Comment Period Closed for Section 111 Civil Money Penalties Proposed Rule

CMS, Mandatory Insurer Reporting, MSP News on April 22, 2020
Posted by Jean S. Goldstein, JD, CMSP

On Monday, the comment period for the Centers for Medicare & Medicaid’s (CMS) Section 111 Civil Money Penalties (CMPs) proposed rule closed.  Entities that are responsible for complying with Section 111 reporting, and subsequently which may be subject to CMPs are referred to as Responsible Reporting Entities (RREs).  These entities must provide specific data on claims that involve Medicare beneficiaries. The proposed rule, consisting of 44 pages, was released in February, highlights of which can be found here

Contained within the proposed rule were three general circumstances for when the imposition of CMPs would occur. These include: 

  • Failure of an RRE to report a claim involving a Medicare beneficiary; 
  • Reporting data which consists of errors that exceed specific “error tolerance thresholds” as established by CMS; or
  • When reported information contradicts conditional payment recovery efforts. 

CMPs would be calculated daily and would be up to $1,000 for each calendar day of noncompliance for each individual, with up to a maximum penalty of $365,000 per individual per year.  These amounts will be adjusted annually.

Of significance, the proposed rule is noted to be prospective, which means civil money penalties will be imposed upon files submitted on or after the effective date of the rule.  However, the proposed rule is generally very broad in nature, with various parts of the rule subject to various interpretations.  Since the comment period has closed, the next step in this process is the final rule stage.  During the final rule stage, CMS will review the comments and conduct a comment analysis.  If CMS finds that significant changes to the proposed rule should be made, we could see a second public comment opportunity.   Final rules are published in the Federal Register, and will subsequently be placed in the Code of Federal Regulations.  It remains to be seen just how long this process may take; however, we will be sure to update our readers on any further movement into the next stage of this process.