TALKING POINTS
Unreasonable private and medicaid insurance audits

are limiting access to mental health care

 

The problem: In recent years, insurers and CCOs have greatly increased the number of their audits of mental health claims and the size of required repayments from mental health providers.  These refunds, commonly referred to as “recoupments,” range from $5-10K up to $200K.  Mental health providers do not have the profit margins to be able to pay back those large amounts. Also, often mental health providers are so afraid of the damage done by audits that they choose not to do business with insurance companies at all.   At a time when Oregon is seeking to increase access to mental health care, these audits are having negative effects on access to care.  

 

•Oregon statute allows insurer and CCO audits to go back 30 months making the recoupments potentially very large. 

            - HB 2455 limits the amount of time an audit of mental health claims can go back to 12 months.  That will reduce the size of required recoupments. 

 

•It is difficult to avoid audits because even though documentation requirements vary with each carrier, insurers and CCOs are not required to provide written directions to providers to clearly explain how to successfully document services in order to pass audits.

            - HB 2455 will require each insurer or CCO to provide clear directions to each mental health provider submitting mental health claims, defining exactly what must be included in their documentation to avoid recoupment.  This will reduce the overall number of recoupments in audits. 

 

•The vast majority of required recoupments are based on simple clerical errors found in audits.

            - HB 2455 follows current statute for Pharmacists that disallows recoupments for simple clerical errors, and it can allow for providers to correct such errors.  

 

•Insurers and CCOs drive up the size of required recoupments by auditing only a small fraction of claims and then issuing large recoupment demands based on “statistical sampling” processes that extrapolate a guess at an overall error percentage, not an actual claims reviewed.       

            - HB 2455 will require auditors to examine each claim individually so that large                                         recoupments based on a few errors will be avoided.

 

•Insurers and CCOs often hire third party auditors who are paid a portion of the recoupments in an attempt to encourage them to find more errors, thus driving up the amount of recoupments.

            - HB 2455 will disallow insurers and CCOs from incentivizing large recoupments.

 

•Insurers and CCOs regularly drag out the audit process to one or more years, leaving providers under an incredible amount of stress as they are trying to serve their clients, and deeply fearful about the continuation of their businesses for an unreasonable length of time.  If the required recoupment is large, providers have to hire attorneys to challenge the results of the audit which further extends the process and is very expensive.    

-  HB 2455 will require audits to be completed within 6 months.     

 

•When providers initiate care with clients, in the process of preauthorization, the insurer or CCO can require the provider to demonstrate there is medical necessity for the treatment to continue.  After appropriate documentation is submitted by the provider, the insurer or CCO approves that medical necessity determination, and the mental health care is allowed to continue.  However, during audits that medical necessity determination can be retroactively denied months or years later, and the entire length of service to that client can be rejected. 

            -HB 2455 would not allow insurers or CCOs to reject a determination of medical                                       necessity once it has been agreed upon, and it would require that all auditors of  mental health claims must be trained as mental health professionals. 

 

•Access to mental health care is suffering because of the unjust and threatening audit process, because each year more providers will go out of business, avoid working with certain insurers/CCOs, avoid going into private practice, or simply leave Oregon to practice elsewhere.  Oregon needs more mental health providers to be available to provide care, not less. 

            - HB 2455 will make the audit process more transparent, just, and rare which will make providers more willing to stay on provider panels and to remain in practice in Oregon to provide care to our most vulnerable citizens.