BASIC (05-01)

HI 02201.010 Recovery of Medicare Overpayments

A. Procedure--Processing Center (PC)--Overpaid Individual in Current Pay Status

  1. Propose full withholding of any benefit payable to the overpaid person in current pay status unless:

    • the debtor or his/her authorized representative requests partial withholding at a lesser rate; or

    • withholding of a lesser amount is requested by the referring agency (Centers for Medicare & Medicaid Services (CMS) Central Office, CMS Regional Office or the Medicare contractor).

  2. Follow the procedure in SM 00610.790 for establishing the overpayment on ROAR.

    NOTE: Any underpayment should be applied to the overpayment.

  3. Complete the Beneficiary Overpayment Return Notice (see HI 02201.015, Exhibit B) and return it to the CMS Central Office, CMS RO or the Medicare contractor upon completion, or cessation of recovery of the overpayment. Include a copy of the SSA overpayment notice. Annotate Medicare contractor or CMS RO's name, address and telephone number to the Special Message field on the MBR.

B. Procedure--Overpaid Individual is not in Current Pay Status

  1. If the overpaid individual is not in current pay status, return the Medicare overpayment file to the referring agency (CMS Central Office, CMS RO or the Medicare contractor) and explain why SSA cannot withhold the overpayment.

  2. If the overpaid individual becomes ineligible for payment during the recovery of the overpayment, complete the Beneficiary Overpayment Return Form (see HI 02201.015, Exhibit B), remove the overpayment from the ROAR, then send it to the referring agency (CMS Central Office, CMS RO or the Medicare contractor) within 60 calendar days. Explain why recovery of the overpayment was stopped.

C. Procedure--Situations that Preclude Recovery of a Medicare Overpayment

  1. If a waiver, compromise or appeal request is pending for an SSA overpayment, return the Medicare overpayment file to the referring agency (CMS Central Office, CMS RO or the Medicare contractor) within 60 calendar days. Explain why the total or the balance of the overpayment recovery request cannot be withheld.

  2. If recovery process of the Medicare overpayment has begun when an SSA overpayment is discovered, stop the withholding and remove the Medicare overpayment from ROAR. Complete the Beneficiary Overpayment Return Notice (see HI 02201.015, Exhibit B) and send to the referring agency (CMS Central Office, CMS RO or the Medicare contractor) within 60 calendar days. Explain why the balance of the overpayment recovery request cannot be withheld, include a timeframe when the referring agency (CMS Central Office, CMS RO or the Medicare contractor) can resubmit the title XVIII overpayment to the appropriate SSA office.

    Example: If SSA received an overpayment from CMS on 4/9/01 and there is already an existing SSA overpayment, then the Beneficiary Overpayment Return Notice (HI 02201.015, Exhibit B) would have a date that is SSA's best guess as to when the overpayment can be resubmitted, e.g., 10/9/01 (6 months) or 4/9/02 (1 year).

    NOTE: Any money previously withheld will be applied to the Medicare overpayment and placed in the appropriate Medicare Trust Fund (see HI 02201.015, Exhibit B). Any compromise requests must be forwarded to the appropriate CMS RO.

  3. The beneficiary requests waiver because of an adverse change in his/her financial situation. The waiver request should be forwarded to the referring agency (CMS Central Office, CMS RO or the Medicare contractor) within 60 calendar days from receipt of the waiver request.

  4. The beneficiary dies during the overpayment recovery period, propose adjustment against survivor benefits payable on the overpaid earnings record. The Beneficiary Overpayment Return Notice (See HI 02201.015, Exhibit B) should be completed and returned to the appropriate referring agency (CMS Central Office, CMS Region Office or the Medicare contractor) within 60 calendar days upon receipt of the notification of death. Include an explanation on what decision has been made to further recover the overpayment.

D. Examples of Overpayment Notice Language

The first paragraph reminds the beneficiary about the Medicare overpayment and amount.

Example: "According to (name of the Medicare contractor), you were notified on (date) that you are liable for an overpayment of $