Medicare Secondary Payer (MSP) Civil Money Penalties (CMP)
Recent Medicare Secondary Payer Final Rule update draws attention to the importance of ensuring that Medicare Section 111 (SCHIP) Reporting is identifying all claims involving Medicare Beneficiaries are reported quarterly as required.
Recently, the Office of management and Budget’s Office of Information and Regulatory Affairs (OIRA) posted a conclusion of the regulatory review of MSP and Certain Civil Money Penalties.
In brief, the OIRA found that the rule was not “economically significant” following an economic analysis. According to the OIRA, prior to April 2023, “A regulatory action is determined to be “economically significant” if OIRA determines that it is likely to have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities. For all “economically significant” regulations, the Executive Order directs agencies to provide (among other things) a more detailed assessment of the likely benefits and costs of the regulatory action, including a quantification of those effects, as well as a similar analysis of potentially effective and reasonably feasible alternatives.” After April 2023, this definition was amended and OIRA designated regulatory actions as “Significant” if they are likely to result in a rule that may have an annual effect on the economy of $200 million or more (adjusted every 3 years by the Administrator of OIRA for changes in gross domestic product); or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, territorial, or tribal governments or communities. After April 6, 2023, OIRA no longer designated regulatory actions as “Economically Significant.”
Despite OIRA and CMS having determined no economic significance, the concluded action is denoted “Consistent with Change”. There are no details regarding any change to the CMP rule of penalties up to $1000 per claim per day, for each day a claim involving a Medicare Beneficiary is not reported to CMS under Section 111 Reporting.
Will CMS increase the fines and penalties based on inflation? It is not currently known.
What we do know is that the notice may signal an imminent release of the Final Rule involving Medicare Secondary Payer compliance and Civil Money Penalties. The Final Rule will specify how and when CMS will calculate and enforce civil money penalties when Responsible Reporting Entities (RREs) fail to adhere to the MSP reporting requirements, and we will continue to follow this regulation and inform how it impacts your claims.
If you are not already compliant with Section 111 Reporting of all claims involving a Medicare Beneficiary on a quarterly reporting bases, the following are tips for success:
- Commit to a monthly query file reporting of all claims to CMS to identify each claim involving a Medicare Beneficiary.
- Provide accurate data in Section 111 data fields, avoiding error reports.
- Ensure accuracy with ORM (Ongoing Responsibility for Medical) and any changes to the claim, as it progresses through the claim process.
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