Billing Errors and Omissions and Audit Defense

Facilities participating in Medicare and Medicaid are subject to post-payment review by government contractors. A billing errors and omissions grant covers the cost of defending those reviews and, in some forms, the cost of responding to an overpayment determination. It does not cover the repayment of amounts genuinely not owed to you, and it does not cover intentional fraud.

The distinction that matters is between defense cost and repayment. Almost every form covers the former in some measure and almost none cover the latter, which is correct: an overpayment is money that was never yours. What operators underestimate is the defense cost itself, because these reviews are document-intensive, often extrapolate from a sample across a large claim universe, and run through a multi-level appeal process that can take years. Check the sublimit, check whether it covers pre-litigation audit response rather than only formal proceedings, and check how the exclusion for intentional conduct is worded, because a version that excludes at the point of allegation rather than final adjudication provides much less than it appears to.