This section applies to funds for
which the contractor is non-financially underwritten, with the exception
of funds overpaid to the Department of Veterans Affairs (VA) facilities
(see
paragraph 33.0). For recovery of overpayments
involving funds for which the contractor is financially underwritten,
see
Section 3. For information on the processing
of Overpayment Recovery-Non-Financially Underwritten Funds during
contract transition, see
Chapter 2, Section 10.
1.0 Causes
Of Overpayments
The occurrence of any of
the following circumstances may result in an erroneous payment and a
requirement for recoupment action. (This list is not intended to
be all-inclusive).
• Erroneous calculation
of the allowable charge.
• Erroneous coding
of a procedure.
• Erroneous calculation
of the cost-share or deductible.
• Duplicate payment.
• Incorrect payee.
• Payment by Other
Health Insurance (OHI).
• Erroneous billing.
• Patient not eligible.
• Unauthorized provider.
• Noncovered service
or supply.
• Service
not actually received.
• Services not medically
necessary.
2.0 Determination
Of Liability For Overpayment
The general
rule for determining liability for overpayments is that the person
or provider who received the erroneous payment is responsible for
the refund.
3.0 Provider
Liable
Overpayment refunds shall be sought
from the provider who received the incorrect payment in the following
situations:
3.1 The provider furnished erroneous information
or failed to disclose facts that the provider knew or should have
known were relevant to payment of the benefit. (Refer to
Chapter 13.)
3.2 The payment was based on an
amount in excess of that allowable.
3.3 The provider received and
retained duplicate TRICARE payments.
3.4 The provider turned a duplicate
TRICARE payment over to the beneficiary.
3.5 The overpayment was due to
a mathematical or clerical error; e.g., an error in calculation
of overlapping or duplicate bills. Mathematical error does not include
a failure to properly assess the deductible. Where a provider has
been incorrectly paid a deductible, the provider shall be deemed
to be without fault and any required recovery shall be sought from
the beneficiary.
3.6 The overpayment was for noncovered
services, supplies, or pharmaceutical agents.
3.7 The services,
supplies, or pharmaceutical agents were not received by the beneficiary
or there is no documentation to substantiate that the provider performed
the services or provided the pharmaceutical agents claimed. (See
Chapter 13, if fraud is suspected.)
3.8 The services,
supplies, or pharmaceutical agents were furnished by an unauthorized
provider.
3.9 The TRICARE payment was made to the participating
provider and a primary health insurance or pharmacy plan also made
a payment to the provider or beneficiary for the same services or
supplies, and the combined payments exceed the lower of the amount
remaining after the double coverage plan has paid its benefits or
the amount TRICARE would have paid as primary payor. See TRICARE Reimbursement
Manual (TRM),
Chapter 4.
3.10 The payment
was made to the wrong provider or a nonparticipating provider. In
such cases, the contractor shall issue payment to the correct payee
and concurrently initiate recoupment action against the erroneously
paid provider. The contractor shall not postpone issuing payment
to the correct provider pending completion of the recoupment.
3.11 The patient
was not eligible at the time the services were provided.
3.12 The patient
had OHI or pharmaceutical coverage primary to TRICARE.
4.0 Beneficiary
Liable
Erroneous payment refunds shall be
sought from the beneficiary in the following situations:
4.1 The overpayment
was caused by incorrect application of the deductible or cost-share.
4.2 The patient
was not an eligible beneficiary at the time services were provided
and the payment was made to a participating provider for whom a
good faith payment has been authorized under
paragraph 6.0. When payment
was made to a retail network pharmacy based on erroneous eligibility data
provided by the Government from Defense Enrollment Eligibility Reporting
System (DEERS), the pharmacy may retain the payment as a good faith
payment. In addition, when the TRICARE Overseas Program (TOP) contractor
creates an authorization for a TOP provider based upon erroneous
DEERS data and improperly pays a TOP provider, the TOP provider
may retain the payment as a good faith payment.
4.3 The beneficiary
who received TRICARE payment had OHI or pharmacy coverage primary
to TRICARE.
4.4 The TRICARE payment was made to the beneficiary
instead of the participating provider. The contractor shall immediately
issue payment to the participating provider and concurrently take recoupment
action against the beneficiary.
4.5 Any instance where the erroneous
payment was made directly to the beneficiary.
5.0 Overpaid
Party Is Deceased
If the contractor determines
that liability for an overpayment rests with a beneficiary or provider
who is deceased, the contractor shall seek recoupment of the overpayment
from the estate of the deceased person. The procedures described
in this Section shall be followed.
6.0
Good
Faith Payment
6.1 Participating providers who exercise reasonable
care and precaution in identifying persons claiming to be eligible
TRICARE beneficiaries and furnish otherwise-covered services and
supplies to such persons in good faith, may be granted a good faith
payment, although the person receiving the services and supplies
is subsequently determined to be ineligible for benefits. In order
to meet the requirements for a good faith payment, the participating
provider must have:
• Exercised reasonable
care and precaution in identifying the patient as TRICARE eligible.
• Made reasonable efforts
to collect payment for the services provided from the person who erroneously
claimed to be a TRICARE beneficiary.
6.2 In
order to qualify for a good faith payment, the provider must submit
documentation to substantiate that he/she has met BOTH requirements.
The usual evidence that a provider has exercised reasonable care
and precaution in identifying the patient as TRICARE-eligible is
a copy of the patient’s ID card which indicates that he/she was
eligible for civilian medical care at the time services were provided.
Generally, the provider must have obtained the copy of the ID card
when the services were provided. If the provider did not obtain
a copy of the ID card, he/she shall submit an explanation of why a
copy was not obtained and the reason(s) for his/her determination
that the patient was eligible for TRICARE benefits.
6.3 The documentation
required to establish that a provider has made reasonable efforts
to collect will vary, depending upon the facts of each case. Such
documentation may include, but is not limited to, invoices or demand
letters sent to the patient and memoranda of telephone calls to
the patient demanding payment. If the TRICARE beneficiary has moved
and left no forwarding address, the provider shall supply copies
of returned letters or memoranda of unsuccessful attempts to reach
the patient by telephone.
6.4 The contractor is not authorized
to determine whether a provider exercised “reasonable care” which
may qualify the provider for a good faith payment; nor are they
authorized to seek, invite, or encourage good faith payment requests
from providers. However, should a provider initiate an inquiry regarding
denial of a claim due to the patient’s ineligibility, or a recoupment
action in which the patient’s eligibility is the issue, the contractor
shall advise the provider of the procedures for requesting a good
faith payment.
6.5 If the contractor has NOT paid the participating
provider (i.e., the claim is denied), the contractor shall advise
the provider and the patient by Explanation Of Benefits (EOB) that
the claim has been denied due to the patient’s ineligibility so
that the provider may attempt collection from the patient in a timely
manner. Occasionally, the patient may need only to update his DEERS
record, so that the denied claim may be processed and paid. Upon
notification of the patient’s ineligibility, the provider shall
attempt collection from the patient. If the provider alleges that
he/she exercised reasonable care and caution in identifying the
patient as TRICARE-eligible and requests a good faith payment, the
contractor shall be responsible for advising the provider in writing
within 30 days of the date of the request that documentation of
his/her efforts to collect from that patient is required. The file
shall be referred to Defense Health Agency (DHA) Communications,
for consideration of the request for a good faith payment and shall
include:
• Pertinent
claim form(s) and EOB(s). (If the pharmacy EOB does not contain
certain data elements, then a separate report is required (see
Addendum A, Figure 10.A-32). If offsets have
been taken, additional data elements are required as listed in
Addendum A, Figure 10.A-33.)
• Evidence of the patient’s
ineligibility.
• The
provider’s request for a good faith payment.
• Documentation of all
contractor contacts with the provider and the patient.
• Documentation of efforts
made by the provider to identify the patient as TRICARE-eligible prior
to rendering service.
• Documentation of efforts
to collect from the ineligible patient.
6.6 The contractor
shall notify the provider that his request has been referred to
DHA Communications. If DHA Communications grants the request for
a good faith payment, the contractor shall then reprocess and pay
the previously denied assigned claim and initiate recoupment action against
the patient. The contractor shall cite Special Processing Code (SPC)
G2 -
Good Faith Payment (TRICARE Systems Manual (TSM),
Chapter 2, Section 2.8, Record Locator 1-
185 or
2-
305) when submitting the TRICARE
Encounter Data (TED) record.
6.7 If an assigned claim was paid
before the contractor discovered the patient’s ineligibility, the contractor
shall initiate recoupment action against the participating provider,
and concurrently, advise the patient of his/her ineligibility for
TRICARE benefits and his/her liability for payment to the provider. If
the provider alleges that he/she exercised reasonable care and precaution
in identifying the patient as TRICARE-eligible, and requests a good
faith payment, the file shall be referred to DHA Communications,
for consideration of the request. The provider is required to supply
all of the documentation outlined in
paragraph 6.2. If the provider’s
good faith payment request does not include documentation to substantiate
the provider’s efforts to collect from the patient, the contractor shall
notify the provider in writing within 30 days of the date of the
provider’s request of the requirement to provide the information.
Upon receipt of the requested information, the contractor shall
notify the provider that his/her request has been referred to DHA
Communications. The contractor shall suspend recoupment action until
a response to the good faith payment request has been received.
If no response is received within 60 days, the contractor shall
contact the DHA Office of General Counsel (OGC), to determine whether
continued suspension of recoupment action is appropriate. If DHA
Communications notifies the contractor that a good faith payment
has been granted, the contractor shall terminate collection action
against the provider, refund any monies collected from the provider,
and initiate recoupment action against the ineligible patient. The contractor
is NOT required to update the existing TED record with SPC =
G2.
7.0 Overpayments
Resulting From Alleged Misinformation
An
allegation by a patient or provider that information obtained from
a Beneficiary Counseling and Assistance Coordinator (BCAC), contractor
or other party resulted in the overpayment does not alter the liability
for the overpayment nor is it grounds for termination of recoupment
activity.
8.0 Denial
Of Benefits Previously Provided
In those
instances where DHA clarification, interpretation, or a change in
the TRICARE Regulation results in denial of services or supplies
previously covered, no action need be taken to recover payments
expended for these benefits prior to the date of such clarification
or change, unless specifically directed by DHA.
9.0 Double
Coverage Situations - Primary Health Insurance Plan Or Pharmacy Plan
Liable
A “Primary Plan,” under TRICARE Law
and Regulation is any Other Health Insurance (OHI) or pharmacy coverage
the patient has, except Medicaid (Title XIX) or a supplement plan
which is specifically designed to pay only TRICARE deductibles,
coinsurance and other cost-shares (see the TRM,
Chapter 4).
Prior to payment of any claim for services or supplies rendered
to any TRICARE beneficiary, regardless of eligibility status, it
must be determined whether double coverage exists. If the reason
for the overpayment is that another coverage plan primary to TRICARE
was not considered in whole or in part in the coordination of benefits,
then the following actions are required to recover the overpayment:
9.1 If the
primary plan has not made payment to the beneficiary or provider,
the contractor shall attempt to recover the overpayment from the
primary plan following the contractor’s coordination of benefits
procedures.
9.2 If the overpayment cannot be recovered from
the primary plan, or if the primary plan has made payment, the overpayment
will be recovered from the party that received the erroneous payment
from TRICARE.
10.0 Third
Party Recoveries
When potential recovery
from or actual payment by a liable third party is discovered, the contractor
shall refer the matter to the designated Uniformed Service Claims
Office (USCO) as set forth in
Section 5.
11.0
Procedures
For Recoupment Of Overpayments
For the purpose
of determining the amount of the overpayment in a particular case,
the contractor shall include all claims overpaid for the same reason/case/Episode
Of Care (EOC). All research required to establish the existence
of a debt shall be accomplished and the initial demand letter shall
be issued within 30 days from the date that a potential recoupment
action is identified or notification is received that an erroneous
payment has been made. (See sample letters
Addendum A, Figure 10.A-4 and
Figure 10.A-5.)
The contractor shall ensure that all demand letters are sent to
the correct debtor at the most current address on file, i.e., enrollment
file, provider file, claims history, etc. When letters are returned
by the post office the forwarding address shall be obtained and
letters that are returned shall be reissued to the new address.
For any recoupment case involving a large number of claims having
low dollar overpayments, the contractor may request a waiver to
the claim adjustment requirements on a case by case basis. Such
requests are to be sent to the Chief, Claims Collection Section
(CCS), DHA. The pharmacy contractor shall issue the initial demand
letter to a network pharmacy within 30 calendar days of the end
of the 60 calendar day period referenced in
Section 1, paragraph 1.0 if collection pursuant
to the network agreement is not successful.
12.0 Erroneous
Payments Resulting From Incorrect Assessment Of The Deductible
12.1 If a contractor
erroneously calculates the deductible and the error is discovered
within the same fiscal year as the one in which the error was made,
the error shall be corrected by properly assessing the deductible
on the next claim or claims. No recoupment notice needs to be given
if the deductible can be collected within the fiscal year in which
the error was made.
12.2 If the deductible cannot be
collected in the same fiscal year in which the error was made, the contractor
shall initiate recoupment action in accordance with this chapter,
regardless of the amount owed by the beneficiary, as a result of
the erroneous calculation of the deductible.
13.0 Overpayments
Totaling Less Than $110 ($30 for pharmacy overpayments)
The contractor shall take no recovery action
when the overpayment to a single payee is less than $110. The pharmacy
contractor shall take no recovery action when the overpayment to
a single payee is less than $30.
14.0 Overpayments
Totaling $110 Or More ($30 for pharmacy overpayments)
The contractor shall take the following recovery
actions when the overpayment resulted from reasons other than failure
to properly assess the deductible and the overpayment totals $110
or more. The pharmacy contractor shall take the following recovery
actions when the overpayment resulted from reasons other than to
properly assess the deductible and the overpayment totals $30 or
more.
15.0 Other
Than Participating Provider
15.1 When an initial request for
refund is sent, flag the record of the overpaid party for possible future
offset action and suspend payment on a sufficient number of current
claims to satisfy the amount of the debt.
15.2 Such claims shall be processed
to the point of payment to expedite finalizing when the refund payment
is received. If the debtor on the claim in question is other than
a participating provider, a system flag shall be set for future
offset action.
15.3 If
the refund request is unsuccessful after 30 days from the date of
the request, offset against any claims suspended during the 30 days
as required in this section. Offset shall be made against any claim
or claims on which payment(s) would be made to the previously overpaid
party, irrespective of who is the patient on the claim from which
offset is taken. For example, where benefit payments have been made
to either parent on behalf of a minor child; i.e., under 18 years
of age, unless one parent has been named the custodial parent in
a divorce decree, both parents are responsible for those debts and offset
may be taken against claims of either parent. However, an offset
shall not be taken against a sponsor for debts of the spouse or
against a spouse for debts of the sponsor. If the overpayment is offset,
prepare a EOB or substitute EOB for pharmacy claims (
Addendum A, Figure 10.A-33) for each claim
against which offset was made and send a notice to the overpaid
party explaining the overpayment and the offset action (see sample
letter,
Addendum A, Figure 10.A-6).
16.0 Participating
Provider
Within 30 days of identifying an
overpayment, send a written request for refund to the overpaid party.
At the same time, the beneficiary shall be notified in writing,
that a recoupment action has been initiated against the rendering
provider. This letter shall identify the beneficiary’s specific
claims included in the recoupment action. The letter shall advise
the beneficiary that no response is required and refer the beneficiary
to the contractors customer service function if they have further
questions. (See sample letter,
Addendum A, Figure 10.A-7.) No offset flag
is set at this point in the recoupment process (see
paragraph 16.2.2).
The pharmacy contractor is not required to issue the notice (
Addendum A, Figure 10.A-7) to the beneficiary
unless directed by DHA.
16.1
Account
Balance $110 ($30 For Pharmacy Contractor) To Less Than $600
If the initial refund request is unsuccessful
and there are insufficient funds available for a full offset send
a follow-up letter 30 calendar days from the date of the initial
letter. All follow-up requests shall include a copy of the original
refund request and shall notify the overpaid party that unless arrangements
for refund are made with the contractor within 30 days from the
date of the follow-up request, an attempt shall be made to offset
against future claims. (See instructions in
paragraph 16.2.2 and the sample
letters,
Addendum A, Figure 10.A-8 and
Figure 10.A-10).
When one year has passed and the debt has not been collected, the
contractor shall ascertain whether there are any other active recoupment
cases under $600 against the same debtor. In those cases which are
not transferred to DHA (i.e., cases below $600 in which the debtor
has not requested relief from the indebtedness), the offset flag
shall remain on the file of the overpaid party for the term of the
TRICARE contract for potential future offset. The contractor shall submit
a Non-Financially Underwritten Accounts Receivable Report. Details
for reporting are identified in DD Form 1423, Contract Data Requirements List
(CDRL), located in Section J of the applicable contract. When there
are one or more additional under $600 active recoupment cases against
the same debtor and the total outstanding debt for all active recoupment
cases is $600 or more, all cases shall be consolidated with a blank
sheet between each debt and a covered sheet completed to reflect
the combined total dollar amount of the consolidated cases. Before
transfer of the combined debts to DHA OGC, a letter should be sent
to the debtor advising that the debts have been consolidated, list
the beneficiary name(s) dates of service and individual recoupment
amounts. The letter should also state that the debts have been referred
to DHA OGC, and therefore, future payments should be sent to the
Contract Resource Management (CRM) office. A credit adjustment shall
be submitted to include all amounts recouped up to the point of referral.
The offset flag shall be removed when the cases are transferred.
Documentation shall be included in the recoupment case file that
the offset flag has been removed. The documentation may be a copy
of the contractor’s internal form to direct removal of the offset
flag. All cases shall be referred to DHA within five working days
after the offset flag has been removed.
16.2 Account Balance
$600 Or More
16.2.1 If the initial refund request is unsuccessful
and there are insufficient funds available for a full offset (see
paragraph 15.3,
for suspended claims) the contractor shall send a follow-up letter
30 calendar days following the date of the initial letter. All follow-up
requests shall include a copy of the original refund request and
will notify the overpaid party that unless arrangements for refund
are made with the contractor within 30 calendar days from the date
of the follow-up request, an attempt shall be made to offset against
future claims, and the matter shall be referred to DHA for further
action (see sample letters,
Addendum A, Figure 10.A-9 and
Figure 10.A-11).
16.2.2 If
the initial and follow-up refund requests and the offset attempt,
if any, are unsuccessful for a period of 60 days from the date of
the initial demand letter, set an offset flag on the file of the overpaid
party (including a participating provider and other debtors) until
the file is transferred to DHA in accordance with
paragraph 19.0. When all or
part of an overpayment is offset, prepare an EOB for each claim
against which offset was made and send a notice to the overpaid
party explaining the overpayment and the offset. (See the sample
letter at
Addendum A, Figure 10.A-6.) If the offset
is against the provider, the provider shall be advised that reimbursement
for the claim against which the offset was made may not be sought
from the patient on whose behalf the services were provided. Additionally,
a letter (see
Addendum A, Figure 10.A-18) shall be sent
to the TRICARE beneficiary against whose claim the offset was taken.
The contractor shall remove the offset flag on an account when it
is referred to DHA OGC, or when the contractor is advised to do
so by that office. Documentation shall be included in the recoupment
case file that the offset flag has been removed. The documentation
may be a copy of the contractor’s internal form to direct removal
of the offset flag. All cases shall be referred to TRICARE OGC within
five working days after the offset flag has been removed. Cases
$600 or more should not be consolidated.
16.2.3 If
the debt has not been collected in full and there has been no positive
response to the demand for payment such as a request for installment
repayment agreement within 90 days from the date of the initial
demand letter, and the balance remaining on the refund request is
$600 or more, the contractor shall send a final demand letter to
the debtor (see
Addendum A, Figure 10.A-16). The final demand
letter shall be sent regardless of whether the debtor is a beneficiary
or a provider and shall be accompanied by a completed Promissory
Note (see
Addendum A, Figure 10.A-12).
16.2.4 If
offsets have not resulted in collection of at least 50% of the amount
of the debt, and there has been no positive response to the demands
for payment within 150 days from the date of the initial demand
letter and the balance remaining on the account is $600 or more,
the case shall be referred to the DHA OGC. When a case is transferred
to DHA, the contractor shall advise the debtor of the referral and
the debtor shall be notified that future payments should be sent
to DHA CRM (see
Addendum A, Figure 10.A-24). The offset flag
will be removed when the cases are transferred. A credit adjustment
will be submitted to include all amounts recouped up to the point
of referral. Cases $600 or more should not be consolidated.
16.2.5 If, on
the 150th day, the contractor has been successful in collecting
50% or more of the total amount of the debt, the offset flag shall
remain in place, and the contractor shall hold the case an additional
150 days. Those cases that are held 300 days because collection
by offset during the first 150 days was largely successful, shall
be transferred to DHA OGC, on the 301st day, if the balance remaining on
the account is $600 or more. When the case is transferred to DHA
OGC, the offset flag shall be removed. Documentation shall be included
in the recoupment case file that the offset flag has been removed.
The documentation may be a copy of the contractor’s internal form
designed to direct removal of the offset flag. All cases shall be
referred to DHA OGC within five working days after the offset flag
has been removed. When a case is transferred to DHA OGC, the contractor
shall advise the debtor of the referral and the debtor shall be
notified that future payments should be sent to DHA CRM. A credit
adjustment shall be submitted to include all amounts recouped up
to the point of referral. Cases $600 or more should not be consolidated.
16.2.6 Any case,
with an account balance of $600 or more in which a debtor unequivocally
refuses to pay and no possibility of offset exists, shall be referred
immediately to the DHA OGC. Any case in which a debtor seeks relief
from the indebtedness due to financial hardship, or seeks other
equitable relief shall be handled in accordance with
paragraph 28.0.
17.0
Bankruptcy
All Notices of Bankruptcy, and letters from
petitioners, attorneys for petitioners, and trustees of the bankrupt
estate shall be forwarded to the DHA OGC, within three work days
of receipt. Each Notice of Bankruptcy forwarded to DHA shall include:
the debtor’s full name; the debtor’s full and complete Social Security
Number (SSN)/Tax Identification Number (TIN); the name of the bankruptcy
court wherein bankruptcy was filed; and the bankruptcy case number.
(See sample coversheet,
Addendum A, Figure 10.A-30). The contractor
shall verify that the only bankruptcy cases forwarded to DHA are
for debts which were paid with non-financially underwritten funds.
Additionally, the contractor shall take the following actions:
17.1 If the
petitioner in bankruptcy is indebted to TRICARE, all recoupment
actions shall cease. If the debtor is on offset, the contractor
shall terminate the offset immediately. If the recoupment case(s) against
the bankrupt petitioner has not already been transferred to the
DHA OGC, the complete case file(s), regardless of dollar value,
shall be transferred with the Notice of Bankruptcy within three
work days of receipt. Each case file shall contain all the documentation
required by
paragraph 19.0. However, the contractor shall
not hold the Notice of Bankruptcy while they attempt to obtain all
of the required documentation. A note will be placed in the case
file to indicate when the missing documentation will be forwarded.
If any amounts have been collected by offset or voluntary repayment
by the debtor, the case file must contain the dates and amounts
of each offset and/or payment. In addition, at the time the case
file is forwarded to DHA OGC, a check for the total amount collected
shall be forwarded to DHA CRM. The following information shall accompany
the check:
• The
debtor’s full name.
• The sponsor’s SSN
on the overpaid claim.
• The Internal Control
Number (ICN)/Refund Control Number (RCN) of the overpaid claim.
• The dates and amounts
of each offset and/or payment.
17.2 If there
is no ongoing recoupment case against the petitioner in bankruptcy
and the petitioner is a provider, the contractor shall ascertain
whether any assigned claims are pending for the petitioner provider.
If there are claims pending, payment on those claims shall be suspended,
and the Notice of Bankruptcy will be forwarded within three work
days of receipt to the DHA OGC, with advice as to the number of
claims suspended and their value. The DHA OGC will advise the contractor
when the pended claims may be processed and to whom payment should
be issued. (See
Addendum A, Figure 10.A-29 for a sample report
of claims pended for provider bankruptcy.)
17.3 The contractor shall identify
individuals and providers who have, during the term of their DHA contract,
filed a Petition in Bankruptcy, regardless of whether the petitioner
is or has been indebted to TRICARE. The contractor shall initiate
no recoupment action, either on their own initiative or upon the request
of another DHA component, against a debtor who has filed a petition
in bankruptcy, without prior approval by the DHA OGC.
18.0 Processing
Claims When The Primary Insurer Is Bankrupt Or In Receivership
18.1 When insurance
companies which have been primary to TRICARE are filing petitions
in bankruptcy or have been placed in receivership refuse to honor
claims, this situation is different from that in which an employer
or labor union stops paying premiums to an insurance company. In
the latter case, insurance coverage ceases for the employee or member
of the labor union when premiums have not been paid; the TRICARE
claims should be processed in the same manner as any other claim
on which the beneficiary has no OHI. Although the TRICARE beneficiary
who was formerly covered by the bankrupt insurer may have a claim
against the bankrupt estate, the beneficiary may have to wait years for
distribution of assets, if any. Since TRICARE is, by federal statute
and regulation, secondary to all health benefit and insurance plans
(except Medicaid), extraordinary measures must be taken to allow TRICARE
to pay claims as primary payer pending any distribution of assets
from the bankrupt estate.
18.2 The contractor shall have
documentation to prove that a claim was filed with the primary insurer
or a Proof of Claim was filed with the bankruptcy court. This information
may be requested using
Addendum A, Figure 10.A-26. When a TRICARE
beneficiary or participating provider provides evidence that the
beneficiary’s primary insurer is in bankruptcy and is no longer
honoring claims, the contractor may issue payment on a claim-by-claim
basis, after the following steps have been taken:
18.3 Determine
the time period that the TRICARE beneficiary was covered by the
bankrupt insurer.
18.4 For each claim, ascertain
whether the medical care claimed was received during the period
of coverage by the bankrupt insurer.
18.5 If the medical care was received
after the petition in bankruptcy was filed by the primary insurer,
determine whether the TRICARE beneficiary has obtained alternative
insurance which is primary to TRICARE. If alternative insurance
has been obtained, process the claim under the double coverage provisions
of the TRM.
18.6 If the medical care was received prior to the
filing of a petition in bankruptcy by the primary insurer, determine
whether the primary insurer has issued payment on the claimed services.
18.7 If the
bankrupt primary insurer has not issued payment on the claimed services,
and the medical care was received during the period of coverage
by the bankrupt insurer, determine who the payee on the TRICARE
check will be. Normally, if the claim is assigned, payment is issued
to the provider of medical services. If the claim is not assigned,
payment is issued to the TRICARE beneficiary, or, if the TRICARE
beneficiary is a minor, or incompetent, to a parent, guardian, or
conservator.
18.8 If the TRICARE payment is to be issued to a
provider, complete the Power of Attorney (POA) and Agreement (
Addendum A, Figure 10.A-25) and mail it to
the provider. The date line on page two of the form is to be completed
by the provider. Use the letter at
Addendum A, Figure 10.A-26.
18.9 If the
TRICARE payment is to be issued to the TRICARE beneficiary, or his
or her parent or guardian, complete the POA and Agreement (
Addendum A, Figure 10.A-27) and mail it to
the beneficiary. The date line on page two is to be completed by
the beneficiary. Use the sample letter at
Addendum A, Figure 10.A-28.
18.11 When the signed POA and Agreement
has been received, the contractor shall process the claim. The POA
and Agreement must have an original signature; facsimile signatures
(i.e., signature stamps) are not acceptable. An authorized agent
of a participating provider may sign the POA and Agreement; however,
no special designation of appointment is required. Only one signed
POA and Agreement is required from each potential recipient of a
TRICARE payment for medical care claimed during the period of coverage
by the bankrupt insurer. A separate POA and Agreement is not needed for
each claim. Each potential recipient of a TRICARE payment (i.e.,
beneficiary or participating provider) who signs a POA and Agreement
may file more than one claim for services provided or received during the
period the TRICARE beneficiary was covered by the bankrupt insurer.
18.12 The contractor
shall maintain a record of all signed POAs and Agreement and all
claims on which TRICARE payment has been issued as the primary payor.
The contractor shall perform the required follow-up and complete
the required report. Claim forms and EOBs shall be filed in the
usual manner.
18.13 Biannually, the contractor
shall follow-up with each beneficiary for whom claims have been paid
by TRICARE as primary payor as a result of the filing of a petition
in bankruptcy by the primary insurer. If any assets were distributed
from the bankrupt estate to the TRICARE beneficiary for medical care,
the amount received either by the TRICARE beneficiary or the participating
provider will be treated as a payment made by the primary insurer,
and benefits shall be coordinated in the usual manner. If the contractor
determines that an overpayment has been made, recoupment action
shall be initiated from the recipient of the TRICARE overpayment.
18.14 If, during
a biannual follow-up, the contractor learns that the bankruptcy
case has been closed, and no assets have been distributed, no further
follow-up is required.
18.15 If a transition occurs before
the contractor determined that the bankruptcy case has been closed,
with or without distribution of assets, the POA and Agreement forms,
with copies of claims and EOBs will be sent to DHA OGC for follow-up.
19.0
Case
Referrals
19.1 Cases referred to DHA OGC, at the request of
DHA, or as required in
paragraphs 16.2.4 and
17.0, shall include
the documentation listed below. (If the pharmacy EOB does not contain
certain data elements, then the contractor shall ensure missing
data is included prior to referral to DHA. See
Addendum A, Figure 10.A-32. If offsets have
been taken, additional data elements are required as listed in
Addendum A, Figure 10.A-33. All documentation
shall be placed in the file in the order listed, with
paragraph 19.2 on
the bottom and
paragraph 19.8 on top.
19.2 Legible
copies of all claims involved in the recoupment. If copies of all
claims cannot, with good reason, be provided, a copy of the automated
claims history may be substituted. However, if a claims history
is substituted for copies of the actual claims, a detailed explanation
of each field on the claims history shall be provided.
19.3 Documentary
evidence, i.e., workpapers, calculations reflecting how the amount
of the overpayment was determined, establishing how the overpayment
was identified and the basis for the erroneous TRICARE payment,
including copies of checks and EOBs for both the erroneous payment
and the correct payment, and documentation such as proof of Medicare
eligibility, proof of OHI, (EOB from the OHI reflecting what the
OHI paid for, the relevant care and the name of the OHI, policy
number and the effective dates of coverage), signed Promissory Note,
etc. When a check copy cannot be obtained the contractor shall document
efforts to obtain it and include the documentation in the file.
Normally cases shall not be forwarded without check copies and EOBs.
When a contractor has determined that a check copy or EOB cannot
be obtained, the contractor shall document efforts made to obtain
it and include it in the file. The contractor shall also notify
the DHA OGC by facsimile within five days of the date it determined
that the documentation could not be obtained and provide the RCN,
claim number, check date, provider name, patient name, sponsor SSN
and date(s) of service. If DHA OGC cannot obtain the required check
copies or EOBs, they will advise the contractor to forward the file
without them.
19.4 Copies of checks and EOBs showing payment made
to correct the erroneous payment, if any. When the recoupment is
the result of a duplicate payment, copies of the check and EOB for
the original payment and the copies of the check and the EOB for
the duplicate payment shall be included in the file. When the recoupment
is the result of a Medicare reversal or adjustment, copies of the
corrected Medicare EOBs shall be included in the file.
19.5 Copies
of all demand letters sent to the debtor, which must provide a full
explanation of the circumstances surrounding the erroneous payment.
19.6 Copies
of all correspondence received from the overpaid party or their
representative relating to the recoupment case and the contractor
response.
19.7 Copies of all EOBs reflecting collections by
offset and copies of all payment acknowledgment letters issued to
debtors. Also, the contractor shall maintain a tally sheet reflecting
the original amount of the debt, each offset taken, and the balance
remaining after each offset. Documentation shall be included in
the recoupment case file that the offset flag has been removed.
The documentation may be a copy of the contractor’s internal form
to direct removal of the offset flag. All cases shall be referred
to DHA within five working days after the offset flag has been removed.
19.8 A
completed cover sheet containing data fields necessary for entry
of the case into an automated case recoupment system (see
Addendum A, Figure 10.A-13). Incomplete or
incorrect cases that are transferred to DHA will be returned to
the contractor for correction. The contractor shall account for
returned cases on the Accounts Receivable Summary Report.
19.9 All refund
checks shall be deposited in accordance with the instructions in
Chapter 3, Section 3, paragraph 2.0. When
a refund check is to be applied to a recoupment case which has been
referred to DHA OGC, the amount shall be forwarded to DHA, CRM along
with information identifying the payee and account being paid. The
contractor shall notify the DHA OGC of the receipt of the payments
the following work day after receipt. The contractor shall furnish
identifying information to the DHA OGC as to how the funds were
transferred, including the check number, date, amount, and the page
number by completing the Collection Made by Offset/Refund Form (
Addendum A, Figure 10.A-31). The contractor shall
not delay notifying the DHA OGC that a payment has been received
pending transfer of the funds. If the DHA OGC determines that the
contractor has received a refund, the request for identifying information
on the transfer of funds should be responded to the following work
day.
19.10 For debts of $600 or more, the contractor shall
establish, maintain, and retain for one year, or the term of their
contract, whichever is longer, files containing all documentation
pertaining to the recoupment cases which have been referred to DHA.
A contractor may maintain such files for debts below $600, if it
chooses to do so. Retention of the files will allow the contractor
to fully respond to all questions generated by DHA OGC, as a result
of the contractor’s referral of a recoupment case to that office.
The contractor shall respond by the following work day to questions
directed to them by DHA OGC. Additionally, the creation and retention
of fully documented recoupment case files will facilitate responses
to debtors’ inquiries and requests for administrative reviews. In
the event of a contract transition, the outgoing contractor shall
have complete documentation of recoupment cases ready for transfer
to the incoming contractor. The contractor shall transmit recoupment
case files to DHA OGC with a return receipt requested. Recoupment
case files not transferred to the DHA OGC or to an incoming contractor
shall be transferred to the Federal Records Center (FRC) in accordance
with
Chapter 9.
20.0 State
Or Local Government Debts
Offset is not to
be applied with respect to debts owed by state or local governments.
Such cases, valued at $600 or more, shall be referred to DHA OGC
for collection. All other procedures apply as usual.
21.0 Offset
Requests From DHA Components
When requested
to do so by a DHA component (i.e., Program Integrity Office (PI),
OGC), the contractor shall initiate recoupment action and/or set
an offset flag on an overpaid party to collect erroneous payments.
The contractor shall comply with the instructions issued by DHA
with the request. The instructions will require one or more of the
actions specified in
paragraph 11.0. Normally, the requests will
be made following resolution of an allegation of fraud or following
a provider audit or as the result of an issuance of a Final Decision
in the appeal process. At the direction of the DHA PI, the contractor
shall provide a nonparticipating provider an opportunity to refund
an erroneous payment in those instances where the nonparticipating
provider has submitted a claim for services which were not provided
or for incorrect payments, prior to initiating recoupment action
against the beneficiary. This procedure shall only be allowed after
the DHA PI, has determined that the case will be resolved through administrative
action. (Refer to
Chapter 13.)
22.0 Offset
Requests From Other Agencies
Any requests
for offset from other agencies or orders for garnishment issued
by the court shall be forwarded to DHA OGC. The contractor shall
offset TRICARE claims to collect debts owed other federal agencies
only when instructed to do so by DHA OGC. This paragraph does not
apply to the federal tax levies.
23.0 Information
To Be Included In Refund Requests
23.1 Refund requests shall include
a preaddressed return envelope and the following claim and payment
information:
• Name
and Address of the Beneficiary and Provider.
• Last four digits
of Debtor’s SSN.
• ICN or RCN.
• Date(s) and Type(s)
of Service.
• Principal
Amount of Debt.
• Date(s) of Check(s).
• Amount(s) of Check(s).
• Name of Payee.
23.2 A clear
explanation of why the payment was not correct.
23.3 The amount
of the overpayment and how it was calculated, and the amount of
the correct payment, if any.
23.4 A notice that the overpaid
party is required to refund the overpayment, or make acceptable arrangements
to make the refund, within 30 days of the date of the request.
23.5 A notice that:
• Interest
will begin to accrue from the date of the letter at the then current
rate set by the United States (U.S.) Department of the Treasury.
• Accrued interest will
be waived if payment is received within 30 days.
• Administrative costs
will also be assessed for expenses in collecting the debt.
• A penalty charge of
6% per year will be assessed on any portion of the debt that is delinquent
for more than 90 days and will accrue from the date that the debt
became delinquent.
Note: The contractor shall obtain the current interest
rate as published in the
Federal Register. Interest
is to be applied under criteria set forth in
paragraph 32.0
23.6 A notice
of the possibility of offset if the overpayment is not refunded.
23.7 Instructions
that the refund shall be by check or money order made payable to
the contractor.
23.8 A notice where appropriate
(see sample letters,
Addendum A, Figure 10.A-4 through
Figure 10.A-11 and
Figure 10.A-16),
that unless a refund is made the case shall be referred to DHA OGC
for further recovery action which can include referral to a credit
reporting agency and the assessment of added administrative costs,
penalties and interest.
23.10 An explanation as to rights
for an administrative review and to appeal rights (see
paragraph 26.0).
24.0 Contractor
Responses To Debtors
The contractor shall
respond to any communication from the debtor within 30 days from
its receipt.
25.0
Installment
Refunds
25.1 Recoupment claims shall be collected in one
lump sum whenever possible. However, debtors may request repayment
of a debt in monthly installments. Before installment repayment
agreements are made, the contractor shall assure that the debt is
amortized to completely refund the overpayment within 24 months.
Debtors will be encouraged to repay the debt in monthly installments
of no less than $50; however, if the debt can be repaid within 24
months at the interest rate properly reflected in the initial demand
letter, the contractor may accept lower monthly payments. If it
is alleged by the beneficiary that monthly installments cannot be
made to complete the refund within 24 months, the debtor will be
asked to complete a financial affidavit in accordance with
paragraph 28.0,
and the completed affidavit, along with the case file and the debtor’s
request and the contractor demand letter(s) shall be transferred
to DHA.
25.2 To determine the monthly installment amount,
and assure that repayment can be made within the 24 months allowed,
the contractor shall amortize the debt over a 24 month period (or
less, if requested by the debtor), including interest on the unpaid
balance at the appropriate interest rate. The use of commercial
programs to perform this function is also acceptable.
25.3 Once the
contractor has computed the amount required each month to repay
the debt in 24 regular monthly installments, if the principal amount
of the debt exceeds $600, the Promissory Note (see
Addendum A, Figure 10.A-12) shall be completed
and sent to the debtor for his/her signature (see
Addendum A, Figure 10.A-22). If the debt is
$600 or below, only a letter (see
Addendum A, Figure 10.A-19) need be sent to
establish the repayment agreement.
25.4 The following information
is provided to assist the contractor in completing the Promissory Note:
25.5 “The principal
sum of _________ dollars” is the amount of the overpayment that
has not been refunded, either voluntarily by the debtor or by contractor
offset.
25.6 Interest accrues from the date of the initial
demand letter which advised the debtor of his rights pursuant to
the Debt Collection Act of 1982 (
Addendum A, Figure 10.A-4 or
Figure 10.A-5).
Interest shall be assessed at the rate that was in effect when the
initial demand letter was mailed and that was properly reflected
in that letter. DO NOT assess interest until the debtor has been
properly advised of his rights. Note that the initial demand letter
may be sent January 1, 2012, and the debtor may request an installment
agreement five months later (June 1, 2012) or at any time before
the case is referred to DHA in accordance with
paragraph 19.0. Interest in
all cases accrues from the date of the initial demand letter. (See
Addendum A, Figure 10.A-20 for an example
of interest calculations on a $1000 overpayment, with an annual
interest rate of 8%. In the example, the initial demand letter was
sent January 5, 2012.)
25.7 The interest rate varies,
dependent upon the current value of funds to the U.S. Treasury (see
paragraph 23.5).
Once a debtor has established a repayment agreement, the rate of
interest on THAT debt does not change, regardless of changes in
the value of funds to the U.S. Treasury.
25.8 Installment payments shall
begin approximately 30 days after the request for an installment repayment
agreement is made. If a debtor requests the agreement on March 1,
2014, his first installment will normally be due April 1, 2014.
Some contractors may wish to have all installments due the first
day of the month. If that is the case, and a debtor requests the
arrangement on March 5, 2014, his first installment will be due
April 1, 2014. If the debtor requests the arrangement on March 29,
2014, his first installment should be due May 1, 2014. Other contractors
may choose to scatter the payments throughout the month, to even
the workload. For consistency, do not require payments on the 29th, 30th
or 31st of the month, since February normally has only 28 days.
25.9 The phrase
“not less than_____dollars beginning on___,” is repeated in the
Promissory Note to allow for an occasional debtor who, for example,
wishes to pay one amount for six months and another amount for the
last 18 months. The request may be for any number of personal reasons,
i.e., a car loan may be repaid in six months and the debtor will
have additional funds from which to repay TRICARE. The contractor
is encouraged to be flexible in establishing a repayment agreement;
however, repayment must be scheduled for completion within 24 months.
If the same amount is to be paid for the entire term of the note,
delete the second phrase from the note.
25.10 If the Promissory Note is
not returned, or is returned unsigned, but the debtor makes the scheduled
payments, the contractor shall treat the account as though the Promissory
Note had been signed and returned.
25.11 Each payment received shall
be acknowledged in writing and must advise the debtor of the amount
received, the portion of each payment that was applied to interest
and to principal, and the current balance due. The acknowledgment
shall advise the debtor that the information provided may be useful
in the preparation of his/her income tax return (see
Addendum A, Figure 10.A-21).
25.12 Financially
underwritten installment payments shall be maintained by the contractor.
Non-financially underwritten related installment payments shall
be reported to DHA. When the recoupment action is completed, the
contractor shall process the collection action using a single transaction
for each claim involved.
25.13 When the debtor enters into
an installment repayment agreement, the offset flag shall be removed.
Any suspended claims shall be processed and paid normally. If the
debtor requests continuation of the offset, any amounts so collected
shall be treated as an installment payment.
25.14 Written
notification of delinquency shall be sent 35 days after the established
due date if an installment, or any portion thereof, remains outstanding
(see
Addendum A, Figure 10.A-15). If the delinquent
amount is not remitted within 30 days of the initial delinquency
notice, and the amount remaining due on the account is $600 or greater,
the case file, including all supporting documentation, shall be
referred to the DHA OGC. If the debtor fails to bring the account
current, but remits the missed installment, or a portion thereof,
the contractor shall retain the case. Cases shall not be transferred
to DHA until two full installment payments are past due. For example,
a debtor may miss one payment entirely, but make all subsequent
payments, and remain one month behind for the term of the agreement.
The case would not be transferred to DHA. When a case is transferred
to DHA, the contractor shall advise the debtor of the referral and
shall be told that future payments should be sent to DHA CRM (see
Addendum A, Figure 10.A-24).
26.0
Recoupment
Action And The Appeals Process
26.1 The determination that an
overpayment was made is not, in itself, an appealable issue. When
a contractor receives a request from a debtor for an administrative
review, the procedures outlined in
paragraph 29.0 shall be followed
to assure that, when appropriate, the debtor receives a reconsideration
as outlined in
Chapter 12.
26.2 If a service or supply which
is not a TRICARE benefit was paid in error, the reversal of the payment
decision constitutes an initial adverse determination. The overpaid
party may appeal if an appealable issue exists. Such appeals are
subject to the requirements and time limits outlined in
Chapter 12. When the overpayment arises because
inpatient mental health care was erroneously paid, the debtor will
be advised that retroactive approval of the days paid may be requested
from the TRICARE mental health review contractor. (See the TRICARE
Policy Manual (TPM),
Chapter 7, Section 3.1.)
26.3 Any funds
recouped by offset after a reconsideration has been requested are
to be identified and properly accounted. The appealing party is
to be notified that the recoupment of the overpayment shall continue
by offset. The contractor shall not terminate the offset action
because of an appeal unless directed to do so by DHA.
26.4 When a
requirement to recoup TRICARE funds is identified in a Formal Review
Decision or a Final Decision resulting from a hearing, the case
shall be forwarded by DHA OGC to the appropriate contractor for
development and initial recoupment action in accordance with this
section. If the contractor is unsuccessful in collecting the debt,
the case shall be returned to the DHA OGC in accordance with
paragraph 19.0.
27.0 Offset
Recoupment/Partial Payment
27.1 If the debtor is a hospital
subject to the Diagnosis Related Group (DRG)-based payment system, offsets
may be taken not only against claims on which payment would be issued
to the debtor hospital, but also against annual payments due to
debtor hospital as reimbursement for its Capital and Direct Medical
Education (CAP/DME) costs. If the full amount is recouped through
offset, an adjustment claim shall be reported with the current claim
or in the next payment run. If the receivable was written off, it shall
be reversed. If the receivable was transferred to DHA, immediately
notify DHA OGC telephonically and follow up by letter within two
work days after the telephone call. Also, reverse the transfer transaction
on the next Accounts Receivable Report.
27.2 If a debtor has entered into
an installment repayment agreement and has asked the contractor to
continue to offset against future claims, the amount offset shall
be applied first to interest and then to principal, as installment
payments are applied. Generally, though, offset amounts shall be
applied only to principal.
27.3 When a debt has been paid
either by offset, partial payment or installment payments, to within $10.00
of the total amount due, including interest, if applicable, the
contractor may consider the debt paid in full, if it is practical
to do so. If the contractor chooses to consider the debt paid in
full when the balance has been reduced to $10.00 or less, the debtor
shall be so advised.
28.0
Requests
For Relief Of Indebtedness
The contractor
is not authorized to compromise or to suspend or terminate collection
actions on federal claims. Requests for relief based upon financial
hardship shall be handled in accordance with the below paragraphs.
Requests for suspension of recoupment action pending the outcome
of an appeal filed in accordance with
32 CFR 199.10, shall be forwarded to the DHA
OGC.
28.1 Account
Balance Of Less Than $600
When debtors request
relief from all or a portion of their indebtedness, including requests
for relief from the assessment of interest, penalties, and administrative
charges, the contractor shall remove the offset flag and ask the
debtor to complete a Financial Affidavit (see
Addendum A, Figure 10.A-23 and
Figure 10.A-25).
The debtor shall be notified that consideration cannot be given
to his/her request for relief unless the completed Financial Affidavit
is returned within 30 days. If the debtor fails to return the completed
Financial Affidavit within 30 days, the offset flag shall again
be set and recoupment action shall continue as though no request
for relief had been made. When the completed Financial Affidavit
is received, the contractor shall forward the affidavit, along with
a copy of the demand letter(s), and the debtor’s request for relief
to the DHA OGC. If directed to do so by DHA, following the review
of the debtor’s request for relief, the contractor shall reset the
offset flag and proceed with normal recoupment procedures.
28.2 Account Balance
Of $600 Or More
The contractor shall remove
the offset flag upon receipt of a request for relief from indebtedness
and ask the debtor to complete a Financial Affidavit. The debtor
will be notified that consideration cannot be given to his/her request
for relief unless the completed Financial Affidavit is returned
within 30 days. When the completed affidavit is received, the entire
recoupment case as outlined in
paragraph 19.0, including the completed Financial
Affidavit, shall be referred to the DHA OGC, for resolution. If
the debtor fails to return the completed Financial Affidavit within
30 days, the offset flag shall again be set and recoupment action
shall continue as though no request for relief had been made. This
paragraph does not apply to the automatic waiver of interest on
accounts paid within the first 30 days. Once a case has been established,
the contractor shall stop or amend a recoupment action, as necessary,
to correct a contractor error.
29.0
Administrative
Review Of Indebtedness
29.1 If a debtor requests an administrative review
of his indebtedness, the contractor shall review the documentation
contained in the case file and any additional information or documents
submitted by the debtor. The contractor review shall be conducted
by someone in a position of higher authority within the contractor
than the individual who originated the recoupment action. Following
the review, the contractor shall respond to the debtor. When the
debtor questions a contractor determination that the care is not
a covered benefit, the debtor’s request for review will be referred
to the appropriate unit within the contractor for issuance of a
Reconsideration pursuant to
32 CFR 199.10 unless
the issue is not appealable under the provisions of
Chapter 12, or the recoupment action was initiated
for one of the following reasons:
• TRICARE payment was
issued without regard to OHI or pharmacy benefit plan, or the TRICARE
liability, after taking into consideration payments made by OHI
or pharmacy benefit plan, was inaccurately calculated.
• The action was initiated
to recoup a duplicate payment.
• The action was initiated
because an error was made in the original determination that a claim
was a participating or a nonparticipating claim.
• The action was initiated
because the payee was incorrect.
29.2 Based upon
the above instructions, if it is inappropriate to provide the debtor
a reconsideration, the contractor shall issue a response to the
debtor’s request for administrative review. The contractor’s response
shall describe the documentation reviewed, including any submitted
by the debtor, and explain the reviewing party’s rationale for the
decision to pursue or terminate the recoupment action. The response
shall explain that further administrative appeal is not available.
If the review results in a decision to recoup the overpayment, the
debtor will be advised that full payment or other satisfactory arrangements
for repayment must be made within 30 days. A debtor’s request for
an administrative review of his or her indebtedness does not result
in suspension of the accrual of interest from the date of the initial
demand letter.
30.0 Suspicion
Of Fraud
30.1 If there is reason to believe that the overpayment
may have been caused by fraud, no request for refund shall be made
until the fraud issue is resolved. However, the contractor shall
retain any amount voluntarily refunded pending resolution of the
fraud issue. These funds shall be deposited in the TRICARE account
and an accounting record maintained capable of audit. Documentation
of the refund and all other evidence relating to the case shall
be sent to the DHA PI. Any recoupment action shall be taken in accordance
with
Chapter 13.
30.2 Once a determination has been
made that a case shall not be prosecuted for fraud, the DHA OGC,
will return the suspected fraud case to the appropriate contractor
for development and recoupment under this section. If the recoupment
action is successful, the contractor shall notify DHA OGC by telephone
within one work day of the final collection and follow-up with written
notification within three work days. If the contractor is unsuccessful
in collecting the debt, the case should be returned to DHA OGC in
accordance
paragraph 19.0.
31.0 Contractor
Transitions
31.1 The incoming contractor and the CCS, shall
receive their designated cases from the outgoing contractor no later
than 30 days from the start of health care delivery (SHCD) in accordance
with
Chapter 2, Section 10, paragraph 5.0.
31.2 If a transition
occurs before the contractor determines that the bankruptcy case
has been closed, with or without distribution of assets, the POA
and Agreement forms, with copies of claims and EOBs shall be sent
to the DHA OGC for follow-up.
32.0
Interest,
Penalties And Administrative Costs
32.1 The debtor shall be notified
in the initial demand letter that interest will accrue from the
date of that letter. The rate of interest to be assessed is the
U.S. Treasury Current Value of Funds Rate. The Department of the
Treasury publishes a new rate pursuant to Section 11 of the Debt
Collection Act of 1982, as Amended (31 USC 3717). The contractor
shall obtain the current rate as published in the Federal
Register. The Treasury’s rate may change on a quarterly basis
if the rolling 12 month average used for calculating the rate changes
by two percentage points. However, the collection of interest shall be
automatically waived on the debt or any portion thereof which is
paid within 30 days after the date of the initial demand letter.
The contractor is not authorized, under any other circumstances,
to waive a debt or any portion of a debt owed the U.S. Government.
32.2 Debtors
shall also be notified in the initial demand letter that a penalty
charge, not to exceed 6% per year, will be assessed upon any portion
of the debt that is delinquent for more than 90 days, and that administrative
costs, (based upon those costs incurred in processing and handling
the debt because it became delinquent) will also be added to their
indebtedness. However, the contractor shall not assess administrative
costs and penalties (DHA will assess administrative costs and penalties).
32.3 The contractor
shall be responsible for the assessment and collection of interest
only when the debtor enters into an installment repayment agreement
as described in
paragraph 25.0. The rate of interest assessed
shall be the rate properly reflected in the initial demand letter
mailed to the debtor. The rate of interest assessed shall be the
rate of the current value of funds to the U.S. Treasury; i.e., the Treasury
Tax and loan account rate. Each installment payment shall be applied
first to the accrued interest and then to the outstanding principal
balance.
32.4 Interest will not be assessed upon previously
accrued interest charges. When the debtor and the contractor enter
into an installment repayment agreement, interest will be assessed
for the period beginning on the date of the initial demand letter
and ending on the due date of the first installment payment. The
interest shall be assessed at the rate properly reflected in the
initial demand letter on that portion of the debt which remained
outstanding 30 days after the date of the initial demand letter.
The interest so assessed will be collected and applied to the debtor’s
account before the due date of the first installment payment. Subsequently,
interest shall be computed daily on the outstanding principal balance
at the rate properly reflected in the initial demand letter, which
shall also be reflected in any Promissory Note sent to the debtor
as required by
paragraph 16.2.3.
32.5 Interest collected under installment
agreements shall be reported to DHA monthly with unidentified refunds
and refunds $10.00 or less. The rate of interest, as initially assessed,
shall remain fixed for the duration of the indebtedness, except
that where a debtor has defaulted on a repayment agreement and seeks
to enter into a new agreement, a new interest rate may be set which
reflects the current value of funds to the Treasury at the time
the new agreement is executed.
32.6 Delinquent installment accounts
shall be handled in accordance with the procedures outlined in
paragraph 25.0.
33.0
Overpayments
To VA Facilities
Overpayments to VA facilities
are not subject to the above procedures. When a contractor discovers
an overpayment to a VA facility, the contractor shall notify the
VA facility and request repayment to the TRICARE program. The contractor
shall not offset funds due to VA under any circumstances. VA may
take up to 240 days to make the repayment. Nevertheless, the contractor
shall obtain an assurance from VA that repayment is forthcoming.
If VA refuses to provide such a statement or payment is not made
within 240 days, the contractor shall contact, by telephone, DHA
OGC. The contractor shall provide a monthly status report of all
VA overpayment cases. Details for reporting are identified in DD
Form 1423, Contract Data Requirements List (CDRL), located in Section
J of the applicable contract.