Whether you’ve coded a claim incorrectly, failed to justify medical necessity or made another error, you’re likely to receive a Medicare demand letter asking for money back in certain cases. Any time your MAC pays you $25 or more in excess of what they should have, you’re subject to the recovery and recoupment process, which means they want that cash back, and quickly.
The demand letter will explain why you got overpaid, how much you need to pay back and the deadline for submitting it.
But before you simply comply with the requests in a Medicare demand letter, it’s important to know your options. Check out three to consider.
Option 1: Pay the Money Back
Before responding to a Medicare demand letter, you should analyze whether the payer is correct in suggesting that you owe them money. Take a look at the claim in question, determine whether you really did make an error, and then decide if you should pay back the overpayment. If you find that the issue was on your end, you can pay the MAC back in several ways:
- Make a payment: Using the criteria outlined in your demand letter, you can pay the insurer back. The Medicare demand letter will indicate whether you can send a check, electronic payment, or other method.
- Request immediate recoupment: If you do this, your MAC will automatically recoup the overpayment. But be careful if you do this, because unless you specifically make a one-time request, the MAC will apply immediate recoupments to all future overpayments.
- Wait for the standard recoupment: After the deadline passes, if you haven’t paid or issued a rebuttal to the demand letter, your MAC will recoup the overpayment on its own.
- Request an extended repayment schedule (ERS): If you can’t pay back the entire overpayment at the same time, you can ask Medicare for a payment schedule to reimburse the MAC in increments.
Option 2: Submit a Rebuttal
If you disagree with the Medicare demand letter details, you can submit a rebuttal to your MAC within 15 days of the date on the letter. In your rebuttal, you should explain why the recoupment request is incorrect and share documentation to support your case.
Keep in mind that a rebuttal won’t stop the recoupment process from continuing. It may allow you to delay recoupment, but you will likely still be responsible for the debt owed. In other words, a rebuttal may delay the process, but won’t stop it.
Option 3: Appeal the Recoupment
You can appeal a MAC’s overpayment decision, the first step of which is called redetermination. You must file your redetermination by the 30th day following the date on the demand letter.
To file your redetermination, you can either complete Medicare’s CMS-20027 form or send a letter including the patient’s name and Medicare identification number, along with the dates of service and the services your practice provided. Include an explanation of why you disagree with the demand letter and include any supporting documentation to show why you don’t owe the money.
There’s so much more to know about how to deal with Medicare recoupments. Get the scoop from expert David J. Zetter, PHR, SHRM-CP, CHCC, CPCO, CPC, COC, PCS, FCS, CHBC, CMUP, PESC, CMAP, CMAPA, CMMP, CMHP, during his online training event, Stop Payers from Taking Back Your Claim Payments With ERISA. Register today!
Check out our Appeals Playlist on YouTube for the latest expert advice, and subscribe to our YouTube channel for step-by-step guidance!
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