CMS Makes Changes to Medicare Overpayment Notification Process

The Centers for Medicare & Medicaid Services (CMS) has made changes to the Medicare overpayment notification process, which became effective this month. If an outstanding balance has not been resolved, providers previously received three notification letters regarding Medicare overpayments: an initial Demand Letter, a Follow-up-Letter and an Intent to Refer Letter. CMS would send the second demand letter to providers 30 days after the initial notification of an overpayment.

A recent CMS review has determined that this is inefficient because most providers respond to the initial demand letter and pay the debt.

Currently, recoupment action occurs 41 days after the initial letter. The remittance advice that describes this action serves as another notice to providers of the overpayment. Therefore, the second demand letters are no longer being sent to providers, effective November 1. Provider appeal rights will remain unchanged.

If an overpayment is not paid within 90 days of the initial letter, providers will continue to receive a letter explaining CMS’ intention to refer the debt for collection.

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