Tennessee Medical Association sues collections company over takebacks

The Tennessee Medical Association (TMA) has filed suit against a collection company working to take back money from doctors, alleging that the company is acting fraudulently in how it targets providers. The lawsuit asks a state court to block the company, Health Research Insights, from trying to collect more money from doctors.

The TMA--plus two physicians who were billed for reimbursements paid in 2006 and 2007--are suing HRI, along with the Metropolitan Government of Nashville and Davidson County, TN, which runs a self-insured health plan. Under the terms of its contract with HRI, the municipality and county allowed HRI to keep 40 percent of anything it collected from physicians.

The suit arises from a gap in the law that gives self-insured employers much greater latitude than private health plans in auditing past payments. While most states set a statute of limitations on collecting alleged overpayments, self-insured plans are governed by federal ERISA law, which doesn't set a clear time limit on overpayment collections. 

The question at hand is whether there's any limit at all in how long ERISA-based employer plans have to re-collect alleged overpayments to physicians. If a court holds that there's no time limit, physicians could conceivably be hit by a blizzard of demands from companies like HRI, experts say. Doctors in Georgia, Kentucky and elsewhere have begun to get letters from HRI, so the case could have national implications, observers note.

To learn more about this case:
- read this American Medical News piece

Related Article:
Self-insured companies demanding payback of 'overpayments'