Bill reducing the time health insurers have to recoup overpayments from providers signed into law

By Samantha Wildow / July 13, 2026

Gov. Mike DeWine signed into law a bill that reduces the amount of time that health insurers have to get funds back from healthcare providers when a health insurer finds it overpaid a provider for services.

Previously, health insurers had up to two years to deny payment retroactively, also called a takeback, and recoup payments they had previously made to healthcare providers.

Senate Bill 162 reduces that timeframe to one year for insurers to audit and takeback paid claims while also extending the appeal period for providers from 30 days to 60 days.

The change is meant to provide healthcare providers with more stability when it comes to planning their budgets, according to state Sen. Louis Blessing III, R-Colerain Twp., primary sponsor of the bill. The possibility of having to pay back an insurer for a claim more than a year old could be disruption in balancing their practices’ finances.

“This legislation strikes an important balance, shielding providers from perpetual financial uncertainty while also preserving the ability of health insurance companies to rectify genuine overpayments in a timely and transparent manner,” Blessing said in a statement. “By giving confidence to providers and retaining the ability for payers to correct errors, this legislation increases stability, fairness, and accountability in the industry.”

What can lead to a takeback?

Takebacks can happen when a health insurer finds it overpaid a provider, typically through an audit, for a variety of reasons. The insurer could have paid the provider twice for the same claim, or the takeback could be due to coding errors, administrative issues, coordination of benefits mistakes, or the patient’s coverage expired prior to when the service was provided.

Dayton-based health insurer CareSource gained attention for a number of takebacks it tried to conduct earlier this year before deciding to reverse course and no longer seek repayments.

In late April, certain behavioral and mental healthcare providers in Ohio received notices from CareSource that it had found an error in how it had calculated reimbursements paid to the providers, who were all non-physicians. The overpayments were discovered during a review of past payments CareSource had made to the providers.

Reimbursement rates for physicians providing behavioral health services are set at 100% of the Medicaid maximum rate, while they are set at 85% for non-physicians, like clinical nurse specialists, certified nurse practitioners, and physician assistants, according to the Ohio administrative code.

CareSource had planned to seek repayment from those providers for two years of overpayments and started by giving the providers a bill for two months of overpayment.

After receiving pushback from providers and learning how this could impact its members, CareSource announced it would not be seeking the recoupments but would still go forward with the correct rate reimbursements in the future.

Broad support for shortening timeframe

This legislation received wide support from those who testified before the Ohio Senate Financial Institutions, Insurance and Technology Committee, along with the Ohio House Health Committee.

“As healthcare providers, we rely on the information insurers provide to us. When eligibility is verified, authorizations are approved, and claims are paid month after month, providers should be able to trust that the coverage is valid,” Chelley Graham, revenue cycle manager for the Dayton Physicians Network, said in testimony before the Ohio House Health Committee.

It is “unacceptable,” she said, for insurance companies to wait months or more than a year before correcting eligibility information and then recoup money after medically necessary care had already been provided.

The bill allows an exception for pursuing recoupments after the one-year timeframe if it is in the case the provider committed fraud.

Behavioral health providers say new Medicaid regulations could disrupt care

Only one organization, the Ohio Association of Health Plans, publicly opposed the bill in testimony before lawmakers. The association didn’t oppose the change in the timeframe, but sought to have additional exceptions added for “waste and abuse” in addition to fraud.

“Discovering fraudulent, wasteful, or abusive claims is a more complex and difficult process than finding administrative or technical claims errors. It usually requires a much more in-depth investigation and analysis, often focused on a pattern of improper or illegal behavior over time,” Megan Richwine, director of government affairs at the Ohio Association of Health Plans, said in opponent testimony.

A health plan’s ability to identify any potential fraud, waste, and abuse may extend beyond the timeframes in SB 162, Richwine said.

Exceptions for waste and abuse were ultimately not added to the bill.