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 (
DVA)
/Veterans
Health Administration (VHA) 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
The
contractor shall take no recovery action when the overpayment to
a single payee is less than $110.
14.0 Overpayments Totaling $110
Or More
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.
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 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
DVA/V
HA
Facilities
33.1 Overpayments to DVA/VHA
facilities are not subject to the above procedures. When the contractor identifies an
overpayment to a DVA/VHA
facility, the contractor shall notify the facility
and request repayment to the TRICARE Program.
The contractor shall not offset funds due to DVA/VHA under
any circumstances.
33.2 Upon
identification of an overpayment, the TRICARE contractor shall issue
written notice of the basis for the overpayment to the applicable
DVA/VHA facility, including a request for repayment of an amount
due. The facility will acknowledge receipt within 90 days of the
contractor’s notification. In addition, the facility’s acknowledgment
will contain any claim disputes, to include the basis for the overpayment
or the calculation of the refund. The facility may request additional
time to investigate potential disputes. If the facility does not
respond, or the contractor cannot resolve a claim dispute, the contractor
shall refer the case to the DHA, OGC, Chief, CCS. If the facility
does not submit a claim dispute, DVA/VHA will refund the amount
due within 180 days from the written notification. Upon resolution
of a claim dispute, if appropriate, the DVA/VHA will issue a refund
within 180 days.
33.3 The
contractor shall provide a monthly status report of all DVA/VHA
overpayment cases. Details for reporting are identified in DD Form
1423, Contract Data Requirements List (CDRL), located in Section
J of the applicable contract.