Unreasonable private and medicaid insurance audits

are limiting access to mental health care

 

The Problem:

At a time when the Legislature is trying to increase access to mental health care, insurers and CCOs are threatening that effort with increased audits and unreasonable demands for refunds of mental health claims payments based on unclear rules, simple clerical errors and statistical sampling. Oregon providers are reporting demanded refunds ranging from $10,000 to $200,000. Mental health providers do not have the profit margins to be able to refund those amounts. Many will go out of business while others report refusing to work with insurance companies to avoid abusive audits. Access to mental health care for vulnerable Oregonians is suffering.

 

Audits Can Be Reasonable:

32 States have statutes that put limits on how far back insurers can audit health claims. The most common limit is 12 months. Oregon Statute allows audits to go back 30 months. HB 2455 will set that limit for mental health claims at 12 months. That will help reduce the size of demanded refunds.   

 

Audit Triggers Can Be Transparent:

Currently insurers/CCOs all have different requirements for their mental health claims.  They do not clearly define those requirements for providers. We have to guess, and often we guess wrong and then face a large demanded refund. HB 2455 will require each insurer and CCO to provide a clear statement to mental health providers that defines exactly what information that particular carrier requires so providers can fulfill requirements before they are audited. This will reduce the overall number of repayment demands. 

 

No Punishment for Simple Errors: 

HB 2455 will follow the lead of the Pharmacy statute and disallow recoupments based on simple clerical errors and it will give mental health providers an opportunity to fix any simple errors without a refund demand.   

 

Audits Can Be Just:

HB 2455 will stop the unjust practice of insurers/CCOs auditing only a small number of mental health claims in a time period and then applying a percentage across all claims during that time period - resulting in demands for large recoupments for claims that were not included in the documents they reviewed. This drives up the size of refunds to astronomical amounts.  With HB 2455 insurers/CCOs will only be able to demand refunds for claims they actually examined, which will reduce the size of refunds.

 

Auditors Should Not Be Incentivized to Increase the Size of Demanded Refunds: 

Insurers and CCOs often hire third party auditors who are paid a portion of any refunds they require, thus incentivizing auditors to increase the overall size of refunds. HB 2455 prohibits that practice and thus will drive down the total amounts of refunds required of mental health providers.  

 

HB 2455 Will Not Stop Refunds for Fraud or Double Payments and Will Apply Only to Mental Health Claims:  

If an audit uncovers insurance fraud or double payments, insurers/CCOs will continue to be able to seek refunds as defined by current ORS.  Finally, HB 2455 will apply only to mental health claims, not all health claims.