CHA News Article

Anthem Blue Cross Ordered to Stop Recouping Old Overpayments
DMHC states effort violates AB 1455 regulations

The California Department of Managed Health Care (DMHC) has issued a Cease and Desist Order requiring Anthem Blue Cross to stop its attempt to recoup overpayments to providers in violation of existing law commonly referred to as the “AB 1455 prompt and fair payment rules.”The order states that between 2008 and 2011, Anthem Blue Cross sent 548 letters to providers in an attempt to recoup overpayments that were more than one-year old without establishing fraud or misrepresentation and without clearly identifying claim details.

In a July 16 press release, DMHC stated that the order applies to “millions in reimbursement.” According to the order, Anthem Blue Cross asserted that 13 providers billed for services they did not provide and the remaining 535 recoupment requests stated that providers improperly coded the claims by upcoding, unbundling or miscoding. In these 535 cases, DMHC found that Anthem Blue Cross explained its review method and the coding pattern being investigated, but did not assert or demonstrate the overpayments were caused by fraud or misrepresentation. California Code of Regulations (C.F.R.), title 28, Section 1300.71(b)(5), establishes a 365-day deadline for a plan to recoup overpayments to providers unless there was fraud or misrepresentation.

In addition, DMHC found that in all 548 recoupment requests, Anthem Blue Cross only listed a specific total dollar amount for which the plan sought reimbursement and invited providers to contact the plan for additional information or negotiation. None of the 548 letters clearly identified the claim, name of the patient or date of service for which recoupment was sought as required by C.F.R., title 28, Section 1300.71(d)(3). DMHC said that providers should not face unexpected demands for reimbursement of medical claims they believe were appropriately paid years ago. The DMHC press release and order are linked below.