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CMS establishes new audit requirements, proposes new overpayment rule
1Powers Pyles Sutter & Verville PC, Washington, D.C., USA. chris.keough@ppsv.com
Summary
The Centers for Medicare and Medicaid Services (CMS) has issued new rules impacting Medicare cost report audits and overpayment identification. Providers must now adhere to stricter guidelines for reopening audits and promptly returning identified overpayments.
Area of Science:
- Healthcare Administration
- Regulatory Compliance
- Medicare Auditing
Background:
- Recent publications from the Centers for Medicare and Medicaid Services (CMS) indicate a potential increase, not a decrease, in the regulatory burden for healthcare providers.
- These publications challenge the expectation of regulatory easing under the Bush Administration.
Purpose of the Study:
- To analyze two recent CMS publications concerning Medicare cost report audits and overpayment identification.
- To inform healthcare providers about new regulatory expectations and potential compliance challenges.
Main Methods:
- Review of Program Memorandum (PM) A-01-141 regarding Medicare cost report audit reopening criteria.
- Analysis of a proposed rule from CMS (January 25, 2002) mandating timely identification and return of Medicare overpayments.
Main Results:
- PM A-01-141 establishes a general rule against reopening cost reports or settling appeals if supporting documentation was unavailable during the initial audit.
- A proposed rule requires Medicare providers to identify and return overpayments within 60 days of discovery, with 'overpayment' definition leaving room for interpretation.
Conclusions:
- Healthcare providers face evolving and potentially more stringent regulatory requirements from CMS.
- Providers must exercise diligence in managing Medicare cost reports and promptly addressing any identified overpayments to ensure compliance.