Insurance is a great way to protect yourself from financial loss in an accident or illness. It’s an investment that pays you back, but it’s not always as simple as that. The insurance sector is massive in the US. More than 7000 insurance companies collect approximately $1 trillion of collective premiums annually.
Sometimes, an insurance company will ask for reimbursement for money it has already paid out on your behalf. It can happen if you deliberately misled them about something related to your policy. For example, if you lied about having a pre-existing condition before signing up for health insurance.
Here are some situations where insurance companies might ask for some of their money back:
Denied Medical Claims
It is not uncommon for patients to feel frustrated by seeking insurance reimbursement when denied medical claims. According to KFF data in the US, around 18% of claims were denied in 2020. You can appeal the decision if you believe the claim was denied in error.
If you are seeking insurance reimbursement for your medical expenses, it’s important to make sure you have a solid understanding of what the process entails.
For an insurance company to pay for your medical care, they need a legal basis. In most cases, this means filing an official claim with the insurer and receiving approval before any reimbursement is made.
If your medical claim is denied, you can take a few steps to get it approved.
- First, ensure you’ve sent all the information requested by the insurance company. If they need more information from you, they will let you know.
- Next, if it’s been a long time since you’ve heard from them about the claim and you still haven’t heard anything, call them back and ask for an update on the status of your claim. This can help get the ball rolling if there is some delay or miscommunication between you and them.
- Finally, if none of these options work for you, seek legal advice about whether or not your case merits further action, like filing a lawsuit.
Duplicate Medical Claims
You may have heard about insurance companies asking for money back from the provider. Maybe you’ve even received a letter from your insurer asking for a refund on medical claims you submitted. Sometimes, an insurance company can ask for money back from the provider if they paid more than once for the same service or treatment.
It happens because sometimes providers charge different amounts to different patients. Sometimes it’s due to their health condition or other factors like age or income level. But if an insurance company pays twice for one procedure performed on one person, they’ll probably want their money returned to them. They can do this either through reimbursement or a refund.
Wrong Patient Medical Claim
Many times, an insurance provider sends a claim to the wrong patient. For example, it could happen when the wrong name is listed on their records, or you have been given another person’s information by accident. In either case, this would be considered an error, and your claim will likely be denied.
In some cases, however, it may be that there was no intention to defraud the system, and this was simply a mistake caused by human error. For example, if someone entered a wrong number into your file from their phone.
If you had no clue about any wrongdoing and made a sincere effort to correct mistakes after being notified, you have to reimburse the insurance company.
Another common reason why insurance claims are rejected involves patients being misidentified when they receive medical services. However unlikely this may seem, why would anyone confuse one company with another? It happens too often.
Not Covered Medical Claim
Insurance companies must pay for medical services that they, the patient, or a third party have authorized. However, not all medical procedures are covered by insurance plans. Some medical procedures are not considered medically necessary, and insurance providers don’t cover them. It may be because they aren’t considered safe or effective and thus don’t fit within reasonable standards of care.
Making it easy, if you’ve been paid for a medical service or procedure that is not covered under your plan, then you are liable for reimbursement to the insurance company.
Fraudulent Insurance Claims
Insurance fraud is the intentional act of receiving insurance payments by deceiving an insurer or violating laws while filing insurance claims. Such acts include exaggeration or misrepresentation of facts in support of a claim and deliberate concealment of pertinent facts about an event.
Fraudulent insurance claims are often made for personal injury and auto and property damage coverage. However, health claims also share a big part in fraudulent claims. According to a report by LegalJobs, approximately $3.1 million worth of fraudulent health claims were filed in 2020.
Inaccurate ICD Codes
Insurance companies use ICD codes to process claims and determine if they will pay your claim. Sometimes, the code will be wrong or not used correctly. It can result in a rejected claim, and you might have to pay for treatment out-of-pocket instead of getting reimbursed by your insurance provider.
In such cases, the insurance company may ask for a refund on their end as well. If an insurance provider asks for a refund because of ICD errors, explain that this is not what happened.
Provide documentation to support your explanation from the doctor’s office explaining why they coded it the way they did and why it was appropriate.
Overpaid Insurance Claims
Two insurance providers cover you, and you receive a reimbursement check from one. You might think you can keep the extra money, but don’t be so sure. Most insurers will ask for their money back when they find out that you had a second plan that covers part of your expenses.
The provider must return the overpayment to the patient within 30 days of finding out about it. In most cases, this would mean writing a check for the amount owed to their client or crediting their account directly. Don’t forget to send proof of payment via email or postal mail.
Reimbursements – Take Experts’ Advice to Counter it
You may not know that your health insurance provider can ask for money back. It is common when patients have been overcharged, but it can happen in other situations. The first step is finding out why the provider has made a refund request. Once you know the reason, the next step is responding correctly to it and deciding whether or not it’s worth fighting back on.
If you feel that your insurance claim has been denied due to a mistake on your part, it’s crucial to speak with an expert before taking further action. Insurance providers have strict rules regarding reimbursements and can request money back in some circumstances. If this may apply to your case, contact an expert as soon as possible.
