On February 11, the Centers for Medicare & Medicaid Services (CMS) announced the issuance of a final rule clarifying requirements with respect to reporting and returning self-identified overpayments by healthcare providers and suppliers.
The final rule is intended to implement the obligations of Section 1128J(d) of the Social Security Act, which was created pursuant to Section 6402(a) of the Affordable Care Act (ACA). Generally, Section 1128J(d) requires Medicare Part A and Part B providers and suppliers who have received an overpayment from Medicare to (1) report and return the overpayment to the Secretary of Health and Human Services, the state, an intermediary, a carrier or a contractor, as appropriate, and (2) notify the recipient of the returned overpayment in writing of the reason for the overpayment. These obligations must be satisfied within 60 days after the date on which the provider or supplier identifies the overpayment. Failure to satisfy the requirements of Section 1128J(d) is deemed a violation of the False Claims Act.
The final rule clarifies the obligations by:
- Defining "overpayment identification" to mean when a "person has or should have, through the exercise of reasonable diligence, determined that the person has received an overpayment and quantified the amount of the overpayment."
- Establishing a "look-back period" requiring providers and suppliers to return and report an overpayment only if it was identified within 6 years of the date it was received.
- Describing the methods by which providers and suppliers must report and return overpayments, including through the use of an applicable claims adjustment, credit balance, self-reported refund or other appropriate process.
The final rule makes clear that CMS expects providers and suppliers to proactively identify and remediate the receipt of Medicare overpayments.
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