Providers worry about proposed CMS 10-year overpayments review

A proposed rule from the Centers for Medicare & Medicaid Services to review Medicare overpayments, dating back to as far as 10 years, could mean undue administrative burdens and costs for healthcare providers.

The proposal rule, published in the Federal Register Feb. 16, requires that providers and suppliers must report and return self-identified overpayments within 60 days. Before the Affordable Care Act, providers didn't have a set deadline for returning taxpayers' money, but under the Act, there will be a specific time frame by which overpayments must be returned, CMS explained in a statement last month. And providers who fail to report and return the overpayment within that time frame could be violating the False Claims Act and face civil monetary penalties or be excluded from the federal program altogether.

Also under the proposed rule, CMS plans to broaden the look-back period of Medicare overpayments from what is generally four years to up to 10, HealthLeaders Media reported. The expanded time frame could cost as much as $58 million in reporting-related expenses per year for about 125,000 providers and suppliers, the article noted.

Calling it "overkill," Amy E. Nordeng, government affairs counsel for the Medical Group Management Association, said the CMS rule, if enacted, could be particularly burdensome for group practices who might not have billing records that far back.

The other issue at hand is that providers who are overpaid might not be intentionally violating the False Claims Act but rather committing billing errors.

"[Ten years] would be under the worst case scenario under the False Claims Act when in fact most of the time when there is some kind of billing error it is just that-an error," Michael Gennett, counsel at Miami-based Akerman Senterfitt Law Firm, said in the article. "It is not a knowingly false claim."

For example, in an Office of Inspector General report released Tuesday, University of California, San Diego, Medical Center complied with Medicare billing requirements for 111 of the 210 inpatient and outpatient claims the OIG audited. But for the other 99 claims, UCSD was overpaid $351,000 for 2008 and 2009. OIG determined that the cause was primarily because the hospital's existing controls did not adequately prevent incorrect billing of the claims. After the audit, the hospital implemented educational programs, leveraged technology, and redesigned the audit and billing process to ensure compliance.

CMS' proposed rule, although worrisome, might not be surprising to providers. The agency has taken a hard-line stance against fraud and waste. CMS already has recovered approximately $5 million in overpayments, the agency said.  

The proposed rule is open for public comment until April 16.

For more information:
- read the HealthLeaders Media article
- check out the proposed rule (.pdf)
- see the CMS announcement
- check out the OIG summary of the UCSD audit

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