Why credits pile up, and why it matters
Credits accumulate constantly: upfront estimates that adjudication came in under, copays taken after the deductible was met, double payments, insurance paying after the patient did. Left alone they become three problems. Your revenue is overstated. Unclaimed patient money eventually escheats to the state under unclaimed property law (NAUPA directory). And identified Medicare/Medicaid overpayments must be returned within 60 days (42 U.S.C. § 1320a-7k(d)) or they become False Claims Act exposure. The fix is a habit: monthly credit-balance report, worked to zero, with an owner.Decide the method
Reverse the original card payment when recent. Cleanest, no address needed. Check by mail for everything else. ACH only when you already have authorization and details.The check recipe
- Verify against the remittance first. A “credit” that’s a posting error becomes a clawback letter.
- Refund the payer of record, who isn’t always the patient (estates, divorced parents).
- Enclose a one-page explanation: the visit, what was collected, what insurance paid, the resulting credit. Unexplained checks go uncashed, which restarts the escheatment clock.
- Track clearance. Uncleared checks go back on the report.
Payer refunds are different
Payer overpayment demands often arrive as offsets against future remittances (PLB segments in the 835), not as letters expecting checks. Never refund a payer by check while it’s also recouping by offset; you’ll pay twice. Match every recoupment letter against remittance activity first. One more place reconciliation pays for itself.Lemma aside: refund checks go out from the Lemma dashboard: address, amount, attached explanation PDF, printed and mailed, logged automatically (docs).