Winning The First Salvo In The Overpayment Battle
As soon as you receive a request for copies of charts, you should make the call to your insurance company. There is no such thing as a benign request for progress notes so accept the Medicare demand for progress notes for what it is: the first shot taken in a battle that is about to unfold.
“Recoupment” means the contractor (e.g. Palmetto GBA) withholds future Medicare payments until the demanded overpayment and accrued interest get paid. When Palmetto gets a check from the provider for the full overpayment demand amount (which is always inadvisable), this is not a recoupment. When Palmetto gets a check from the provider for a negotiated, reduced amount (this should be a last resort), this is not a recoupment either. A recoupment only occurs when Medicare takes your future earnings to pay the overpayment plus the accrued interest amount.
Allowing recoupment is the best course of action when you have a defensible case because the ALJ will make the contractor refund the full amount taken from you along with the accrued interest for each and every claim on which you prevail.
You should never respond by writing a check when you receive the overpayment demand, even when the demanded amount is small. Even if you think the amount in question is so small that it is not worth the fight, there is an implied admission of guilt.
Appeals for overpayments occur in exactly the same way as underpayment appeals. However, in order to stop the recoupment process in its tracks during the redetermination appeal, you must submit your redetermination appeal within 30 days of receiving the notice of overpayment. In order to stop the recoupment process in its tracks during the reconsideration appeal, you must submit your reconsideration appeal within 60 days of receiving the redetermination decision.
In either case, if you exceed the statute of limitations, the carrier will start recoupment of the full overpayment amount, plus interest, from your future earnings. Do not let them do this. Get your appeals in early.
There is no chance that the carrier will decide in your favor at the redetermination appeal level. The carrier gets to pocket a portion of the overpayment amount recovered.
There is almost no chance that the QIC will decide in your favor at the reconsideration appeal level. The QIC wants to keep CMS happy so the QIC can get to keep the lucrative CMS contract.
However, there is an excellent chance that the ALJ will decide in your favor at the ALJ hearing appeal level. The administrative law judges are truly neutral parties who are not bound by the decisions of the carrier or the QIC. Your hearing is a new “de novo” trial and the ALJ will consider all of the evidence as though being presented for the first time.
Moreover, with rare exception, the ALJs are not only fair, they also understand the financial motivation of the carriers as well as the difficulties inherent with record keeping in the day-to-day practice of medicine. Your records do not have to be perfect. They just have to be legible and show what you did and why you did it in a way that makes sense to the ALJ.
Understanding Your Rights With Overpayment Appeals
When you receive a Medicare repayment of overpayment demand, you have nothing to lose and everything to gain by refusing to pay and, instead, methodically appealing every Medicare (RAC) demand for repayment of any alleged overpayment. Why?
First, Change Request (CR) 6183 limits (controls) the conduct of the RACs and the claim processing contractors (e.g. Palmetto) during the recoupment process. Currently, the RACs and the claim processing contractors are paying little if any attention to the CR 6183 rules (see “A Closer Look At Overpayment Regulations” below). This works in your favor because the ALJs will not tolerate this behavior on the part of the RACs and claim processing contractors.
Second, you likely will win at the ALJ level if you have anything that even approaches the level of a reasonable argument in defense of the procedure codes billed.
Third, you will get back every dollar recouped by Medicare along the way. This includes interest on that money and any additional interest taken by Medicare during the recoupment process.