Can a medical insurance company ask for money back that they reimbursed to me from a supposed overpayment for a service?

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Can a medical insurance company ask for money back that they reimbursed to me from a supposed overpayment for a service?

I paid a bill with a hospital for a service. My insurance company sent me a $480 check (6 or more months later) saying they had made a mistake and I had overpaid. Now, a good 3 months after I’ve deposited and spent the money, they are saying they made another mistake and need that money back. Am I obligated to pay them back? I double checked with our HR department who double checked with the insurance company before I ever put it in the bank.

Asked on April 4, 2011 under Bankruptcy Law, Mississippi

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

Legally, if overpaid, you have no entitlement to that money: another person making a mistake does not give you the right to keep the money, any more than a business would have a right to keep your money if they mistakenly billed or charged you too much. The only real question is whether or not you were in fact overpaid; that is, did you receive more than you are entitled to under your insurance plan. That's a factual issue, and you can certainly challenge it if you believe (and presumably can show) that you were paid the correct amount. However, at the end of the day, if you were in fact overpaid, the insurer can seek return of whatever amount of money you were overpaid by.


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