How would you feel if CMS had a direct line into your wallet and took out money every time it felt you were overpaid? Well, you're in luck, because neither technology nor law has gone that far. Instead, CMS is giving you a direct debit option that allows the agency to withdraw funds from your bank account and avoid interest on overpayments, according to Transmittal 7688 that was released Jan. 27.
As it is now, your Medicare Administrative Contractor (MAC) begins recouping overpayments 41 days from the date of the initial demand letter. If you don’t pay the debt in full within 30 days of receiving the letter, interest accrues on the overpayment. As of July 1, you’ll be able to avoid paying interest by requesting your MAC start the recoupment process before 41 days, CMS says in the transmittal. Opting to start the recoupment within 30 days of getting the demand letter will keep you from paying interest and making payments via check, the agency says.
The catch: Requesting an immediate recoupment is considered a voluntary repayment, CMS says. Here are key things you need to know if you volunteer for this early “direct debit process:
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Providers who choose immediate recoupment must do so in writing to the contractors.
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The request will be for a particular overpayment or as a permanent request for all overpayments.
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By choosing immediate recoupment, providers are waiving their rights to section 935 interest.
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Providers can terminate the immediate recoupment process at anytime. The request to terminate must be in writing.