CMS Issues Final Rule for Self Reporting Overpayments
February 12, 2016 02:49 PM
The Centers for Medicare & Medicaid Services (CMS) has issued a final rule for provider and supplier self reporting overpayment requirements.
The rule clarifies requirements for the reporting and returning of self‑identified overpayments. Health care providers and suppliers have been and will continue to be subject to potential False Claims Act (FCA) liability, Civil Monetary Penalties Law (CMPL) liability, and exclusion from federal health care programs for failure to report and return an overpayment.
The major provisions of this final rule include clarifications around: the meaning of overpayment identification; the required look back period for overpayment identification; and the methods available for reporting and returning identified overpayments to CMS.
An overpayment must be reported and returned by the later of: (i) the date which is 60 days after the date on which the overpayment was identified; or (ii) the date any corresponding cost report is due, if applicable. This final rule states that a person has identified an overpayment when the 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.
In the rule, CMS finalized a look back period of 6 years, rather than the proposed 10 years, for reporting and returning overpayments.
Providers and suppliers must use an applicable claims adjustment, credit balance, self‑reported refund, or another appropriate process to satisfy the obligation to report and return overpayments. In addition, if a health care provider or supplier has reported a self-identified overpayment to either the CMS or the Office of the Inspector General (OIG) using the Self-Referral Disclosure Protocol, the provider or supplier is considered to be in compliance with the provisions of this rule as long as they are actively engaged in the respective protocol.
Home health and hospice providers raised concerns with the proposed rule regarding the rule's effect on the hospice annual cap, the home health outlier revenue cap, and requests for anticipated payments (RAPs). Hospices and home health agencies have no way of knowing whether they have received a cap overpayment, or the amount, until they are notified by the MAC. CMS clarified in the rule that hospice and home health cap determinations are made at the end of the year and it is possible that the provider may not be aware of the cap status until their MAC calculates the final cap amount. Therefore, the provider is not responsible to report and refund the overpayment until they have received the cap determination from their MAC. There can be no applicable reconciliation until the final cap amount is determined.
CMS also clarified that overpayments as a result of PIP payments would be reported and returned at the time the initial cost report is due. There is no applicable reconciliation until the PIP payments are dealt with in the cost report process. However, if a provider is aware that their PIP payment may not be accurate, they should continue with normal business practices and inform its MAC of the issue.
The National Association for Home Care & Hospice will continue to evaluate the final rule and provide any additional analysis specific to home health and hospice providers.