Williams Mullen Alert: CMS Issues Proposed Rule on 60-Day Reporting/Repayment Obligation for Overpayments to Medicare Providers

Williams Mullen Alert: CMS Issues Proposed Rule on 60-Day Reporting/Repayment Obligation for Overpayments to Medicare Providers

By Marcus C. Hewitt

As part of 2010's Affordable Care Act, a new section was added to the Social Security Act (Section 1128J(d)), which requires providers to report and return any overpayments they receive from Medicare or Medicaid within 60 days (see http://www.ssa.gov/OP_Home/ssact/title11/1128J.htm). Any overpayment that is not reported and returned within 60 days constitutes an "obligation" for purposes of the Federal False Claims Act. Therefore, concealing or improperly avoiding repayment of the overpayment could result in False Claims Act liability, including civil penalties of $5,500-$11,000 per violation and triple damages.

The Centers for Medicare and Medicaid Services (CMS) published a proposed rule on 16 February 2012 implementing this new obligation for providers of services under Medicare Parts A and B. The proposed rules would be codified as 42 CFR Parts 401 and 405. In particular, the proposed rule contains a provision that a provider must report and return any overpayment that it has "identified," meaning "if the person has actual knowledge of the existence of the overpayment or acts in reckless disregard or deliberate ignorance of the existence of the overpayment." The 60-day timeline begins to run from the date the overpayment is identified, and overpayments up to 10 years old must be reported and returned within the 60-day period.

The commentary with the proposed rule also gives instructive examples of the various ways in which an overpayment might be "identified," which providers should be aware of since identification triggers the obligation to report and repay. There is a two-month period in which providers may submit comments to CMS on the proposed rule, ending 16 April 2012.

For more information about this topic, please contact the author or any member of the Williams Mullen Health Care Team.


Please note:
This newsletter contains general, condensed summaries of actual legal matters, statutes and opinions for information purposes. It is not meant to be and should not be construed as legal advice. Readers with particular needs on specific issues should retain the services of competent counsel. For more information, please visit our website at www.williamsmullen.com or contact Wyatt S. Beazley, IV, 804.420.6497 or wbeazley@williamsmullen.com. For mailing list inquiries or to be removed from this mailing list, please contact Julie Layne at jlayne@williamsmullen.com or 804.420.6311.

With approximately 300 attorneys practicing in over 30 practice areas, Williams Mullen provides comprehensive legal services to regional, national and international clients. Their clients include multinational Fortune 500 companies, private family-owned businesses, nonprofit organizations and government entities.  From offices in North Carolina, Virginia, Washington D.C. and London, Williams Mullen attorneys bring skills and experience to solving the legal needs of their diverse client base.

For more information about LexisNexis products and solutions, connect with us through our corporate site.