Don’t Hold Patient Credit Balances Past 30 Days

Q.  How should our practice handle patient overpayments/credit balances?

A.  State law says physicians must return any overpayment to a patient within 30 days after determining the patient has overpaid. Because the law has no minimum balance exception, you can reasonably infer that you must refund all amounts, even tiny amounts. A practice risks Texas Medical Board action by, for example, continuing to refuse to refund overpayments, requiring the patient to pick up the refund in person, or insisting the practice retain the amount as credit against future services.

To keep an overpayment for personal use may be a criminal act known as "conversion of property." You must use your best efforts to return the overpayment. 

What if we can't find the patient?

If you are unable to find the patient to return the overpayment or credit balance, and the patient doesn't claim the money after three years, you must turn over the money to the state by depositing it in the Office of the Texas Comptroller's unclaimed funds accounts.

Each year on March 1, review your records, and by July 1 of that year, file your unclaimed property report, if applicable, at ClaimItTexas.org. Texas law requires also that you mail a written notice to the last known address of the property owner, unless you have done so already or don't have an address.

Failure to send unclaimed money to the state in a timely manner can incur a penalty of the unclaimed amount plus 10% interest. You are required to retain records of unclaimed funds for 10 years after you've reported them to the comptroller.

If you need more information, contact the comptroller's office at (800) 321-2274 or up.holder@cpa.texas.gov.

 Have a question like this? TMA members can call the TMA Knowledge Center at (800) 880-7955 and talk to an information specialist. In addition, many frequently asked questions are on the TMA website at www.texmed.org/findanswers (log in required).

NOTICE: This information is provided as a commentary on legal issues and is not intended to provide advice on any specific legal matter. This information should NOT be considered legal advice and receipt of it does not create an attorney-client relationship. This is not a substitute for the advice of an attorney. The Office of the General Counsel of the Texas Medical Association provides this information with the express understanding that (1) no attorney-client relationship exists, (2) neither TMA nor its attorneys are engaged in providing legal advice, and (3) the information is of a general character. Although TMA has attempted to present materials that are accurate and useful, some material may be outdated, and TMA shall not be liable to anyone for any inaccuracy, error, or omission, regardless of cause, or for any damages resulting therefrom. You should not rely on this information when dealing with personal legal matters; rather legal advice from retained legal counsel should be sought. Any legal forms are only provided for the use of physicians in consultation with their attorneys. Certain links provided with this information connect to websites maintained by third parties. TMA has no control over these websites or the information, goods, or services provided by third parties. TMA shall have no liability for any use or reliance by a user on these third-party websites or the information provided therein.

Last Updated On

December 11, 2019

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