Healthcare Reimbursement & Third-Party Payor Dispute Attorneys for Texas Providers

Representing Texas Physicians, Hospitals, & Healthcare Facilities in Disputes with Commercial Insurers & Managed Care Organizations

If you are a Texas physician, group practice, hospital, or healthcare facility that is owed money by an insurer or managed care organization, Hendershot Cowart P.C. can help you recover it. We represent healthcare providers – not patients – in disputes with commercial health plans, HMOs, PPOs, and other third-party payors. Whether you are dealing with late payments, underpayments, wrongful claim denials, SIU audits, or recoupment demands, our healthcare attorneys know the Texas and federal law that governs these disputes.

Texas healthcare providers face an uneven playing field when dealing with commercial insurers and managed care organizations. We level it. 

Note: We represent Texas healthcare providers and medical practices. If you are a patient seeking help with a personal medical bill, please contact a consumer law attorney.

When insurers don't pay what they owe, Texas law gives you tools to fight back. Call (713) 783-3110 or contact us online to discuss your healthcare reimbursement dispute today.

On This Page

• Healthcare Providers We Represent in Payor Disputes
• The Challenge of Collecting from Third-Party Payors
• Payor Dispute and Reimbursement Issues We Handle
• You Delivered the Care – Make Sure You Get Paid
• Frequently Asked Questions 

Healthcare Providers We Represent in Payor Disputes

Hendershot Cowart P.C. represents both in-network and out-of-network providers in reimbursement matters, including:

• Individual physicians and physician groups
• Hospitals and health systems
• Ambulatory surgery centers
• Urgent care clinics and freestanding emergency rooms
• Behavioral health providers
• Physical therapists, occupational therapists, and other allied health professionals
• Home health agencies and skilled nursing facilities
• Diagnostic labs and imaging centers
• Dental practices
• Medical billing companies and revenue cycle management firms pursuing claims on behalf of providers
• Durable medical equipment (DME) providers

The Challenge of Collecting from Third-Party Payors

You delivered the care. You submitted a clean claim. And now – weeks or months later – you are still waiting to be paid. Or you received a payment, but it was far less than your contracted rate. Or the insurer is now demanding repayment of claims it paid years ago. These are not billing errors to quietly absorb. These are legal disputes, and Texas law gives you specific tools to address them.

Insurers and managed care organizations routinely fail to process and pay clean claims within the statutory deadlines established under Texas law. Underpayment – paying less than the contracted rate – is as common as outright denial. Out-of-network providers face a separate set of challenges, including reimbursement at rates that do not reflect what is usual, customary, and reasonable in your market. And recoupment demands – where a commercial payor seeks to claw back payments it already made – are an increasingly common threat to a practice's financial stability.

Each of these scenarios is governed by a specific legal framework. Knowing which framework applies to your situation – and whether you are an in-network or out-of-network provider, dealing with a state-regulated commercial plan or a federally governed program – determines which remedies are available to you and what steps you need to take, and when.

Payor Dispute and Reimbursement Recovery Issues We Handle

Our healthcare attorneys handle the full spectrum of provider-payor disputes – from demand letters and Texas Department of Insurance complaints to mandatory arbitration and litigation.

Late Payment Claims

When a commercial insurer or HMO fails to pay your clean claim on time, Texas law is on your side – and the penalties are significant. The Texas Prompt Payment of Claims Act (TPPCA), codified in Texas Insurance Code Chapter 843 and Chapter 1301, requires HMOs and PPO insurers regulated by the TDI to act on clean claims within strict statutory deadlines. Insurers that miss those deadlines face a tiered penalty structure – up to $200,000 per claim plus 18% annual interest – on top of the contracted rate owed.

Our attorneys can determine whether your claims qualify for TPPCA protection, work with experts to calculate the full amount owed, including applicable penalties, and pursue recovery through negotiation, TDI complaints, or litigation. 

For in-network providers with a direct contractual relationship with an HMO or PPO, the TPPCA is one of the most powerful reimbursement recovery tools available under Texas law – and we know how to use it.

Underpayment and Contracted Rate Disputes

When an insurer or HMO pays less than your contracted rate on a payable clean claim, you may have both a breach of contract claim and a TPPCA penalty claim – because the statute treats a partial on-time payment the same as failing to pay the claim at all. 

We help providers assess whether their claims qualify, calculate the full amount owed including applicable penalties, and pursue recovery through negotiation, TDI complaints, or litigation.

Out-of-Network Reimbursement Disputes

Out-of-network reimbursement disputes often come down to a single question: What is usual, customary, and reasonable (UCR) for your services in your market? Insurers sometimes set UCR rates using proprietary databases or internally developed benchmarks that undervalue what providers in your area actually charge – in some cases by 20% to 30%. Under Texas administrative law, any UCR methodology used to reimburse a non-network provider must fairly and accurately reflect market rates, including geographic cost differences.

If you believe an insurer's UCR determination shortchanges what your services are worth, our attorneys can evaluate whether the methodology meets the legal standard, build the market rate evidence needed to support your position, and guide you through the Texas Department of Insurance dispute resolution process – binding arbitration for non-facility providers and mandatory mediation for facility providers. 

Strict deadlines apply for out-of-network providers to request mediation or arbitration: within 180 days of receipt of the disputed claim payment for facilities and 90 days for non-facility providers. Only after the TDI dispute resolution process is exhausted can providers file a lawsuit in civil court. 

Wrongful Claim Denials and Medical Necessity Disputes

Insurers and HMOs sometimes deny claims on medical necessity grounds that are not supported by the facts of the case, or apply coverage exclusions improperly. Our healthcare attorneys work with you to assess the basis for the denial, compile the clinical and contractual record needed to support an appeal, and pursue the available legal channels to get valid claims paid – first through the payor's internal appeals process or, where applicable, through the dispute resolution processes available under Texas law. When denials reflect a pattern of improper practices, we also evaluate whether a complaint to the Texas Department of Insurance is warranted. 

Payor Audits and Recoupment Defense 

Providers have the right to contest recoupment determinations. Commercial payors often initiate recoupment demands through Special Investigations Unit (SIU) audits – post-payment reviews that scrutinize billing patterns and claim documentation, sometimes years after the original claims were paid. Our attorneys can help you respond quickly, analyze each disputed claim, challenge the audit methodology, and pursue the most effective strategy for protecting your revenue. 

Note that recoupment demands from Medicare or Medicaid follow a separate federal process with its own administrative appeal rights. See our Medicare fraud defense page for more on that process. 

Payor Contract Review and Dispute Prevention

Many reimbursement disputes are rooted in provider agreements that contain unfavorable terms providers did not fully understand at signing: broad audit rights, narrow clean claim definitions, short filing deadlines, or dispute resolution provisions that limit the provider's options. Before entering or renewing a network agreement with an insurer or HMO, our attorneys review the plan contract to identify problematic terms, negotiate improvements where possible, and ensure your team understands the claim submission requirements that must be met to preserve your payment rights.

Texas Healthcare Providers: You Delivered the Care – Make Sure You Get Paid

You followed the rules. You submitted your claims. You held up your end of the contract. When a commercial insurer or managed care organization does not hold up their end, Texas law gives you tools to fight back – but those tools come with deadlines, procedural requirements, and legal nuances that require experienced counsel to navigate.

At Hendershot Cowart P.C., we have represented Texas healthcare providers in disputes with insurers, HMOs, and managed care organizations for over 35 years. We know the law, we know the process, and we will not be outprepared.

Call (713) 783-3110 or contact us online to schedule a consultation with one of our healthcare attorneys.

Frequently Asked Questions About Provider-Payor Disputes in Texas

How long does an insurer have to pay a clean claim in Texas?

Under Texas Insurance Code Chapters 843 and 1301, an HMO or PPO insurer regulated by the Texas Department of Insurance must act on a clean claim within 30 days of receiving it electronically or 45 days of receiving it by paper. "Acting on" a claim means either paying it in full, paying the undisputed portion and explaining why the remainder will not be paid, or denying it entirely with a written explanation. The TPPCA's deadlines apply to contracted, in-network providers and out-of-network emergency care providers; however, the penalty provisions only apply to contracted, in-network providers.

What is a clean claim?

A clean claim is a claim that meets all submission requirements under Texas Insurance Code Section 1301.131 – meaning it uses current CPT codes, is submitted in the required format, and includes all information the insurer needs to process it without additional follow-up. Clean claim status matters because it triggers the TPPCA's statutory payment deadlines: 30 days for electronically submitted claims, 45 days for paper claims. If an insurer fails to act on a clean claim within those windows, the penalty provisions kick in.

What penalties can an insurer face for late payment of claims in Texas?

The TPPCA creates a tiered penalty structure for in-network providers whose clean claims are paid late: 

1. Tier 1: If a payable claim is not paid by the deadline, the insurer owes the contracted rate plus a penalty up to the lesser of 50% of the difference between billed charges and the contracted rate, or $100,000.
2. Tier 2: If payment occurs between 46 and 90 days past the required date, the penalty increases to the lesser of 100% of that difference or $200,000. 
3. Tier 3: If payment is made 91 or more days late, the insurer owes the Tier 2 penalty plus 18% annual interest (accruing from the date payment was originally due). 

For non-institutional providers (individual physicians, physician groups), the entire penalty is paid to the provider, with the exception of any 18% interest due under tier 3, which must be paid to the Texas Health Insurance Risk Pool. For institutional providers (hospitals), 50% of the penalty goes to the provider and 50% to the Texas Health Insurance Risk Pool.

These penalties are automatically triggered without litigation – the law requires insurers to pay penalties concurrently when paying late claims, a requirement the TDI actively enforces.

Can an out-of-network provider sue an insurer for underpayment in Texas?

Not directly – at least not without first going through the TDI’s mandatory dispute resolution process. Under Texas Insurance Code Chapter 1467, out-of-network non-facility providers (physicians and physician groups) must complete binding arbitration before they can file a lawsuit over a reimbursement dispute with a state-regulated commercial health plan. Facility providers (hospitals, ASCs, freestanding emergency rooms) must go through mandatory mediation first. 

Within 45 days of the arbitrator’s decision or the mediation concludes, either party may then file a lawsuit in civil court.

What is the deadline for a Texas healthcare provider to submit a claim?

Under Texas Insurance Code Section 1301.102, a physician or healthcare provider must submit a claim to a PPO insurer no later than 95 days after the date the services were provided. Missing this deadline means you forfeit the law’s protections. The deadline may be extended by contract or by the TDI Commissioner in the event of a catastrophic event. Similar requirements apply under Chapter 843 for HMO claims. 

How do I dispute an out-of-network reimbursement rate in Texas?

Most out-of-network reimbursement disputes center on a UCR (usual, customary, and reasonable) determination – the insurer's calculation of what it considers an appropriate rate for your services in your market. Under Texas administrative law, any UCR methodology used to reimburse a non-network provider must fairly and accurately reflect actual market rates, including geographic cost differences. When an insurer's methodology falls short of that standard, you have grounds to challenge it.

For state-regulated commercial plans, Texas Insurance Code Chapter 1467 is the formal pathway – mandatory mediation for out-of-network facilities and mandatory binding arbitration for other out-of-network providers. Strict deadlines apply to request dispute resolution – within 180 days of receiving the disputed payment for out-of-network facilities and 90 days for other providers – and missing those deadlines forfeits your right to pursue the disputed claim.

Our attorneys can evaluate the insurer's UCR methodology, build your market rate evidence, and guide you through every stage of the Chapter 1467 process.

Does Hendershot Cowart P.C. represent patients with medical bill disputes?

No. Hendershot Cowart P.C. represents Texas healthcare providers – physicians, group practices, hospitals, surgical centers, and other medical businesses – in disputes with insurers, managed care organizations, and other third-party payors. We do not represent patients seeking help with personal medical bills or debt. If you are a patient dealing with a medical billing dispute, please consult a consumer law attorney in your area.

You delivered the care. Let us help you get paid for it. Call (713) 783-3110 or contact us online to schedule a consultation.