Need to Know: You have 60 Days to Refund Gov’t Overpayments

The Patient Protection and Affordable Care Act of 2010 (ACA) requires healthcare providers to return overpayments to government payers, with an explanation of why the payment is being returned, within 60 days from the time that the provider identifies the overpayment. According to regulation, an “identified” overpayment occurs when “a person has actual knowledge of the existence of the overpayment or acts in reckless disregard or deliberate ignorance of the overpayment.”

If an overpayment is retained beyond 60-days, it becomes an “obligation” sufficient for reverse false claims liability under the False Claims Act, and may become subject to treble damages and penalties if there is a “knowing and improper” failure to return the overpayment. Failure to return the payment within the 60-day window also puts the healthcare entities at risk of exclusion from the Medicare and Medicaid programs.

If they haven’t done so, already, healthcare entities should address this time-sensitive reporting requirement by examining their current process for auditing charges and returning overpayments to government payers. Although this sounds like a simple task, many parties must address the practical improvements necessary to identify, report, and repay the government within the 60-day limit.

When you have a plan in place, you should observe the measures, below, to better identify potential overpayments, and to prevent them, going forward:

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  • Conduct periodic audits to monitor timeliness, accuracy, and completeness of reporting and refunding identified overpayments. Coding specialists likely would assume a key role in reviewing claims to help avoid the incidence of overpayments on the front end.
  • Obtain from the payer validation that overpayments were correctly reported and recouped.
  • Follow through on corrective action plans.
  • Implement training and education for all entities involved.
John Verhovshek

John Verhovshek

John Verhovshek, MA, CPC, is Managing Editor at AAPC. He has covered medical coding and billing, healthcare policy, and the business of medicine since 1999. He is an alumnus of York College of Pennsylvania and Clemson University, and a member of the Asheville-Hendersonville AAPC Local Chapter.
John Verhovshek

About Has 404 Posts

John Verhovshek, MA, CPC, is Managing Editor at AAPC. He has covered medical coding and billing, healthcare policy, and the business of medicine since 1999. He is an alumnus of York College of Pennsylvania and Clemson University, and a member of the Asheville-Hendersonville AAPC Local Chapter.

One Response to “Need to Know: You have 60 Days to Refund Gov’t Overpayments”

  1. Linda says:

    Does the same rule apply to non government insurance plans? does that rule apply to ChampVa and TriCare as well?

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