Audits Involving Medicare Demand Billing and Overpayments Involving Dual Eligible Recipients

Switch to:

Audits Involving Medicare Demand Billing and Overpayments Involving Dual Eligible Recipients


Date Issued: 10/2/2018

In the February 2017 Medicaid Update newsletter, the Office of the Medicaid Inspector General (OMIG) issued information for providers about new home health care services audits of Medicare demand billing and Medicaid overpayments involving dual eligible recipients. In April 2017, OMIG and its contractor, the University of Massachusetts Medical School (UMass), began auditing for dual eligible recipient Medicaid overpayments.

  • Demand bill audits were issued in August 2018.

OMIG contracts with UMass to maximize Medicare reimbursement for dual eligible Medicare/Medicaid recipients who have received home health care services paid for by Medicaid. Medicaid is always the payor of last resort. Therefore, when a recipient is eligible for both Medicare and Medicaid, or has other third-party insurance benefits, the provider must bill Medicare or the other third-party insurance first for covered services prior to submitting a claim to Medicaid.

To ensure Medicaid is the payor of last resort, UMass identifies home health providers who have not billed Medicare for home health services previously paid by Medicaid, and directs the provider to “demand bill” Medicare for those services. If providers do not comply with this request, they are required to reimburse the Medicaid program for the amount Medicaid paid for these services as required under 18 New York Codes, Rules and Regulations (NYCRR) section 540.6 (e).

UMass also pursues Medicare coverage for claims that were denied payment by Medicare at initial determination and paid by Medicaid. When a provider receives a Medicare payment as a result of a reversed Medicare denial, the provider has received a duplicate payment, which then makes the payment an overpayment. UMass sends notification letters to the provider who receives the overpayment to inform them that the provider is required to return the Medicare payment to the Medicaid program. If the amount of the Medicare payment is not reimbursed to the Medicaid program, OMIG will pursue recovery of the overpayment.

OMIG expects provider compliance with NYS Medicaid program regulations to ensure receipt of proper payments before the time frames for submission of claims to Medicare are exhausted. Providers who are noncompliant with requests to demand bill Medicare or who fail to return identified overpayments will be subject to an audit for recovery of all inappropriate payments.