Medicare Advantage (MA) Plan Overpayments - Frequently Asked Questions (FAQ)

Published 01/04/2021

Extension of Settlement Offer Deadline Due to COVID-19 — Updated June 15, 2020

Question: Why is CMS extending the deadline for accepting the Settlement Offers?

Answer: CMS is extending the Settlement Offer deadline to July 15, 2020, because some providers may have lost sight of the prior deadline due to the COVID-19 outbreak.

Question: Who is affected by the extension of the deadline?

Answer: This COVID-19 extension affects only a relatively small number of providers; eighty percent (80%) of providers that received Settlement Offers in early January 2020 have already accepted them. Palmetto GBA will be sending out “reminder letters” to affected providers; that is, to providers that received Settlement Offers but have not yet responded to the Offers. However, Palmetto GBA will not issue “reminder letters” to providers whose original letter was returned as undeliverable (and Palmetto GBA was unable to obtain an updated address).

Question: With the COVID-19 extension, how much additional time is CMS giving providers to consider the January 2020 Settlement Offers?

Answer: As indicated in the “reminder letters,” providers will have until July 15, 2020, to accept the Settlement Offer and to remit the associated payment.

Question: We already submitted our signed Settlement Agreement and payment. Do we need to do anything?

Answer: No. Providers that have already accepted the Settlement Agreements will not receive a “reminder letter.” If a provider believes that it has received a “reminder letter” in error, it should contact Palmetto GBA immediately.

Question: We cannot locate our original paperwork. Will CMS provide a copy of the original Settlement Offer letter?

Answer: Yes. On or about June 16, 2020, Palmetto GBA will be issuing “reminder letters” to the twenty percent (20%) of providers that have not yet accepted their Settlement Offer. Enclosed with each “reminder letter” will be a copy of CMS’s original Settlement Offer (dated January 3, 2020) along with the same listing of claims as was enclosed with the original Settlement Offer.

Question: Where should Settlement Offer payments be sent?

Answer: Providers will need to sign and date their acceptance (as indicated on the Settlement Offer), and return the Settlement with a check payable to Medicare for the required amount to:

Palmetto GBA, LLC
P.O. Box 100312
Columbia, SC 29202-3312

Question: What happens if we do not respond to the Settlement Offer by July 15, 2020?

Answer: Providers that do not accept the CMS Settlement Offer by July 15, 2020, will receive a Medicare demand letter for the full balance owed, which they will need to repay. However, these providers will be permitted to pursue appeals on any of the claims if they wish to. CMS plans to issue these Medicare demand letters in early August.

Question: How much time do providers have to resolve issues with their Settlement Agreements?

Answer: Due to the COVID-19 emergency, CMS has extended Settlement Offer due date from early March to July 15, 2020. Palmetto GBA will process provider settlement submissions (i.e., signed and dated Settlement Agreement, with check payable to “Medicare” and matching to the settlement amount) that are postmarked on or before July 15, 2020. Similarly, providers that have been contacted by Palmetto GBA due to a missing or unsigned Settlement Agreement, and/or due to a mismatch between their checks and Settlement Agreements, are encouraged to resolve these issues as soon as possible, and to not wait until the last minute. Such issues need to be resolved no later than July 15, 2020.

Providers that do not accept the CMS Settlement Offers (including those providers that submit incomplete agreements which cannot be resolved timely) will receive demand letters for the full overpayment amount on or about the first week of August 2020.

Question: Can we do a partial settlement? For example, if we receive the Phase Three letter that lists 10 claims and we only want to settle on five of them. Is this an option?

Answer: No. CMS’s Settlement Offers relate to the full set of claims included with the Phase Three letter. Partial settlements will not be accepted. Providers rejecting CMS’s Settlement Offer in the third letter will receive a demand letter for the full balance. The letters will specify the provider’s FFS appeal rights, which will include the right to appeal any claim or set of claims.

Question: When a provider wants to accept CMS’s Settlement Offer, is it sufficient for the provider to send in a check for the settlement amount to Palmetto GBA, or does CMS also require the provider to sign and submit the Settlement Agreement? 

Answer: No, it is not sufficient for the provider to submit only a check. For CMS to consider the Settlement Agreement to be valid, CMS requires that the provider sign, date, and submit the Settlement Agreement, along with a check (payable to “Medicare”) that corresponds to the full settlement amount due, as indicated in the Settlement Agreement. These documents should be submitted together to the designated Palmetto GBA address.

Question: What happens when the provider forgets to send in the signed Settlement Agreement?

Answer: When providers have forgotten to enclose signed Settlement Agreements along with their checks, Palmetto GBA has contacted them to obtain the signed Agreements. Providers can avoid this extra back-and-forth by enclosing both their signed Agreements and checks (matching to the settlement amount due) with their initial submission.

Providers receiving “reminder letters” are encouraged to submit complete Settlement Agreements the first time (i.e., signed and dated Settlement Agreement, coupled with a check payable to “Medicare” that matches to the Settlement Agreement amount), and to not wait until the last minute. 

Question: What happens when the provider sends in a check for an amount that does not correspond to the Settlement Agreement amount (i.e., a partial payment)?

Answer: Some providers have submitted checks that do not match the amount shown in CMS’s Settlement Agreement. CMS will not accept partial settlement payments and does not consider these Settlement Agreements to be valid.

Palmetto GBA has been making follow-up calls to the providers that have short-paid the settlement. Providers can avoid this extra back-and-forth by enclosing the full settlement amount due (an amount that matches to the CMS Settlement Offer dated January 3, 2020) with their initial submission.

If such situations cannot be resolved timely, CMS has instructed Palmetto GBA to refund any partial payments received, and to proceed as though no Settlement Agreement exists.

General FAQ
Question: What is the resolution to the MA overpayment issue?
Answer: A thorough investigation was conducted to not only ensure protection of Medicare trust fund but to evaluate the concerns of the stakeholders. This allowed the Centers for Medicare & Medicaid Services (CMS) the opportunity to consider multiple aspects of this issue, and to give Palmetto GBA time to research “exception cases” submitted by providers. Palmetto GBA has completed all “exception case” reviews and all submitting providers have been notified of Palmetto GBA’s determinations.

With respect to the remaining unresolved MA overpayments, depending on their specific claims and circumstances, each affected provider will receive one, two or three detailed letters. Many providers will receive the first letter, advising of claims redeemed by MA plan voluntary payments to the Medicare FFS program.

Some providers will receive the second letter, which will require repayment to the Medicare FFS program, but which will facilitate provider rebilling to the correct MA plan.

Finally, some providers will receive the third letter, which will include a CMS Settlement Offer for the remaining claims. Providers accepting these Settlement Offers will retain a sizable portion of the erroneous claims payments and other advantages. Providers rejecting the Settlement Offers will need to make repayment in full, but will have FFS appeal rights. Additional information can be found in the Medicare Advantage (MA) Plan Overpayments: Background article.

Question: Have all the exception requests been considered?

Answer: Palmetto GBA has fully considered the exception requests that were elicited from providers in 2018. That process has concluded. Palmetto GBA fully agreed with some exception requests, partially agreed and partially disagreed with other exception requests, and for some other exception requests, there was no factual support. All providers submitting exception requests have been notified of the results of Palmetto GBA’s review.

Question: Did CMS and Palmetto GBA ask the MAO plans to consider making voluntary payments to redeem the erroneous payments made by the Medicare FFS program to providers that had furnished covered services to their enrollees?

Answer: Yes. CMS’s request for MAOs to consider making voluntary payments to the Medicare Fee-For-Service (FFS) program to resolve the MA overpayments and relieve provider burden was successful in many cases.

Question: I identified a claim that was formerly included in one of my prior notification letters (these notification letters were dated June 15, 2018, and/or January 28, 2019), that is missing from the lists provided to me in the new letters. I am advised that it was not and will not be included in any Palmetto GBA letter. What should I do?

Answer: If a claim is not included in any of the new letters that a provider may receive concerning this matter, then CMS and Palmetto GBA do not consider an MA plan overpayment to exist with respect to the claim. For MA plan overpayment purposes, the only claims that providers need to take action on will be identified in the second letter, which will require repayment to Medicare FFS but which will steer affected providers to coordinate with the applicable MA plan, and claims that are identified in the third letter, which will include all claims encompassed by the CMS Settlement Offer. Providers rejecting the CMS Settlement Offer will later receive a demand letter for the full amount of the overpayment, but will be afforded claims appeal rights. Again, with respect to the MA plan overpayment issue, providers only need to take action on those claims which are identified in either of the two letters described above.

Question: How will we know what claims were looked at?

Answer: CMS and Palmetto GBA looked at all claims enclosed with the original notification letters dated June 15, 2018, and January 28, 2019. In the first new letter, providers will see which of these claims were redeemed through voluntary MAO payments. The second and third letters will identify the claims that providers need to take action on, and the specific actions that providers need to take. In respect to the MA overpayments issue, providers do not need to take any action to resolve claims not identified in any of the three letters. If a claim is not identified in one of the letters, then CMS and Palmetto GBA do not consider that an MA plan overpayment exists with respect to that claim.

Question: If a claim is not listed does that mean that it was not included in the MA plan overpayment?

Answer: CMS does not consider an MA plan overpayment to exist if the claim is not identified in any of the three letters described in this CPIL update and the related article. Providers should respond accordingly to the specifics of each letter and the claims included within it.

Question: What are my options if I do not agree with one or more claims included in either the December or the January letters?

Answer: Providers will be able to appeal claims under normal FFS procedures that are included in the Phase Two demand letters; however, providers should note that if they are successful in receiving payment for any of the claims from an MA organization, then they will have received a duplicate payment and immediate repayment will be expected. Providers accepting CMS’s Settlement Offer will accept the settlement for the full set of claims on the associated listing. Providers rejecting CMS’s Settlement Offer in the third letter will receive a demand letter for the full balance. The letters will specify the provider’s FFS appeal rights, which will include the right to appeal any claim or set of claims.

Question: Will CMS or Palmetto GBA provide us with MA Plan rebilling instructions?

Answer: No, the MA plans would provide any rebilling instructions. Palmetto GBA’s Phase Two letter will identify a point of contact for all of the MA plans associated with the specific provider’s Phase Two MA overpayment claims. If you choose to submit claims to the applicable MA plans, please contact their respective designated points of contact to discuss the specific procedures you must follow in resubmitting the claims. Do not submit claims to an MA plan without first contacting the designated point of contact. If you proceed otherwise, and just submit claims to an MA plan without prior notice, then administrative or systems limitations may result in a rejection of your claims.

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