The Centers for Medicare & Medicaid Services (CMS) proposed a rule late last year that would impose standards on healthcare providers and suppliers to report and return overpayments from Medicare that mirror aspects of the False Claims Act (FCA). Failures to report Medicare overpayments have long been the basis for FCA violations, but CMS regulations had previously imposed what some viewed as functionally a negligence standard on providers and suppliers (i.e., they were required to exercise "reasonable diligence" to identify and return overpayments). In 2021, a federal district court concluded that the reasonable diligence requirement impermissibly sought to impose a negligence standard for FCA claims. In an apparent response to that case, the proposed regulation replaces the reasonable diligence requirement with the FCA's knowledge requirement (i.e., actual knowledge, deliberate ignorance or reckless disregard of the overpayment).
Background
The proposed rule would amend existing regulations for Medicare Parts A, B, C and D and is designed to implement aspects of the Patient Protection and Affordable Care Act (ACA). Under the ACA...
