appeal overpayment allegations, payers may continue to move forward with the process, ignoring their obligations and offsetting the disputed amount on future claims until the refund is granted.

To fight back, first evaluate the validity of a benefit denial or refund demand. If you can show that the insurer made the error that led to the alleged overpayment or if there was, in fact, no overpayment at all, you'll have more success during the appeal process. Never just assume a payer's findings and statements are accurate.

To judge the validity of the denial, start by asking a few questions about the refund demand and claim in question, including:

• Did the facility initially receive the entire payment for all services rendered, including for implants, splints and radiology?
• Were there any services or items that were underpaid or unpaid?
• If a service was unpaid due to an error, who made the initial error?
• Are the insurer's billing allegations factual?
• Do you suspect that the payer violated any compliance requirements, like appeals or other notification requirements, in issuing the refund demand or denial?

An invalid request?
If you find yourself suspecting that the refund request isn't valid, it's time to take action. You're required to refund overpayments only when there is clear evidence of 'unjust enrichment' of the claim or for services not rendered. Even if you've been overpaid, it's crucial to determine where the error stemmed from. If the insurer mistakenly paid the claim, don't take ownership of it. Appeal the refund request and gather previous documents and records to support your argument. It's also a good idea to demand the insurer show you proof backing up their claims.

Appealing refund requests can take a lot of time and energy, and the best way to enhance your chances of success is to ensure you and your staffers are properly trained on how to assess the validity of claim determinations. There are many resources available, including webinars and other related denial management training courses addressing advanced appeal rights and processes. No matter what action you take, don't just roll over when insurers come with recoupment requests — take a stand and protect the revenue you are entitled to receive. OSM