Behavioral Health Prepayment Review: Respond and Exit
Why behavioral-health groups land on prepayment review, how to keep cash moving, how to answer each records request, and how to ask to be released.
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Direct answer
Behavioral health prepayment review: what operators need to know
Why behavioral-health groups land on prepayment review, how to keep cash moving, how to answer each records request, and how to ask to be released. Prepayment review turns every affected claim into a records request with its own deadline; track each one as a case.
On prepayment review, a payer stops paying selected claims automatically and pays only after someone has reviewed the records behind each one. Medicare's Program Integrity Manual puts it plainly: prepayment review is a claim determination made before payment. For a group that bills weekly sessions, every week under review adds another set of claims that cannot be paid until records are requested, sent, and reviewed.
Commercial prepayment review drew objections from national professional associations in 2024. Optum sent letters to psychologists and psychiatrists saying claims would not be paid until they submitted records, and that review could take up to nine weeks. After American Psychological Association Services and the American Psychiatric Association wrote to the company, Optum told APA Services in October 2024 that it had paused the reviews of psychologists, while saying it wanted psychologists to know its documentation expectations before further reviews. Optum's current network manual still lists referral for recoupment and/or prepayment review among the possible results of an intervention on outlier billing.
This guide covers why groups get selected, how to keep cash moving, how to answer each pended claim, which documentation fixes matter, and how to ask to be released.
Key takeaways
The short version
- Prepayment review turns every affected claim into a records request with its own deadline; track each one as a case.
- Medicare provider-specific reviews must state why you were selected; ask commercial payers for the reason, scope, and exit criteria in writing.
- Answer every request completely and on time. In Medicare, no response means denial.
- Fix the pattern that triggered review before the next round; Medicare waits at least 45 days after education before pulling new claims.
- Measure pended dollars weekly and escalate early instead of waiting for the review to end.
Take the template with you
Free to copy · no email required
Summarizes your review results and corrective actions, then asks for release or written release criteria, the reason for selection, and the look-back. Fill every [BRACKET] from your tracker, not from memory.
One row per pended claim, from request to decision: due dates, delivery proof, decision, days pended, and appeal deadline. The totals become the evidence in your release request.
claim_ref,payer,program,date_of_service,code,billed_amount,claim_submitted_date,records_request_date,records_due_date,records_sent_date,submission_channel,delivery_proof_ref,payer_received_date,decision_date,decision,amount_paid,denial_reason,appeal_deadline,days_pended,owner,notes ,,,,,,,,,,,,,,,,,,,,
1. Why groups get placed on prepayment review
In Medicare, a contractor may start targeted provider-specific prepayment review only when there is the likelihood of a sustained or high level of improper payments. Contractors pick targets for high volume, high cost, dramatic changes in frequency, problem-prone services, or vulnerabilities identified by recovery auditors, the CERT program, OIG, or GAO. Targeted Probe and Educate focuses on providers with historically high denial rates or billing that varies from peers. A contractor may not deny a claim just because it fails a single screening-tool criterion; each claim needs an individual determination.
Commercial manuals describe the same logic. Optum's network manual says its practice-management team identifies practices outside typical billing patterns, established guidelines, and expected utilization, and that interventions can end in monitoring, performance improvement plans, a credentialing referral, or referral to its Program and Network Integrity unit for recoupment and/or prepayment review. UnitedHealthcare's guide lists prepayment data analytics and abnormal billing patterns among its prospective detection tools.
- A share of a time-based code well above specialty peers; Novitas, a Medicare contractor, has run Targeted Probe and Educate on 90832, 90834, and 90837
- A sudden change in the volume or frequency of a service
- Prior denials or audit findings, including earlier probe rounds
- Services a payer audits as a category; Optum lists ABA, services delivered through telehealth platforms, and peer support services
- Out-of-network billing: the 2024 Optum reviews heavily targeted out-of-network psychologists and psychiatrists, according to the associations' letter
2. Put a number on the cash-flow gap
Review delays payment on every affected claim by at least the time it takes to request records, send them, and review them. Medicare gives providers 45 days to respond to a prepayment documentation request and denies claims when documentation does not arrive; Optum said in 2024 that its review could take up to nine weeks after records arrived. Treat the gap as a forecast, not a surprise.
| Lever | What to do |
|---|---|
| Measure exposure | Report pended dollars weekly by payer, code, clinician, and program, with the age of the oldest claim |
| Shorten your side | Send records the same week a request arrives; Medicare accepts unsolicited documentation sent with the claim and flagged with the PWK code, though it is not required |
| Track the payer's side | Log the date records were received and the decision date for every claim, and escalate claims that exceed the payer's stated review time |
| Use state prompt-pay rules | Some states limit requests for more claim information; check whether your state's rules reach the plan |
| Escalate through the network | Ask provider relations for the reason, scope, and exit criteria, and request a meeting with the reviewing unit |
| Talk to patients plainly | The associations reported patients stopping treatment over reimbursement fears; explain the delay without discussing clinical content |
3. Answer each pended claim as a records request
- 01
Log the request
Claim reference, date of service, code, amount, request date, due date, and channel. Each pended claim is its own deadline.
- 02
Send what the service requires
The progress note for the date of service with documented time for time-based codes, the treatment plan in effect, signature and credentials, telehealth modality where relevant, and any authorization reference.
- 03
Hold the minimum-necessary line
The 2024 Optum letters asked for all medical records that support the services; the associations argued that breached the HIPAA minimum-necessary rule, which bars requesting an entire record unless specifically justified. Send what supports the claim, leave psychotherapy notes out, and ask the payer to name the documents it needs. Medicare instructs its own contractors to request only the individual pieces needed.
- 04
Keep proof of delivery
Use the channel the payer specifies, keep an exact copy of what you sent, and log the date and delivery confirmation.
- 05
Reconcile each decision
Compare every payment or denial with what you sent. Appeal denials that ignore enclosed documentation on the normal appeal track.
4. Fix the documentation that triggered review
Start with what reviewers actually cite. Novitas's published reasons for denying psychotherapy claims in Targeted Probe and Educate and Optum's treatment-record standards point at the same short list.
| Finding | What reviewers look for | Fix |
|---|---|---|
| Time not supported | Start and stop time or total time for time-based services | Template requires actual times; no default to the scheduled slot |
| Code not supported by time | A code consistent with documented minutes; Novitas recodes to the level the time supports | Pre-bill check that documented minutes match the code |
| Medical necessity not evident | Diagnosis, symptoms, functional status, a treatment plan with measurable goals, and progress | Plan updated when goals are met, new problems appear, or progress stalls |
| Outside scope of practice | Service within the rendering clinician's license | Credential-to-service matrix checked at scheduling |
| Supervision not shown | Evidence of required supervision when billing under another practitioner | Supervision documented on the date of service |
| Late or altered entries | Entries made on the date of service; Optum asks that entries made more than 24 hours later be labeled as late | Note-completion deadline and late-entry labeling |
| No response to request | Records received by the deadline | Deadline tracking with a named owner |
5. Ask to be released, in writing
Medicare spells out its exit path. A Targeted Probe and Educate round typically covers 20 to 40 claims followed by one-on-one education, and the contractor must allow at least 45 days after that education before selecting new claims. The process typically repeats for up to three rounds. A provider can be removed after any round with low or sufficiently improved error rates, and one that meets the goal is released from review for one year, subject to new review if billing patterns change. Providers still non-compliant after three rounds are referred to CMS, which can lead to 100 percent prepayment review, extrapolation, recovery-auditor referral, or revocation.
Before a contractor places a provider on 100 percent prepayment review, it must tell CMS the expected duration and the criteria for removal. Ask for both. Commercial payers have no uniform rule, so ask for the same things in writing: the reason for selection, the scope (codes, clinicians, programs), the expected duration, the release criteria, and the date of the next determination.
- 01
Show your results
Claims reviewed, paid as billed, denied, and why; your response timeliness; the dollars pended.
- 02
Show the fixes
Template changes, pre-bill checks, training dates, and a re-audit of recent notes.
- 03
Ask for release or criteria
Request release as of a specific date, or written release criteria and the date of the next determination.
- 04
Escalate on schedule
If there is no answer, escalate through provider relations and the reviewing unit's leadership, and keep every exchange on the case.
6. Know when to bring in counsel
- The payer asks for entire records with no stated purpose and will not narrow the request
- Reviews appear to target mental-health providers more heavily than medical-surgical ones; the associations argued in 2024 that this raises a parity question
- The notice comes from a special investigations unit or program-integrity contractor, or mentions fraud
- Medicare notifies you of a payment suspension, a separate and more serious tool governed by chapter 8 of the Program Integrity Manual
- Findings are heading toward an extrapolated overpayment demand
Common questions
Answers before you build.
What is prepayment review in behavioral health?+
A payer holds selected claims and pays each one only after reviewing the records behind it. In Medicare it is a claim determination made before payment; commercial plans use the same approach for codes, clinicians, or programs flagged by their payment-integrity analytics.
How long does prepayment review last?+
In Medicare Targeted Probe and Educate, a round is designed to take no more than about six months, the process typically runs up to three rounds, and release is possible after any round. Commercial reviews have no uniform limit, so ask for the expected duration and release criteria in writing.
Does prepayment review cover all of our claims?+
Not necessarily. Medicare's 100 percent prepayment review can cover every claim for a specific code or every claim from the provider, while a probe round samples 20 to 40 claims per service. Ask the payer to state the scope.
Is prepayment review the same as a payment suspension?+
No. On prepayment review, claims are reviewed and then paid or denied one by one. A Medicare payment suspension withholds payment more broadly and follows separate rules in chapter 8 of the Program Integrity Manual.
Do we have to send the whole chart for every claim?+
No. Send what supports each billed service, leave psychotherapy notes out, and ask the payer to identify the specific documents it needs. A covered entity may not request or disclose an entire record unless the entire record is specifically justified.
Practical closeout
Use this operator checklist.
- Prepayment review turns every affected claim into a records request with its own deadline; track each one as a case.
- Medicare provider-specific reviews must state why you were selected; ask commercial payers for the reason, scope, and exit criteria in writing.
- Answer every request completely and on time. In Medicare, no response means denial.
- Fix the pattern that triggered review before the next round; Medicare waits at least 45 days after education before pulling new claims.
- Measure pended dollars weekly and escalate early instead of waiting for the review to end.
Continue through the cluster
Verified customer case studies are added only with customer permission and supporting evidence; none is implied by these operational examples.
Sources & methodology
Trace the operational claims.
Marsa Health Editorial reviewed the primary and research sources below on September 21, 2026. We translate them into workflow controls, distinguish proposals from final rules, and flag where plan, program, state, contract, or clinical requirements vary.
- 01Medicare Program Integrity Manual, Chapter 3: Verifying Potential Errors and Taking Corrective Actions Centers for Medicare & Medicaid ServicesRev. 13821 (June 2026): review targeting, provider notice, additional documentation request time frames, Targeted Probe and Educate, 100 percent prepayment review, signature attestation, amendments, and the bar on requesting psychotherapy notes.Accessed or rechecked September 21, 2026
- 02Medicare Program Integrity Manual, Chapter 8: Administrative Actions and Sanctions and Statistical Sampling for Overpayment Estimation Centers for Medicare & Medicaid ServicesRev. 13762 (May 2026): conditions for extrapolation, sampling documentation, the one-sided 90 percent lower limit, required methodology disclosures, payment suspension, and the effect of appeals on estimates.Accessed or rechecked September 21, 2026
- 03Optum pauses prepayment reviews that angered psychologists American Psychological Association ServicesOctober 2024 report on Optum's prepayment reviews of mainly out-of-network psychologists, the up-to-nine-week review window, and the pause announced after an October 10 meeting.Accessed or rechecked September 21, 2026
- 04Letter to Optum Health on prepayment reviews American Psychological Association Services and American Psychiatric AssociationOctober 8, 2024 letter describing the all-records requests, the minimum-necessary and parity concerns, and the burden on small practices.Accessed or rechecked September 21, 2026
- 05Behavioral Health Services National Provider Network Manual OptumPublished July 1, 2026, effective September 1, 2026: practice-management interventions, treatment-record standards, records-request contents, audits, and offset.Accessed or rechecked September 21, 2026
- 062026 UnitedHealthcare Care Provider Administrative Guide UnitedHealthcareCommercial payer manual example: audit access, record-production duties, audit failure denials, extrapolation, overpayment disagreements, and 45-day offsets.Accessed or rechecked September 21, 2026
- 07Texas Insurance Code Chapter 1301: Preferred Provider Benefit Plans Texas Legislative CouncilSection 1301.1054 limits requests for additional claim information; Section 1301.132 sets a 180-day overpayment notice window and bars recovery until appeal rights are exhausted.Accessed or rechecked September 21, 2026
- 08Psychiatric services: Psychotherapy (CPT 90832, 90834, and 90837) Novitas Solutions (Medicare Administrative Contractor)Targeted Probe and Educate results page updated September 14, 2026, listing top denial reasons including unsupported time, recoding by time, and medical necessity.Accessed or rechecked September 21, 2026
Organizational author. Editorial review covers source accuracy, search intent, workflow boundaries, and human-oversight requirements. This material is educational and does not provide clinical, legal, coding, or coverage advice.
No named clinical or legal expert reviewer is attributed to this version. Marsa Health does not invent reviewer credentials.
Read our editorial methodRevision history
What changed and when
September 21, 2026
Initial publication, source review, and operational editing.