Medicare Overpayments

A Medicare overpayment is a payment that exceeds amounts properly payable under Medicare statutes and regulations. When Medicare identifies an overpayment, the amount becomes a debt you owe the Federal government. Federal law requires the Centers for Medicare & Medicaid Services (CMS) to recover all identified overpayments.

Medicare overpayments commonly occur due to:

  • Incorrect coding
  • Insufficient documentation
  • Medical necessity errors
  • Processing and other administrative errors

Overpayments can occur when Medicare is the primary OR secondary insurance.  That’s why we don’t recommend filing Medicare on auto accident cases unless Medicare is the only coverage. Don’t let a lawyer bully you into filing a Medicare claim when it’s not in your best interest.

If you determine that you have received an overpayment from Medicare you should voluntarily report and return the overpayment to Medicare.

Your Medicare Administrative Contractor (MAC) initiates overpayment recovery by sending a demand letter requesting repayment. These overpayment requests can be challenged.

As with most government run programs it gets a little complicated. This MLN Fact Sheet will give you more information and instructions. You may want to print it out and keep it in your “bag of tricks.” (See the “Print-Friendly Version” button at the top of the fact sheet)

Properly handling overpayments is just one aspect of a much larger subject covered in our Online Medicare Course