Caution: Do not hold on to Medicare overpayments
From international law firm Arnold & Porter LLP comes a timely column that provides views on current regulatory and legislative topics that weigh on the minds of today’s physicians and health care executives.
Recently, we advised you about regulations issued by CMS implementing what is known as the “60-Day Rule,” which requires providers to refund any Medicare overpayment within 60 days after the date on which the overpayment was identified. The rule was based on a 2009 statutory amendment that applied to Medicaid, as well as Medicare, overpayments. We explained that the regulation provided that once a provider has “credible evidence” of an overpayment, the provider has the obligation to undertake “reasonable diligence” to determine whether or not an overpayment exists, and, if so, the amount of that overpayment. Failure to fix such action could result in imposition of False Claims Act liability, which carries with it triple damages plus a penalty of up to $11,000 per claim.
Over the past several years, we have seen many physician practices take a cavalier attitude toward improper payments, with credit balances that have built up over the years to several hundred thousand dollars. To the extent that these credit balances reflect Medicare or Medicaid overpayments, they reflect a significant potential liability beyond the face value of the overpayment. Practices should take steps to refund any identified overpayments to avoid risking a more serious liability.
Alan E. Reider, JD, MPH, a partner at Arnold & Porter LLP, can be reached at firstname.lastname@example.org.
Matthew T. Fornataro, JD, an associate at Arnold & Porter LLP, can be reached at email@example.com.