Timeframe for Overpayment Request From Medicare
What is the timeframe in which Medicare may request return of an overpayment?
For Medicare overpayments, the federal government and its carriers and intermediaries have 3 calendar years from the date of issuance of payment to recoup overpayment. This statute of limitations begins to run from the date the reimbursement payment was made, not the date the service was actually performed. CMS has instructed carriers not to recover payments that have not been reopened (where no attempts have previously been made to collect) within 4 years from the date of payment, unless the case involves fraud or similar fault. CMS instructs carriers not to recover overpayments discovered later than 3 full calendar years after the year of payment, unless there is evidence that the physician or beneficiary was at fault with respect to the overpayment. Liability of the physician for refunding an overpayment is based on fault- if the overpayment was a result of a lack of disclosure or information from the Medicare beneficiary, the liability may shift to the beneficiary.
The CMS final rule requires providers and suppliers receiving funds under the Medicare program to report and return overpayments by the later of the date that is 60 days after the date on which the overpayment was identified; or the date any corresponding cost report is due, if applicable. The requirements in this rule are meant to ensure compliance with applicable statutes, promote the furnishing of high quality care, and to protect the Medicare Trust Funds against fraud and improper payments. This rule provides needed clarity and consistency in the reporting and returning of self-identified overpayments.
When Medicare identifies an overpayment of $25 or more, the Medicare Administrative Contractor (MAC) initiates the overpayment recovery process by sending an initial demand letter requesting repayment.
Demand letters from your MAC explain:
- Medicare made an overpayment
- Interest begins to accrue if you do not repay the overpayment in full within 30 days
- Options to request immediate recoupment or an Extended Repayment Schedule (ERS)
- Rebuttal/appeal rights