Expect delays from MedicareIn case you haven’t heard, last week the Medicare Secondary Payer Recovery Contractor (MSPRC) posted a notice on its website indicating that it had temporarily stopped issuing Rights and Responsibilities Letters and Demand Letters until further notice. It has now indicated that review of the Rights and Responsibilities Letter is complete, and these letters should resume issuance by June 10th. Demand Letters, however, remain suspended until further notice. Click here and scroll down to “News and Updates” for the notice.

Who Is the MSPRC and What Are These Letters?

The MSPRC is the contractor hired by Medicare to handle conditional payment recoveries. The Rights and Responsibilities Letter (RAR) is the notice sent to Medicare beneficiaries and their counsel indicating that Medicare is asserting a “right to recovery” action. The RAR Letter explains Medicare’s rights, and requests information. The Demand Letter is Medicare’s notice of the final reimbursement amount it expects to collect, and contains instructions for repayment and the consequences for an untimely response/payment.

Why Is Medicare Creating This Delay?

It is believed that Medicare has pulled these letters to change the language they contain, specifically as it relates to the appeal process and the 60-day time frame beneficiaries are given to make payment. These changes are most likely due to the recent Haro v. Sebelius case decision where Medicare received an adverse decision regarding its enforcement procedures. Click here for a write up on the Haro case, which explains the issues in further detail:

What Does This Mean For You?

If you have a case with a potential Medicare reimbursement issue, expect an extra long time to obtain a final demand amount. The good news is that this is a temporary situation, but this is not too comforting. This will create a backlog that will likely take months to clear even though the MSPRC indicates it is still reviewing cases.

Prior to this temporary cutoff, the turnaround time for an RAR Letter was 30 days following Medicare’s notice of the case, and the turnaround time for the Demand Letter was 35-45 days following MSPRC’s receipt of the final executed settlement documents. In between those two letters is the Conditional Payment Letter (CPL) process that occurs 65-90 days after the RAR letter issues but before the Demand Letter is issued. That’s already a 5-6 month process from start to finish.

The Bottom Line

It is important now more than ever to have a partner that can help you through the Medicare conditional payment process. Not knowing where to begin or what to do with a letter you receive can (and will) delay settlements and add to the frustration surrounding this issue.

A special thanks to Jon Gunter for putting together this important information. Here is his contact info:

Jon Gunter | Executive VP, West Coast, for MEDVAL. MEDVAL is a national Medicare compliance services firm. Get answers at 888-SET-ASIDE, or jgunter@medval.com or visit medval.com.

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