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Anthony Cirillo

Medicare Overpayment Recovery Extended to Five Years

By February 25, 2013

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A provision of the recently signed fiscal cliff legislation extended The Centers for Medicare & Medicaid Services (CMS) time frame to recover non-fraudulent Medicare payments. It now has five years instead of three to collect and that could result in the collection of $500 million from providers and others by some estimates.

The change reflects a recommendation made in May by the Office of the Inspector General (OIG) of the U.S. Department of Health and Human Services. In its "Obstacles to Collection of Millions in Medicare Overpayments" report, the OIG stated the three-year statute of limitations prevented CMS from collecting more than $332 million in overpayments identified in 154 audit reports examined as of Oct. 8, 2010.

Critics say CMS should be able to handle overpayment recovery within three years, and auditing the additional two years will put an unreasonable burden on providers. In addition, the legislative process leading to this provision was not transparent and many lawmakers "might not even have known what they were voting on," said Rick Pollack, executive vice president of advocacy and public policy at the American Hospital Association, in a Modern Healthcare report.

Critics aside. You still need to prepare to be audited. So take steps to prepare.

Perform a self-audit targeting known vulnerabilities targeted by RAC auditors. Stay abreast of RAC information by subscribing to CMS updates.

Put in place key processes that can help address and avoid audits. These could include admissions screening criteria; coding reviews and training; and comprehensive case management.

Put in place the technology to aid these processes.

Develop a denials management process to monitor and track denials.

Form a taskforce that meets regularly and can be mobilized upon a RAC request.

Develop an Appeals Process.

Learn more ~ or join the conversation!


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February 25, 2013 at 6:31 pm
(1) David Bynon says:

I can’t help but think that CMS continues to focus on the wrong things. So they extended the collection period, so what? Do they really have the manpower to audit tens of thousands of providers for overpayment?

Why hasn’t CMS invested in prevention instead of enforcement? We live in an era where everything is electronic… EXCEPT Medicare billing. It’s time for CMS to update the Medicare ID card and use it for point-of-purchase authorization. Let the seniors ask why the provider is charging for 1,000 diabetes test strips instead of 100 that are in the box.

February 26, 2013 at 12:01 pm
(2) assistedliving says:

David – I have a mixed opinion. I agree with you on this issue but I also see CMS setting the tone in shifting the healthcare model from sickness to wellness, even as hospitals and long term care providers come kicking and screaming along!

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