July 15, 2013
Demand Letters to Medicare Providers and Suppliers Associated with an Item or Service Provided to Incarcerated Beneficiaries
Recently, the Centers for Medicare & Medicaid Services (CMS) initiated recoveries from providers and suppliers based on data that indicated that the beneficiary was incarcerated on the date of service (DOS). Medicare will generally not pay for medical items and services furnished to a beneficiary who was incarcerated when the items and services were furnished. Medicare has identified previously paid claims that contain DOS that partially or fully overlap a period when the beneficiary was incarcerated based on information from the Social Security Administration (SSA). A large number of overpayments have been identified and demand letters released with appeals instructions. At this time, CMS asks that providers do not file appeal requests. This issue will be resolved more quickly and efficiently if providers follow the instructions below.
There may be instances where providers believe that the beneficiary was not incarcerated when the service was provided. However, a beneficiary may be “incarcerated” even when the individual is not confined within a penal facility. For example, a beneficiary who is on a supervised release, on medical furlough, residing in a halfway house, or other similar situation may, nevertheless, be in the custody of authorities under a penal statute. In such cases, Medicare payment may be barred. Providers receiving demand letters for denial of claims because the beneficiary’s SSA record indicates incarceration on the DOS, and who have reason to believe that the beneficiary was not incarcerated on the DOS, may wish to contact the beneficiary to gather as much information as possible.
Information Gathered Indicates SSA Record May Need to be Updated
If a beneficiary did not inform the SSA of his or her release from custody, this may result in his or her record being incorrect. If a provider believes this is the case, the provider may wish to encourage the beneficiary to contact his or her local SSA office in order to have his or her records updated.
It can take up to one month for the beneficiary’s Medicare eligibility file to be updated with the revised SSA information. If the beneficiary tells the provider that SSA is updating his or her records, we suggest the provider contact the Medicare Administrative Contractor using the contact information on the overpayment demand letter.
Information Gathered Indicates SSA Record is Current
If the provider believes that the beneficiary was not incarcerated on the DOS in question and the beneficiary advises that SSA’s records are currently accurate, the provider can contact his or her local CMS Regional Office
by fax.
At a minimum, providers should be prepared to submit the following information to the appropriate CMS Regional Office:
Fax Subject: Incarcerated Beneficiary Claim Issue
Provider Name and Contact information:
Beneficiary Name:
Health Insurance Claim Number:
Dates of Service:
Claim Number (ICN/DCN):
Reason why incarceration information for the DOS is incorrect:
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