§ 1101.69. Overpayment—underpayment.
(a) Except as provided in subsection (b), if a provider discovers that the Department has underpaid the provider under this part, or that a recipient has other coverage for a service for which the Department has made a payment, the provider shall be paid the amount of the underpayment or shall reimburse the Department the amount of the overpayment according to the instructions in the provider handbook.
(b) For payments to providers that are subject to cost settlement, if either an analysis of the provider’s audit report by the Office of the Comptroller discloses that an overpayment has been made to the provider or the provider advises the Department in writing that an overpayment has occurred for a cost reporting period ending on or after October 1, 1985, the following recoupment procedure applies:
(1) The Office of the Comptroller will issue a cost settlement letter to the provider notifying the provider of the amount of the overpayment. The cost settlement letter will request that the provider contact the Office of the Comptroller within 15 days of the date of the letter to establish a repayment schedule. The date of the cost settlement letter will count as day 1 in determining the 15-day response period to the cost settlement letter and the repayment period for the overpayment. The provider’s timely written response to the cost settlement letter will be determined by the postmark on the provider’s letter or, if hand delivered, the Department’s date stamp.
(2) If the provider does not submit an acceptable repayment plan to the Department or fails to respond to the cost settlement letter within the specified time period, the Department will offset the overpayment amount against the provider’s MA payments until the overpayment is satisfied.
(3) An acceptable repayment schedule includes either direct payment to the Department by check from the provider or a request by the provider to have the overpayment offset against the provider’s Medical Assistance payments until the overpayment is satisfied. To be acceptable, a direct repayment or offset plan shall ensure that the total overpayment amount is repaid to the Department by the date on which the Department is required to credit the Federal government with the Federal share of the overpayment, not including an administrative processing period that may be granted to the Department under Federal procedures for completing the Medicaid expenditure report. Direct repayment to the Department by check from the provider may be made only in one lump sum payment. If the provider chooses the offset method, the provider may choose to offset the overpayment in one lump sum or in a maximum of four equal installments over the repayment period.
(4) If a provider chooses to make direct repayment by check to the Department, but fails to repay by the specified due date, the Department will offset the overpayment against the provider’s MA payments. If the provider chooses to repay by check but fails to do so as agreed, the Department reserves the right to refuse to allow the provider to elect a direct repayment plan, other than immediate direct repayment in response to the cost settlement letter, if an overpayment is discovered for subsequent cost reporting periods.
(5) Paragraphs (1)—(4) do not apply if the provider is bankrupt or out-of-business and the debt is uncollectable under section 1903(d)(2)(D) of the Social Security Act (42 U.S.C.A. § 1396(b)(2)(D)).
(6) An appeal by the provider of the action by the Department to offset the overpayment against the provider’s MA payments when the provider fails either to respond timely to the cost settlement letter or to pay the overpayment amount directly when due will not stay the Department’s action.
(7) Under § 1101.84(b)(5) (relating to provider right of appeal), an appeal by the provider of the audit disallowance does not suspend the provider’s obligation to repay the amount of the overpayment to the Department. If the provider prevails in whole or in part in an appeal and is thereby owed money by the Department, the Department will refund to the provider monies due as a result of the provider’s appeal.
Authority The provisions of this § 1101.69 amended under sections 201 and 443.1 of the Public Welfare Code (62 P. S. § § 201 and 443.1).
Source The provisions of this § 1101.69 amended February 5, 1988, effective February 6, 1988, 18 Pa.B. 556. Immediately preceding text appears at serial page (124111).
Cross References This section cited in 55 Pa. Code § 1151.47 (relating to annual cost reporting); 55 Pa. Code § 1163.452 (relating to payment methods and rates); and 55 Pa. Code § 1181.69 (relating to annual adjustment).
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