An Insurance Overpayment is any payment that a provider receives in excess of the amount payable for a service rendered.What Causes an Insurance Overpayment?
- Two insurance companies pay a primary due to a lack of coordination of benefits (COB).
- The provider bills incorrect or in excess of actual charges.
- Duplicate submission of the same claim resulting in a duplicate payment.
Once it is determined that your credit balance is due to an insurance overpayment, your refund process should be initiated. There are six steps to a complete refund process.
- Send a letter to the insurance company making them aware that an overpayment has been made in error. You should never send a refund to an insurance company without contacting them first. Each insurance company has a process of handling overpayments and refunds.
- Allow them at least thirty (30) days to respond to your letter. You should receive instructions on how the refund should be submitted and where to send it.
- Once you have received instructions on how to process the refund, make sure it is submitted with all required information to ensure proper credit.
- Some insures prefer to recoup from future remittances. Keep an eye out for when this happens so you can properly notate the accounts affected to reflect this transaction.
- If no response is received from the insurance company with thirty (30) days, contact them by phone to follow-up before taking further action.
- In the event the refund is due to Medicare or Medicaid the process may be different from other insurance carriers. Follow CMS guidelines for Medicare and check with the Medicaid office in your state for refund instructions.