Handling Insurance Overpayments and Refunds

Insurance companies may request refunds for a variety of reasons. The correct workflow depends on why the refund is being requested,  whether the patient’s insurance coverage is still active and if the patient has an active contract.

Common reasons for insurance refund requests include:

• An insurance overpayment
• A claim that was processed incorrectly and must be resubmitted
• A carrier takeback documented on an Explanation of Benefits (EOB)
• A reduction or termination of insurance benefits
• Loss of insurance coverage during or after treatment

Review the scenarios below to determine the appropriate workflow.

Scenario 1: Insurance Overpayment or Claim Correction

Use this workflow when:

• Insurance paid more than they should have.
• A claim was paid incorrectly and must be corrected.
• Insurance requests reimbursement before a corrected claim can be resubmitted.
• The patient possibly reflects a credit in Expected Insurance.

Issue the Refund

1. Open the patient chart.
2. Select View > Patient Info or press Command-I.
3. Go to Action > Change Expected Insurance.
4. Select I want to Increase the Expected Insurance by and enter the refund amount.
5. Review the After Change column. The amount being refunded will move from Expected Insurance to the patient’s Due Now balance as a credit.
6. Click Change Expected Insurance.

Post the Refund

1. Go to Action > New Transaction or press Command-T.
2. In the Fee/Payment Type field, select [+] Account Adjustment.
3. Enter your Tops Ortho password.
4. Select Refund to Ins. Co. and click Use Selected Adjustment Type.
5. Enter the refund amount.
6. In the Notes field, enter the check number and any additional details.
7. Click Process Charges and Payments.

Final Steps

1. Adjust the patient’s Remaining Benefit amount if necessary.
2. Add an Insurance Ledger Note documenting:
   • Reason for the refund
   • Refund amount
   • Check number
   • Whether a corrected claim will be submitted
3. In this scenario, you are still expecting insurance to pay the amount at a later date.

Scenario 2: Insurance Takeback Listed on an EOB

Sometimes insurance companies recover funds through a takeback listed on an Explanation of Benefits (EOB). In many cases, the adjustment is not directly related to the patient whose EOB is being reviewed.

For instructions on handling insurance takebacks, refer to the article Manage Insurance Payments with Recouped Funds:  https://help.topsortho.com/article/255-manage-insurance-payments-with-recouped-funds

Scenario 3: Loss of Insurance and Insurance Overpayment - Patient responsible for balance.

The patient's contract is still active.  Adjust the insurance balance in the contract.

Use this workflow when:

• Insurance coverage has terminated or benefits have been reduced.
• Insurance requests a refund of previously paid benefits.
• The patient’s contract remains active.
• The patient will assume responsibility for the unpaid insurance amount.

Note: This process should not be combined with Scenario 1. You either update the contract or use Action>Change Expected Insurance, but not both.

Example

Mojo’s contract originally included $1,500 of expected insurance.

The insurance company later reduced the benefit to $1,000 and requested a refund of $500.

Before proceeding, confirm with the insurance company that the patient is responsible for the unpaid portion of treatment.

Update the Contract

1. Open the patient’s chart.
2. Go to the Contracts/Ledgers tab.
3. Double-click the active contract.
4. Add charges to the Copay column until the Calculated Insurance amount reflects the revised benefit amount.
5. Click Record Contract.

6. When prompted to update Expected Insurance, click Change and enter your password.

   

Expected Insurance should now reflect a credit equal to the refund amount.

Move the Credit to Due Now

1. Go to Action > Change Expected Insurance.
2. Select I want the Expected Insurance to be.
3. Leave the amount set to 0.00.
4. Review the After Change column to confirm the credit moves to Due Now.

5. Click Change Expected Insurance.

   

Issue the Refund

1. Go to Action > New Transaction or press Command-T.
2. Select [+] Account Adjustment.
3. Enter your password.
4. Choose Refund to Ins. Co.
5. Enter the refund amount.
6. Enter the check number and refund details in Notes.
7. Click Process Charges and Payments.

Final Steps

1. Add an Insurance Ledger Note documenting the loss of insurance and refund request.
2. Open the patient’s Employer Policy.
3. Uncheck Make Claims Automatically.
4. Remove the Next Claim Date.
5. Close any remaining open claims associated with the terminated policy.

Scenario 4: Loss of Insurance and Insurance Overpayment - Patient Responsible for Balance

The patient's contract is deactivated.  Use Action>Change Expected Insurance.

Use this workflow when:

• The patient’s contract is no longer active.
• Insurance coverage terminated after the contract charged out and deactivated.
• Insurance requests repayment of previously issued benefits.

Because the contract is inactive, the unpaid insurance amount must either be collected from the patient or adjusted according to office policy.

For detailed instructions, see Issue a Refund to Insurance - Deactivated Contract https://help.topsortho.com/article/254-issue-a-refund-to-insurance-deactivated-contract.