Cancel and Escrow payment
Were the Escrow funds released already or is the Milestone still funded? Is this an active contract or have you just sent an offer to a freelancer? Getting a refund for the funded Milestone and funding another Milestone will require your freelancer's approval, so you might want to consider proceeding with this Milestone as agreed and using a different billing method to fund subsequent Milestones on this or any other contract. You can communicate with your freelancer about approving the refund but do note that this will entail losing Payment Protection on your contract until a new Milestone is funded, which might create confusion or be a problem for some freelancers.