The Danger of Unclaimed Property for Healthcare Providers

April 27, 2020

Healthcare providers build up patient credit balances from collecting more coinsurance, copays, and/or deductibles than they earn.

Barbara Blick

Author

Sovos

This blog was last updated on February 23, 2021

Healthcare providers build up patient credit balances from collecting more coinsurance, copays, and deductibles than they earn. Unfortunately, because the fees are unearned, the healthcare provider has inadvertently accepted fiduciary responsibility for the funds. In addition to safeguarding the funds from potential loss, the healthcare provider is now facing penalties and interest from the states for failing to turn over the funds as unclaimed property.

Penalties & interest

For example, Title 6 of the Texas Property Code requires an individual or entity holding property to which it does not have legal claim (the “holder”) to turn that property (the “unclaimed property”) over to the rightful owners by July 1st each year. If the holder cannot locate the rightful owners, it must turn the unclaimed property over to the state comptroller. In fact, all companies who fail to report and remit unclaimed property on time are assessed interest and penalties from the date the property should have been turned over until the date it is received by the state comptroller.

Benefit of a VDA

Fortunately, both penalties and interest can be waived by the comptroller if the holder enters a Voluntary Disclosure Agreement (VDA) and reports and remits the unclaimed property voluntarily. However, once the comptroller initiates an investigation, the holder is precluded from entering a VDA. Other state unclaimed property divisions have different rules and requirements to follow. Due to the complexity of complying with the ever-changing unclaimed property laws, leading businesses automate the compliance process with software.

Take Action

Get in touch with a Sovos unclaimed property expert to learn more about managing your unclaimed property compliance processes.

Barbara Blick

Barbara Blick is a Senior Account Executive at ETM. She works with mid-to large-scale organizations throughout the United States, including Texas, Ohio, Maine and Utah. Her focus centers on innovative products and services to solve clients’ statutory financial reporting, tax-compliance, and unclaimed property regulatory compliancy and labor-intensive task challenges. Barbara’s expertise is helping clients resolve the headaches and frustrations in managing staff performing labor-intensive duties through SaaS cloud automation and/or outsourcing services. You can expect 100% transparency and a commitment to serve when working with Barbara. Barbara has 25 years of business management experience ranging from project management, account management, and sales. Her training includes a Bachelor of Science with a specialization in Business Administration from the University of Louisville and Masters’ in Business Administration from the Pennsylvania State University. She also holds project management, life insurance underwriters and chartered financial consultant certifications. You can reach her at Barbara.Blick@Sovos.com or linkedin.com/in/barbarablick.

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