On February 16, CMS issued its long-awaited proposed rule (the Proposed Rule) implementing the requirements for reporting and returning overpayments set forth in the Affordable Care Act (the Act) (available here). The Act requires a person who has received an overpayment to report and return that overpayment by the later of: “(1) the date which is 60 days after the date on which the overpayment was identified; or (2) the date any corresponding cost report is due, if applicable.” Failure to comply with these requirements may result in significant penalties, including False Claims Act liability, Civil Monetary Penalties liability, and exclusion from participation in federal health care programs.

The Proposed Rule would result in heightened reporting burdens and uncertainty for providers and suppliers. Key features include the following:

• Adoption of an existing voluntary refund process as the sole methodology for reporting overpayments, absent self-disclosure under the OIG Self-Disclosure Protocol (OIG SDP).
• An “actual knowledge, reckless disregard or deliberate ignorance” standard for determining when an overpayment is “identified” that leaves significant uncertainty about the point at which the “60-day clock” will begin to run.
• An extraordinarily lengthy 10-year “lookback” period for reporting.

Please see full advisory below for more information.