Major payors frequently audit their affiliated healthcare providers for what they consider to be overpayments on claims. Audits leading to these large overpayment demands typically involve a detailed review of submitted claims, supporting documentation, coding accuracy, and payment determinations. When inconsistencies or non-compliance are alleged, the payor’s Special Investigations Unit (“SIU”) will seek to claw back previously paid claims and may also require corrective actions in light of its alleged findings.
Upon receipt of an overpayment demand, it is essential to engage healthcare counsel to navigate regulatory complexities and assess the validity of the demand.
Mutual Walkaway
In a recent case, Frier Levitt achieved a highly favorable outcome for a practice by negotiating a mutual walkaway agreement that resulted in the complete reversal of an overpayment demand, which initially started at nearly six-figures.
This success was the product of a carefully crafted legal strategy developed by Frier Levitt attorneys, who identified a critical opportunity to leverage the client’s outstanding accounts receivable as a bargaining tool. Rather than allowing the matter to devolve into parallel disputes, one over the payor’s overpayment demand and another over the provider’s unpaid claims, the attorneys reframed the negotiation into a single, holistic discussion centered on financial and legal equity.
The matter had reached a stalemate following months of negotiation with the payor, particularly around the flawed data extrapolation methods used to justify the overpayment demand. Recognizing that traditional defenses were unlikely to break the impasse, the firm pivoted to a more creative and assertive strategy, namely, pairing the overpayment issue with the client’s outstanding receivables, which had long been tied up in separate billing disputes with the same payor. By initiating a conversation that considered the net value of both sides’ financial and legal positions, Frier Levitt secured a settlement that allowed the practice to proceed without having to admit to any finding of wrongdoing or repay any funds.
When coupled with the reduction obtained after appealing the original overpayment demand, this matter was resolved on favorable terms for the practice. This case highlights the firm’s commitment to strategic advocacy and its ability to deliver creative solutions.
Significant Reduction of a Commercial Payor Overpayment
While Managed Care Organizations (“MCO”) are typically inflexible and categorically unwilling to negotiate the dollar amounts associated with overpayment demands, commercial payors often present a very different landscape, one that allows for meaningful negotiation when approached strategically. Recognizing this key distinction, the firm’s attorneys crafted a comprehensive and assertive negotiation strategy tailored specifically to the commercial payor’s practices and risk posture.
Rather than accepting the initial demand, Frier Levitt conducted a thorough review of the payor’s audit methodology, challenged the underlying data assumptions, and presented compelling counterarguments supported by documentation and expert consultation. With the assistance of Certified Professional Coders, the firm’s team developed a strong appeal rebutting the findings of the commercial payor. Through persistent and focused advocacy, the attorneys were able to create significant leverage, ultimately securing a 60% reduction in the original overpayment demand.
This outcome not only resulted in substantial financial savings for the client but also avoided the costly and time-consuming litigation process. The case highlights the importance of working with counsel who understands the nuances of payor behavior and knows how to apply the right strategy at the right time to protect provider interests.
Audit Findings Should Be Challenged
Many healthcare providers mistakenly assume that once a payor issues an audit finding, the matter is resolved. However, payor audit findings are not final determinations. Payors may overlook critical documentation, misapply coverage standards, misinterpret policies, or rely on flawed sampling methodologies. With skilled legal representation, these findings can be effectively challenged and often reversed.
At Frier Levitt, we specialize in identifying errors, presenting well-supported arguments, and leveraging expert analysis to protect our clients from unjustified overpayment demands. We scrutinize every audit finding, ensuring that all aspects are thoroughly examined and errors are addressed.
How Frier Levitt Can Help
If your practice is facing an audit or overpayment demand, swift action is essential. The stakes are high, and timely intervention is crucial to protect your financial interests and professional reputation. Frier Levitt’s Audit Defense Team has extensive experience navigating complex payor audits and safeguarding practices from further scrutiny. We tailor our defense strategy to each case to achieve the best possible outcome for our clients.
Don’t let unjust audit findings jeopardize your practice’s financial future. Contact Frier Levitt to learn how we can help you challenge payor audits and protect your practice.
Frier Levitt provides strategic, industry-focused legal counsel tailored to your needs. Contact our team today to learn how we can help you.
