Limitation of recoupment process (Medicare Modernization Act [MMA] 935)

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Home ► Appeals ► Limitation of recoupment process (Medicare Modernization Act [MMA] 935)

Last Modified: 2/21/2024 Location: FL, PR, USVI Business: Part A, Part B

Limitation of recoupment process (Medicare Modernization Act [MMA] 935)

Section 935 of the MMA requires changes to the way Medicare recoups certain overpayments.

Overpayments subject to limitation of recoupment:

• Post-pay denials of claims, under Part A and Part B, for which a written demand letter was issued.

• Medicare secondary payer (MSP) recovery for a duplicate primary payment and for which a written demand letter was issued.

• MSP recovery based on the provider’s failure to file a proper claim with the primary insurer.

• Final claims associated with a home health agency (HHA) request for anticipated payment (RAP) under home health prospective payment system (HH PPS), but not the RAP itself.

Overpayments not subject to limitation of recoupment:

• All other MSP recoveries

• Beneficiary overpayments

• Overpayments from a cost report determination

• Overpayments that are appealed under the provider reimbursement payment (PRB) process of 42 CFR, part 405, subpart R-Provider/Reimbursement Determinations and appeals.

• HHA RAP

• Hospice caps calculations

• Provider initiated adjustments

• Accelerated or advanced payments

• Certain claim adjustments at the contractor’s discretion (which will require CMS approval)

Overpayments subject to the Section 935 limitation of recoupment provision, to ensure limitation of recoupment occurs:

• Providers should file their request for redetermination by the 30th day following the date of the first demand letter.

• Providers are encouraged to send a copy of the demand letter with the appeal request.

Changes have also been made to the Medicare Redetermination Form (4579) to indicate an applicable appeal.

Recoupment can proceed on day 41 from the first demand letter, unless a valid and timely request for a redetermination is received, unless payment is made in full or a valid ERS (extended repayment schedule) request is received. If an appeal request is not received within 30 days from the initial demand date but is received later, the contractor will cease recoupment once the appeal is validated, however funds already recouped will not be returned to the provider.

Once we receive a valid and timely redetermination on an overpayment eligible for the limitation of recoupment the following will happen:

• Contractor will cease recoupment.

• Interest will continue to accrue.

• Once the redetermination decision is made and the revised overpayment notice is issued, recoupment will begin no earlier than the 60th day from the date of the notice.

A provider can stop Medicare from recouping again by filing the next level of appeal (reconsideration with the Qualified Independent Contractor (QIC).

Once a valid and timely reconsideration is filed on an overpayment eligible for the limitation of recoupment the following will happen:

• The QIC will notify the contractor that a valid request was received.

• The contractor will cease recoupment.

• Interest will continue to accrue.

• Once the reconsideration decision is made and the revised overpayment notice is issued, recoupment will begin on the 30th day from the date of the notice.

Regardless of any subsequent appeals (Administrative Law Judge, the Medicare Appeals Council, or Federal Court) the contractor will continue to recoup until the debt is satisfied in full.

Interest will accrue on an overpayment, if not repaid within 30 days of the original demand date. If the overpayment is not made, interest will continue to accrue for each subsequent full 30-day period. If the overpayment amount is reduced, interest will be recalculated and adjusted for the overpayment amount from the original demand date, regardless of the date the revised overpayment amount is determined.

Note: A valid appeal request (redetermination or reconsideration) will delay offset (unless otherwise requested) but will not cease the assessment of interest.

The appeal timeframes remain the same. Follow the instructions in your overpayment or appeal determination letter.

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