CMS pushes penalties for failing to report Medicare enrollees' settlements

CMS is proposing rules to the Office of Information and Regulatory Affairs that would impose fines of $1,000 per day against people and organizations that fail to report settlements with Medicare enrollees who allocate funds to future medical services, according to a March 21 Claims Journal report.

Though the reporting requirement is current law under the Medicare Secondary Payer Act, there is no enforcement mechanism. 

In 2013, Congress amended the law to require penalties of up to $1,000 per day and required CMS to adopt formal rules before imposing fines. CMS may also decline to cover treatment for enrollees if they have not exhausted the entire settlement agreement.

The law also requires annual adjustments for inflation, meaning the maximum penalty is currently $1,247, according to the Claims Journal.

CMS' proposal calls for the maximum penalty for most infractions, which equates to $575,685 annually for failing to report a settlement. The federal agency is also asking for a five-year statute of limitations.

Approval of the rules from OIRA is the final step toward adoption of the rules.

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