Health Insurer "Closes the Case" on a $600,000 Refund Demand

A major health insurer audited a group health practice as to closed, previously paid claims (a “post-payment audit). Thereafter, the health insurance company demanded a refund from the doctors in the sum of over $600,000. The insurer said that they would claw back the money from future health plan claims payable to the doctors, as an offset, if the doctors did not pay the $600,000 in full. The doctors hired a health care law firm that corresponded with the insurer as to issues raised in the audit. The health insurance company refused to alter its demand after reviewing all of the letters from the health care law firm.

ERISA and the federal health plan Claims Regulations, however, govern most of the health plan claims in the country and there is a set of legal tools available to fight back against post payment audits. After learning about Quadrino Law Group’s use of ERISA, the group medical practice hired us to assert their ERISA legal rights concerning the audit, the clawback money demand, and the threat to offset future payments to the practice.

We sent extensive legal arguments and follow up correspondence informing the health insurance company that audits are unlawful under ERISA. They ultimately abandoned the demand for $600,000 from the doctors and informed us that they were “closing the case”.

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