Tennessee Medical Association Sues Recovery Contractor

HRI contends that its actions are not subject to contract terms and state laws prohibiting such late allegations of overpayment, or made directly by MBPE rather than BCBST. The TMA disagrees.

"HRI's actions were an attempt to circumvent state law and contracts involving BCBST, MBPE, and the physicians, which set forth how and when any questions regarding overpayment to network physicians are to be handled," DePersio says.

The lawsuit says that if BCBST did not have the authority to contract on behalf of MBPE, and MBPE can circumvent the terms of the BCBST/physician agreement, then discounts given to MBPE under that agreement should be refunded to physicians.

The lawsuit seeks an injunction and a declaratory judgment to stop the HRI tactics, and monetary damages for defamation and for expenses incurred by physicians accused of overbilling.

HRI operates in Tennessee, Kentucky, Georgia, and Texas, but TMA officials say they don't know if other state medical societies are taking similar actions against the contractor. While Tennessee state law limits retrospective overpayment recovery collections to 18 months, it is not clear if those statutes can apply to self-insured health plans, which usually fall under ERISA law.