The previous Frequently Asked Questions on this subject are no longer applicable.

Question: What is the resolution to the MA overpayment issue?

Answer: A thorough investigation was conducted to not only ensure protection of Medicare trust fund but to evaluate the concerns of the stakeholders. This allowed the Centers for Medicare & Medicaid Services (CMS) the opportunity to consider multiple aspects of this issue, and to give Palmetto GBA time to research “exception cases” submitted by providers. Palmetto GBA has completed all “exception case” reviews and all submitting providers have been notified of Palmetto GBA’s determinations.

With respect to the remaining unresolved MA overpayments, depending on their specific claims and circumstances, each affected provider will receive one, two, or three detailed letters. Many providers will receive the first letter, advising of claims redeemed by MA plan voluntary payments to the Medicare FFS program.

Some providers will receive the second letter, which will require repayment to the Medicare FFS program, but which will facilitate provider rebilling to the correct MA plan.

Finally, some providers will receive the third letter, which will include a CMS settlement offer for the remaining claims. Providers accepting these settlement offers will retain a sizable portion of the erroneous claims payments and other advantages. Providers rejecting the settlement offers will need to make repayment in full, but will have FFS appeal rights. Additional information can be found in the Medicare Advantage (MA) Plan Overpayments: Update article.

Question: Have all the exception requests been considered?

Answer: Palmetto GBA has fully considered the exception requests that were elicited from providers in 2018. That process has concluded. Palmetto GBA fully agreed with some exception requests, partially agreed and partially disagreed with other exception requests, and for some other exception requests, there was no factual support. All providers submitting exception requests have been notified of the results of Palmetto GBA’s review.

Question: Did CMS and Palmetto GBA ask the MAO plans to consider making voluntary payments to redeem the erroneous payments made by the Medicare FFS program to providers who had furnished covered services to their enrollees?

Answer: Yes. CMS’s request for MAOs to consider making voluntary payments to the Medicare Fee-For-Service (FFS) program to resolve the MA overpayments and relieve provider burden was successful in many cases. Voluntary MAO payments have fully resolved more than 50 percent of the universe of potential overpayments.

Question: I identified a claim that was formerly included in one of my prior notification letters (these notification letters were dated June 15, 2018, and/or January 28, 2019), that is missing from the lists provided to me in the new letters. I am advised that it was not and will not be included in any Palmetto GBA letter. What should I do?

Answer: If a claim is not included in any of the new letters that a provider may receive concerning this matter, then CMS and Palmetto GBA do not consider an MA plan overpayment to exist with respect to the claim. For MA plan overpayment purposes, the only claims that providers need to take action on will be identified in the second letter, which will require repayment to Medicare FFS but which will steer affected providers to coordinate with the applicable MA plan, and claims that are identified in the third letter, which will include all claims encompassed by the CMS settlement offer. Providers rejecting the CMS settlement offer will later receive a demand letter for the full amount of the overpayment, but will be afforded claims appeal rights. Again, with respect to the MA plan overpayment issue, providers only need to take action on those claims which are identified in either of the two letters described above.

Question: What types of notification letters will be sent?

Answer: In line with CMS Administrator initiatives, CMS and Palmetto GBA will communicate findings to affected providers during three resolution phases:

  • PHASE ONE: Close-Out Letters, Late November 2019. Certain providers will receive notification letters that will reduce any burden of MA overpayments for JJ providers. Letters will include a comprehensive claim listing that will identify MA Plan ID and Name whose voluntary payment redeemed the potential overpayment.

  • PHASE TWO: Waived Claims Filing Deadline Letters, Early December 2019. Certain providers will receive letters regarding MA plans who have agreed to waive their claims filing deadlines, and to give consideration to late claims involving their enrollees. These providers will need to repay the FFS program for these claims, but may contact the MA plan for further information on how to proceed. All demand letters will afford and specify providers’ administrative appeal rights in keeping with FFS rules.

  • PHASE THREE: Settlement Offers, Early January 2020. CMS will make settlement offers to providers to resolve the MA overpayments that are not resolved under the first two phases of activity. Settlement offers will provide for a 40 percent to be repaid to Medicare and 60 percent to be retained by providers. Providers will be given 60 days to accept CMS’s settlement offer. Providers not accepting CMS’s settlement offer will receive a demand letter requesting repayment to FFS of the full amount of the MA overpayments. All demand letters will afford and specify providers’ administrative appeal rights in keeping with FFS rules.

Each affected provider will receive one, two or three letters appropriate to its situation. Providers need to be alert for these letters. Letters will be mailed in envelopes from Medicare with “ATTN: Chief Executive Officer” stamped in RED underneath the provider’s business address. Additional information can be found in the Medicare Advantage (MA) Plan Overpayments: Update article.

Question: How will we know what claims were looked at?

Answer:
CMS and Palmetto GBA looked at all claims enclosed with the original notification letters dated June 15, 2018, and January 28, 2019. In the first new letter, providers will see which of these claims were redeemed through voluntary MAO payments. The second and third letters will identify the claims that providers need to take action on, and the specific actions that providers need to take. In respect to the MA overpayments issue, providers do not need to take any action to resolve claims not identified in any of the three letters. If a claim is not identified in one of the letters, then CMS and Palmetto GBA do not consider that an MA plan overpayment exists with respect to that claim.

Question: If a claim is not listed does that mean that it was not included in the MA plan overpayment?

Answer:
CMS does not consider an MA plan overpayment to exist if the claim is not identified in any of the three letters described in this CPIL update and the Article. Providers should respond accordingly to the specifics of each letter and the claims included within it.

Question: What are my options if I do not agree with one or more claims included in either the December or the January letters?

Answer:
Providers will be able to appeal claims under normal FFS procedures that are included in the Phase Two demand letters; however, providers should note that if they are successful in receiving payment for any of the claims from an MA organization, then they will have received a duplicate payment and immediate repayment will be expected. Providers accepting CMS’s settlement offer will accept the settlement for the full set of claims on the associated listing. Providers rejecting CMS’s settlement offer in the third letter will receive a demand letter for the full balance. The letters will specify the provider’s FFS appeal rights, which will include the right to appeal any claim or set of claims.

Question: Can we do a partial settlement? For example, if we receive the Phase Three letter that lists 10 claims and we only want to settle on five of them. Is this an option?

Answer:
No. CMS’s settlement offers relate to the full set of claims included with the Phase Three letter. Partial settlements will not be accepted.

Question: How much time does the provider have to consider the January settlement offer?

Answer:
Affected providers will have sixty (60) calendar days to consider CMS’s settlement offer.

Question: What happens if we do not respond to the settlement offer within sixty (60) calendar days?

Answer:
Providers that do not accept CMS’s settlement offer within sixty (60) days will receive a demand letter from Palmetto GBA for the full amount of the unsatisfied FFS overpayments specified in the Phase Three letter.

Question: Do the three letters encompass all our MA plan overpayments claims in question?

Answer:
Providers will only receive one, two, or three letters relating to CMS’s plan for resolving the MA plan overpayments issue — namely, the Phase One, Phase Two, and/or Phase Three letters described above. A listing of the specific claims associated with the specific letter will be enclosed with the appropriate letter. Only those providers that reject CMS’s settlement offer in the Phase Three letter will get a fourth letter, namely a letter requesting a repayment for the full FFS overpayment amount, but the claims encompassed in this final letter will be the same claims as those included in the Phase Three letter. If a claim is not listed with any of the letters, then CMS and Palmetto GBA do not consider that an MA overpayment exists with respect to that claim.

Question: Will CMS or Palmetto GBA provide us with MA Plan rebilling instructions?

Answer:
No, the MA plans would provide any rebilling instructions. Palmetto GBA’s Phase Two letter will identify a point of contact for all of the MA plans associated with the specific provider’s Phase Two MA overpayment claims. If you choose to submit claims to the applicable MA plans, please contact their respective designated points of contact to discuss the specific procedures you must follow in resubmitting the claims. Do not submit claims to an MA plan without first contacting the designated point of contact. If you proceed otherwise, and just submit claims to an MA plan without prior notice, then administrative or systems limitations may result in a rejection of your claims.

Question: My hospital received one of the Phase II demand letters dated December 6, 2019. We will make repayment to the Medicare Fee-for-Service (FFS) program as requested in the letter, and will work with the Medicare Advantage (MA) Plans listed in the letter’s enclosures to re-bill our claims.

As we move forward, how are we to handle any past payments received from beneficiaries for the services in question (e.g., deductible, coinsurance)?

Answer:
CMS does not expect and will not require providers to return any Medicare FFS deductible or coinsurance amounts already paid by the beneficiary to the provider for the services in question unless the provider has previously entered into a written agreement with the beneficiary to repay such amounts.

Question: My hospital received one of the Phase II demand letters dated December 6, 2019. We will make repayment to the Medicare Fee-for-Service (FFS) program as requested in the letter, and will work with the Medicare Advantage (MA) Plans listed in the letter’s enclosures to re-bill our claims.

As we move forward, how are we to handle any past payments received from secondary payers for the health care services in question?

Answer: With respect to secondary payers, CMS notes that the demand letter is simply recovering the erroneous primary payment made by the Medicare FFS program, and facilitating the efforts of providers to obtain a substitute primary payment from the applicable MA plan through waiver of claims-filing deadlines. The secondary payer status of the other non-MA payer does not change with the substitution of the MA primary payment for the erroneous FFS primary payment; the non-MA secondary payer had and still has secondary payer liability for the health care services furnished.

If the provider has a contractual agreement with the secondary payer directing how such repayment cases are to be handled, or there is some other applicable requirement (for instance, a state law requirement), it should honor such agreements (or such applicable requirements). In the absence of such a contractual agreement (or applicable requirement), CMS has no objection to providers retaining the original secondary payment amount despite the change in the source of the primary payment.

In the event the total of the primary payment made by the MA plan and any payments made by secondary payer(s) and the beneficiary exceeds billed charges for the services, then CMS would expect the excess credit balance to be applied to any current liability of the beneficiary, or be refunded to the beneficiary. (If the total of MA primary payment and secondary payer payments exceeds billed charges, but there was no beneficiary payment, then refund of the excess credit balance to the last in line payer might be warranted.)

Question: When a provider wants to accept CMS’s settlement offer, is it sufficient for the provider to send in a check for the settlement amount to Palmetto GBA, or does CMS also require the provider to sign and submit the settlement agreement?
 
Answer: No, it is not sufficient for the provider to submit only a check. For CMS to consider the settlement agreement to be valid, CMS requires that the provider sign, date, and submit the settlement agreement, along with a check (payable to “Medicare”) that corresponds to the full settlement amount due, as indicated in the settlement agreement. These documents should be submitted together to the designated Palmetto GBA address. 

Question: What happens when the provider forgets to send in the signed settlement agreement? 

Answer: When providers have forgotten to enclose signed settlement agreements along with their checks, Palmetto GBA has contacted them to obtain the signed agreements. Providers can avoid this extra back-and-forth by enclosing both their signed agreements and checks (matching to the settlement amount due) with their initial submission. 

Providers are encouraged to submit complete settlement agreements the first time (i.e., signed and dated settlement agreement, coupled with a check payable to “Medicare” that matches to the settlement agreement amount), and to not wait until the last minute.  

Question: What happens when the provider sends in a check for an amount that does not correspond to the settlement agreement amount (i.e., a partial payment)? 

Answer: Some providers have submitted checks that do not match the amount shown in CMS’s settlement agreement. CMS will not accept partial settlement payments and does not consider these settlement agreements to be valid. 

Palmetto GBA has been making follow-up calls to the providers that have short-paid the settlement. Providers can avoid this extra back-and-forth by enclosing the full settlement amount due (an amount that matches to the CMS settlement offer dated January 3, 2020) with their initial submission. 

If such situations cannot be resolved timely, CMS has instructed Palmetto GBA to refund any partial payments received, and to proceed as though no settlement agreement exists. 

Question: How much time do providers have to resolve issues with their settlement agreements? 

Answer: The settlement offer due date is March 3, 2020. Palmetto will process provider settlement submissions (i.e., signed and dated settlement agreement, with check payable to “Medicare” and matching to the settlement amount) that are postmarked on or before March 3, 2020. 

Similarly, providers that have been contacted by Palmetto due to a missing or unsigned settlement agreement, and/or due to a mismatch between their checks and settlement agreements, are encouraged to resolve these issues as soon as possible, and to not wait until the last minute.  Such issues need to be resolved no later than March 3, 2020. 

Providers that do not accept the CMS settlement offers (including those providers that submit incomplete agreements which cannot be resolved timely) will receive demand letters for the full overpayment amount on or about March 20, 2020.

Additional Resources

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Provider Contact Center: 877-567-7271

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