Retro-termination of Coverage

Retro-termination of coverage is a continuous problem for providers. These retro-terminations occur after the provider has verified coverage and provided services, expending valuable resources based on the promise of available benefits. Retro-terminations occur after the provider has already verified the patient was covered, rendered services in reliance and expectation of payment, and, often, even received payment. Retro-terminations do not “magically” erase coverage that was verified and confirmed and result in the provider bearing the loss; to the contrary, payers are responsible for representations relied upon prior to provision of services.

In the group health plan market, retro-terminations are a significant problem as payers or third party administrators (TPAs) cater to their employer-clients by promising the ability to retro-terminate a policy to an effective date several months earlier. Payers / TPAs allow employers to retro-terminate, even though they verified coverage and eligibility and/or authorized services for patients who will, in effect, no longer have coverage for services already provided. This practice results in payment denials and refund activity, which costs the providers valuable time, resources, and revenue.

TGF advocates for its provider-clients by arguing legal inequities that will result if denials occur due to retro-termination of coverage versus the right to retro-terminate coverage.

  • Payers verify benefits and coverage prior to a procedure only to later deny claims because a member’s benefits were retroactively terminated to a pre-service date
  • Providers are generally, and improperly, expected to bear losses created by payer misrepresentations
  • TGF works to ensure that providers who dutifully verify benefits and comply with all necessary formalities are not forced to bear losses based on payer errors