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CMS Notice of Proposed Rulemaking (NPRM) Suggests A Change to the Reporting and Returning of Overpayments

The Centers for Medicare and Medicaid Services (CMS) has suggested updated language regarding the reporting and returning of overpayments in its NPRM dated December 27, 2022. 

Currently, the law states, “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. A person should have determined that the person received an overpayment and quantified the amount of the overpayment if the person fails to exercise reasonable diligence and the person in fact received an overpayment.” 42 CFR §401.305(a)(2) “Reasonable diligence” has allowed entities to perform investigations in good faith and take up to six months to complete the investigation into any possible issue. Once a repayment liability is identified, the entity has 60 days to complete the repayment.

The new language states, “A person has identified an overpayment when the person knowingly receives or retains an overpayment. The term ‘‘knowingly’’ has the meaning set forth in 31 U.S.C. 3729(b)(1)(A).” “Knowingly” means that a person, with respect to the information, (1) has actual knowledge of the information; (2) acts in deliberate ignorance of the truth or falsity of the information; or (3) acts in reckless disregard of the truth or falsity of the information.

This proposed rule may concern provider organizations as many issues identified require significant time to investigate before determining whether an overpayment was made. Considerations include whether CMS will allow providers under this new suggested language the time they need to investigate any issue or if the expectation is to include the time for the investigation in the 60 days to pay back.

A copy of the NPRM can be found at

© Copyright 2023. The views expressed herein are those of the author(s) and not necessarily the views of Ankura Consulting Group, LLC., its management, its subsidiaries, its affiliates, or its other professionals. Ankura is not a law firm and cannot provide legal advice.


healthcare compliance, healthcare operations, performance, healthcare & life sciences, memo

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