Apr 15, 2024
Apr 15, 2025
Written By Elizabeth Cifers
We’re only human, and humans make mistakes. With medical administrators' best efforts to comply with Medicare regulations, improper payments are still a familiar part of the insurance claims process.
Errors can be identified by the Medicare Administrative Contractors (MACs), but they’re often discovered by the practices receiving the payment. Medicare's 60-day rule applies to overpayments at any medical practice, including your retina clinic. Read on to learn about the 60-day rule and how you can stay compliant.
In February 2012, the Centers for Medicare & Medicaid Services (CMS) published a final Medicare Part A and B rule regarding overpayments. In effect as of March 2016, the rule states:
“This final rule requires providers and suppliers receiving funds under the Medicare program to report and return overpayments by the later of the date that is 60 days after the date on which the overpayment was identified; or the date any corresponding cost report is due, if applicable.”1
This 60-day rule raises several questions about the nature of identifying, reporting, and returning overpayments, which are addressed in the Federal Register. To help you better interpret the rule, I’ve isolated significant statements below and included a few notes from my many years in medical industry administration and consulting. However, please know that these comments are my own and are not legal advice. Refer to Medicare regulations for the final say on all compliance matters, and remember to consult your retina practice’s attorney if you have any questions.
The Federal Register provides the following guidance on the meaning of identification in the 60-day rule:
“This final rule states that a person has identified an overpayment when the 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.”1
After reading the statement above, you may ask: “At what point in the revenue cycle would overpayments be identified at my retina clinic? When should they be identified? What is “reasonable diligence?”
As a proactive compliance activity, it’s recommended that medical practices perform coding and documentation audits at a minimum annually. Still, audits can also be biannual or quarterly, depending on your retina practice’s needs. Audits are only one way overpayments are identified. Another is working on the Accounts Receivable (A/R) each month and identifying negative balances, which may or may not be an overpayment and must be researched.
The 60-day clock starts once an actual overpayment is identified and verified. However, if the practice does not perform due diligence in investigating a reported overpayment, the clock begins the day the information becomes available. Additionally, the practice must determine whether the overpayment is a one-off or a more pervasive problem. Choosing to ignore the potential overpayment issue for claims other than the one found can create liability under the False Claims Act.1
If you suspect overpayment, perform due diligence and start the clock once you confirm. This is one of those places where you want to draw a wide boundary.
If not discovered in the regular course of practice operations, the overpayment may be caught by your Medicare Administrative Contractor (MAC), who sends an overpayment demand letter if the overpayment is more than $25.00.2
How do you report and return overpayments to Medicare? Using existing processes. Easy enough! The Federal Register indicates:
“This final rule states that providers and suppliers must use an applicable claims adjustment, credit balance, self-reported refund, or another appropriate process to satisfy the obligation to report and return overpayments.”1
Overpayments can result from mistakes on the part of your MAC or your practice. If your MAC identifies an overpayment, follow the instructions in the demand letter to return the overpayment. If it’s self-identified, determine if the overpayment was accidental on the part of your retina practice. If it was a genuine mistake, perform the appropriate due diligence for other overpayments of the same type with a probe audit, check with your MAC on their return process, and return the overpayment. If the probe audit indicates the issue is more pervasive, it may be time to contact your healthcare attorney.
Suppose you believe the overpayment may be intentional. It may now be considered a false claim that must be reported to your MAC and Health and Human Services Office of the Inspector General (HHS-OIG) using the Self-Disclosure Protocol. Contact your healthcare attorney to determine your next steps.
Additionally, in October 2023, CMS published a Medicare Learning Network (MLN) Fact Sheet indicating that overpayments resulting from a violation of the physician self-referral law should be reported through the Self-Referral Disclosure Protocol, specifically.3
Among the top reasons for overpayments that may be identified and invoke Medicare’s 60-day rule include:
Proper coding and documentation are essential. Equally important is ensuring the medical necessity of your services to your retina patients. In other words, the documentation and medical necessity should support all claims submitted.
Improper payments happen. Medicare’s 60-day overpayment rule provides guardrails for a proper response when identified. Compliance is simple but crucial.
Mistakes—either on your practice’s part or the part of your MAC—can be caught when working your A/R each month. Establishing a schedule for regular coding and documentation audits (internal and external) can also help identify overpayments and reduce risk at your retina clinic. I’d be happy to partner with you in this endeavor.
Let’s put my decades of experience in medical administration and consulting to work for you. My career has centered on ophthalmology and retina, so I know what to look for regarding retina overpayments. Schedule an initial consultation with me here.
Sources:
1Medicare Program; Reporting and Returning of Overpayments (Final Rule), 81 FR 7654 p. 7654-7684 (February 12, 2016). https://www.federalregister.gov/documents/2016/02/12/2016-02789/medicare-program-reporting-and-returning-of-overpayments. Accessed April 10, 2024.
2Centers for Medicare & Medicaid Services (CMS). MLN Fact Sheet: Medicare Overpayments, ICN MLN006379 (March 2020). https://www.hhs.gov/guidance/sites/default/files/hhs-guidance-documents/overpaymentbrochure50809textonly.pdf. Accessed April 11, 2024.
3Centers for Medicare & Medicaid Services (CMS). MLN Fact Sheet: Medicare Overpayments, MLN006379 (October 2023). https://www.cms.gov/outreach-and-education/medicare-learning-network-mln/mlnproducts/downloads/overpaymentbrochure508-09.pdf. Accessed April 10, 2024.
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