Medicare Compliance & Reimbursement

You’re responsible for determining whether you’ve received overpayments, says CMS.

If you’ve been struggling to understand when the 60-day time period begins for returning an overpayment according to Medicare’s proposed 60-day rule; there’s help in the final rule.

Rule of thumb: Under the Affordable Care Act, a provider must report and return an overpayment by the later of:

• The date which is 60 days after the date on which the overpayment was identified; or
• The date any corresponding cost report is due, if applicable.

“The final rule makes clear that the 60-day clock starts only after the provider, using reasonable diligence, determines and quantifies the amount of the overpayment,” note attorneys Stephanie Sprague Sobkowiak and Daniel Kagan with Murtha Cullina in a recent analysis. And “reasonable diligence” means the timely, good-faith investigation of credible information, which would take at most six months following the receipt of the credible information, except in extraordinary circumstances (i.e., complicated self-referral law violations, natural disasters, or states of emergency).

Although the Centers for Medicare & Medicaid Services’ (CMS’) commentary indicates that “reasonable diligence may include an audit and subsequent extrapolation to arrive at the reasonable overpayment amount,” CMS also makes clear that providers must engage in proactive measures to determine whether they’ve received overpayments, Sobkowiak and Kagan note. “Simply waiting for a problem to come to light is not enough.”

Pitfall: “As you would expect, maintaining documentation of all investigatory efforts is critical and should not be overlooked,” Sobkowiak and Kagan stress. “Of course, if the provider did in fact receive an overpayment and fails to conduct reasonable diligence, the 60-day clock starts to tick on the date that the provider received credible evidence of the overpayment.”