By Lauren M. Gaffney
Search the internet for “60-day” and “overpayment” and you will see results with words like burdensome, unworkable and unreasonable. These adjectives sum up the industry response to the February 2012 Proposed Rule regarding Medicare providers’ and suppliers’ obligation to timely report and return overpayments within 60 days of their identification (or, if applicable, the date any corresponding cost report is due) (77 Fed. Reg. 9179).
With the comment period now closed, the industry is left hoping that the final rule will be significantly reworked. In the meantime, however, it is important to understand the Proposed Rule and some of its potential pitfalls.
One major source of concern is the meaning of the word “identification.” Providers may struggle in many instances determining exactly when an overpayment has been identified and, therefore, when the 60-day clock for reporting and returning begins.
In its Proposed Rule, The Centers for Medicare & Medicaid Services (CMS) states that a provider “has identified an overpayment if the [provider] has actual knowledge of the existence of the overpayment or acts in reckless disregard or deliberate ignorance of the overpayment.” And, although CMS offers a non-exhaustive list of examples in which it would assert that an overpayment has been identified, many providers may still be left wondering. For example, there is concern that CMS may take the position that knowledge of an issue of overpayment is sufficient to trigger the 60-day clock – regardless of how long it might reasonably take the provider to determine the amount of the overpayment.
The Proposed Rule’s establishment of a 10-year look-back period, which coincides with the outer limits of the False Claims Act statute of limitations, also triggered trepidation in the provider community. Ten years is significantly longer than CMS’ current administrative recoupment and reopening rules, and could greatly amplify the time, cost, and complexity involved in making a reasonable inquiry of the existence and amount of any overpayment – especially given the way coding, billing and reimbursement rules tend to change over time.
Importantly, CMS notes that reporting and returning overpayments pursuant to the Patient Protection Affordable Care Act obligation cannot resolve any potential False Claims Act or Office of Inspector General (OIG) administrative liability and that providers “should be aware that the contractors will scrutinize overpayments received through this process and may make referrals to the OIG whenever the contractors believe circumstances warrant such a referral.”
With uncertainty ranking among the top industry concerns for 2012, stakeholders enthusiastically accepted the opportunity to comment on the Proposed Rule. In light of the Proposed Rule, providers should continue taking stock of their operational risk areas and implement compliance programs aimed at auditing and targeting those specific risk areas.
Lauren M. Gaffney is an attorney in the healthcare practice group at Bass Berry & Sims PLC in Nashville, Tenn.
