Corporate

Overview Overview

Overpayments are Medicare payments to a provider/supplier in excess of amounts due and payable under the statute and regulations. Once a determination of an overpayment has been made, the amount is considered a debt owed by the debtor to the United States Government and CGS must attempt recovery of the overpayment in accordance with the Centers for Medicare & Medicaid Services (CMS) regulations. CMS requires CGS to request refunds on Non-MSP overpayments of $25 or more. If a supplier owes several small overpayments, each of which is less than $25, the total of the overpayments will be added together and a demand letter will be issued. The tolerance does not apply to MSP overpayments.

When CGS determines that a provider has been overpaid, we will issue an overpayment demand letter.   The debtor has 30 days from the date of the demand letter to refund the contractor. If the overpayment is not paid within the timeframe specified in the initial demand letter, interest begins to accrue on the amount.  For overpayments not subject to the Limitation on Recoupment or in an excluded category, standard recoupment begins on Day 16.   For overpayments subject to Limitation on Recoupment, if full payment is not received by the 40th day from the date of the initial demand letter, the recoupment process will begin on the 41st day.  These collection activities will be  in the form of an offset. Current and future payments will be offset until the overpayment is completely recouped. If you would prefer to refund the debt through the offset process, you can complete an immediate offset Form.

There are two types of overpayments:

  • Non-MSP – where Medicare fee-for-service is primary, and
  • MSP – where Medicare fee-for-service is secondary

CMS requires the Medicare Administrative Contractor (MAC) and other entities including the Recovery Audit Contractor (RAC), Unified Program Integrity Contractor (UPIC), Supplemental Medical Review contractor (SMRC) to analyze claims payment data and conduct reviews of Medicare claims.  The Beneficiary and Family Centered Care (BFCC) Quality Improvement Organizations (QIO) may also perform a review of a claim.  Upon completion of the review, in most cases a Notification letter will be mailed with the results of claims reviewed.  The Notification letter is not a demand letter.      

When CGS or other Medicare contractor determines that a provider has been overpaid, the MAC is responsible for issuing the overpayment demand letter.   The debtor has 30 days from the date of the demand letter to refund the contractor. If the overpayment is not paid within the timeframe specified in the initial demand letter, interest begins to accrue on the amount. If full payment is not received by the 40th day from the date of the initial demand letter, the recoupment process will begin in the form of an offset. Current and future payments will be offset until the overpayment is completely recouped. If you would prefer to refund the debt through the offset process, you can complete the Immediate Offset Request FormPDF.

Once you receive the overpayment demand letter, if you disagree, you may file an appeal.  For more information regarding appeals refer to:” to say “If you disagree with the overpayment you may file an appeal.  For more information refer to the Part A Appeals/Redeterminations Web page.

Was this page helpful? YES NO


Two Vantage Way, Nashville, TN 37228 © CGS Administrators, LLC. All Rights Reserved