Medicare 60-Day Overpayment Rule Requires Vigilance, Says Author

Family Practice Management Article Provides Physicians Guidance

May 04, 2016 03:03 pm Sheri Porter
[The words Risk Mitigation, Identify, Assess, Control, Reduce and Danger written on Puzzle Pieces]

There's been a lot going on in the health care realm of late, and family physicians have been swamped with issues that need tracking.

For instance, CMS' 60-day overpayment rule is a very big deal that may have slipped under some radar screens, prompting Family Practice Management to publish an article online ahead of print to ensure that family physicians have the information they need.

That article, titled "Understanding the New 60-Day Overpayment Rule" provides important guidance about a rule that went into effect on March 14 and that has implications for any physician, health care professional or supplier who is paid with Medicare funds.

The very first sentence penned by author Alice Gosfield, J.D., is enough to make physicians sit up and take notice: "Did you know that any overpayment by Medicare that is not repaid within 60 days of being identified converts to a false claim which can result in prosecution?" she asks.

Story Highlights
  • Medicare's 60-day overpayment rule took effect on March 14, and an article in Family Practice Management tells physicians exactly what they need to know.
  • Author Alice Gosfield, J.D., reminds physicians that any overpayment by Medicare that is not repaid within 60 days of being identified converts to a false claim and can result in prosecution.
  • The AAFP spoke out against portions of the regulation in 2012, and when the final rule was released in February, AAFP President Wanda Filer, M.D., M.P.H., noted that most errors related to Medicare billing and payments were inadvertent rather than fraudulent.

As principal of Alice G. Gosfield & Associates, a Philadelphia-based law firm that focuses on health law and health care regulation, Gosfield certainly speaks with authority on this topic and she thoroughly covers the fine points of the regulation.

It's important to note that this regulation has been on the AAFP's radar screen since it first commented(4 page PDF) on the proposed rule in 2012.

And when news broke of the final rule's release in February, AAFP President Wanda Filer, M.D., M.P.H., of York, Pa., noted that most errors related to Medicare billing and payments were inadvertent rather than fraudulent.

Filer also chided CMS for misunderstanding the notion of a physician's "clear duty" and said, "Family physicians have a clear duty to take care of their patients; it's CMS' clear duty to ensure that accurate payments are made to physicians within the Medicare system."

Need-to-Know Info

In her article, Gosfield explains the regulations in language that makes sense and addresses the implications for physicians' practices.

Gosfield defines overpayments as "any funds received or retained under Medicare Part B to which the person is not entitled." She notes that the rules also extend to Part A, although she does not cover those rules in this article.

She lists "obvious" overpayments that physicians likely would spot, such as duplicate payments and payments that exceed the allowable amount. She then provides a list of "less-obvious" overpayments. (Think about situations such as accidental upcoding or payments not supported by adequate documentation.)

"The definition of overpayment is sweeping, and the regulations put the burden on the recipient to be proactive about identifying them," writes Gosfield.

Then there's this nugget: "The identification of an overpayment triggers a 60-day obligation to repay the identified amount," writes Gosfield. "After 60 days, the claim becomes false. A false claim is subject to triple the charges plus up to $11,000 for each improper claim, a value that will increase over time.

"Whistleblowers can also file suit over unreported false claims," she adds.

Gosfield goes over all the particulars about

  • what happens when an overpayment is identified,
  • how to identify the overpayment amount and
  • how to report and repay Medicare for overpayments.

She also spends some time reviewing the implications of this rule for practicing physicians. For instance, she urges physicians to -- at the very least -- "tweak" their existing compliance programs.

"Many compliance programs review claims on a prepayment basis, thinking that then there is no obligation to look at prior paid claims," writes Gosfield. "The new regulations, however, undermine that concept and obligate practices to review up to six years, depending on the problem."

Furthermore, Gosfield cautions, surviving a government audit with "no negative findings" is even more important now because "overpayment found for a specified period creates a new obligation to investigate other time periods."

Gosfield's tips for what to do in the event an auditor does come knocking -- along with her "proceed with caution" advice -- make this article a must-read for physicians.

Author Q&A

AAFP News asked Gosfield a few last questions about her article and the impact of the 60-day rule on family physicians. This short Q&A reflects that conversation.

Q. Why did you write this article for Family Practice Management?

A. We have found that FPM is one of the best-read journals we write for, and their audience is at the crux of some of the major changes in health care.

Q. Why is it important that family physicians become intimately familiar with the 60-day rule?

A. Family physicians are beleaguered in many ways, even as they are central to many of the changes in health care. Medicare Part B is a critical payer for them, and these new regulations impose new obligations on them. They need to be proactive to avoid the pitfalls that lurk here.

Q. What are the most critical take-away points for readers?

A. It may seem oxymoronic to refer to "voluntary repayment" rules as an obligation, but failure to repay overpayments within 60 days converts them to false claims. Having a real compliance program that prevents problems in the first place is more important than ever. False claims are subject to government enforcement as well as whistleblower suits.

Q. What is the first action physicians need to take?

A. Physicians need to make sure they have a functional, meaningful compliance program and add these new processes to it.

Q. Is there anything else you'd like to add?

A. Any physician who bills Medicare Part B needs to understand that the necessity to get the billing -- and other things that create overpayments (e.g. anti-kickback violations and Stark violations) -- right in the first place requires them to pay attention and take action.

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