January 12, 2016 Articles

Speedy Returns: The 60-Day Rule

The first and only court decision on the "60-Day Rule" highlights the importance of quickly identifying and repaying Medicare/Medicaid overpayments.

By Maura K. Monaghan, Kristin D. Kiehn, Jacob W. Stahl, and Young-Hee Kim

The Patient Protection and Affordable Care Act (PPACA) is best known for its efforts to achieve universal health insurance coverage. The PPACA, however, is less well known for the tools that it provided to federal law enforcement to curtail allegedly improper health care spending.

Last year, the Department of Justice (DOJ) brought its first action, Kane v. Healthfirst, Inc., No. 11 Civ. 2325 (S.D.N.Y. Aug. 3, 2015), to enforce one of those tools—the so-called “60-day rule” found in section 6402(a) of PPACA (42 U.S.C § 1320a-7k). This rule requires providers, suppliers, and plans that receive payment from the Medicare and Medicaid programs to report and repay any identified overpayments received from the government within 60 days or face liability under the False Claims Act (FCA).

The Kane defendants filed a motion to dismiss. This motion was decided by Judge Edgardo Ramos on August 3, 2015. Judge Ramos denied the defendants’ motion, adopting the DOJ’s aggressive position regarding when the 60-day rule requirement is triggered.

Separately, in early 2014, the Department of Health and Human Services (HHS) issued rulemaking regarding the 60-day rule for Medicare Advantage and Medicare Part D payments, and has suggested that it will conduct final rulemaking for Medicare Parts A and B by 2016.

These developments highlight the need for recipients of government health care funding to ensure that robust compliance systems are in place to detect and facilitate timely reporting of overpayments.

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