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Medicare Overpayments

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The Affordable Care Act (ACA) codified, for the first time, that a provider has an affirmative duty to return self-discovered Medicare overpayments. The Final Rule for implementing this ACA mandate was published by the Centers for Medicare and Medicaid Services (CMS) on February 6, 2016.

Pursuant to the Final Rule, an overpayment is identified once the provider knows, or should know, using reasonable diligence, that the provider has received a certain amount from Medicare that is higher than the amount to which it was entitled.

Once identified, the overpayment must be returned within 60 days or, for those providers who submit cost reports, by the date that such cost report is due.

A key component of the Final Rule is clarification of the length of the look back period. Since the passage of the ACA, providers have been wrestling with multiple theories of how long CMS would look back to determine liability for overpayments. The proposed rules indicated that the look back period would be 10 years long. However, the Final Rule states that CMS will look back six years. This means that any self-discovered overpayment must be returned if it was received within the prior six years. It also means that should a billing error or pattern of errors be discovered, the provider has an obligation to look back six years and return all overpayments received within the prior six years which relate to that same billing error or pattern of errors.

If you discover a Medicare overpayment, the health care attorneys at Houston Harbaugh can assist you with navigating these new rules. Call us at 412-281-5060.