The Tennessee Medical Assn. has filed a lawsuit against a collections company working in several states to take back reimbursements paid to doctors. The lawsuit alleges fraud and asks a state court to block the company from trying to collect any more money from physicians.

Health Research Insights, based in Franklin, Tenn., has sent letters to physicians in Georgia, Kentucky, Tennessee and Texas demanding repayment for claims that in some cases dated back years. The letters accused physicians of coding visits at too high a level. According to its own descriptions, HRI bases the accusations of upcoding on an analysis of claims data, not reviews of medical records.

The TMA filed its lawsuit June 12. Other plaintiffs are an ophthalmologist and a pediatrician from Nashville, Tenn., who received letters from HRI in April of this year seeking repayment for reimbursements made in 2006 and 2007.

The lawsuit also names as a defendant Metropolitan Government of Nashville and Davidson County, Tenn., and its board of education, which runs a self-insured health plan for school employees. BlueCross BlueShield of Tennessee, which was contracted as a third-party administrator for the school plan that TMA says used HRI, is also a named defendant. Before the lawsuit, the Tennessee Blues had sent letters to doctors disavowing any involvement in HRI's collections efforts.

The Metropolitan Government of Nashville hired HRI earlier this year to collect alleged overpayments to physicians who cared for school employees in the plan. According to the TMA's lawsuit, the arrangement allowed HRI to keep 40% of anything it was able to collect from physicians. The metro government said it would not comment on the lawsuit.

HRI President and Chief Executive Officer Theodore Perry, PhD, said company policy barred him from commenting on pending litigation.

Organized medicine in several states will be watching to see what comes out of the lawsuit, in part because it could set legal precedent. Although states commonly set a statute of limitations on retrospective overpayment collections, those laws don't necessarily apply to self-insured plans. Self-insured plans are typically run by large employers who directly pay employees' claims as opposed to paying premiums to a health plan.

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