Q: “I don’t participate with insurance, but I got a check from an insurance plan, paying ME instead of my client who was seeking reimbursement. What should I do?”

A: You might be surprised how often insurance plans cut the check to the wrong party.  The problem is, there isn’t an easy or clear solution.  Clients may ask you to sign the check over to them, or may want you to cash the check and refund their money.

However, it is risky to cash any checks from the insurance plan and then credit the client (or sign the check over to them). The insurance company could become aware of their error and, at a later date, ask for repayment.  At that point, it isn’t easy to prove the actions you took with the check. Worse yet, the insurance plan may not care — they may only be interested in getting their money back, and may hound you for repayment. By this time, the client may have left therapy, or be unresponsive.

I know of one instance where the therapist got a check, cashed it, and paid the client, but then the therapist later got a second check for the same sessions from the insurance plan.  Since ethically a healthcare provider cannot keep an overpayment, she was obligated to try to repay the funds.  However, the client was uncooperative in helping the therapist to repay it.

In the past when I’ve received these checks, I’ve deposited them and squared things with the client.  However, I’ve now heard enough cautionary tales from other therapists who have gotten into messes with check like these that I changed my policies.

OK, then, so what SHOULD you do with the check you’ve received?  Don’t just return it to the plan with a note attached. It may not get to the proper department there and you might not be credited.  Since each plan has different policies, it is best to contact the plan directly, usually by phone.  I know, good luck getting a human on the phone, but do try.  They often will tell you that they need to issue a written overpayment request to you before you can return the funds.  In this way you would be asked to return the check or to write a check to them for the money you were paid.  Another option would be they may stay they will put a “stop-payment” on the check, and/or tell you to destroy it.

Remember to document carefully all detail about the check and all actions you took regarding it, including when you received it, when you called the plan, what phone number you called, who you spoke with from what department, what you were told to do, and ALWAYS, ALWAYS, ALWAYS get call confirmation numbers.

For more helpful articles on all things insurance, check out www.theinsurancemaze.com/articles