Refund Process

Mcare Settlement Refund Information

CHOICE AND ASSIGNMENT PERIOD ENDED APRIL 19, 2016

The previously announced final deadline for choices and assignments under the settlement with the Hospital & Healthsystem of Pennsylvania, the Pennsylvania Medical Society and the Pennsylvania Podiatric Medical Association has passed.  No further choices or assignments will be accepted since Mcare is in the process of preparing to issue the second round of checks.  Further information will be provided as the check issuance date is determined.  More information is available at www.McareRefund.org or by emailing the Mcare Refund Center at ra-in-McareRefundCtr@pa.gov. 

FINAL CHOICE AND ASSIGNMENT DEADLINE - APRIL 19, 2016

Mcare has announced that April 19, 2016 is the deadline for making choices on claimed lines of coverage under the settlement with the Hospital & Healthsystem of Pennsylvania, the Pennsylvania Medical Society and the Pennsylvania Podiatric Medical Association.  Health care providers with one or more claimed lines of coverage for which no choice was made were mailed letters the end of March informing them of the deadline if they want to make a choice.  The deadline also applies to assignment of unclaimed lines of coverage for which the health care provider has not already received a check.  More information is available at www.McareRefund.org and www.McareChoice.com or by emailing the Mcare Refund Service Center at ra-in-McareRefundCtr@pa.gov.

IMPORTANT ASSESSMENT REFUND UPDATE (March 7, 2016)

Mcare Issues First Round of Assessment Refund Checks.

Mcare has begun issuing the first found of checks to health care providers under a settlement agreement with the Hospital & HealthSystem of Pennsylvania, the Pennsylvania Medical Society and the Pennsylvania Podiatric Medical Association.  The settlement requires Mcare to make refunds of assessment overpayments for assessment years 2009, 2010, 2011, 2012, and 2014.  The first round of checks contains over 16,000 checks in an aggregate amount of over $33 million.  

Health care providers not getting checks in the first round include those who:

1.  didn't pay an assessment during the years covered by the settlement, or

2.  have one or more refunds claimed by another assessment payor and did not make a      choice whether the refund should be paid to the health care provider or the claimant,      or

3.  had the refund notice letter mailed to them in November 2015 returned to Mcare with      an undeliverable address.

Health care providers may be eligible for refunds in a second round of checks that will be issued before the end of the third quarter of 2016.  This group consists primarily of larger assessment payors such as hospitals and large physician groups.  This group will also consist of those health care providers who make a choice as to whether a refund claimed by another assessment payor should be paid to the health care provider or to the claimant.  The final deadline for making a choice on a claimed refund will be announced later.  The number of checks and the amount to be paid in the second round has not been determined at this time.

IMPORTANT ASSESSMENT REFUND UPDATE (November 23, 2015)

Provider's Change of Address with Department of State.

Providers should be aware that whenever there is a need to update their mailing address through the Department of State's online licensing site located at https://www.mylicense.state.pa.us, it is important to note that you must do so in the following two separate locations:

1.  Profile Demographic
2.  Licensing Address Change

For more information on this process, please contact one of the following:

• State Board of Medicine at st-medicine@pa.gov
  
• State Board of Osteopathic Board of Medicine at st-osteopathic@pa.gov
  
  

IMPORTANT ASSESSMENT REFUND UPDATE (November 17, 2015)

The Mcare Refund Notice Letters have been mailed.

Over 60,000 Refund Notice Letters were mailed by Mcare on November 16, 2015.  These letters inform physicians and hospitals about the refunds under the Settlement.  If you received a notice letter, your next steps to ensure proper payment of the refunds for your coverage depend upon the designation of the refund in the second column of your refund itemization:

IMPORTANT ASSESSMENT REFUND UPDATE (September 18, 2015)

Claiming Process for Assessment Payors Is Now Closed - Friday, September 18, 2015 was the deadline for assessment payors to request and submit documentation claiming a refund for those health care providers for which the assessment payor paid an assessment on behalf of a health care provider. 

Assignment Process for Assessment Payors and other Health Care Providers is Now Closed – Tuesday, April 19, 2016 was the last day in which Mcare would accept an Assignment of Refund Spreadsheet Request Form from assessment payors for assignments agreed to by health care providers for whom their assessment was paid by someone other than themselves.   

Health care providers who paid their own assessment should view the “Refund Process” and “Assignment” sections of this page for more information regarding the refund process.

Additional assessment refund resources can be found at:

• The Pennsylvania Medical Society, McareFund.org
• The Hospital & Healthsystem Association of Pennsylvania, Medical Liability Refund Section
• Pennsylvania Podiatric Medical Society (materials will be available as the refund process progresses)

Refund Service Center

Mcare has established a Refund Service Center. The Service Center can be reached between 8 a.m. - 5 p.m. M-F at 717-231-6400. Emails may be sent to ra-in-mcarerefundctr@pa.gov with refund questions anytime.

Mcare Assessment Refund Process

Mcare has begun the process of implementing the settlement of litigation brought by the Hospital and Healthsystem Association of Pennsylvania (HAP), the Pennsylvania Medical Society (PAMED) and the Pennsylvania Podiatric Medical Association (PPMA). This process involves making assessment refunds to over 55,000 health care providers and involves over 330,000 transactions. Health care providers will be given the opportunity to direct Mcare to pay the assessment refund to another person or entity if that is who actually paid the original assessment (the "Payor"). Mcare, HAP, PAMED and PPMA have been meeting regularly since the settlement in October 2014 to define a process that strikes the appropriate balance between having health care providers control where the assessment refunds go and having the assessment refunds go to the proper recipient. It is anticipated that as the refund process moves forward, adjustments will be identified so health care providers are encouraged to periodically check this website for updated information.

Frequently Asked Questions

Lawsuit Settlement Information

The assessment refunds are being made as a result of Mcare’s settlement of litigation brought by HAP, PAMED and PPMA challenging the way annual assessments were calculated. The assessment calculation is determined by statute to be based on Mcare’s final claims payments in a claim period, Mcare expenses, principal and interest on any borrowing and a 10% buffer. While not explicitly addressed in the statute, as a result of the settlement any projected year-end balance will be used to reduce the next year assessment amount to be collected.

Using this methodology, in 2008, $4 million remained that was available to reduce the 2009 assessment; in 2009, $57 million was available to reduce the 2010 assessment; and, in 2010, $56 million was available to reduce the 2011 assessment. In 2012, no funds were available to reduce the 2013 assessment; thus, there was no refund for 2013. In 2013, $39 million was available to reduce the 2014 assessment. The projected year-end balance for 2014 of $61 million was applied to the 2015 assessment.

Automatic Assessment Refund

Health care providers who paid their own assessments do not need to take any action to receive payment of a refund for their lines of coverage. They will be automatically paid the refund as long as their refund notice is deliverable. Physicians refund notices will be mailed to the address on file with their licensing board. Mcare will mail these notices in the fall of 2015.

Refund Process

Mcare has agreed to refund a percentage of the assessments collected for assessment years 2009, 2010, 2011, 2012 and 2014 because the calculation used did not include the projected year-end balance (there was no projected year-end balance in 2013). Each health care provider who paid an assessment in one or more of these years will be eligible for a refund (see "Refund Amount" below for more details on how the refunds will be calculated). There were over 55,000 health care providers who paid an assessment during these years. Many health care providers have coverage from more than one insurer during a year so there are over 330,000 individual transactions (lines of coverage or LOC) that need to be recalculated.

On April 1, Mcare in conjunction with HAP, PAMED and PPMA began the refund process by providing health care providers who had a Payor pay their assessment on one or more LOCs the opportunity to direct Mcare to pay the refund directly to the Payor. This was done in one of two ways, through an ASSESSMENT PAYOR'S CERTIFICATION AND CLAIM AGREEMENT (which is now CLOSED) or through an ASSESSMENT PAYOR'S CERTIFICATION AND ASSIGNMENT AGREEMENT process that continues.  For more details, please see “Claim and Assignment Process” below.

Once this information is received, Mcare will send letters (see "Refund Notice Letters" below for more details) to each health care provider who paid an assessment during the years listed above. The letter will detail the refund amount due to the health care provider. It will also direct the health care provider to a website to address any LOCs that may have been claimed by another person or entity.

Mcare will issue checks through the Treasury Department to health care providers whose LOCs are all finalized. This means that all LOCs are either not claimed, were claimed and the health care provider made a decision on the website to agree or disagree with the claim or the refund on a LOC has been assigned to another. It is anticipated that the first round of checks will be issued in the first quarter of 2016.

IRS Form 1099 – Misc forms will be issued to those health care providers receiving refunds with the payment designated under Box 3, "Other income."

Any undeliverable refunds that are not claimed by another person or entity, will be escheated to the Pennsylvania Treasury's Bureau of Unclaimed Property where they will be held in the name of the health care provider.

Claim and Assignment Process

Assignment Process

Mcare needs very specific information regarding a claimed or assigned assessment as there are over 330,000 lines of coverage that are subject to a refund.

 Claim - CLOSED

The claiming process is now closed to persons or entities (assessment payors) that paid an assessment on behalf of another health care provider.

If a Payor paid the assessment for a LOC on behalf of a health care provider and for some reason they are not in a position to enter into an assignment agreement (for example, the health care provider has moved and cannot be found) the Payor who paid the assessment for a LOC had the opportunity to  claim the refund associated with that LOC. However, that process has now closed. 

Assignment - CLOSED

If a Payor paid the assessment for a LOC on behalf of the health care provider, the Payor and health care provider had the opportunity to direct Mcare to pay the refund to the Payor. Mcare will then send the Payor a spreadsheet containing the information needed to assign one or more LOCs, as well as an approved assignment form that must be used. The completed spreadsheet is then returned to Mcare with the ASSESSMENT PAYOR’S CERTIFICATION AND ASSIGNMENT AGREEMENT. The HEALTH CARE PROVIDER’S REFUND ASSIGNMENT AGREEMENT(s) must be retained by the parties to the assignment for six (6) years. However, that process has now closed.

 

Refund Amount

The amount to be refunded to each health care provider depends on the following factors:

• The number of years covered by the settlement in which the health care provider paid an assessment.
• The health care provider’s specialty, where they practiced during those years and any discounts that applied (e.g. new physician).
• How much of the total amount to be refunded in the settlement was generated in each of the years the health care provider paid an assessment.
• The actual amount of assessment that was collected in each of the years covered by the settlement.

The exact percentage of the assessment a health care provider paid on each LOC needs to be calculated on a specific date so that the $139,012,919 can be exactly allocated to each LOC. This date is called the “Refund Effective Date” or “RED Date”. This date is expected to be in Fall 2015. Mcare will update the assessment reporting documents on its web site concurrently with the RED date, so that assessments paid after that date for any of the years covered by the settlement will reflect a lower assessment percentage as a result of the settlement's calculation methodology.

Refund Notice Letters

Mcare has agreed to send each health care provider who paid an assessment during the years covered by the settlement a letter. The letter will be sent to the address on file with the appropriate licensing authority or the Corporation’s Bureau. The letter will specifically detail the LOCs Mcare records reflect a health care provider either paid or were paid on their behalf. In addition to the amount of refund per LOC, the refund notice letter will confirm for the health care provider that Mcare has received notice that one or more LOCs were assigned or claimed. If a LOC is claimed, the health care provider must go to the claim decision website that is being developed and select “Pay me” to prevent a refund going by default to the Payor who claimed the LOC. Mcare will receive information from the claim decision website and the decision by the health care provider on the claim decision website will control where Mcare sends the refund for that LOC. Spreadsheets containing assignments for unclaimed LOCs (but not new claims to LOC’s) will also be accepted during this period.

Updating Medical Practice Addresses

Mcare will mail refund notices and refunds to medical practices at their registered address with the Pennsylvania Corporation Bureau.

• PCs and LLPs – A medical practice operating as a professional corporation (PC) or a registered limited liability partnership (LLP) is required to have a registered office on file with the Department of State (DOS). These practices can update their registered address using the DOS form for Change of Registered Office.
• Other medical practices – Other medical practices, such as a sole proprietorship or non-registered partnership, should have registered their fictitious name with the DOS. These practices can update their address using DOS form for Amendment of Fictitious Name Registration.

Medical practices that update their addresses also should notify Mcare by emailing a copy of the completed DOS form to the Refund Service Center.

REFUNDS FOR DECEASED HEALTH CARE PROVIDERS

Mcare has created a process for the personal representative of a deceased health care provider to apply to receive the refund notice for the provider, to make decisions for the health care provider regarding claims and assignments, and to have refunds payable to the provider paid to the provider's estate.

The first step in this process requires the personal representative to read the NOTICE TO PERSONAL REPRESENTATIVE OF DECEASED HEALTH CARE PROVIDER.

The next step is for the personal representative to complete and submit an APPLICATION BY PERSONAL REPRESENTATIVE OF DECEASED HEALTH CARE PROVIDER.

The application requires the personal representative to provide copies of:

• The death certificate for the deceased health care provider, and
• The certificate of grant of letters or other court-issued evidence of the personal representative's appointment (in Pennsylvania, commonly referred to as the short certificate).

The application and the required attachments must be emailed to Mcare Refund Service Center at the address below. Once approved, Mcare will advise the personal representative via an email to the email address on the application.

Refunds for Dissolved Professional Corporations, Associations and Partnerships

PLEASE NOTE: This process is only if there is no successor entity or buyer of the Professional Corporation, Association or Partnership. If there is such a successor entity or buyer, the successor entity/buyer may submit a claim for the refund and payment of the Professional Corporations, Associations and Partnerships refund(s) will be made in accordance with the claimed refund process.

Mcare has created a process for a representatives of dissolved Professional Corporations, Associations and Partnerships (Dissolved Entities) to apply to be provided notice of any refunds for the Dissolved Entities’ coverage and to identify a person or entity to which Mcare should pay the refund(s) in situations where there is no successor of the Entity or buyer of the Entities’ receivables and other assets.

The representative must complete and submit an Application by Representative of Dissolved Health Care Provider with No Successor Entity.pdf  This application must be notarized. The original must be mailed to: Mcare Fund, Attn: Refund Process Coordinator, 1010 N. 7th Street, Suite 201, PO Box 12030, Harrisburg, PA 17108-2030.

Once approved, Mcare will advise the representative via an email to the email address on the application.

Refund Service Center

Mcare has established a Refund Service Center. The Service Center can be reached between 8 a.m.-5 p.m. M-F at 717-231-6400. Emails may be sent to ra-in-mcarerefundctr@pa.gov with refund questions anytime.