Medicare Advantage (MA) Overpayments Frequently Asked Questions (FAQs)

The following Questions were added September 8, 2020

Question:  When will the Phase III MA collection letters be issued?

Answer:  Palmetto GBA will issue these demand letters on September 14, 2020, and affected providers should receive the demand letters shortly after.

Question:  Who will be receiving the Phase III MA demand letters?

Answer:  Providers that have not accepted CMS’s settlement offer (issued January 3, 2020) will be receiving these demand letters.  These affected providers number fewer than 100, and collectively will be required to repay approximately $600,000.

Question:  Why is CMS issuing the Phase III MA demand letters at this time?

Answer:  CMS initially made the settlement offers on January 3, 2020, and gave providers sixty (60) days to consider the offers.  Due to the COVID-19 emergency, CMS subsequently extended the settlement acceptance deadline by several months.  Palmetto GBA sent out “reminder letters” to providers with valid mailing addresses in June 2020, and has followed up with email reminders.  While more than eighty-five percent (85%) of all providers accepted their settlement offers, a few (numbering fewer than 100 providers) did not accept their settlements.  Most of these remaining providers never responded to any communications relating to the settlement offers.  The agency concludes that these providers do not wish to partake in the settlement terms, and accordingly, is moving forward with its normal collection process.

Question:  Will providers receiving the Phase III MA demand letters have appeal rights?

Answer:  Yes, the affected providers will be afforded the regular Medicare claim appeal rights.  The providers will be able to appeal any and/or all of the claims at issue.  The demand letters will explain the affected providers’ appeal rights in detail.

Question:  Will CMS allow providers receiving the Phase III MA demand letters to accept the January 2020 settlement offer?

Answer:  No.  Due to COVID-19, CMS has already extended the settlement acceptance deadline by several months.  Once Palmetto GBA issues the Phase III MA demand letters (September 14, 2020), CMS will not accept settlement offers from any provider.  Subject to their Medicare claim appeal rights, affected providers will be required to repay the full amount of their Medicare overpayments at issue.

Question:  Was the Phase III settlement offer process successful?

Answer:  Yes.  More than eighty-five percent (85%) of providers receiving CMS’s settlement offers accepted them.  By so doing, these providers resolved more than ninety-four percent (94%) of the claims at issue.

Question (Added on June 28, 2018): Is there a formal appeals process for this project?

Answer (This response was updated on September 13, 2018): There is not an appeals process for these claims to pay under Fee-For-Service Medicare since the beneficiary was covered under a Medicare Advantage plan which should have paid instead. However, Palmetto GBA has extended the cancellation and recoupment date of these claims from July 1, 2018, to August 18, 2018, to allow providers additional time to research their patient account records and provide us with information to review and consider in support of an exception request.

Exception Requests: Providers who have exceptions they feel are warranted may continue to submit them to Palmetto GBA for consideration.
 
Submitting Exception Requests: If you believe you have a valid exception request: 

• You may send an email to jj.prrs@palmettogba.com notifying us and indicating the specific claim identifiers (DCNs) and related documentation you are prepared to submit. If the documentation is NOT PHI/PII based, please proceed with attaching and submitting it with your email.
• You may submit a request via the eServices online provider portal at www.palmettogba.com/eservices via the general inquiry form notifying us and indicating the specific claim identifier (DCNs) and you may include the related documentation even if it includes PHI/PII based information

The following are some examples (not exhaustive of all possible forms) of appropriate documentation:

• Copy of the cancelled check if payment was already sent and processed for these identified overpayments
• Credit Balance Report documentation showing the listing of claims you previously submitted with your report and requested to have cancelled
• Proof of delivery receipt to Cahaba GBA 

The following are examples of submissions that have NOT been granted an exception:

• Providers who are no longer in business requested an exception for overpayments that occurred while they were in business
• Providers identified claims as being paid by fee-for service Medicare as secondary which were determined to have processed as Medicare primary
• Providers advised claims as processed appropriately under Medicare fee-for-service but for which a Medicare Advantage plan was determined to be in effect for those dates of service

Question (Added on September 13, 2018): Is there a listing of Medicare Advantage (MA) plans?

Answer: Individual MA plan information  can be found in the MA Plan Directory on the CMS website.

Question (Added June 28, 2018): What information and what format will Medicare accept?

Answer (This response was updated on September 13, 2018):

• You may send an email to jj.prrs@palmettogba.com notifying us and indicating the specific claim identifiers (DCNs) and related documentation you are prepared to submit. If the documentation is NOT PHI/PII based, please proceed with attaching and submitting it with your email.
• You may submit a request via the eServices online provider portal at www.palmettogba.com/eservices via the general inquiry form notifying us and indicating the specific claim identifier (DCNs) and you may include the related documentation even if it includes PHI/PII based information

The following are some examples (not exhaustive of all possible forms) of appropriate documentation:

• Copy of the cancelled check if payment was already sent and processed for these identified overpayments
• Credit Balance Report documentation showing the listing of claims you previously submitted with your report and requested to have cancelled
• Proof of delivery receipt to Cahaba GBA

Note: No standard format is required but we recommend a claims listing by DCN or PCN in an excel format which is easily searchable.

• Providers who are no longer in business requested an exception for overpayments that occurred while they were in business
• Providers identified claims as being paid by fee-for service Medicare as secondary which were determined to have processed as Medicare primary
• Providers advised claims as processed appropriately under Medicare fee-for-service but for which a Medicare Advantage plan was determined to be in effect for those dates of service

Question (Added on July 17, 2018): Can you explain why we cannot file an appeal for these claims?

Answer:  As the initial claims are being cancelled there is no appeal. Providers will need to file a new (corrected) claim if they feel they have a valid exception to the FFS payment exclusion during an MA/HOM/PPO plan period of eligibility. Palmetto GBA will work with the provider to waive timely filing for these claims.

Reference: Timely Filing Job Aid

Question (Added on July 17, 2018): When Medicare starts cancelling the claims will the recoupments be processed lump sum or over a period of time?

Answer: Once claims processing begins, recoupments will take place as individual claim cancellations are processed. The length of time and the number of remits will be a function of the volume of claim cancellations and the volume of resulting overpayments to be collected.

Question: Will the Medicare Advantage Plans waive timely filing?

Answer: The individual Medicare Advantage Plans will need to make a determination regarding whether or not timely filing will be waived for their specific plans.

Question: Why am I held liable for this overpayment when I completed a CHOW?

Answer:  When a provider undergoes a CHOW where the new provider accepts assignment of the previous owner’s Medicare agreement, the responsibility for repaying any outstanding and future overpayments resides with the new owner. A sales agreement stipulating that the new owner is not liable for the overpayments made to the previous owner is not evidence enough for recovery from the new owner to not occur. Medicare was not a part of the sales agreement. That is a civil matter and it would be up to the new owner to enforce the sales agreement. If the new owner assumes assignment of the Medicare agreement, Medicare will attempt to recover from the new/current owner regardless of the sales agreement.

Question: We are unable to identify the patients for which these recoupments relate. Would there be a way you could give us the information?

Answer: Yes, providers are able to use the IVR to identify these patients. Providers can enter the Document Control Number (DCN) provided in the letter and the IVR will crosswalk it to the Patent Control Number (PCN) that was entered on the claim or providers can call and request a listing be e-mailed to them.

Question: What if my claim was for a hospice patient?

Answer: If you have claims that you believe were related to hospice but were billed without the 07 condition code on the claim, you may reprocess these with the 07 condition code along with the following remarks in the remarks section of the claim - MA Overpayment Timely Filing Exception so that we may process these with an exception to timely filing for administrative error.

Question: Will interest be applied to the overpayment?

Answer: If the provider does not elect to request an extended repayment plan, the adjustment will be recovered through the recoupment of future claims. If the overpayment resulting from the claim adjustment has had not recoupment in the past 60 days, a demand letter will be issued. If the amount is not paid in full by 30 days from the date of the demand letter, interest will be charged on the unpaid balance in accordance with 42 CFR 405.378.

If a provider elects to request an extended repayment plan, a demand letter will be issued once the claims are cancelled. Interest will be charged monthly on the unpaid balance of the overpayment.

Question (Updated on July 12, 2018): What if I am unable to identify all claims that need to be submitted for exception prior the August 17 date?

Answer (This response was updated July 12, 2018): Submission of a request for exception – with documentation – will result in a postponement of recoupment of all claims for which recoupment is sought until a determination is made of the legitimacy of the challenged claims. If you are unable to complete your review of all claims prior to August 17, recoupment will be stopped for all claims upon receipt of a valid example and a statement indicating additional time is needed to complete the review of all claims.

The following FAQs were added on June 28, 2018:

Question: What is appropriate documentation to submit to show there was no open HMO file?

Answer: A screenshot of the updated Common Working File showing no open HMO record for the dates(s) of service in question is acceptable documentation.

Question: If our supporting documentation includes PHI, is there a secure format by which to submit?

Answer: PHI and/or PII should NOT be submitted over the standard email system but Palmetto GBA does accept secure email for the purpose of transmitting this type of information.

Question: Can you provide us with a template or are we at liberty to create one internally?

Answer: There is not a standard template required but we recommend a claims listing by DCN or PCN in an excel format which is easily searchable.

The following FAQ was added on July 6, 2018 and was updated August 8, 2018:

Question: How should Hospitals/RHCs handle credit balance reporting? Since these payments have been identified as overpayments, should they be included on the Quarterly 838 report or should the Quarterly reports not include these claims since they have already been identified by the CMS contractor?

Answer: Providers may either submit any credit balances due to billing the MA plan via the regular credit balance process or submit an adjustment claim via Direct Data Entry (DDE).

The following FAQs were added on July 9, 2018:

Question: What are the exact dates involved?  

Answer: Palmetto GBA’s four year reopening period includes those claims paid July 1, 2014 through February 26, 2018. We limited our 4 year look back period based on the June 15, 2018 letters, the actual universe is July 1, 2014 - June 30, 2018, but there are no payment errors past February 26, 2018. We advise providers to conduct an internal review of claims within the last six year period (beginning July 1, 2012).

Question:  Since the letters refer to ‘processing’ and ‘paid’ claims, am I correct to focus on the payment date during this period and not date of service?    

Answer: Yes, the period is based on the payment date of the claim.

Question:  What is the rationale for the additional two year period included in the self-review?  

Answer (This response was updated on July 12, 2018): Providers are responsible for performing a review of claims outside of the four year reopening period to determine if additional overpayments have occurred. As required by 42 CFR 401.305 a provider/supplier who has received an overpayment must report and return the overpayment within 60 days after having identified the overpayment. (The overpayment can also be reported and returned by the date any corresponding cost report is due, if applicable). This requirement applies to overpayments identified within six years of the date the overpayment was received. In addition, when a government agency informs a provider/supplier of a potential overpayment, the provider/supplier has an obligation to accept the finding or make a reasonable inquiry to determine whether an overpayment exists and whether any similar overpayments exist within the six year look back period.

While Palmetto GBA cannot proscribe the nature or scope of the self-review, providers need to assess their risk exposure knowing this error condition existed and then document whatever due diligence they perform and their rationale. Lastly, any updated processes to address the vulnerability should definitely be included in the review documentation (along with any claim corrections identified).