Updated Draft of MLN Matters on Limitation on Recoupment for Provider, Physicians and Suppliers Overpayment

On September 18, 2008 Medicare updated a MLN Matters Articles to clarify page 2 and delete unneccesary language on pages 5 & 9. For the full details of this updated document please visit:

http://www.cms.hhs.gov/MLNMattersArticles/downloads/MM6183.pdf

Background of this update:
Before the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA) was enacted, a provider’s electing to appeal an overpayment determination did not affect Medicare’s prerogative to recover the debt. However, through an amendment of Title XVIII of the Social Security Act (the Act); MMA Section 935 changed this process, by adding a new paragraph (f) to section 1893 of the Act.

This amendment requires the Centers for Medicare & Medicaid Services (CMS) to change: 1) the way it recoups certain overpayments to providers, physicians and suppliers; and 2) how it pays interest to a provider, physician or supplier whose overpayment is reversed at subsequent administrative (Administrative Law Judge (ALJ)) or judicial levels of appeal.

CR 6183 describes these changes to the providers, physicians and suppliers overpayment recoupment process. Specifically, Section 1893 (f)(2)(a) of the Social Security Act protects providers physicians, and suppliers during the initial stages of the appeal process (both first level
appeal – contractor redetermination, and second level appeal -- Qualified Independent Contractor (QIC) reconsideration) by limiting the recoupment process for Medicare overpayments while the appeals process is underway.

It requires that when a valid first or second level appeal is received from a provider on an overpayment, subject to certain limitations (see below), CMS and its Medicare contractors may not recoup the overpayment until the decision on the redetermination and/or reconsideration has been rendered.

The article (link above) provides more detail and clarifies which overpayments are subject to limitation on recoupment and which types of overpayments are not subject to this limitation. Make sure that your billing staff are aware of these changes.

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