According to MedPAC, almost 20% of all hospice providers are now exceeding the Medicare aggregate payment limitation (“CAP”). Many hospices will have a CAP liability when they file their self-determined CAP liability report on or before February 28, 2022. Many more hospices will not have a CAP liability at the time of filing the self-determined CAP liability, but will incur a CAP liability as time passes and the CAP liability calculations are reviewed by the hospice’s respective Medicare Administrative Contractor (“MAC”).
Every year, we receive numerous inquiries from our clients, other hospices, and consultants regarding when the liability should be paid, as well as filing for an Extended Repayment Schedule (“ERS”) to liquidate the reported CAP liability. Unfortunately, the hospice’s approach to liquidating the CAP liability is dependent on the respective MAC and, potentially, other factors.
The following instructions are provided on the respective MAC’s website.
“Repaying an Overpayment (if applicable)
If the cap computation indicates an amount due the Medicare Program, please submit a check made payable to Palmetto GBA for the full amount (or the first month payment if requesting an ERS) and mail the check. The payment can also be submitted using eCheck. eCheck is a feature of the eServices portal, where registered providers can submit payments electronically. To register and utilize this feature, access our website, and select the eServices link.
Requesting an Extended Repayment Schedule
If you are unable to repay the cap overpayment in full, you may submit documentation supporting a request for extended repayment. This documentation must be sent at the time of the submission of your cap computation to avoid withholding of your payments.”
“If the self-reported cap calculation indicates an amount due to Medicare, please wait to receive a demand letter before making a check payable to National Government Services.
If a provider is unable to repay the self-determined overpayment within 15 days, they can submit a request for an ERS.”
“Any overpayment amount calculated as a result of the self-determined cap should be sent, along with a cover letter that explains what the payment is for.
Checks must be made payable to CGS. If the overpayment is not submitted at the same time as the self-determined aggregate cap, CGS shall demand the overpayment reported on the self-determined aggregate cap.”
The following is a quick overview of certain key items based on our experience:
- NGS, unlike other MACs, asks hospices to wait to make repayment until they receive communication from them (see instructions above). NGS may update the hospice’s calculation based on more current PS&R data.
- All MACs issue demand letters for reported, or updated CAP liabilities. Palmetto GBA issues a demand letter quickly in response to the self-filing if payment was not made at the time of filing. Historically, we have recommended that hospices wait until they receive notification from the MAC regarding the CAP obligation in case the MAC modifies, for any reason, the amount of the obligation. However, hospices dealing with Palmetto may want to liquidate the liability at the time of filing or begin the ERS process at the time of filing. Caution – we have seen instances when the liability was paid but payments were withheld due to a communication issue at the MAC.
- These letters typically provide for repayment of the liability or the submission of an ERS within 15 days to avoid withholdings against remittances.
- Hospices should be on alert for the receipt of a demand for repayment (hospices with multiple operating locations must ensure that communications from the MAC will be received timely by those responsible for any repayment).
- Hospices should ensure their CAP files are complete including all self-filings, all notices received relating to each respective CAP Year, and documentation supporting all CAP liability repayments, including ERS filings, approvals, and payments made.
Regardless of the action you take, hospices should be keenly aware of CAP liabilities and the resolution of those liabilities.