May 2006 Newsletter

Medicare to Delay Payments

By: Compliance Officer

Buried in Sec. 5203 of Public Law 109-171 (the Deficit Reduction Act of 2006) is a mandate for the Centers for Medicare & Medicaid Services (CMS) to hold Part A and Part B payments for all claims from September 22, 2006 through September 30, 2006, the end of the Federal fiscal year. This delay effectively defers the expense until fiscal year 2007.

More specifically:

• The hold applies to all paper and electronic claims subject to payment, including PIP, MSP, RAPS, beneficiary, etc.
• It does not apply to full denials and no-pay claims.
• Claims held as a result of this one-time policy will be paid on October 2, 2006.
• No interest or late penalty will be paid to a provider for any delay in a payment.
• Medicare contractors will continue to apply the 14-day electronic claim payment floor and 29-day paper claim payment floor.
• Contractors have the option to send cross-over files during the payment hold