One of the major health insurers suddenly stopped paying claims and demanded reimbursement. What can we do?

Review the payer’s procedures for billing disputes, identify the basis for the denials, and develop an appropriate response.
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First, it is important to understand the payer’s processes and procedures for billing disputes. There may be deadlines that need to be met. Also, is the basis for the denial (or demand for reimbursement) clear? If not, clarification will be necessary. If the insurer refuses to clarify, then such refusal should be adequately documented.

The provider will need to determine which reimbursement policies apply to the disputed claims. This may involve combing through a large number of the insurer’s policies and coverage guidelines.

In some states, healthcare providers may also be protected under the Employee Retirement Income Security Act of 1974 (“ERISA”), which requires reasonable procedures and notice of benefit determinations. The insurers’ failure to follow ERISA requirements may be a full or partial defense to a demand for reimbursement.

Usually, resolving the dispute involves a “letter writing campaign,” where the provider and insurer exchange correspondence for a period of time. Sometimes, direct communications with the insurer’s claims handlers may be part of the process, while some insurers may involve their legal department if the dispute is significant.

If the written and verbal communications fail to resolve the dispute, a provider may need to be ready to exercise their legal remedies through litigation or arbitration. Of course, legal action is usually a last resort.