Extended Repayment Schedule (ERS)
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Extended Repayment Schedule (ERS)

If a lump sum refund would cause a severe financial hardship, repayment may be accepted over an extended period of time. Refer to the following information on requesting an extended repayment.

According to CMS guidelines, a provider is expected to repay any overpayment as quickly as possible. If CGS notifies a provider of an overpayment and the provider acknowledges that the overpayment exists but is unable to refund the entire amount within 30 days, the provider may contact CGS to request an Extended Repayment Schedule (ERS).

CMS established the Extended Repayment Schedule process to enable providers experiencing hardship to maintain their cash flow from Medicare. In order for Medicare to evaluate hardship, providers must provide certain financial documents along with their requests. Not all requests will meet the hardship eligibility requirements, and some requests may be approved for timeframes other than those requested. Requests for less than six months will not be considered.

A repayment schedule may be established for all or part of an overpayment and may be requested at any time as long as the overpayment is outstanding and has not been referred to Treasury. If a provider has also requested an appeal on the overpayment, it is in their best interest to include a copy of their most recent appeal decision letter with their request to assist in determining the appropriate balance. Additionally, overpayments established after or outside of an ERS request are not automatically included in the ERS, and providers must separately request repayment plans or submit revised requests to include those overpayments.

An ERS request must be made timely to avoid withholding of the unpaid balance. Providers must make their first proposed payment in addition to sending the required documents and must continue to make their scheduled payments during the review in order to prevent a full withholding until a decision on the ERS request has been made.  Proposed and good faith payments and should be based on an amortization schedule which includes interest to be accrued over the life of the loan and must not be less than 1/60th of the total amount owed.

A request for an ERS does not stop interest accrual, and all payments are applied first to interest and then to principal. After each payment, interest will continue to accrue on the remaining principal balance at the interest rate referenced in the Medicare overpayment letter. The proposed amortization schedule should include this interest.  If a request is made more than 30 days after the date of the initial Medicare overpayment letter, repayment of any remaining balances of previously accrued interest should also be included in the schedule. CGS has provided some examples of amortization schedules.

Providers may receive a tentative amortization schedule to follow during review of their application and, if so, will be expected to follow this schedule instead of their own proposed schedule until Medicare makes a decision on the ERS request. On approving an ERS request, Medicare will provide a final amortization schedule for the provider to follow. In some cases, scheduled tentative or approved ERS payments will be automatically deducted from Medicare payments. Medicare will notify providers in advance via an ERS tentative or approval letter if this is going to occur. Should changes in provider billing practices or other events later prevent recoupment of these ERS payments, providers should contact CGS to make other payment arrangements because such delays may result in additional interest charges and changes to the loan amortization. Cumulative shortages in monthly payments may also result in a default status if not addressed.

Providers can elect on the ERS Request form to have all underpayments or manual refunds automatically applied to their ERS overpayments.  This election can be rescinded with written notice.  Providers with an approved ERS may also request refund of an identified underpayment by submitting an Underpayment/Manual Refund Election formPDF along with additional documentation.  This must be done within 15 calendar days from the underpayment notification letter in order to be considered.

Payments made by check must be received on or before the due date. If providers do not make monthly payments as scheduled, additional interest charges may accrue which can result in changes to the loan amortization and final payment amount. Missing one payment will result in default of the installment plan. Should a provider default on an approved ERS, the remaining balance of the loan will become due in full, and Medicare will initiate withholding from the provider's Medicare payments.

Sending in a request:

In submitting a request for an Extended Repayment Schedule, providers must submit the following:

  1. A signed written request that provides the specific overpayment for which the extended repayment is being requested, the number of months requested, and the approximate monthly payment amount
  2. A completed Extended Repayment Schedule Checklist
  3. A copy of each document referenced on the Extended Repayment Schedule Checklist
    (Note: If a provider is unable to furnish one or more of the applicable Checklist documents with the request, the provider must explain the reason why the document is unavailable or will be provided later. All items must be received within 15 days of the request.)
  4. The first payment referencing the provider number and "ERS Request" made payable to CGS Administrators, LLC and sent to the payment address noted in the Medicare overpayment letter
    (Note: A list of available CGS payment addresses may be found at http://www.cgsmedicare.com/ers/payment_addresses.html. A copy of the check should also be included with the request documents.)

* Failure to provide any of the above items within 15 days will result in closure of the request and normal collection activities will resume.

All ERS requests and documentation should be faxed to 615.664.5949 or mailed to:

CGS Administrators, LLC
ATTN: CFO Extended Repayments
P.O. Box 20018
Nashville, TN 37202

Questions about a pending or approved ERS application may be emailed to CGS.ERS.CORR@CGSADMIN.COM.

Reference: CMS IOM - Publication 100-06, Chapter 4, Section 50


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