New Medicare Overpayments, Underpayments Interest Rate Set
Underpaying Medicare claims will cost your practice a little more now than it did just a few weeks ago. The Department of the Treasury recently notified the Department of Health and Human Services (HHS) of the private consumer interest rate that may be assessed for underpayments and overpayments. On the bright side, the new interest rate could work in your favor if the Centers for Medicare & Medicaid Services (CMS) underpays your practice.
Effective Jan. 25, contractors will assess an interest rate of 11.25 percent for Medicare overpayments and underpayments. This interest rate is up from 10.875 percent between Oct. 22, 2009 and Jan. 24. CMS will charge this rate of interest on overpayments, and pay interest on underpayments, to providers and suppliers of Medicare services (including physicians and other practitioners).
In case you’re unfamiliar, Medicare Regulation 42 CFR §405.378 provides for the assessment of interest at the higher of the current value of funds rate (1 percent for 2010) or the private consumer rate as fixed by the Treasury Department. Interest accrues from the date of the final determination.
See regulation 42 CFR §405.378 for final determination definitions, as well as when exceptions and waivers to this regulation may apply.
Source: CMS Transmittal 165, Change Request 6652, issued Jan. 15.
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