On February 11, 2016, CMS released its eagerly awaited final overpayment rule for Parts A and B.  The Final Rule responds to significant concerns voiced by the provider community and, in some respects, is more workable than competing alternatives.

The Final Rule defines identification of an overpayment as when a person “has or should have, through the exercise of reasonable diligence, determined that the person has received an overpayment and quantified the amount of the overpayment.”  Importantly, this standard affords providers the opportunity to conduct an investigation and quantify the overpayment amount before the beginning of the 60-day clock.  Additionally, in its commentary, CMS established a six-month benchmark for the outer timeframe for completing most overpayment investigations. 

In the Final Rule, CMS also adopts a maximum six-year lookback period, as opposed to the ten-year period originally proposed.  CMS additionally discarded its original proposal for specific data elements for overpayment submissions and instead (except for details regarding statistical sampling) will rely on existing processes for reporting and returning overpayments.

The Final Rule will be effective on March 14, 2016.

Reporter, Isabella E. Wood, Atlanta, + 1 404 572 3527, iwood@kslaw.com.