The Standard Recoupment Process

Providers do not need to do anything to request standard recoupment after receiving a demand letter.  Recoupment and application of funds for claim or other manual payments processed will begin automatically in accordance with the timeframe outlined in the demand letter received. 

Some things to note about the recoupment process:

  • Timeframes for recoupment are calculated from the date of the initial demand letter 
  • Depending on the reason for the overpayment, recoupment may begin immediately, 15 days from the date of the initial demand letter, or 40 days from the date of the demand letter. The recoupment timeframe for each overpayment is listed within the contents of the initial demand letter.
  • The interest rate assessed on overpayments is the prevailing rate specified by the Secretary of the Treasury and is the rate effective on the initial demand letter date. The rate applicable to each overpayment is listed within the initial demand letter.
  • Interest will accrue on the outstanding principal balance of the debt for each 30 day period in which a balance remains
  • Recoupment will continue until the overpayment is collected in full unless the debt falls into a status that prevents recoupment, such as an appeal subject to the Limitation on Recoupment provisions (redetermination/reconsideration) or Extended Repayment Schedule (ERS)
  • If a balance remains outstanding on an overpayment for longer than 60 days from the date of the demand letter and the overpayment is not in a status that prevents recoupment, a final letter, referred to as the Intent to Refer letter, will be issued to the provider to request payment. In accordance with the Debt Collection Improvement Act requirements, the final letter is a specific notice to debtors prior to referring the debt to the Department of Treasury for collection.
    • If a copy of the initial demand letter is needed upon receipt of an Intent to Refer letter, providers may contact the Provider Contact Center to obtain a copy of the initial demand
  • If a balance remains outstanding on an overpayment 60 days after the date of the Intent to Refer letter and the overpayment is not in a status that prevents recoupment, the overpayment will be referred to the Department of Treasury for collection

CMS Regulation References

Publication 100-06, Chapter 4, Section 10, Section 30, and Section 70 (PDF, 1.79 MB)

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