Medicare Financial Management Manual

Chapter 5 - Financial Reporting

Table of Contents

(Rev. 315, 05-17-19)

Transmittals for Chapter 5

10 - Checks Paid Method - General

20 - Summary of Procedures

30 - Establishment of Special Bank Accounts

30.1 - Execution of Bank Agreement

30.2 - Collateral Requirement

30.3 - Changes in Collateral Pledged as Security for Federal Health Insurance

Accounts

30.4 - Check Format Specifications

40 - Signature of Bank Individuals Authorized to Draw on The Letter-of-Credit

40.1 - Revision of Signature Cards

40.2 - Request for Additional Cards

40.3 - Signatures of Contractor Personnel Authorized for Federal Health

Insurance Time Account

50 - Withdrawal of Federal Funds

60 - Use of Payment Vouchers

70 - Form CMS-1521, Payment Voucher on Letter-of-Credit Transmittal

70.1 - Instructions for Completion of Form CMS-1521

80 - Form CMS-1522, Monthly Contractor Financial Report

80.1 - Instructions for Completion of Form CMS-1522

80.2 - Medicare Contractor Monthly Cash Collections Worksheet

90 - Intermediary Benefit Payment Report (Form CMS-456)

90.1 - Purpose and Scope

90.2 - Due Dates and Transmittal

90.3 - Verification of Data

90.4 - Accuracy of Data Contained on Report and Reconciliation of Data

Reflected on Monthly Intermediary Financial Report (Form CMS-1522)

90.5 - General Reporting Instructions

90.6 - Instructions for Completion of the IBPR

90.7 - Form CMS-456 - Schedule R

100 - Issuance of Letter-of-Credit

100.1 - Monthly Limitation

100.2 - Amending Letter-of-Credit

100.3 - Establishment of Accounting Records

110 - Initial Federal Health Insurance Time Account Deposit

110.1 - Subsequent Time Account Deposits and Adjustments

110.2 - Bank Account Analysis

120 - Reviewing Bank Agreements

120.1 - Terminating Bank Agreements

120.2 - Terminating Federal Health Insurance Accounts

120.3 - Phase-out Period for Federal Health Insurance Bank Accounts

130 - Invitation for Bid (IFB) to Provide Banking Services Under The Checks Paid

Method of Letter-of-Credit Financing

140 - Bonding

150 - Letter-of-Credit Check List

160 - Electronic Funds Transfer (EFT)

170 - Electronic Remittance Advice (ERA)

180 - Exhibits

190 - General Information About Termination Costs

200 - General

210 - Instructions for Completing The Form CMS-750A/B, Contractor Financial Reports

220 - Due Date

230 - Certification

240 - Instructions for Completing Form CMS-751 A/B, Status of Accounts Receivable

250 - Due Date

260 - Certification

270 - Line Item Instructions Form CMS-751A/B

270.1 - Line 1, Beginning FY Balance (Principal & Interest)

270.2 - Line 2a, New Receivables (Principal)

270.3 - Line 2b, Accrued Receivables (Principal)

270.4 - Line 3, Interest Earned (Interest)

270.5 - Line 4a, Cash/Check Collections on Receivables (Principal & Interest)

270.6 - Line 4b, Offset Collections on Receivables (Principal & Interest)

270.7 - Line 4c, Collections Deposited at Another Location (Principal & Interest)

270.8 - Line 5, Adjusted/Transferred/Waived Amounts (Principal & Interest)

270.9 - Line 6, Amounts Written-off Closed (Bad Debts)/Transferred CNC

(Principal & Interest)

270.10 - Line 7, Ending Balance (Principal & Interest)

270.11 - Line 7a, Current Receivables (Principal)

270.12 - Line 7b, Non-current Receivables (Principal)

270.13 - Line 8, Allowance for Uncollectible Accounts (Principal & Interest)

270.14 - Line 9, Total Receivables Net of Allowance

270.15 - Line 10, Cash/Offsets Received for Receivables at Another Location

(Principal & Interest).

270.16 - Line 1, Total Not Delinquent (Principal & Interest)

270.17 - Line 2, Total Delinquencies (Principal & Interest)

270.18 - Line 3, Status of Delinquent Receivables, less than or equal to 180 Days

(Principal & Interest)

270.19 - Line 4, Status of Delinquent Receivables, greater than 180 Days

(Principal & Interest)

270.20 - Line 4c, Collections Deposited at Another Location (Principal &

Interest)

270.21 - Line 10, Cash/Offsets Received for Receivables at Another Location

(Principal & Interest)

270.22 - Collections on Delinquent Debt (Principal & Interest)

270.23 - Line 5c, Transfers Out to other Medicare Contractors (Principal &

Interest)

270.24 - Line 5e, Transfers Out to other CMS Locations, POR/PSOR (Principal &

Interest)

270.25 - Line 5g, Transfers Out to other CMS Locations, Not POR (Principal &

Interest)

280 - Instructions for Completing the CMS-C751A/B, Status of Debt - Currently Not

Collectible (CNC), and CMS-MC751A/B, Status of MSP Debt - Currently Not

Collectible (CNC)

290 - Due Date

300 - Certification

310 - Line Item Instructions CMS-C751A/B - Non-MSP and CMS-MC751A/B - MSP

310.1 - Line 1, Beginning FY Balance (Principal & Interest)

310.2 - Line 2, New CNC Debt (Principal & Interest)

310.3 - Line 3, Interest Earned Since CNC Approval (Interest)

310.4 - Line 4(a) through (e), Reclassified CNC Debt (Principal & Interest)

310.5 - Lines 5(a) through (f), Amounts Transferred (Principal & Interest)

310.6 - Line 6, Ending Balance (Principal & Interest)

310.7 - Line 1, Total Aged CNC Debt (Principal & Interest)

310.8 - Collections on CNC Debt (Principal & Interest)

310.9 - Status of CNC Debt over 181 Days (Principal & Interest)

400 - Exhibits

400.1 - Exhibit 1 - Statement of Financial Position and Statement of Operations -

HI/SMI

400.2 - Exhibit 2 - Statement of Financial Position and Statement of Operations -

SMI

400.3 - Exhibit 3 - Status of Accounts Receivable - HI

400.4 - Exhibit 4 - Status of Accounts Receivable - SMI

400.5 - Exhibit 5 - Status of Non-MSP Debt - CNC - HI

400.6 - Exhibit 6 - Status of Non-MSP Debt - CNC - SMI

400.7 - Exhibit 7 - Status of MSP Accounts Receivable - HI

400.8 - Exhibit 8 - Status of MSP Accounts Receivable - SMI

400.9 - Exhibit 9 - Status of MSP Debt - CNC - HI

400.10 - Exhibit 10 - Status of MSP Debt - CNC - SMI

400.11 - Exhibit 11 - Medicare Contractor Account Definitions - Data Element

Definitions

400.12 - Exhibit 12 - Accounts Payable - Protocol for Estimating Claims - Form

CMS-750A/B, Statement of Financial Position

400.13 - Exhibit 13 - Periodic Interim Payments (PIP) Protocol for Estimating

Payables/Receivables for the Form CMS-750A/B, Statement of Financial Position

(Intermediaries Only)

400.14 - Exhibit 14 - Protocol for Estimating Allowance for Uncollectible

Accounts Form CMS H/M -751A/B, Status of Accounts Receivable

400.15 - Exhibit 15 - Protocol for Prorating Intermediary Time Account Balances

Between Form CMS 750A (HI) and Form CMS 750B (SMI)

400.16 - Exhibit 16 - Electronic Certification

400.17 - Exhibit 17 - Instructions for the Transfer of Debt Between Reporting

Entities

400.18 - Exhibit 18 - Collection Reconciliation/Acknowledgement Form

400.20 - Exhibit 20 - Procedures for Reporting Currently Not Collectible (CNC)

Debt

400.21 - Exhibit 21 - CMS Policy for Recognizing Accounts Receivable

400.22 - Exhibit 22 - Accounts Receivable Trending Analysis Procedures

400.23 – Exhibit 23 – Instructions for the Benefits Payable Survey

400.24 – Exhibit 24 – Benefits Payable Trending Analysis Procedures

410 – Unsolicited Voluntary Refunds

410.1 – General Information

410.2 – Office of the Inspector General (OIG) Initiatives

410.3 – Unsolicited/Voluntary Refund Accounts

410.4 - Receiving and Processing Unsolicited/Voluntary Refund Checks When

Identify Information is Provided

410.5 – Handling Checks or Associated Correspondence with Conditional

Endorsements

410.6 - Receiving and Processing Unsolicited/Voluntary Refund Checks when

Identifying Information is not Provided

410.7 – CMS Reporting Requirements With the Exception of MSP

410.8 – Exhibit 1 Overpayment Refund

410.9 - Exhibit 2 Unsolicited/Voluntary Refund Checks – Summary Report

410.10 - Education

411 – Exhibits

411.1 – Overpayment Refund Form

411.2 – Exhibit 2 - Unsolicited/Voluntary Refund Checks – Summary Report

411.3 – OIG Law Enforcement Demand Letter

420 – Procedures for Re-issuance and Stale Dating of Medicare Checks

500 – Procedures for the Reconciliation of Total Funds Expended for Fiscal Intermediary

Shared System (FISS) Medicare Contractors Used in the Preparation of Form CMS-1522,

Monthly Contractor Financial Report

500.1 – Identification and Summarization of Detailed Claims Data Records for

Use in the Financial Reconciliation of Total Funds Expended to Fiscal

Intermediary Shared System Reports

500.2 – Using the Electronic Spreadsheet to Complete the Reconciliation of the

Detailed Claims Data File to Fiscal Intermediary Shared System Reports

500.3 – Electronic Spreadsheet Input Schedule

500.4 – Total Funds Expended (Net Disbursements and Adjustments to Net

Disbursements)

500.5 – Reconciliation of Detailed Claims Data File to FISS System Reports

500.6 – Reconciliation of Non-PIP Payments on FISS System Reports

500.7 – Reconciliation of Interest Received and Paid on FISS System Reports

500.8 – Categorization of Total Funds Expended by Category

510-Procedures for the Reconciliation of Total Funds Expended for Multi-Carrier System

(MCS) Medicare Contractors Used in the Preparation of Form CMS-1522, Monthly

Contractor Financial Report

510.1 - Reconciliation of Detailed Claims Data File to Multi-Carrier System

(MCS) Report

510.2 - List of Primary MCS Reports Used in the Reconciliation of Total Funds

Expended

510.3 - Standard MCS 1522 Reconciliation Lead Schedule

510.4 - Reconciliation of Claim Payments from the Detailed Claims Data

File/Report to the Month-to-Date Analysis of Payment (MCS Report #2002 or

HBDR2002)

510.5 - Proof of Net Disbursements and Total Issues per Detailed Claims Data

File/Report

510.6 - Proof of Net Disbursements and Total Issues Per MCS Report #2002

510.7 - Reconciliation of Net Disbursements and System Issues from the Detailed

Claims Data File/Report to the Month-to-Date Analysis of Payment (HBDR2002)

510.8 - Proof of Net Disbursement per MCS Register Summary Report

(HBDR6000) to the Month-to-Date Analysis of Payments (HBDR2002 Report,

Line G

510.9 - Input Sheet for Cash Activity Items

520 – Instructions for Completion of the Contractor’s Monthly Bank Reconciliation

Worksheet

NOTE: Throughout this chapter, reference to provider includes institutional providers,

physicians, and suppliers, i.e., all delivers of health care services that are reimbursed by

either the intermediary or the carrier.

NOTE: Revision 1, the initial release of this chapter, includes a cross reference to the

source sections in current manuals. The manual is identified by A1, A2, A3, or A4 for

Intermediary Manual Parts 1 through 4; or by B1, B2, B3 or B4 for Carriers Manual Parts

1 through 4. This indicator is followed by a dash and the related section number.

10 - Checks Paid Method - General - (Rev. 5, 08-30-02)

A1-1400, B1-4400

Certified Letter-of-Credit Defined:

A certified letter-of-credit is a legal reservation of funds on deposit in the Federal

Reserve Bank that covers payments for which the contractor has contracted to pay by

issuing checks and authorizing electronic funds transfer.

The objective of the letter-of-credit checks paid method of financing is to reduce the level

of the Federal debt and the interest costs of short-term borrowing. This method provides

cash availability to meet Medicare program requirements, while at the same time,

controls the timing of cash withdrawals so that the impact of these withdrawals on the

public debt level and related financing costs is minimized. Cash flow is controlled by:

• Postponing withdrawal of funds from the U.S. Treasury until Medicare checks are

presented to the contractor's Medicare servicing bank for payment;

• Limiting the amount withdrawn at any time; and

• Reducing the amount of Federal funds required to offset bank service charges.

The Treasury Department requires all Government agencies that make advance payments

to utilize the letter-of-credit checks paid method of financing. (See Circular No. 1075,

revised February 27, 1973, and Chapter 1000 of the Treasury Fiscal Requirements

Manual.)

20 - Summary of Procedures - (Rev. 5, 08-30-02)

A1-1401, B1-4401

A contractor shall use the following steps to implement the letter-of-credit checks paid

method of financing:

• It shall notify the RO 165 days prior to the expiration of the current three-party

bank agreement when a new bank will be secured under the checks paid method;

• It shall request the latest copy of the Invitation for Bid (IFB) from the Regional

Office (RO);

• It shall use the IFB package as a guide to prepare its IFB. The language contained

in the package cannot be materially altered except for "BID FORMS AND

CONTRACTOR'S REQUIRED MEDICARE BANKING SERVICES." (See

Attachment A, Section G, of the package.) The contractor shall obtain from its

RO the implementation package that contains examples of material required for

the bid process as follows:

o Letter to Commerce Business Daily requesting IFB advertisement; and

o Sample write-ups of contractor's specifications for bank services,

computer requirements, check specifications, and electronic funds transfer

capability;

• It shall send the completed IFB to its RO for approval prior to its release for bid.

It shall send an additional copy to:

Centers for Medicare & Medicaid Services

Office of Financial Management

7500 Security Boulevard

Baltimore MD 21244-1850

• Obtain bids from two or more banks;

• Follow the Federal Acquisition Regulations (FAR), Part 14, when securing

competitive bids;

• Evaluate the bank bids and, with the concurrence of the servicing RO, select the

commercial bank that meets all of the mandatory requirements and submits the

lowest required time account balance;

• Select a commercial bank and establish special bank accounts;

• Secure Signature Cards. Use Form SF-1194 to obtain the signatures of those

individuals authorized by the bank to draw payment vouchers against the letter-

of-credit and the signature of the bank official who has the authority to designate

the authorized individuals;

NOTE: CMS executes the three-party bank agreement between the contractor, the bank,

and the Government (the servicing RO). CMS also issues a letter-of-credit that sets forth

the monthly limitation.

• Post (Bank) collateral with the Federal Reserve Bank;

• Establish (Bank) both the Benefits Account and the Time Account;

• Submit monthly letter-of-credit transmittals (form CMS-1521) via Contractor

Administrative Financial Management (CAFM) to the Funds Control Branch,

Central Office. Distribute Medicare funds withdrawn by bank via FNS-5401

payment voucher according to type of benefits; and

• Submit the monthly form CMS-1522, TAA-1b and TAA-1C, to CMS via the

CAFM system.

30 - Establishment of Special Bank Accounts - (Rev. 5, 08-30-02)

A1-1403, B1-4403

Keep all Federal funds withdrawn under the letter-of-credit separate from all other funds.

Designate the Medicare account for deposit in a special bank account established by you

in a member bank of the Federal Reserve System. Designate the special demand deposit

checking account as follows:

(Name of Contractor)

Federal Health Insurance Benefits Account

Designate the special non-interest bearing time account as follows:

(Name of Contractor)

Federal Health Insurance Time Account

Restrict withdrawals to transfer of funds to the Federal Health Insurance Benefits

account.(FHIBA)

30.1 - Execution of Bank Agreement - (Rev. 5, 08-30-02)

A1-1403.1, B1-4403.1

The contractor shall execute the three-party bank agreement with the selected commercial

bank. The bank agreement requires that the Federal Government retain a lien on all funds

held in the special bank account. The bank abides by written instructions of the

Government with regard to the deposit and withdrawal of funds. The Government also

has the right to inspect or audit the bank's books and records that pertain to the special

accounts. (Refer to Attachment C of the IFB package.)

The contractor shall use the following guidelines when it executes a bank agreement;

• It must strictly adhere to the wording and format of the bank agreement.

• It may alter only Covenant 7. The provisions of Covenant 7 may, by agreement of

all parties, be written to require either a one or two-year period of performance

following the initial two year period;

• The RO forwards an original and three copies of the completed three-party

agreement to the bank via the contractor for execution. Each copy of the bank

agreement must contain original signatures. Facsimile signatures are not

acceptable; and

• After it is countersigned by CMS, individual copies of the agreement are

distributed to:

o The contractor;

o The bank;

o The servicing RO; and

o Centers for Medicare & Medicaid Services

Office of Financial Management

7500 Security Boulevard

Baltimore MD 21244-1850

30.2 - Collateral Requirement - (Rev. 5, 08-30-02)

A1-1403.2, B1-4403.2

Posted collateral is based on the balance to be maintained in the time account less FDIC

coverage, if applicable. The RO advises the contractor, upon notification by the Federal

Reserve Bank, when collateral is posted. (Collateral must be acceptable under the

guidelines provided to the Federal Reserve by the Department of the Treasury).

The contractor shall place the collateral with the Federal Reserve Bank or Branch of the

district where its servicing financial institution is located or with a custodian designated

by the Federal Reserve Bank or Branch. It shall include a letter with the collateral that

states that the collateral is pledged as security for public money by CMS, agency account

number 5555-4454-5 under the terms of 31 CFR, Part 202 (Treasury Circular 176).

30.3 - Changes in Collateral Pledged as Security for Federal Health

Insurance Accounts - (Rev. 5, 08-30-02)

A1-1403.3, B1-4403.3

The CMS, Division of Contractor Financial Management (DCFM), monitors collateral

requirements. DCFM continuously reviews the most recent balances maintained in the

Federal Health Insurance Bank Accounts.

If an increase in pledged collateral appears necessary, DCFM requests the bank to post

additional collateral with its Federal Reserve Bank.

If a decrease in pledged collateral appears warranted, DCFM advises the Federal Reserve

Bank of the amount of excess collateral pledged.

The contractor shall direct any request for release of excess bank collateral to the local

Federal Reserve Bank.

30.4 - Check Format Specifications - (Rev. 5, 08-30-02)

A1-1403.4, B1-4403.4, B2-5215

The following phrase must appear on all checks or drafts written for purposes of paying

benefits and related administrative costs authorized under the Medicare program:

MEDICARE PAYMENT

For Health Insurance - Social Security Act

The contractor shall use the following check format specifications:

Check Front

The contractor shall center the words "Medicare Payment" at the top of the check or draft

and print these words in at lease 1/4-inch type. Contractor name and address should

appear on the face of the check. The check may also include the contractor's emblem or a

picture of a building it occupies. The contractor may not include advertising on the face

of the check. (Advertising should not appear on the envelope in which the check is

mailed.) It is expected that the type sizes of the items placed on the check will not detract

from the required "Medicare Payment" phrase.

Check Back

The contractor shall print on the back of all Medicare checks the following statement:

"This payment is made with Federal funds. Fraud in procuring, forging a signature or

endorsement, or materially altering this check is punishable under the U. S. Criminal

Code."

For carriers, assigned claims must also include the following statement:

"As provided by the terms of the law under which this check is issued, the undersigned

payee, in accepting assignment, agreed that the charge determination by the Medicare

carrier shall be the full charge for any service which the check is payable. The patient is

responsible only for the applicable deductible and coinsurance, and for non-covered

services."

It is not necessary to show the account name on the check. If one is shown, it should read

"Federal Health Insurance Benefits Account." If both Part A and Part B are shown, it

should read, "Federal Health Insurance Benefits Account - Part A" and "Federal Health

Insurance Benefits Account - Part B."

The time limitation for cashing the check (if specified on the check) cannot be less than 6

months.

The contractor shall clear formats of checks with the servicing RO prior to printing or

contracting for printing.

40 - Signature of Bank Individuals Authorized to Draw on The Letter-

Of-Credit - (Rev. 5, 08-30-02)

A1-1405, B1-4405

Signatures of bank representatives authorized to sign payment vouchers must be on file

along with the letter-of-credit at the servicing Federal Reserve Bank or branch in order to

honor payment vouchers (FMS-5401). The contractor shall submit a signature card, Form

SF-1194, for the person(s) authorized by the bank to sign payment vouchers.

NOTE: Executed signature card(s) must be received in DCFM no later than 20 calendar

days prior to the effective date of a new letter-of-credit.

40.1 - Revision of Signature Cards - (Rev. 5, 08-30-02)

A1-1405.1, B1-4405.1

The contractor shall prepare new card(s) if more than two signatures are no longer valid.

It shall prepare two original cards for every four individuals. If more than one card is

needed, i.e., more than 4 individuals are authorized, it shall number the cards 1 of 2, 2 of

2 to ensure that all cards are received.

New signature cards must contain the signatures of all individuals who will sign payment

vouchers and be certified by an official of the bank. The contractor need not resubmit a

new signature card if change in position or title of an individual authorized to sign

payment vouchers is involved.

The contractor shall mark new signature cards "Replaces and Supersedes all Previously

Submitted Cards" on the top edge of the card.

40.2 - Request for Additional Cards - (Rev. 5, 08-30-02)

A1-1405.2, B1-4405.2

The contractor shall send requests for additional signature cards to:

Centers for Medicare & Medicaid Services

Office of Financial Management

7500 Security Boulevard

Baltimore, MD 21244-1850

40.3 - Signatures of Contractor Personnel Authorized for Federal

Health Insurance Time Account - (Rev. 5, 08-30-02)

A1-1405.3, B1-4405.3

Signatures of two or more individuals designated by the contractor to sign withdrawal

requests to transfer funds from the Federal Health Insurance Time Account to the Federal

Health Insurance Benefits Account must be on file with the designated commercial bank.

50 - Withdrawal of Federal Funds - (Rev. 5, 08-30-02)

A1-1406, B1-4406

The Federal Government assures that funds are always in the Federal Reserve Bank to

honor properly drawn payment vouchers within the limits of the letter-of-credit. This

arrangement is consistent with State banking laws since it eliminates any possibility of

intent to defraud.

60 - Use of Payment Vouchers - (Rev. 5, 08-30-02)

A1-1408, B1-4408

To obtain Federal funds, the bank prepares a daily payment voucher, Treasury Form

FMS-5401, and forwards it to the servicing Federal Reserve Bank or Branch holding the

letter-of-credit.

When the bank receives the initial letter-of-credit, the bank sequentially numbers

payment vouchers drawn beginning with the number one (1). Amendments to the letter-

of-credit do not interrupt the sequential numbering of payment vouchers.

Payment vouchers are prepared only in an amount equal to the contractor's total checks,

bank debit memos, and electronic funds transferred. These vouchers are presented for

payment each day less any balance in the benefits account representing collected other

deposits or transfers from the Federal Health Insurance Time Account.

If the bank is not located in a Federal Reserve Bank (FRB) city, CMS requests the

Treasury Department to implement a telephonic method of receiving funds for the bank.

The bank calls its FRB and requests a specific funding amount. The FRB prepares the

payment voucher and a copy is sent to the bank.

The letter-of-credit provides a ceiling on the amount that may be drawn during the month

and is purposely set high to meet peak cash needs. In no instance is a payment voucher to

be drawn for less than $5,000 or more than $5,000,000 (unless the letter-of-credit has

been annotated "Authorized to draw payment vouchers in excess of $5,000,000"). Only

one payment voucher should be drawn per day. Regardless of the factors considered in

determining when and in what amount to draw payment vouchers, banks are expected to

abide by the intent of the letter-of-credit Checks Paid Method of financing system by

assuring that the total of the daily voucher processed is the minimum required to finance

current disbursements.

NOTE: The "Name and Address of Drawer" block on the Treasury Form FMS-5401

must include the name of the bank as it appears on the letter-of-credit sent by CMS and

the annotation "agent for" (name of contractor). Due to space limitations, the contractor

does not have to show the address in this block. A supply of payment vouchers is

provided to each commercial bank. Additional supplies of payment vouchers may be

ordered from:

Centers for Medicare & Medicaid Services

Office of Budget and Administration

Distribution Liason Officer

7500 Security Boulevard

Baltimore, MD 21244-1850.

70 - Form CMS-1521, Payment Voucher on Letter-Of-Credit

Transmittal - (Rev. 5, 08-30-02)

A1-1410, B1-4410

The purpose of form CMS-1521, Payment Voucher on Letter-of-Credit Transmittal, is to

record daily voucher data that the contractor's bank submits to the Federal Reserve Bank

for payment of Hospital Insurance (HI) and Supplemental Medical Insurance (SMI)

benefit payments. Administrative costs paid through the Smartlink System are also

reported on the form. Administrative costs are allocated to current or prior fiscal years

and to special projects.

Transmit form CMS-1521 to CMS by the 15th of each month via the CAFM System.

(See operating instructions for completion that are contained in the CAFM Users Guide.)

70.1 - Instructions for Completion of Form CMS-1521 - (Rev. 5, 08-30-

02)

A1-1410.1, B1-4410.1

Data comes from Treasury Form FMS-5401 Payment Voucher.

Date drawn - Contractor enters the date funds were drawn. It shall use 2 digits.

Voucher Number - Contractor enters the payment voucher number in 3 digits beginning

with voucher number 001 to 999. It shall inform the bank to start over when number 999

is reached.

Serial Number - Contractor enters the serial number of the payment voucher.

Hospital Insurance Benefits - Contractor enters the total amount drawn for HI and SMI.

The total of HI and SMI benefits should equal the total funds drawn.

NOTE: Part B contractors enter amounts for SMI only.

PMS Smartlink Communication System for Administrative Costs –

On pages 1 and 2, the contractor shall continue to report administrative costs drawn via

the PMS Smartlink Telecommunications System in the same designated "Administrative

Cost" column 4. However, it shall show these amounts after it reports all benefit payment

amounts.

Contractor shall indicate in the "date drawn" column the date the money was deposited

into its commercial bank account and not the date it requested the money. This entry

(entries) may occur on either page 1 or 2 depending on the number of entries.

Contractor shall not make entries in the columns for Voucher Number, Serial Number,

and Voucher Totals.

Contractor shall reflect the current or prior year administrative costs drawn via Smartlink.

It shall report on page 3 any special project(s) amount(s) drawn via Smartlink.

Public reporting burden for collecting this information is estimated to average 1 hour per

response. This includes time for reviewing instructions, searching existing data sources,

gathering and maintaining data needed, and completing and reviewing the collection of

information. Contractor shall send comments regarding this estimated burden or any

other suggestions for reducing the burden to:

Office of Management and Budget

Paperwork Reduction Project (0938-0361)

Washington, D.C. 20503;

and to:

Centers for Medicare & Medicaid Services

Office of Financial Operations

7500 Security Boulevard

Baltimore, Maryland 21244-1850.

80 - Form CMS-1522, Monthly Contractor Financial Report – (Rev. 5,

08-30-02)

A1-1412, B1-4412

Form CMS-1522 is designed to provide a reconciliation of Medicare benefit dollars

between CMS, the contractor, and the bank. The contractor shall transmit this report to

CMS by the 15th of each month via the CAFM System.

80.1 - Instructions for Completion of Form CMS-1522 - (Rev. 5, 08-30-

02) - (Rev. 5, 08-30-02)

A1-1412.1, B1-4412.1

• Screen 1 - Section A - Purpose for Which Funds are Drawn:

o Contractor shall reflect the current or prior year administrative costs drawn

via Smartlink. It shall report on page 3 any special project(s) amount(s)

drawn via Smartlink.

o Funds Drawn this Month - Contractor enters the total amount of Federal

funds drawn via payment vouchers during the calendar month for use as

HI benefits, line 1-B, or SMI benefits, line 2-B. Each entry must equal the

sum of the amounts shown in this category on the Form CMS-1521 dated

during the calendar month.

o Total Funds Expended This Month - Contractor enters total funds

expended for HI benefits, line 1-D, and SMI benefits, line 2-D during the

calendar month. Totals should equal the sum of all checks drawn and

electronic funds transfer payments against the special bank account during

the calendar month. (It shall include all checks issued and electronic funds

transferred, i.e. dated during the calendar month.) Any refunds received

from beneficiaries or their assignees during the calendar month because of

prior overpayments deposited in the special bank account should serve to

reduce total funds expended.

o Funds Drawn for Fiscal Year - This is a calculated field.

o Funds on Hand End of Month - This is a calculated field.

o Line 3, Drugs and Line 4, Regular Administrative Costs - Contractor shall

not use at this time.

o Bills Paid - Lines 7 and 8 - Completed by Part A intermediaries. Part B

carriers complete only line 8.

o Retro-Adjustment - Part A contractors enter credit adjustments on

appropriate lines. Part B contractors do not use lines 9 or 10.

• Benefits Bank Account

o From Bank Statement - The contractor shall take information for lines 15

through 19 from the statement of the special bank account issued by the

bank at the end of the calendar month.

o Line 15 - Balance Beginning of Month Per Bank - Contractor enters the

balance in the special bank account as of the beginning of the calendar

month as shown on the bank statement.

o Line 16a - Payment Vouchers Drawn During Month - Contractor enters

the total amount of funds drawn on payment vouchers (FMS-5401) during

the calendar month and credited to the benefits account as shown on the

bank statement. Since all checks drawn for deposit in the Time Account

are cleared through the benefits account, a payment voucher is drawn for

this transaction and is included in line 16a. The amount shown on this line

must agree with the totals from the Form CMS-1521 corresponding to the

calendar month and also with Section A, Line 5, column (b). The only

exception is for vouchers in transit (line 20).

o Line 16b - Other Deposits - Contractor enters all other deposits credited

during the month to the special bank account as shown on the bank

statement. It shall reduce the next payment voucher by the amount of the

deposited refunds in the account in order to minimize idle funds in the

account. It shall Include any credits or adjustments made to the bank

account during the calendar month in this line.

o Line 16c - Contractor shall include funds withdrawn from the Time

Account and deposited in the Benefits Account.

o Line 16d - Miscellaneous Credit Memo - Contractor enters any

miscellaneous adjustments to the benefits bank account during the

calendar month.

o Line 17 - This is a calculated field.

o Line 18A - Contractor shall subtract: Checks and EFT Payments Honored

by Bank During Month - It enters from the bank statement the total funds

charged to the special bank account as a result of checks honored and

electronic funds transferred by the bank during the month. This total must

include all checks that were drawn for deposit in the time account and

honored by the bank during the month.

o Lines 18B and C - Miscellaneous Bank Charges - Contractor enters any

miscellaneous charges made to the special bank account that are part of

the bank statement.

o Line 19 - This is a calculated field.

o Line 20 - Add: Deposits in Transit. - Enter payment vouchers drawn and

other deposits made during the calendar month that the bank has not yet

credited to the special bank account according to the statement.

o Line 21. - This is a calculated field.

o Line 22 - Subtract: Outstanding Checks. - Enter the total of all checks

issued during the current month or any previous month that the bank has

not yet paid as of the end of the calendar month. If during the calendar

month payment is stopped on any check previously issued, or any

previously issued check is otherwise voided, subtract the amount of funds

represented by that check from this total before making an entry on this

line.

o Line 23 - This is a calculated field.

o Line 24 - Highest Balance During Month Per Bank. Contractor enters the

highest balance in the special bank account during the calendar month as

reflected on the bank statement.

• Time Account

o Line 15 - Balance Beginning of Month - Contractor enters the balance in

the time account as of the beginning of the calendar month as shown on

the bank statement.

o Line 16a - Other Deposits - Contractor enters the amount of funds drawn

from the benefits account for deposit in the time account.

o Line 17 - Total. - This is a calculated field.

o Line 18a - Contractor enters only amount of funds withdrawn from the

time account and deposited in the benefits account during the month.

o Line 18b - Contractor enters any miscellaneous items.

o Line 19 - Balance EOM Per Bank - This is a calculated field.

• Screen 4 - Completed by Part A Contractors Only

o Periodic Interim Payments - Contractor enters amounts paid during the

month by category.

o Accelerated Payments - Contractor enters the amount of accelerated

payments paid out and received during the month.

o Suspended Payments - Contractor enters the amount of payments

suspended and released during the month.

• Screen 5 - Bills Paid - Contractor enters the amount of money actually paid during

the calendar month as follows:

o Amount paid for disabled or disability (identified by Codes 1 and 3 as

contained in S trailer of query reply).

o Amount paid for chronic renal disease (identified by Code 2 as contained

in S trailer of query reply).

o Amount paid for premium paying enrollees (identified by Codes 8 and 9

as contained in S trailer of query reply).

o Amount paid for aged. Contractor shall complete entries for disabled,

chronic renal disease, and premium paying enrollees prior to completing

the entry. It shall then subtract the sum of these entries from the calculated

Total and enter that amount.

o Total - (Bills paid for the month). This is a calculated field.

NOTE: For those Part A intermediaries that transmit bills to CMS from more than one

point, each processing point should submit to the home office at the end of the calendar

month all of the data requested in screen 1. (It shall consolidate data related to amounts

paid in screen 1.)

• Only Part A Intermediaries complete retroactive adjustments.

• Only Part A Intermediaries complete adjustments between trust funds.

• Interest:

o Interest Received From Providers On Overpayments - Separate Check for

Interest Collected - When a check is received for interest on an

overpayment, the contractor shall deposit the check immediately in the

Medicare bank account. It shall report this check as an "Other Deposit"

(line 16b). Also, it shall report the check as "Interest Received" on screen

5 and use as a reduction to expenditures on screen 1, funds expended

column.

o Check Includes Both Interest Collected and Overpayment Recoupment -

Contractor shall deposit the check immediately into the Medicare bank

account. It shall report the entire amount of the check as an "Other

Deposit" (line 16b) on screen 2. It shall report the interest portion as

"Interest Recovered" on screen 5. Both the interest recovered and the

overpayment recoupment are used as a reduction to expenditures on screen

1, funds expended column.

o Interest Paid to Providers on Underpayments - Separate Check for Interest

Paid - When a check is issued for interest due to a provider on an

underpayment, the contractor shall report it as a "Check Honored" (line

18a) on screen 2. Also, it shall report this amount as "Interest Paid" on

screen 5 and as an increase to expenditures on screen 1, funds expended

column.

• Screen 6 - No entries are required at this time.

Public reporting burden for this collection of information is estimated to average 16 hours

per response. This includes time for reviewing instructions, searching existing data

sources, gathering and maintaining data needed, and completing and reviewing the

collection of information. Contractors may send comments regarding this estimated

burden or any other suggestions for reducing the burden to:

Centers for Medicare & Medicaid Service

Office of Financial Management

Baltimore, Maryland, 21244-1850;

and to:

Office of Management and Budget

Paperwork Reduction Project (0938-0361)

Washington, D.C. 20503.

80.2 - Medicare Contractor Monthly Cash Collections Worksheet

(Rev. 80, Issued: 10-21-05, Effective: 07-01-05, Implementation: 11-21-05)

The Medicare Contractor Monthly Cash Collections Worksheet is to identify cash

collections deposited in the Medicare Trust Funds related to Provider Overpayments.

The Medicare contractors are to follow the line by line instructions for completing the

collections worksheet. The instructions are to provide uniformity throughout all

contractors for the calculations of the data used to populate each line item. Medicare

contractors are required to maintain supporting documentation for the amounts reported

on the Medicare Contractor Monthly Cash Collections Worksheet.

Medicare contractors are required to submit the worksheet via email to

[email protected] on the 15

day of the following month end. For year-end,

Medicare contractors may be required to submit the Monthly Cash Collections

Worksheet in an accelerated time frame.

A. Total Monthly Principal Deposit (Using Forms CMS-1522, Forms CMS-751)

Line 1 - Enter the total ‘Other Deposits’ (Line 16b, Form CMS-1522) for the

reporting period (e.g., June 30, etc.).

Line 2 - Enter ‘Deposits-In-Transit’ (Line 20, Form CMS-1522) for the month

prior to the reporting period (e.g., May 31, etc.).

Line 3 - Enter ‘Deposits-In-Transit’ (Line 20, Form CMS-1522) for the reporting

period (e.g., June 30, etc.).

Line 4 – Enter the sum of Line 1 minus (-) Line 2 plus (+) Line 3 equal (=) ‘Total

Monthly Deposits.

Monthly Interest (Cash) Collections

Line 5 – Enter the total ‘Received-Provider Overpayment’ (Line 1, page 4, Form

CMS-1522) for reporting period (e.g., June 30, etc.).

Line 6 – Enter the total ‘Interest Offset’ for the reporting period. Total ‘Interest

Offset’ must equal the amount of the offset collections included in the

amount reported on Line 1, page 4/4, Form CMS-1522 and included in

the amount of the offset reported on Line 4b, Form CMS 751 for the

quarter ending June 30, 2005.

Line 7 – The sum of Line 5 minus (-) Line 6 equal (=) Monthly Interest Cash

Collections.

Line 8 – Monthly Interest Cash Collections = Line 7.

Line 9 – The sum of Line 4 (Total Monthly Deposits) minus (-) Line 8 Monthly

Interest Cash Collections) = Total Monthly Principal Cash Deposits.

B. Calculate HI/SMI Percentage Split (FI Only) – 12 month rolling average

Line 10 – Enter the sum of Line 4a (principal), Form CMS-751A (quarter ending

June 30, 2005). For example, Line 4a (principal) for the period ending

June 2005 plus (+) [Line 4a (principal), Form CMS-751A (period

ending September 2004) minus (-) Line 4a (principal), Form CMS-

751A (period ending June 2004)]. The sum of Line 4a (period ending

September 2004) minus Line 4a (period ending June 2004) must equal

Cash Collections for the period July 2004 – September 2004.

(NOTE: 12 months of most recent HI principal Cash Collections (e.g., July

2004 - June 2005))

Line 11 - Enter the sum of Line 4a (principal), Form CMS-751BA (quarter ending

June 30, 2005). For example, Line 4a (principal) for the period ending

June 2005 plus (+) [Line 4a (principal), Form CMS-751BA (period

ending September 2004) minus (-) Line 4a (principal), Form CMS-

751BA (period ending June 2004)]. The sum of Line 4a (period ending

September 2004) minus Line 4a (period ending June 2004) must equal

Cash Collections for the period July 2004 – September 2004.

(NOTE: 12 months of most recent SMI principal Cash Collections (e.g., July

2004 - June 2005))

Line 12 – Enter the sum of Line 10 plus (+) Line 11 = Total HI/SMI collections.

Line 13 – Enter the HI percentage split. The result of Line 10 divided by Line 12.

Line 14 – Enter the SMI percentage split. 1.00 minus the HI percentage split

(Line 13).

(NOTE: Line 14 must equal Line 11 divided by Line 12)

C. HI Monthly Cash Deposit = HI percentage split (Line 13) multiplied by Total

Monthly Principal Cash Deposit (Line 9).

D. SMI Monthly Cash Deposit = HI percentage split (Line 13) multiplied by Total

Monthly Principal Cash Deposit (Line 9).

E. The Chief Financial Officer (CFO) is required to certify/sign the Medicare

contractor Cash Collection Worksheet Attachment I (electronic signature is

acceptable if the email is sent by the CFO), as an indication of the

correctness/completeness of the data in accordance with applicable instructions.

(NOTE: The sum of C and D must equal Total Monthly Principal Cash Deposits

(Line 9))

90 - Intermediary Benefit Payment Report (Form CMS-456) – (Rev. 5,

08-30-02)

A1-1414

90.1 - Purpose and Scope - (Rev. 5, 08-30-02)

A1-1414.1

The Intermediary Benefit Payment Report (IBPR) is a report of current monthly

information that covers the categories of benefits the contractor paid and selected

statistical data that relates to those payments. CMS uses this data to:

Track benefit payments by type of provider to detect significant shifts in program

expenditures;

Monitor implementation of new programs, e.g., hospice benefits, and comprehensive

outpatient rehabilitation benefits; and

Identify operation problem areas for resolution by the contractor or CMS.

90.2 - Due Dates and Transmittal - (Rev. 5, 08-30-02)

A1-1414.2

Contractor shall input the reports accompanying the reconciliation between IBPR and the

Monthly Intermediary Financial Report (Form CMS-1522) into the CAFM system 20

work days following the report month.

90.3 - Verification of Data - (Rev. 5, 08-30-02)

A1-1414.3

The various subsidiary records that include the individual provider files must support the

data entered on the report.

The contractor must have the capability to trace all data entered on the report to the

individual provider files.

Where applicable, the Provider Statistical and Reimbursement Report and other provider

reports containing benefits paid data must support the data on the report.

90.4 - Accuracy of Data Contained on Report and Reconciliation of

Data Reflected on Monthly Intermediary Financial Report (Form CMS-

1522) - (Rev. 5, 08-30-02)

A1-1414.4

The contractor must ensure that all data reflected on the report is accurate.

Line 36, column (g) of the report, should equal the amount shown on the CMS-1522,

column (d), lines 1 and 2 in the aggregate. In the event that the amounts do not agree, the

contractor shall complete a reconciliation report.

90.5 - General Reporting Instructions - (Rev. 5, 08-30-02)

A1-1414.5

Where money is withheld from payments due the provider (as an offset) for monies due

the contractor, the contractor shall show the gross amount (less any deductibles,

coinsurance, interest, or sequestration) as the payment on the appropriate line and

column. It shall show the offset as a negative amount in its appropriate line and column.

For example, when the contractor reduces a PPS Periodic Interim Payment (PIP) for a

settlement amount due from the provider, it shall record the gross PIP amount (less any

deductibles, coinsurance, interest, or sequestration) on line lA in column 1 (a) or 1(b), as

appropriate. It shall record the offset on line 6B in column 1(a) or 1(b), as appropriate.

However, it shall record a claim adjustment (e.g., a PRO disallowance or subsequent

reversal) as a reduction of claims payments on line 2A for a non-PIP/PPS hospital.

Where the contractor makes an accelerated payment and the provider repays a portion of

the accelerated payment during the same reporting period, the contractor shall show the

net amount on the appropriate line and column.

For example, when an accelerated payment of $100,000 is made to a provider during the

period, and the provider repays $30,000 during the same period, the contractor shows

$70,000 as the net accelerated payment.

In situations where an accelerated payment is made during the period, and the contractor

recovers a portion of the accelerated payment through reduction of interim payments, it

shall show the gross amount (less any deductibles, coinsurance, interest, or sequestration)

of interim payments as payment on the appropriate line and column. It shall show the

offset amount as a negative amount on the appropriate line and column.

For example, when an accelerated payment is made for $100,000 and later in the month

$30,000 of the accelerated payment is recouped by offset against PPS/PIP amounts of

$150,000 paid to the provider, the contractor shows the $150,000 gross PPS/ PIP amount

on line 1A in column 1(a) or 1(b), as appropriate. It shows a net accelerated payment of

$70,000 ($100,000-$30,000) on line 7 in column 1(a) or 1(b), as appropriate.

90.6 - Instructions for Completion of the IBPR - (Rev. 5, 08-30-02)

A1-1414.6

A. Heading

The contractor enters its name and assigned number. Multi-regional intermediaries use

the number assigned to the home office for administrative budget and cost reporting

purposes. The contractor shall furnish a consolidated report for all locations.

The contractor enters the calendar month and year as a four-digit entry, e.g., 1000, 1100,

1200, 0101.

B. Column Definitions - Page 1

Column (a) - Single Facility - refers to payments to PPS hospitals that do not have

distinct part facilities, such as SNFs, HHAs, psychiatric units, or rehabilitation units.

• Column (b) - Facility With Distinct Parts - refers to payments to PPS hospitals

that include distinct parts, such as SNFs, HHAs, psychiatric units, or

rehabilitation units.

NOTE: The contractor enters non-PPS payments to the distinct part on the appropriate

line and column of page 2.

• Column (c) - Non-PPS Payment - refers to payments to the following:

o Hospitals excluded from PPS (e.g., psychiatric, children's, rehabilitation

and long term);

o Hospitals receiving payments via an alternative payment program (waiver

States);

o Hospitals yet to be phased into PPS; and

o PPS hospitals for bills or underpayments applicable to pre-PPS fiscal

years.

• Column (d) - Total - refers to the total of columns (a), (b), and (c).

C. Line Item Definitions - Page 1:

1. Hospital Inpatient (PIP) - refers to hospitals paid by the PIP method. The

contractor shall show these figures less any deductibles, coinsurance, and interest

for all items on the PIP bills and any sequestration applicable to this line with any

offsets shown on line 6A or 6B.

A. Inpatient Operating Payments - refers to the amount of the PIP that covers

items that would otherwise be paid on a per claim basis plus those items

paid on a per claim basis in addition to PIP payment. (Such as payments

for outliers and hemophilia blood clotting factor add-on.)

The contractor enters the PIP amounts paid as follows:

PPS Provider Payments - Payments related to services furnished after

conversion to PPS in columns 1(a) or 1(b), as applicable. This includes outlier

payments, hemophilia blood clotting factor add-on payments, disproportionate

share amounts, indirect medical education, ESRD payments, and phased-in

capital-related costs during the transition period. Non-PPS Provider Payments

- column (c) - Payments related to services furnished prior to conversion to

PPS. Payments to all providers listed in the definitions for column (c).

B. Pass Through Costs - Contractor enters the PIP payments, including any

withholdings, but less any sequestration amounts for items paid on a

reasonable cost basis as follows:

• Capital;

• Direct medical education which includes nursing and paramedical

health professional (allied health) programs and graduate medical

education;

• Kidney and other organ acquisitions;

• Bad debts; and

• Nonphysician anesthetists.

NOTE: This includes that part of capital-related costs not included in line

1A.

C. Indirect Medical Education - Contractor enters the PIP payments for the

indirect medical education adjustment, whether on a PIP or a claim-by-

claim basis for PIP providers, less any sequestration (already included in

line 1A).

NOTE: Contractor shall make entries on this line for memorandum purposes

only to identify the amount of indirect medical education for PIP hospitals.

2. Hospital Inpatient (Non-PIP), refers to hospitals paid based upon bills reviewed

and approved. Contractor shall show total payments less any reductions on line

6A or line 6B.

A. DRG Bills Paid/Non-DRG Bills Paid - Contractor enters the calculated

payment less any deductibles, coinsurance, and interest for all items on the

bill and any sequestration applicable to this line. It shall include payments

for outliers, disproportionate share, indirect medical education, high

percentage of end-stage renal disease beneficiary discharges, and

hemophilia blood clotting factor add-on payments on a claim-by-claim

basis. Also, it shall include phased-in capital-related costs during the

transition period.

For DRG bills, it shall use columns (a) and (b). For non-DRG bills paid, it

shall use column (c).

It shall report all retroactive adjustments pertaining to hospitals on line 6A or

6B.

B. Pass Through Costs - The contractor enters the interim payments, less any

sequestration, for items paid on a reasonable cost basis as follows:

• Capital;

• Direct medical education which includes nursing and paramedical

health professional (allied health) programs and graduate medical

education;

• Kidney and other organ acquisitions;

• Bad debts; and

• Nonphysician anesthetists. NOTE: This includes that part of the

capital-related costs that are not included in line 2A.

C. Indirect Medical Education - Contractor enters the interim payments for

the indirect medical education adjustment (already included in line 2A).

NOTE: Contractor shall make entries on this line for memorandum purposes only to

identify the amount of indirect medical education for non-PIP hospitals. It shall not

adjust these amounts for MSP or sequestration.

3. Outlier Payments - Contractor enters additional amounts paid for outlier cases.

NOTE: Contractor shall make entries on this line for memorandum purposes only to

identify the total outlier payments that are found in the UB82 billing form in Locator 46-

49 in Value Code 17. These amounts are already included in the amounts recorded on

lines lA and 2A.

A. Days - The contractor enters additional payments made as a result of the

length of stay exceeding the day outlier threshold criteria. It shall make

entries on this line for memorandum purposes only. These are non-add

items.

NOTE: After FY 1997, outlier days no longer exist.

B. Cost - The contractor enters additional payments made for claims where

extraordinary costs were approved. It shall make entries on this line for

memorandum purposes only. These are non-add items.

4. Subtotal - Contractor enters the total of the amounts on lines 1A, 1B, 2A, and 2B.

NOTE: The amounts included in lines 1C, 2C, 3A and 3B are memo entries only and

have been included in lines 1A, 1B, 2A and 2B.

5. Outpatient Payments - Contractor enters the payment, less deductibles,

coinsurance and sequestration for outpatient and Part B inpatient services. It shall

report any offset against these amounts on line 6A or 6B. See line 19 for reporting

SNF outpatient payments.

6. Retroactive Adjustments:

• PPS Provider Payments - Contractor enters on lines 6A and 6B (as

applicable), columns (a) or (b), the net amount of retroactive adjustments

paid and received as a result of interim rate adjustments, pass through cost

adjustments, and cost report settlements applicable to current or prior

provider fiscal years.

Contractor shall show interest on cost report overpayments and late-filed cost

reports on these lines. An example of a proper recording of a retroactive

adjustment would be an entry of $500,000 of cash received from the provider

as the first installment of the final settlement of $1,000,000 due the program

from the prior year's cost report.

Another example would be an entry of $500,000 offset against current PIP

payments due of $1,000,000. (The $1,000,000 would be shown on line 1A.)

• Non-PPS Provider Payments - Contractor enters on line 6A or 6B (as

applicable) in column (c) the net amount of retroactive adjustments paid

and received as a result of interim rate adjustments and cost report

settlements applicable to current or prior provider fiscal years.

It shall show interest on cost report overpayments and late-filed cost reports

on these lines.

7. Accelerated Payments - Contractor enters the net amount of accelerated payments

made to and collected from hospitals and distinct part units. (See §160.5 for an

explanation of the appropriate recording of offsets.)

8. Total - The contractor enters the total of lines 4 through 7.

D. Statistical Data-Hospitals-Page 1:

9. PIP:

A. Contractor enters the total number of bills processed for hospitals paid by

the PIP method.

B. Contractor enters the dollar amount that would have been paid if the bills

processed were not subject to PIP in accordance with the definition of line

2A.

10. Non-PIP - Contractor enters the total number of bills for hospitals paid on a

submitted-bill basis.

11. Number of Hospitals - Contractor enters the total number of hospitals

participating in the Medicare program.

12. Number of Admissions - Contractor enters the total number of admissions the

Common Working File (CWF) has approved for payment.

13. Number of Discharges - Contractor enters the number of discharge bills processed

during the reporting month.

14. Number of Readmissions - Contractor enters the total number of readmissions to a

hospital within 7 calendar days of discharge from an acute care facility.

15. Number of Transfers - Contractor enters in column (a) and column (b) the total

number of transfers to a PPS hospital. It enters in column (c) the total number of

transfers to a non-PPS hospital.

16. Outlier Bills:

A. Days - Contractor enters the total number of day outlier bills paid that

relate to the dollar amounts shown in line 3A.

NOTE: Outlier days have been obsolete since the end of FY 1997.

B. Costs - Contractor enters the total number of cost outlier bills paid that

relate to the dollar amounts shown in line 3B.

17. Outpatient - Contractor enters the total number of outpatient bills and Part B

inpatient bills paid that relate to the dollar amounts shown in line 5.

E. Column Definitions - Page 2

• Column (e) - Single Facility - Refers to all providers that are not part of a hospital

complex.

• Column (f) - Part of Hospital Complex - Refers to providers that are an integral

part of a hospital and are operated with other departments of the hospital under

common licensure and governance.

• Column (g) - Total - Refers to total of columns (e) and (f).

F. Line Item Definitions - Page 2

Skilled Nursing Facilities - Including swing bed payments for SNF care.

18. PIP - Contractor enters all PIP payments made to SNFs. It enters total payments

(less any deductibles, coinsurance, interest or sequestration) with any withholding

reductions being shown on line 20.

19. Bills Paid - Contractor enters total payments less any deductibles, coinsurance,

interest, or sequestration with any withholdings shown on line 20. It enters the

calculated payment, less any deductibles, coinsurance and interest for all items,

and any sequestration applicable to SNFs on a submitted-bill basis. It shall

include Part A and Part B services.

20. Retroactive Adjustments - Contractor enters the net amount of retroactive

adjustments paid and received as a result of cost report settlements and lump sum

interim rate adjustments made in prior or current provider fiscal years.

21. It shall show interest on cost report overpayments and late-filed cost reports on

this line. An example of a proper recording of a retroactive adjustment would be

an entry of $500,000 cash received from the provider as the first installment of the

final settlement of $1,000,000 due the program from the prior year's cost report.

22. Accelerated Payments - Contractor enters the net amount of accelerated payments

made to and collected from SNFs. (See §160.5) for an explanation for reporting

accelerated payments.)

23. Total SNF Payments - Contractor enters the total of lines 18 through 21.

Home Health Agencies:

23. PIP - Contractor enters all PIP payments made to HHAs including SNF-based.

24. It shall show total payments less any deductibles, coinsurance, interest, or

sequestration with any withholding reductions shown on line 25.

25. Bills Paid - Contractor shall show total payments (less any deductibles,

coinsurance, interest, or sequestration) with any withholdings shown on line 25. It

enters the calculated payment, less any deductibles, coinsurance, and interest, for

all items, and any sequestration applicable to HHAs on a submitted-bill basis. It

shall include Part A and Part B services and SNF-based HHAs payments.

26. Retroactive Adjustments - Contractor enters the net amount of retroactive

adjustments paid and received as a result of cost report settlements and lump sum

interim rate adjustments made in prior current provider fiscal years.

27. It shall show interest on cost report overpayments and late-filed cost reports on

this line. An example of a proper recording of a retroactive adjustment would be

an entry of $500,000 cash received from the provider as the first installment of the

final settlement of $1,000,000 due the program from the prior year's cost report.

28. Accelerated Payments - Contractor enters the net amount of accelerated payments

made to and collected from HHAs. (See §160.5) for an explanation for reporting

accelerated payments.)

29. Total HHA Payments - Contractor enters the total of lines 23 through 26.

Additional Providers:

28. ESRD - Contractor shall include in these columns payments to ESRD networks,

as applicable:

Column (e) - It enters net payments to independent facilities. Column (f) - It enters

net payments to hospital-based facilities.

29. Hospice - Contractor enters net payments made to hospices.

30. RHC - Contractor enters net payments made to rural health clinics (RHCs).

31. OPA/HL - Contractor enters net payments made to organ procurement agencies

and histocompatibility laboratories.

32. CORF - Contractor enters net payments made to comprehensive outpatient

rehabilitation facilities (CORFs).

33. Distinct Part Units - Contractor enters net payments made to exempt distinct part

rehabilitation and psychiatric units.

34. All Others - Contractor enters net payments made to other providers not listed in

lines 28 -33.

NOTE: Contractor shall make adjustments, pertaining to providers, identified on lines

28 through 34 directly to the specific line. This includes checks received and offsets or

withholdings.

35. Total - Contractor enters the total of lines 28 through 34.

36. Grand Total - Contractor enters the total of lines 8(d), 22(g), 27(g) and 35(g).

G. Statistical Data - Page 2:

37. SNF:

• Number of SNFs - Contractor enters the total number of participating

SNFs.

• Number of Admissions - Contractor enters the total number of SNF

admissions.

38. HHA:

• Number of HHAs - Contractor enters the total number of participating

HHAs.

• Number of Bills - Contractor enters the total number of bills processed.

(Audit intermediaries should not complete this line.)

39. Number of Transfers to Distinct Part Units - Contractor enters the total number of

transfers to distinct part units for which payments are shown in line 33.

It shall use edit checks to ensure completeness, arithmetical accuracy, and to discover

inconsistencies. It shall have an authorized official sign and date the report.

90.7 - Form CMS-456 - Schedule R - (Rev. 5, 08-30-02)

A1-1414.7

(Page 3 of 3 of the Monthly Intermediary Benefit Payment Report) Reconciliation

Between IBPR and CMS-1522.

A. Purpose and Scope

The contractor shall use the Schedule R to account for any variances between line 36(g),

Total on the IBPR, and the HI and SMI Benefits reported on lines 1(d) and 2(d) of the

CMS-1522 Report.

Schedule R is an integral part of the IBPR and must be completed each month whether or

not a variance exists between the IBPR and the CMS-1522 Report. If there is no variance,

the contractor shall complete line 36(g) of the IBPR and HI and SMI Benefits for lines

1(d) and 2(d) of the Form CMS-1522. If there is a variance, it shall reconcile the two

reports by completing the appropriate lines.

It must have the capability to substantiate all amounts reflected on Schedule R.

Schedule R includes line items that will facilitate the contractor's reconciliation process.

It shall input the Schedule R, along with pages 1 and 2 of the IBPR, into the Contractor

Administrative Budget and Financial Management System (CAFM) for each report

month.

B. Instructions for Completion of Schedule R:

Heading - The contractor enters the report month and year. (See §160.6A) for

intermediary name and number.) Also, it enters its current letter-of-credit number.

Line Item Definitions - Schedule R:

CMS-456 (IBPR) Column:

Line 36(g) Total - Contractor enters the amount obtained from page 2 of 3 on line 36(g)

of the IBPR.

Medicare Secondary Payer (Non-Providers Cash Recoveries) - Contractor enters the cash

receipts and offsets applied to claims payments or other refunds that are received from

attorneys, beneficiaries, insurance companies or other non-providers. These amounts

should be negative numbers since they represent cash receipts.

Other Recoveries Identify - Contractor enters recovered or offset amounts not included in

any other line item (lines 1 through 36 or lines 1 and 3 of Schedule R). These amounts

should be negative numbers since they represent cash receipts.

Other Items Identify (Lines 3A through 3E) - Contractor enters any other benefit

payments or refunds not included elsewhere on the CMS-456 or on lines 1 and 2. The

items shown here may be unique to its operation and should be identified accordingly. It

shall itemize each major category on lines 3A. through 3E. These amounts could be

positive or negative numbers.

Total - Contractor enters the sum of all line items in this column. It must take care to

subtract negative amount(s) included on the above lines. The total amount must equal the

amount in the total adjacent CMS-1522 column.

1. Remarks - Contractor enters an explanation to clarify any item or amount.

• Line Item Definitions - Schedule R:

CMS-1522

1. HI Benefits, Line 1 (d) - Contractor enters the HI benefits amount from form

CMS-1522 in line 1(d).

2. SMI Benefits, Line 2(d) - Contractor enters the SMI benefits amount from form

CMS-1522 in line 2(d).

3. Subtotal - Contractor enters the total HI and SMI benefit amounts.

4. Other Items Identify - Contractor enters any other benefit payments or refunds

that may be unique to your operation that are not included on lines 1(d) or 2(d) of

form CMS-1522. It shall itemize each major category and identify on line 1

through 6. These amounts could be positive or negative numbers.

5. Total - Contractor enters the sum of all line items in this column. It must take care

to subtract negative amounts included in items 1 through 6. The total amount must

equal the amount in the total adjacent CMS-456 column.

Public reporting burden for this collection of information is estimated to average 30 hours

per response. This includes time for reviewing instructions, searching existing data

sources, gathering and maintaining data needed, and completing and reviewing the

collection of information. Send comments regarding this estimated burden or any other

aspect of this collection of information, including suggestions for reducing the burden, to:

Centers for Medicare & Medicaid Services

Office of Financial Management

7500 Security Boulevard

Baltimore MD 21244-1850

and to:

Office of Management and Budget

Paperwork Reduction Project (0938-0361)

Washington DC 20503

100 - Issuance of Letter-Of-Credit - (Rev. 5, 08-30-02)

A1-1416, B1-4414

The Letter-of-Credit, Standard Form-1193, authorizes a Federal Reserve Bank or Branch

to advance funds to a designated commercial bank on behalf of CMS. Under the Checks

Paid Method of financing, a letter-of-credit is issued to authorize the designated

commercial bank to withdraw funds for deposit only to the contractor's Benefits Account

when a bank presents a payment voucher (FMS-5401).

Upon receipt of the properly executed signature cards and notification from the Federal

Reserve Bank that the required collateral has been posted, CMS prepares and certifies a

letter-of-credit in favor of the designated commercial bank. The certified letter-of-credit,

together with the executed signature cards, are sent to the Treasury Department for

forwarding to the servicing Federal Reserve Bank or Branch. A copy of the certified

letter-of-credit and signature cards are also sent to the contractor, the RO, and the

designated commercial bank.

100.1 - Monthly Limitation - (Rev. 5, 08-30-02)

A1-1416.1, B1-4414.1

The letter-of-credit specifies a maximum amount of funds that the bank may draw during

each month. The ceiling amount on the letter-of-credit is established at a sufficiently high

level to provide for fluctuations in monthly disbursement patterns and is based upon

benefit payments estimated by CMS and the contractor. The unused portion of the letter-

of-credit is revoked at the end of each month, and the full monthly ceiling amount is

automatically renewed at the beginning of each month. There is no carryover of any

unused ceiling amount. Each month stands by itself.

100.2 - Amending Letter-of-Credit

(Rev. 236, Issued: 06-13-14, Effective: 06-02-14, Implementation: 07-15-14)

All requests for new or amended Letters Of Credit, whether considered routine or

emergency, must be submitted no later than 6 business days prior to the calendar date of

the actual need. All requests must be sent via email to DFSE@cms.hhs.gov; the

appropriate Regional Office (RO) contacts should also be copied on the request.

Conditions requiring new LOCs include but are not limited to:

• A new MAC joins the Medicare program;

• A MAC assumes a new workload from another MAC;

• A complete or partial change in MAC’s name;

• A change in the name of the MAC’s servicing bank; or

• A change in the Federal Reserve Bank or Branch servicing the MAC’s

commercial bank.

Conditions requiring amended LOCs include but are not limited to:

• A permanent increase or decrease in the LOC funding limitation due to significant

change in Medicare workload or expenditure that is expected to affect the MAC’s

financial needs;

• A temporary increase in the LOC funding limitation to cover all Medicare checks

and Electronic Funds Transfer (EFT) payments presented to the bank for payment

within a given month.

100.3 - Establishment of Accounting Records - (Rev. 5, 08-30-02)

A1-1416.3, B1-4414.3

The contractor shall establish adequate accounting records to ensure that:

• The total monetary amount on the payment vouchers issued during the month

does not exceed the monthly limitation established by the letter-of-credit;

• Funds drawn are properly allocated between HI and SMI benefits. The contractor

shall establish memorandum accounts to separate the respective benefit payments;

• Refunds received from providers or beneficiaries resulting from prior

overpayments or retroactive adjustments are immediately deposited into the

FHIBA. The contractor shall credit all such deposits on the day following the date

of receipt in its mail room or initial point of entry. (It shall credit within 2 days if

the bank is not located in the same city as the contractor.); and

• Bank charges for services furnished are in accordance with the contractual

agreement and that the volume by types of service (e.g., checks paid and deposits)

are in agreement with the contractor's records.

110 - Initial Federal Health Insurance Time Account Deposit - (Rev. 5,

08-30-02)

A1-1418, B1-4416

To preclude excessive use of Federal funds, the contractor shall delay the initial deposit

in the Time Account until it has actually started processing checks that are cleared against

the FHIBA. It shall effect the initial deposit of Federal funds into the Federal Health

Insurance Time Account by drawing a check on the new FHIBA payable to the Time

Account.

It shall establish the amount of the initial time deposit check by re-computing the Award

Schedule (AS) (Page 2 of 2) that the selected bank submits to reflect the effective prime

rate (i.e., prime minus one percent) in effect on the date the new accounts are

implementation.

It shall make the check payable to the designated bank with the following directive

clearly printed on the reverse:

For Deposit Only In (Name of Contractor)

Federal Health Insurance Time Account

The contractor shall delay use of the Federal Health Insurance Accounts until the Federal

Reserve Bank has received authorization from the Treasury Department for the

designated commercial bank to process payment vouchers under the letter-of-credit

procedure.

110.1 - Subsequent Time Account Deposits and Adjustments – (Rev. 5,

08-30-02)

A1-1418.1, B1-4416.1

The quarterly review of bank activity in the Benefits Account may disclose the need for

an adjustment in the Time Account balance. When an adjustment is indicated, the

contractor shall make the adjustment within 15 calendar days after the close of the

quarter.

It shall follow the procedures outlined for the initial Time Account deposit as described

in §110 to increase the Time Account balance.

To decrease the Time Account balance, it shall prepare a Time Account withdrawal slip

that instructs the bank to transfer the amount of the required reduction from the Time

Account to the FHIBA.

NOTE: The contractor shall report all initial deposits and subsequent adjustments in the

Time Account balance on form CMS-1522

110.2 - Bank Account Analysis

(Rev. 158, Issued: 09-25-09, Effective: 10-26-09, Implementation: 10-26-09)

To ensure a continuing evaluation of all bank services and associated charges, the

contractor shall adhere to the following procedures:

• Arrange to receive from the bank its account analysis on a regular monthly basis

no later than the 10th of the following month. Bank analysis must include:

o Bank Processing Charges (Schedule of Itemized Bank Services Provided

Report); and

o A list of daily closing bank balances (Recap of Daily Available Balances).

• The contractor shall verify the accuracy of the data presented for the average daily

bank balance, units of service, and all other computations on the bank's account

analysis.

• The contractor shall complete and forward, within 15 calendar days after the end

of each month to CMS electronically (Excel; [email protected];), the

following schedules:

o Monthly account activity of bank processing charges (Schedule of

Itemized Bank Services Provided Report); and

o Recap of Daily Available Balances (Recap of Daily Available Balances).

120 - Reviewing Bank Agreements - (Rev. 5, 08-30-02)

A1-1420, B1-4418

The contractor shall determine if it wants to continue, renegotiate, or terminate the bank

agreement by reviewing the bank's performance and processing charges for the present

term. It shall review 165 days prior to the expiration of the three-party bank agreement.

If the bank's performance is acceptable, and the bank does not request a rate increase, the

contractor shall recommend to the RO, in writing, that it wants to continue with the bank

agreement and that it be continued for another year or two year period. It shall advise the

RO as soon as a bank's request for a rate increase is received along with its evaluation of

the bank's performance and recommendation, to continue or renegotiate the contract. The

RO develops comparative analysis of three banks' charges with similar volumes to

support the recommendation to continue the bank agreement at a higher processing

charge. If the higher processing charge is not justified, the contractor will be advised to

begin the termination process.

120.1 - Terminating Bank Agreements - (Rev. 5, 08-30-02)

A1-1420.1, B1-4418.1

The contractor, the Government, or the bank may terminate the bank agreement when the

party wishing to terminate submits written notification to the other parties 150 days prior

to the expiration of the current term. In the event of termination, the bank agrees to retain

the contractor's Federal Health Insurance Account(s) for an additional 180-day period

(phase-out) beyond the current term to allow for clearance of outstanding checks.

120.2 - Terminating Federal Health Insurance Accounts - (Rev. 5, 08-

30-02)

A1-1420.2, B1-4418.2

• Initial Adjustment to the Federal Health Insurance Time Account - Pending

receipt of the prior month's bank statement, the contractor shall reduce on the first

day of the phase-out period the current balance in the Federal Health Insurance

Time Account by seventy-five percent (75%). It shall prepare a Time Account

withdrawal slip that instructs the bank to immediately transfer the computed

amount to the FHIBA.

• Time Account Analysis - Within 7 days of the expiration of the current term, the

contractor shall complete Schedule TAA in its entirety to determine whether the

time account should remain open during the phase-out period. It shall include in

line 4 the total projected service charges for the entire phase-out period. It shall

modify the 25 percent figure on line 10 to reflect the actual length of the phase-

out period, e.g., 6-month period would show 50 percent.

o If line 13 of Schedule TAA (page 1 of 3) indicates a positive amount, the

contractor shall maintain that amount of money in the time account during

the phase-out period, and adjust the present time account balance

accordingly in lines 14-16.

o If line 9 of Schedule TAA (page 1 of 3) indicates a negative amount, the

contractor shall immediately transfer the current time account balance to

the benefits account, and the contractor should secure from the bank a

check payable to the benefits account in an amount equal to the negative

amount reflected on line 9.

• Closing Federal Health Insurance Time Accounts - At the expiration of the phase-

out period, the contractor shall transfer all funds on deposit in the Time Account,

if applicable, and FHIBA immediately to the new FHIBA.

120.3 - Phase-out Period for Federal Health Insurance Bank Accounts –

(Rev. 5, 08-30-02)

A1-1420.3, B1-4418.3

In the event of termination of the bank agreement, the bank agrees to retain the

contractor's Federal Health Insurance Account(s) for up to an additional 180-day period,

beyond the current term, to allow for clearance of outstanding checks. (See subsection C

of the IFB.) The letter-of-credit issued to the bank remains in effect to allow the bank to

draw payment vouchers to cover all outstanding checks as they are presented for

payment.

During this phase out period, the current bank agreement continues in effect with the

exception of the following:

• Letter-of-Credit - Covenant 5;

• The Term of the Bank Agreement - Covenant 7;

• Termination of Agreement - Covenants 8 and 9; and

• Renegotiation of Agreement - Covenant 10.

It is further understood that during the phase out period:

• The bank maintains collateral in an amount sufficient to cover the high balances

in the account(s) less FDIC coverage on each account;

• All bank service charges and earnings credits are consistent with those amounts

reflected in the current agreement;

• All terms and conditions of the original bid submitted by the bank, which are not

inconsistent with this additional term, remain in effect; and

• The contractor continues to complete the CMS-1521, CMS-1522 and the TAA

Schedules.

130 - Invitation For Bid (IFB) to Provide Banking Services Under The

Checks Paid Method of Letter-Of-Credit Financing - (Rev. 5, 08-30-02)

A1-1422, B1-4420

The contractor shall request the most recent copy of the IFB package from the RO to

prepare its procurement. The IFB is constantly being updated to meet CMS requirements

in the changing banking environment.

140 - Bonding - (Rev. 5, 08-30-02)

A1-1424, B1-4422

The contractor is required to have a fidelity bond on, as a minimum, each certification

and disbursement employee. Blanket bonds are an acceptable alternative.

Bonds must protect against at least the risks contained in the contractor's agreement

(specified in the article entitled "Certification and Disbursement and Indemnification").

As a general rule, the amount of the bond should equal 1/10 of the monthly limitation of

the letter of credit but not exceed $500,000.

CMS accepts a bond in excess of $500,000 and assumes an allocated share of its total

cost if the contractor determines that a larger bond is desirable.

No deductibles are permitted with respect to coverage, risks, and amounts.

150 - Letter-Of-Credit Check List

(Rev. 158, Issued: 09-25-09, Effective: 10-26-09, Implementation: 10-26-09)

FORM NAME

DUE DATE

Intermediary Benefit Payment Report,

CMS-456

Monthly - within 20 working days after the

end of the reporting month.

Payment voucher on Letter-of-Credit

Transmittal - CMS-1521

Monthly - within 15 days after the end of

the reporting month.

Monthly Intermediary Financial Report,

CMS-1522

Same as above

Banking Schedules,

Schedule of Itemized Bank Services

Provided Report and Recap of Daily

Available Balances

Monthly - within 15 days after the end of

the reporting month

160 - Electronic Funds Transfer (EFT) - (Rev. 5, 08-30-02)

A1-1430, B1-4430

The contractor shall pay claims from providers of services according to the following

criteria.

A. Requirement

The contractor may transmit payments electronically to each provider who bills

Medicare, elects to receive payments electronically, and who provides the necessary bank

account and routing data to enable the contractor to pay electronically.

B. Notification Requirement

The contractor shall provide its Regional Office (RO) with quarterly data on the number

of providers paid under EFT, the transmission protocol, such as the ANSI X12 835 used

for its EFT transmissions, and the benefit payment amount of EFT transactions. It shall

use Form CMS-588, Authorization Agreement for Electronic Funds Transfer, to maintain

a record of those physicians and suppliers that authorize Medicare payment under EFT.

C. Claims Processing Timeliness (CPT) Requirement

When transmitting electronic payments to providers, the contractor shall pay claims in a

timely manner consistent with the payment floor in effect at the time of payment. It shall

transmit the EFT authorization to its originating bank upon the expiration of claims

processing timeliness payment floor, as discussed in the Medicare Claims Processing

Manual, Chapter 1, General Billing Requirements. For example, an EFT payment in

March 2001 for an electronic claim may not be transmitted to the originating bank earlier

than 14 days after the date of receipt. An EFT payment in March 2001 for a paper claim

may not be transmitted to the originating bank earlier than 27 days after the date of

receipt. Payment settlement, i.e., the date on which funds are posted to the provider's

account, should not be earlier than 2 business days following transmission of the

electronic payment data to the originating bank. The contractor shall accomplish this by

designating an effective payment date on the electronic payment file of no earlier than 2

business days after the transmission date.

D. Electronic Transmission Standard

When making direct deposits to the accounts of providers under EFT, the contractor shall

use a transmission format that is both economical and compatible with its servicing bank

and the Automated Clearing House.

For Standard Systems Maintainers, the Medicare standard ANSI 835 health care

payment/advice can be abbreviated and used to generate an ACH-FORMATTED EFT

file that contains no beneficiary-specific data. In these cases, the bank translates the

abbreviated ANSI 835 into an ACH-COMPATIBLE payment file. The entire ANSI 835

Remittance advice record will be sent directly to the provider. In the event these

abbreviated ANSI data are not acceptable to certain banks for purposes of initiating

electronic payments through the appropriate ACH, the standard system users should

consult with their individual banks to determine which electronic payment data format is

acceptable. The contractor should refer to Part 3, Chapter 24, EDI Support Requirements

for more information on the abbreviated ANSI-835.

E. Alternatives to Electronic Payment

When EFT is not used, the contractor shall make payments to providers via hardcopy

checks drawn on the commercial bank servicing its Medicare account. It shall send the

hardcopy check by first class U.S. Postal Service only.

NOTE: The pickup, next-day delivery, express mail or the use of a courier service for

hardcopy checks is prohibited except in emergency situations, as authorized by the

contractor's RO.

F. Modification of Tri-partite Bank Agreement to Include EFT Method of Payment

The contractor shall work with its servicing bank and its RO to ensure that the Tri-partite

bank agreement is modified to include wording that allows funding of the Letter of Credit

to include electronic payments as well as hardcopy checks. The Tri-partite bank

agreement needs to clearly state that all references to checks in the original bank

agreement shall mean checks and/or electronic funds transfer (EFTs).

The contractor shall have its legal department and that of the originating bank review the

Tri-partite bank agreement to ensure that it meets contractor needs and the requirements

of the Medicare program. It shall forward any modifications to the Tri-partite bank

agreement at least 1 month prior to its effective date to the RO and the Chief, Financial

Management Unit, OCA, BPO in CO for review and approval. See §160.1, Exhibit 2 for

a sample addendum to the Tri-partite bank agreement that includes general provisions for

payment under the EFT method.

G. The Receiving Bank's Role in EFT/Electronic Remittance Advice (ERA)

While providers may wish to consider criteria such as experience with EFT and receipt of

ANSI-formatted financial data when choosing a bank, these procedures should in no way

be interpreted as requiring providers to do business with a particular financial institution

(e.g., receiving bank only).

H. Electronic Funds Transfer Transaction Costs

Prior to transmitting payments electronically, the originating bank fills in the relevant

EFT transaction costs on the Schedule AS (Schedule of Bank Processing Charges), and

submits it to the contractor. The contractor shall transmit this information to both the RO

and CO. Once electronic payments are initiated, the originating bank shall include all

payment information on the Monthly Schedule of Bank Processing Charges, (TAA 1-b),

and transmit this form to the contractor, who enters the data into the Contractor

Administrative Budget and Financial Management (CAFM) system where it is reviewed

and approved first by the RO and then CO.

NOTE: The EFT costs reported on line 8 of the AS Schedule and the Monthly Schedule

of Bank Processing Charges (TAA 1-b) shall include a breakdown of all costs associated

with EFT, including the cost per EFT transaction, set-up costs, monthly charges,

transmission costs, etc.

I. Contractor Responsibility for EFT/ERA Records Retention

The contractor shall retain records on EFT/ERA in accordance with established CMS and

Department of Justice procedures for retention of documentation associated with

electronic claims.

J - Provider Responsibility for the Accuracy of Claims Data

To minimize errors and disruptions to cash flow, providers are responsible for verifying

the accuracy of claims payment information submitted to their Medicare contractor.

170 - Electronic Remittance Advice (ERA) - (Rev. 5, 08-30-02)

A1-1431, B1-4431

The contractor shall accommodate provider requests to receive hardcopy checks or

electronic payments with ERAs. Providers have the option to receive remittance

information on paper or electronically. Providers who elect EFT are not required to

receive ERAs. The contractor shall furnish ERAs to providers using the following

criteria:

A. Standard Format Requirement

In lieu of the traditional method of sending hardcopy remittance advices and checks to

providers, effective October 1, 1992, the contractor shall transmit, over wire only, the

ANSI X12.835, Health Care Claim Payment/Advice (ANSI-835) to a requesting provider

or to a requesting provider's billing service. The ANSI-835 is the only electronic

remittance option available as of this date. If the contractor has any technical questions

on formats or electronic remittance transmission requirements, it should contact its RO.

B. Privacy Act Compliance

Unless otherwise directed by CO, the contractor shall ensure that remittance information

is transmitted to providers or their authorized billing agents either directly, through a

Value Added network, or as authorized by a provider, to a bank that is capable of

receiving ERA data and agrees to safeguard the data.

C. Reconciliation Requirement

Prior to entering into an electronic payment arrangement with a provider, the contractor

shall ensure that its providers are able to reconcile their accounting records using the

ANSI-835 remittance advice. Once this determination is made, it shall provide telephone

support during normal business hours and allow for an initial reconciliation period of up

to 30 days during which it will produce both paper and electronic remittances. After this

30-day phase-in period, it shall eliminate paper remittances for these providers.

D. Standard Format Reference

See the Claims Processing Manual, Chapter 22 - Remittance Notice to Providers, for

information and additional requirements concerning the standard remittance advice

format.

180 - Exhibits - (Rev. 5, 08-30-02)

A1-1435

Exhibit 1 - Form CMS-1521 - - See CMS Forms page.

Exhibit 2 - Form CMS-1522 - - See CMS Forms page.

Exhibit 3 - Intermediary Benefit Payment Report - - See CMS Forms page.

Exhibit 4 -Authorization Agreement for Electronic Funds Transfer

PROVIDER/PHYSICIAN

NAME____________________

ID NUMBER___________________

I hereby authorize (Insert Contractor Name), hereinafter called COMPANY, to initiate

credit entries and to initiate, if necessary, debit entries and adjustments for any credit

entries in error to my ( ) Checking ( ) Savings account (select one) indicated below and

the depository named below, hereinafter called DEPOSITORY, to credit and/or debit

the same to such account.

DEPOSITORY

NAME _____________________

BRANCH _____________________

CITY ______________________

STATE ______ ZIP ____________

TRANSIT

NUMBER ____________

ACCOUNT NUMBER ____________

This authority is to remain in full force and effect until COMPANY has received

written notification from me of its termination in such time and in such manner as to

afford COMPANY and DEPOSITORY a reasonable opportunity to act on said notice of

termination.

NAME ________________________

TITLE _____________________

(PLEASE PRINT)

SIGNED X ______________________

DATE _____________

Exhibit 5 - Addendum to Medicare Bank Agreement

The parties have executed this Agreement for the Medicare A(B) Bank Accounts using

the Checks Paid Method of Letter of Credit Financing and desire to add changes to the

existing agreement currently in force. These changes are necessitated by the

implementation by (Insert Contractor Name) of the Electronic Funds Transfer (EFT)

method of paying providers effective (Insert Date). This change in payment method is

under the direction of the Centers for Medicare and Medicaid Services (CMS) as an

initiative to increase the uniformity and efficiency of the provider payment process.

Also, item number 10 below, although not related to EFT, is incorporated into the bank

agreement to insure that no excessive earnings credits accumulate during the period of

the bank agreement.

The parties hereby agree to the following terms and conditions that shall be considered an

integral part of the bank Agreement:

1. The rates as reflected on the Schedule of Bank Processing Charges shall be in

effect for the term of this Agreement.

2. This Agreement, with all its provisions and covenants, shall continue in force

from year to year after the expiration of such term; provided, however, that

notification to terminate or renegotiate has not been given by any party as

specified in the Agreement executed on (Insert Date).

3. All references to checks in the original Agreement shall hereby mean checks

and/or Electronic Funds Transfers (EFTs).

4. The Fiscal Intermediary (Carrier) is obligated to obtain, retain, and provide copies

of provider authorizations, particularly with regard to the rights, liabilities, and

responsibilities of Medicare contractors and financial institutions under

Regulation E.

5. The nature, format and medium of entries, or entry information is to be furnished

to the originating bank in writing by the Fiscal Intermediary (Carrier) prior to

entering into an EFT arrangement.

6. The Fiscal Intermediary (Carrier) and the originating bank shall negotiate the

level of security to be established for delivering the payment data from the Fiscal

Intermediary (Carrier) to the originating bank, such as transmittals with

authorized signatures, and the method used to verify authenticity of

telecommunicated data, prior to entering into an EFT arrangement.

7. The Fiscal Intermediary (Carrier) shall specify the time when funds are to be

provided to the originating bank prior to entering into an EFT arrangement.

8. The Fiscal Intermediary (Carrier) and the originating bank shall agree to the

deadline for reversals, corrections, or changes by the Fiscal Intermediary (Carrier)

of entries or entry information furnished to the originating bank prior to entering

into an EFT arrangement.

9. In those cases where the Fiscal Intermediary's (Carrier's) Medicare bank is unable

to originate EFT transactions, the Medicare bank may subcontract certain

functions. The Medicare bank agrees that none of the functions to be performed

under the Tri-partite agreement shall be subcontracted without prior written

approval of the Fiscal Intermediary (Carrier) and the CMS. Any such approved

subcontract shall contain the language of the Examination of Records Clause

contained in the bank agreement (Covenant 3).

10. If Line 7 of Page 1 of the Quarterly Time Account Adjustment Schedule reflects

any positive balance, the contractor shall immediately forward supporting

documentation and a check made payable to CMS for that amount to:

Send a copy of the check and transmittal letter to:

Centers for Medicare & Medicaid Services

Office of Financial Management

7500 Security Boulevard

Baltimore MD 21244-1850

190 - General Information About Termination Costs - (Rev. 5, 08-30-02)

A1-1800

The contractor shall prepare a shut-down cost budget voucher based on its natural

expense line items, and submit the budget to both CMS's Central Office (CO) and to the

contractor's Regional Office (RO).

It shall include the following information on the voucher:

• All incurred shut-down expenses determined by the contractor's natural cost

items;

• The amount, and a detailed explanation, for each item it claims; and

• An attestation signed by a company official that validates the costs the contractor

is claiming are correct.

The CMS pays shut-down costs based on the contractor's voucher's information. The

contractor shall not draw administrative funds, via its letter-of-credit, after the official

date of either contract close-out or termination.

It shall submit the voucher on official company letterhead. It shall make sure the voucher

is signed by an authorized company official, and forward a copy to CMS's CO at the

following address:

Centers for Medicare & Medicaid Services

Division of Contractor Financial Management, OFO

7500 Security Boulevard

Baltimore MD 21244-1850

200 - General - (Rev. 14, 02-03-03)

A1-1900, B1-4900

The Contractor Financial Reports provide a method of reporting financial activities for

benefit payments by Medicare contractors according to the Chief Financial Officers

(CFOs) Act of 1990. The contractor is required to maintain accounting records according

to government accounting principles and applicable government laws and regulations.

This requirement complies with the Office of Management and Budget (OMB) Bulletins

about Financial Statements. These policies and procedures are developed by the Federal

Accounting Standards Advisory Board (FASAB).

The accounting principles and the auditing standards required are not substantially

different from Generally Accepted Accounting Principles (GAAP) and Generally

Accepted Auditing Standards (GAAS) as formulated by the accounting profession.

Government accounting principles which are developed by FASAB, however, require

maintaining records not only for preparing financial statements, but also to enforce

applicable laws and regulations. Accounts are maintained to provide control over

operations as well as to provide financial information.

Medicare contractors are required to use double entry bookkeeping and accrual basis

accounting. For example, if an accounts receivable is established, accounts receivable

should be debited and, most likely, operating/program expense should be credited. If an

accounts payable is established, accounts payable should be credited and, most likely,

operating/program expense should be debited. In addition, the information reported must

be supported by the contractor's books and records as of the end of the period requested

and adequate audit trails must be maintained. To ensure accurate reporting, proper cutoff

procedures must also be established in order to limit reporting to activities attributable to

the reporting period. Where actual data is not available, reasonable estimates are

acceptable. See Exhibits 12 through 15 for protocols for estimating relevant accounts.

When end of period entries are made to accrue account balances, the contractor shall

reverse the entries in the following quarter to allow normal processing of accounting

transactions.

In order to maintain consistent and accurate financial reporting, Medicare contractors

must have an internal control structure that integrates the accounting and claims

processing systems. The internal control structure must provide for the following control

procedures:

1. Independent review of proper valuation of recorded amounts and performance;

2. Segregation of duties (separate authorization, record-keeping, and custody);

3. Safeguards over access to assets and records;

4. Authorization of transactions and activities;

5. Documents and records that are adequate to ensure proper recording; and

6. Quarterly reconciliation of internal systems to the Provider Overpayment Report

(POR) system for intermediaries and the Physician Supplier Overpayment Report

(PSOR) system for carriers.

Supporting documentation must be maintained and available for review and audit. This

must include lead schedules for all amounts used for report preparation and detailed

documentation, such as demand letters for accounts receivable. A very good procedure

that CMS recommends to ensure the accuracy of reported amounts, is trending and

comparative analysis. This analysis involves comparing reported amounts to prior

amounts to identify material errors.

Hardcopy books and records used to prepare the annual financial reports should be

retained for 6 years unless microfilmed. Then, the hardcopy needs to be retained for 3

years and the microfilm retained for the balance of the 6-year period.

The Office of the Inspector General (OIG) will conduct audits of contractors according to

government auditing standards. This requirement complies with OMB Bulletin No. 98-

08, Audit Requirements for Federal Financial Statements. Applicable government laws

and regulations also supplement the government auditing standards. These standards are

similar to those contained in the Comptroller General of the United States Standards for

Audit of Governmental Organizations, Programs, Activities, and Functions (The Yellow

Book).

The OMB Bulletin No. 01-09, Form and Content of Agency Financial Statements

requires the preparation of Federal Agency interim financial statements, in addition to

accelerating the due date of the submission of year-end audited financial statements to

OMB and Congress. Because of OMB's new requirements, CMS and its Medicare

contractors must be able to prepare financial statements at the end of any month at the

request of CMS.

To meet this obligation, all shared systems must be able to produce any system reports

required by Medicare contractors utilizing those systems to prepare all the Forms CMS-

750 A/B and the Forms CMS-751 A/B on a month-end basis. These reports must be

cumulative in order to provide Medicare contractors' financial position and status of

accounts receivable activity from the beginning of the fiscal year through the month

requested.

Medicare contractors must be able to support all summary amounts reported on any of

these reports with transaction level detail, and must be able to produce this support upon

request by CMS or internal/external auditors.

210 - Instructions For Completing The Form CMS-750A/B, Contractor

Financial Reports - (Rev. 5, 08-30-02)

A1-1910, B1-4910

There are separate reports and data screens for Part A, Hospital Insurance (HI), and Part

B, Supplementary Medical Insurance (SMI) in the Contractor Administrative-Budget and

Financial Management (CAFM) system. The intermediary enters data in both HI and

SMI data screens (see Exhibits 1 and 2). The carrier enters data in the SMI data screens

(see Exhibit 2).

The data for the report is HI and SMI financial information as defined in the Medicare

Account Definitions (see Exhibit 11). In order to facilitate reconciliation, balancing and

error resolution, the contractor shall report all data in dollars and cents.

The data on the report may not equate on a one-to-one basis with data reported to CMS in

other reports, such as Draws on Letter of Credit, reported on Form CMS-1521. The

contractor must maintain records that will allow reconciliation of Form CMS-750A/B

with those other reports.

220 - Due Date - (Rev. 5, 08-30-02)

A1-1911, B1-4911

This report is due on January 21, April 21, July 21, October 21 (21 days after the end of

each quarter) via the CAFM system. If that date occurs on a holiday or a weekend, the

report is due the following Federal workday.

230 - Certification - (Rev. 5, 08-30-02)

A1-1912, B1-4912

Medicare contractor certification by the Chief Financial Officer (CFO) is required. The

CFO must input their password on the CAFM system (see Exhibit 16). Failure to record

the official's password is a serious error that will prevent acceptance of the report by the

CAFM system. The following statement appears at the end of the Form CMS-750A/B:

I hereby CERTIFY that I have examined the Statement of Financial Position prepared by

[name of contractor] for the period beginning (first day of FY) and ending (last day of

quarter), and that to the best of my knowledge and belief, it is a true, correct and

complete statement prepared from the books and records of the contractor in accordance

with applicable instructions.

NAME _______________ Date __________ Title ___________

240 - Instructions for Completing Form CMS-751 A/B, Status of

Accounts Receivable - (Rev. 5, 08-30-02)

A1-1920, A1-1940, B1-4920, B1-4960

Forms CMS-H751A/B and CMS-M751A/B are similar data entry screens used to report

the following receivables.

• Form CMS-H751A to report debt under Part A (HI) by intermediaries

• Form CMS-H751B to report debt under Part B (SMI) by intermediaries and

carriers

• Form CMS-M751A to report MSP debt under HI by intermediaries;

• Form CMS-M751B to report MSP debt under SMI by intermediaries and carriers;

MSP accounts receivable data reported on CMS-M751A/B is a subset of total accounts

receivable data reported on Form CMS-H751A/B (e.g., 751A/B includes the data

reported on the CMS M751A/B and non-MSP data.

The screen heading indicates whether the report is for the MSP subset.

Samples of the screens are shown in Exhibits 3 - 9. There are separate reports and data

screens for Part A, HI, and for Part B, SMI in the CAFM system. The intermediary enters

data in both HI and SMI data screens (Exhibits 3 and 4). The carrier enters data in only

the SMI data screens (Exhibit 4).

The intermediary or carrier reports the accounts receivable activity for fiscal year-to-date

(FYTD) for the period of the report. In order to facilitate reconciliation, balancing and

error resolution, it reports the accounts receivable in dollars and cents.

The reports require information both for the amount and the number of accounts

receivable. To provide standardization, CMS suggests that contractors use their collection

process as a guide when reporting the number of accounts receivable. For example, a

separate, stand alone accounts receivable collected would be reported as a quantity in the

number column.

EXAMPLES:

1. (Intermediaries only). A cost report is one receivable. Even though several claims

are associated with the cost report, the collection activity would be against the

entire cost report rather than each claim.

2. A demand letter issued in a Medicare Secondary Payer (MSP) case to one debtor

with several claims listed on the letter. If the collection is made and posted against

an individual claim, each claim on the demand letter would be an individual

receivable.

3. A demand letter issued to a physician based on adjustments projected from

sampling claims equals one. Even though many claims are represented by

projection of the sample.

Once the principal number is established, the contractor shall report the interest

associated with the principal amount in the same manner. There can be a difference

between the principal number and the interest number because some receivables are not

subject to interest.

250 - Due Date - (Rev. 5, 08-30-02)

A1-1921, A1-1941, B1-4921, B1-4941

This report is due on January 21, April 21, July 21, October 21 (21 days after the end of

each quarter) via the CAFM system. If that date occurs on a holiday or a weekend, the

report is due the following Federal workday.

260 - Certification - (Rev. 5, 08-30-02)

A1-1922, A1-1942, B1-4922, B1-4942

Medicare contractor certification by the CFO is required. The CFO must input their

password on the CAFM system (see Exhibit 16). Failure to record the official's password

is a serious error that will prevent acceptance of the report by the CAFM system. The

following statement appears at the end of Form CMS-H751A/B:

I hereby CERTIFY that I have examined the Status of Accounts Receivable

prepared by (name of contractor) for the period beginning (first day of FY) and

ending (last day of quarter), and that to the best of my knowledge and belief, it is

a true, correct and complete statement prepared from the books and records of the

contractor in accordance with applicable instructions.

For (Status of MSP Accounts Receivable) (Form CMS-M751) the statement includes a

reference to MSP and reads as follows:

I hereby CERTIFY that I have examined the Status of MSP Accounts Receivable

prepared by (name of contractor) for the period beginning (first day of FY) and

ending (last day of quarter), and that to the best of my knowledge and belief, it is

a true, correct and complete statement prepared from the books and records of the

contractor in accordance with applicable instructions.

The name, date and title of the person making the certification are on both certifications.

270 - Line Item Instructions Form CMS-H751A/B - (Rev. 5, 08-30-02)

A1-1923, A1-1943, B1-4923, B1-4943

Medicare contractors must develop and maintain transaction level detail (at a minimum,

this would include the provider name, provider number, date of determination,

outstanding balance, and any adjustments or recoupments) by debt to support the

amounts reported for each line outlined below.

In addition, non-MSP amounts must be reconciled to the POR (intermediary) or PSOR

(carrier) system as applicable.

Part I, Status of Receivables

For each line in Section A, below, the instruction applies to each the Form CMS-H751

and Form CMS-M751, and to the intermediary report and to the carrier report unless

otherwise noted. The instructions are applicable only to MSP amounts for the Form

CMS-M751 and are applicable to all amounts for the Form CMS-H751.

Section A - Outstanding Receivables

270.1 - Line 1, Beginning FY Balance (Principal & Interest) –

(Rev. 5, 08-30-02)

A1-1923.1, A1-1943.1, B1-4923.1, B1-4943.1

The contractor enters the number and amount for all accounts receivable outstanding as

of the beginning of the FY. These amounts will be pre-filled with the ending balances

reported on the preceding (9/30/XX) FY Contractor Financial Reports. The contractor

must make any corrections to the beginning principal and interest FY balance on Line 5a,

Adjusted Amounts, Internal Adjustments. It shall apply the offsetting entry, on the related

Form CMS-750A/B report (debit or credit) to Operating/Program Expense for

transactions that affect principal, or interest revenue if the transaction affects interest.

270.2 - Line 2a, New Receivables (Principal) - (Rev. 5, 08-30-02)

A1-1923.2, A1-1943.2, B1-4923.2, B1-4943.2

The contractor enters the number and amount for all new receivables established at its

location during the FY. New receivables for intermediaries include cost report

settlements and credit balances. For both intermediaries and carriers, overpayments and

claims accounts receivables for all claim types are included. For carriers only, beneficiary

debt and under-tolerance accounts receivable are included.

For MSP new receivables includes group health plan data-match, non-data-match,

liability (including worker's compensation, auto and no fault), etc.

The contractor does not include those receivables transferred from other Medicare

contractors, other CMS locations, Currently Not Collectible (CNC), or other transferred

locations in prior fiscal periods. It includes all of these items on Lines 5b, 5d, 5f, or 6b,

Transferred In Amounts.

NOTE: MSP accounts receivable are not established until a settlement, judgment or

award has been reached and a demand letter is sent.

270.3 - Line 2b, Accrued Receivables (Principal) - (Rev. 5, 08-30-02)

A1-1923.3, A1-1943.3, B1-4923.3, B1-4943.3

Line 2b is not applicable to carriers or to MSP.

The intermediary enters the number and amount of Periodic Interim Payment (PIP)

accrued receivables, fiscal year-to-date on this line. The only receivables a FI will accrue

are those that result from comparing PIP payments to claims submitted. For each

quarterly reporting period, a new accrual is established and the prior quarter's accrual

must be reversed or zeroed out. Both the establishment and reversal of the PIP accrual

must be reflected in this line, except for the reversal of the September's quarterly accrual,

which would be reflected in Line 5a, Adjusted Amounts, Internal Adjustments (see

Exhibit 13, Periodic Interim Payments (PIP) Protocol for Estimating

Payables/Receivables for the Form CMS-750A/B, Statement of Financial Position).

270.4 - Line 3, Interest Earned (Interest) - (Rev. 5, 08-30-02)

A1-1923.4, A1-1943.4, B1-4923.4, B1-4943.4

The contractor enters the number and amount of interest earned on: (a) existing or new

receivables established at its location during the FY; and (b) the interest earned on

receivables transferred to it, following the date the receivables are established on its

records. The contractor shall not include the amount of accrued interest earned at other

locations. It shall report the accrued interest earned at other locations as transferred in on

Line 5b, 5d, 5f or 6b, Transferred In Amounts.

270.5 - Line 4a, Cash/Check Collections on Receivables (Principal &

Interest) - (Rev. 5, 08-30-02)

A1-1923.5, A1-1943.5, B1-4923.5, B1-4943.5

The contractor enters the amount collected by cash or check on receivables during the

fiscal period.

270.6 - Line 4b, Offset Collections on Receivables (Principal & Interest)

- (Rev. 5, 08-30-02)

A1-1923.6, A1-1943.6, B1-4923.6, B1-4943.6

The contractor enters the amount collected by offset on receivables during the fiscal

period.

270.7 - Line 4c, Collections Deposited at Another Location (Principal &

Interest) - (Rev. 5, 08-30-02)

A1-1923.7, A1-1943.7, B1-4923.7, B1-4943.7

The contractor enters the amount collected or offset by CMS Central Office (CO) for

collections on accounts receivable referred under the Debt Collection Improvement Act

(DCIA). Do not transfer the case to CO where the deposit or offset of the money is made.

Upon receipt of the Collection Reconciliation/Acknowledgement form, enter the amount

collected or offset by cross servicing/TOP and received by CO in this line to reduce the

outstanding amount of the receivable being reported on Form CMS-751A/B. CO will

record the actual deposit of cash/check/offset on Line 10, Cash/Offsets Received for

Receivables at Another Location of its' Form CMS-R751.

The Medicare contractor or CO that records the actual deposit of cash/check/offset will

record this amount on Line 10, Cash/Offsets Received for Receivables at Another

Location. (See §270.15 for instructions and Exhibit 18 Collection Reconciliation/

Acknowledgement Form).

270.8 - Line 5, Adjusted/Transferred/Waived Amounts (Principal &

Interest) - (Rev. 5, 08-30-02)

A1-1923.8, A1-1943.8, B1-4923.8, B1-4943.8

The contractor enters the amount of receivables it has adjusted, transferred in from or out

to other locations, or waived. It is required to maintain supporting documentation and

records for all these receivables transferred in and out. Amounts transferred in from or

out to other CMS locations or Medicare contractors must be reconciled to the other

entity's records for the same reporting period prior to submission of the quarterly reports

to ensure that only approved transfers are being reported. Documentation of the

reconciliation must be maintained and must indicate that a supervisory review of the

reconciliation was performed. Refer to Exhibit 17 for instructions for the transfer of debt

between other reporting entities.

The contractor reports in Lines:

a. Adjusted Amounts (Principal & Interest). The contractor enters the

amount for any adjustments to the beginning balance, or

corrections/adjustments of receivables previously established during the

fiscal period. These adjustments can be either positive or negative. It

separately reports adjustments resulting from Auditor/Consultant

recommendations, and those determined independently.

b. Transfers In from other Medicare Contractors (Principal & Interest). The

contractor enters the amount transferred in from other Medicare

contractors during the fiscal period.

c. Transfers Out to other Medicare Contractors (Principal & Interest). The

contractor enters the amount transferred out to other Medicare contractors

during the fiscal period.

d. Transfers In from other CMS Locations, POR/PSOR (Principal &

Interest). (Carriers report PSOR, and intermediaries report POR). The

contractor enters the amount transferred in from other CMS locations and

reported on the POR/PSOR during the fiscal period. (Applies to non-MSP

debt only.)

e. Transfers Out to other CMS Locations, POR/PSOR (Principal & Interest).

Carriers report PSOR, and intermediaries report POR). The contractor

enters the amount transferred out to other CMS locations and reported on

the POR/PSOR during the fiscal period.

f. (Applies to non-MSP debt only)

g. Transfers In from other CMS Locations, Not POR/PSOR (Principal &

Interest). The contractor enters the amount transferred in from other CMS

locations and not reported on the POR/PSOR during the fiscal period.

h. Transfers Out to other CMS Locations, Not POR/PSOR (Principal &

Interest). The contractor enters the amount transferred out to other CMS

locations and not reported on the POR/PSOR during the fiscal period.

i. Waivers (Principal & Interest). The contractor enters the amount of

accounts receivable waived based on the application of §§ 1862(b) and

1870(c) of the Social Security Act.

270.9 - Line 6, Amounts Written-off Closed (Bad Debts)/Transferred

CNC (Principal & Interest) - (Rev. 5, 08-30-02)

A1-1923.9, A1-1943.9, B1-4923.9, B1-4943.9

The contractor enters the amount which it has written-off as a bad debt, or transferred to

or from CNC.

The contractor reports in lines:

a. Amounts Written-off Closed (Bad Debts)(Principal & Interest). The

contractor enters the amount for which collection efforts have been

abandoned. (This would include the remaining balance on accounts

receivable after the bankruptcy court has ruled on bankruptcy, appeals,

and other litigated cases).

b. Transfers In from CNC (Principal & Interest). The contractor enters the

amount re-established as active debt that was previously classified as CNC

during the fiscal period.

c. Transfers Out to CNC (Principal & Interest). The contractor enters the

amount removed from the ending balance and reclassified as CNC during

the fiscal period.

270.10 - Line 7, Ending Balance (Principal & Interest) - (Rev. 5, 08-30-

02)

A1-1923.10, A1-1943.10, B1-4923.10, B1-4943.10

The ending balance is a computed field reporting the number (manual entry) and amount

for receivables outstanding as of the end of the reporting period. It equals:

Principal

Interest

Beginning FY balance (Line 1)

Principal

Interest

New Receivables (Line 2a)

Interest Earned (Line 3)

+/-

Accrued Receivables (Line 2b)

Collections on Receivables (Line 4a-

4c)

- Collections on Interest (Line 4a-c)

+/-

Adjusted/Transferred Amounts (Line

5a-5g)

+/-

Adjusted/Transferred Amounts (Line

5a-5g)

Waivers (line 5h)

+/-

Amounts Written-off/Transferred

CNC(Lines 6 a - c)

Amounts Written-off/Transferred

CNC (Lines 6 a - c)

Ending Balance (Line 7)

NOTE: Although Line 7 is a calculated amount, the contractor must be able to provide a

detailed listing of all outstanding receivable balances that support this line at any given

period of time. The ending balance must be equal to the accounts receivable and interest

receivable amounts reported on the form in Statement of Financial Position.

270.11 - Line 7a, Current Receivables (Principal and Interest) –

(Rev. 5, 08-30-02)

A1-1923.11, A1-1943.11, B1-4923.11, B1-4943.11

The contractor enters the amount of the receivables due within 12 months following the

reporting period. The definition of current and non-current does not depend on the time a

debt is outstanding but when the debt is due. A receivable for which the due date is 12

months or less from the report date is a current receivable. For example, a debt due

September 30, 2003, within 12 months from the date of a report for September 30, 2002,

is a current receivable. In addition, all delinquent receivables are to be reported as

current. The contractor shall assign between current and non-current the appropriate

amount of those receivables for which it has negotiated extended repayment schedules,

based on the installment payment dates.

270.12 - Line 7b, Non-current Receivables (Principal) - (Rev. 5, 08-30-

02)

A1-193.12, A1-1943.12, B1-4923.12, B1-4943.12

The contractor enters the amount of non-current receivables due more than 12 months

after the reporting period. The definition of non-current receivables includes those

receivables for which the due date is more than 12 months from the end of the reporting

period. For example, those receivables for which the due date is October 1, 2003, 1 year

from the date of a report for September 30, 2002, are non-current receivables.

270.13 - Line 8, Allowance for Uncollectible Accounts (Principal &

Interest) - (Rev. 5, 08-30-02)

A1-1923. 13, A1-1943.13, B1-4923.13, B1-4943.13

The contractor enters the amount of the ending balance reported in Line 7 for accounts

receivable it estimates will not be collectible. (See Exhibit 14, Allowance for

Uncollectible Accounts).

270.14 - Line 9, Total Receivables Net of Allowance - (Rev. 5, 08-30-02)

A1-1923.14, A1-1943.14, B1-4923.14, B1-4943.14

Total Receivables Net of Allowance is a computed field (Line 7 less Line 8) reporting the

contractor's estimate of the amount of accounts receivable it reasonably expects to

collect.

270.15 - Line 10, Cash/Offsets Received for Receivables at Another

Location (Principal & Interest). - (Rev. 5, 08-30-02)

A1-1923.15, A1-1943.15, B1-4923.15, B1-4943.15

This line shall be used only be used in the instances where CO receives collection from

cross servicing/TOP for DCIA debt.

The Medicare contractor who reports the receivable on Form CMS-751A/B will reduce

the outstanding balance of the receivable for the amount deposited by CO by recording

the amount of the collection in Line 4c, Collection Deposited at Another Location. (See

Exhibit 18, Collection Reconciliation/Acknowledgement Form).

Section B - Delinquent Receivables

270.16 - Line 1, Total Not Delinquent (Principal & Interest) –

(Rev. 5, 08-30-02)

A1-1923.16, A1-1943.16, B1-4923.16, B1-4943.16

The contractor enters the total number and amount of accounts receivable that are not

delinquent.

270.17 - Line 2, Total Delinquencies (Principal & Interest) - (Rev. 5, 08-

30-02)

A1-1923.17, A1-1943.17, B1-4923.17, B1-4943.17

The contractor enters the total number and amount of delinquent receivables. It enters the

amount of the past due payment unless the full amount is normally due and declared

payable. The debt becomes delinquent the day following the date that the debt is due with

all extensions recognized. Thus, for non-MSP if the debt is due 30 days after demand, the

first day of delinquency starts on day 31. For MSP, if the debt is due 60 days after

demand, the first day of delinquency starts on day 61. If any portion of a debt has been

delinquent more than 180 days, the entire amount is reported as delinquent. The

contractor enters the amount of receivables that are delinquent for the respective periods

(a through i) indicated.

270.18 - Line 3, Status of Delinquent Receivables, less than or equal to

180 Days (Principal & Interest) - (Rev. 5, 08-30-02)

A1-1923.18, A1-1943.18, B1-4923.18, B1-4943.18

The contractor enters the total number and amount of delinquent receivables 180 days

delinquent and less, which are in (a) Bankruptcy, (b) Appeal, (c) Department of Justice,

(d) Referred for Cross Servicing and/or (e) Other Status.

270.19 - Line 4, Status of Delinquent Receivables, greater than 180 Days

(Principal & Interest)

(Rev. 111; Issued: 10-27-06; Effective: 04-01-07; Implementation: 04-02-07)

The contractor enters the total number and amount of delinquent receivables 181 days

delinquent and greater, which are in one of the following categories:

(a) Referred to the Department of the Treasury for Cross Servicing. For MSP,

this means debts entered into the DCS. For Non-MSP, this means debts that have

been transmitted to DCC by CMS Central Office and the Medicare contractor has

acknowledged and verified the validity and accuracy of the debts transmitted.

(b) Not Eligible for Referral, the number and dollar amount is equal to the sum of

lines (1) through (12) of this section.

1) Bankruptcy;

2) Appeal;

3) Department of Justice/Litigation;

4) Fraud and Abuse Investigation, if the contractor has received specific

instructions from the investigating unit (i.e., Office of Inspector General or

Office of General Counsel, etc.) not to attempt collection;

5) Deceased Debtor, debts where the debtor is deceased and the estate is

closed;

6) Debts less than $25;

7) Federal Entity Debts, MSP only, where the only entity which received

the last demand letter is the employer and the employer is a Federal

agency;

8) Beneficiary Debts, Non-MSP only;

9) Pending Request for Waiver or Compromise;

10) CMS Identified Exclusions, MSP only, debts where CMS has

identified a specific debt or group of debtors as excluded from DCIA

referral.

11) Other Exclusions, must footnote.

12) In the Process of Internal Offset (Previously Under Medicare

Modernization Act, Section 935 Appeal).

Treasury for cross servicing but not yet referred.

270.20 - Line 4c, Collections Deposited at Another Location (Principal

& Interest) - (Rev. 5, 08-30-02)

A1-1923.20, A1-1943.20, B1-4923.20, B1-4943.20

The contractor enters the distribution of collections on receivables, by location, for

amounts offset or received and deposited at another location. The total amounts listed in

this section must equal the amount reflected in Section A, Line 4c of this report.

270.21 - Line 10, Cash/Offsets Received for Receivables at Another

Location (Principal & Interest) - (Rev. 5, 08-30-02)

A1-1923.21, A1-1943.21, B1-4923.21, B1-4943.21

This will not apply to Medicare contractors.

270.22 - Collections on Delinquent Debt (Principal & Interest) –

(Rev. 5, 08-30-02)

A1-1923.22, A1-1943.22, B1-4923.22, B1-4943.22

The contractor enters the number and amount of collections on receivables that were

delinquent upon collection. The total amount should be less than total collections for the

FY.

Section D - Transferred Receivables

The contractor enters the distribution of debts transferred to Medicare contractors or other

CMS locations.

For Form CMS-H751A/B, the data in this section is also reported in Section A, Status of

Accounts Receivable Transfers Out to other Medicare contractors or other CMS

locations, and will be used by the contractor and other CMS locations to reconcile its

books and records.

For Form CMS-M751A/B, the data in this section is also reported in Section A

Outstanding Receivables, Line 5c, Transfers Out to other Medicare Contractors; Line 5e,

Transfers Out to other CMS locations on the POR/PSOR; and Line 5g, Transfers Out to

other CMS Locations, Not POR/PSOR.

270.23 - Line 5c, Transfers Out to other Medicare Contractors

(Principal & Interest) - (Rev. 5, 08-30-02)

A1-1923.23, A1-1943.23, B1-4923.23, B1-4943.23

The contractor enters the distribution to Medicare contractor locations of the debts,

entered in Line 5c, Transfers Out to other Medicare Contractors, reflected in Section A of

this report.

270.24 - Line 5e, Transfers Out to other CMS Locations, POR/PSOR

(Principal & Interest) - (Rev. 5, 08-30-02)

A1-1923.24, A1-1943.24, B1-4923.24, B1-4943.24

The contractor enters the distribution to the various regional offices (ROs) or CO of the

debts on the POR, entered in Line 5e, Transfers Out to other CMS Locations,

POR/PSOR, reflected in Section A of this report.

270.25 - Line 5g, Transfers Out to other CMS Locations, Not POR

(Principal & Interest) - (Rev. 5, 08-30-02)

A1-1923.25, A1-1943.25, B1-4923.25, B1-4943.25

The contractor enters the distribution to the various ROs or CO of the debts not reported

on the POR/PSOR, entered in Line 5g,Transfers Out to other CMS Locations, Not

POR/PSOR, reflected in Section A of this report. POR is applicable to FIs. PSOR is

applicable to carriers.

280 - Instructions for Completing the Form CMS-C751A/B, Status of

Debt - Currently Not Collectible (CNC), and Form CMS-MC751A/B,

Status of MSP Debt - Currently Not Collectible (CNC) - (Rev. 5, 08-30-

02)

A1-1930, A1-1950, B1-4930, B1-4950

Form CMS-C751A/B and Form CMS-M751A/B are similar data entry screens used to

report the following.

• Form CMS-C751A to report non-MSP debt under Part A (HI) by intermediaries;

• Form CMS-C751B to report non-MSP debt under Part B (SMI) by intermediaries

and carriers;

• Form CMS-MC751A to report MSP debt under HI by intermediaries; and

• Form CMS-MC751B to report MSP debt under SMI by intermediaries and

carriers;

Note that currently not-collectible debt reported by Forms CMS-C751 and CMS-MC751

is reported separately for non-MSP and MSP accounts receivables.

The screen heading indicates whether the CNC report is for the non-MSP or MSP subset.

Samples of the screens are shown in Exhibits 5 and 6. Note that intermediaries must

prepare separate reports for each category by trust find.

There are separate reports and data screens for Part A, HI, and for Part B, SMI in the

CAFM system. The intermediary enters data in both HI and SMI data screens (Exhibits 5

and 6). The carrier enters data in only the SMI data screens (Exhibit 6).

The data for each of these reports are essentially the same.

The contractor reports the CNC accounts receivable activity for FYTD for the period of

the report. In order to facilitate reconciliation, balancing and error resolution, it reports

the CNC accounts receivable in dollars and cents.

The reports require information both for the amount and the number of accounts

receivable. To provide standardization, CMS suggests the contractor use its collection

process as a guide when reporting the number of accounts receivable. For example, a

separate, stand alone accounts receivable collected would be reported as a quantity in the

number column.

Once the principal number is established, the contractor reports the interest associated

with the principal amount in the same manner. There can be a difference between the

principal number and the interest number because some receivables are not subject to

interest.

290 - Due Date - (Rev. 5, 08-30-02)

A1-1931, A1-1951, B1-4931, B1-4951

This report is due on January 21, April 21, July 21, October 21 (21 days after the end of

each quarter) via the CAFM system. If that date occurs on a holiday or a weekend, the

report is due the following Federal workday.

300 - Certification - (Rev. 5, 08-30-02)

A1-1932, A1-1952, B1-4932, B1-4952

Medicare contractor certification by the CFO is required. The CFO must input their

password on the CAFM system (see Exhibit 16). Failure to record the official's password

is a serious error that will prevent acceptance of the report by the CAFM system. The

following statement appears at the end of the Form CMS-C751A/B (as well as the Form

CMS-MC751A/B):

I hereby CERTIFY that I have examined the Status of Non-MSP Debt - CNC prepared by

name of contractor for the period beginning (first day of FY) and ending (last day of

quarter), and that to the best of my knowledge and belief, it is a true, correct and

complete statement prepared from the books and records of the contractor in accordance

with applicable instructions.

NAME _____________________ DATE _______ TITLE _________

NOTE: In the above statement, "MSP" replaces "Non-MSP" for the MSP report.

310 - Line Item Instructions Form CMS-C751A/B - Non-MSP and Form

CMS-MC751A/B - MSP - (Rev. 5, 08-30-02)

A1-1933, A1-1953, B1-4933, B1-4953

The following instructions are to be used by Medicare contractors to report the status of

Non-MSP or MSP, as applicable, CNC debt. Medicare contractors must develop and

maintain transaction level detail (at a minimum, this would include the provider name,

provider number, date of determination, outstanding balance, and any adjustments or

recoupments) by debt to support the amounts reported for each line outlined below (see

Exhibits 5 and 6). Medicare contractors must reclassify MSP or Non-MSP debt as CNC

in accordance with CMS policy (see Exhibit 19 and Exhibit 20).

Within this subset of instructions, the designation "MSP" or "Non-MSP" is implied,

depending on which report is being submitted, MSP or Non-MSP.

Section A - CNC Debt

310.1 - Line 1, Beginning FY Balance (Principal & Interest) –

(Rev. 5, 08-30-02)

A1-1933.1, A1-1953.1, B1-4933.1, B1-4953.1

The contractor shall report the number and amount for all CNC debts outstanding as of

the beginning of the FY. These amounts will be pre-filled with the ending balances from

the prior FY on Form CMS-C751A/B, Status of Non-MSP Debt-CNC Financial Report

or Form CMS-MC751A/B, Status of MSP Debt-CNC Financial Report. It shall make any

corrections to the beginning principal and interest FY balance only on Line 4e,

Reclassified CNC Debt - Other.

310.2 - Line 2, New CNC Debt (Principal & Interest) - (Rev. 5, 08-30-02)

A1-1933.2, A1-1953.2, B1-4933.2, B1-4953.2

The contractor enters the number and amount of all debt approved by CMS RO and CO

for CNC during the FY. This line should include the outstanding principal balance and all

outstanding interest associated with the debt that was earned up to the date the debt was

removed from Form CMS-751A/B or Form CMS-M751A/B reports, as appropriate, and

included on the current Form CMS-C751A/B report or Form CMS-MC751A/B. This

amount must equal the principal and interest amounts reported on Line 6c, Transfers Out

to CNC.

310.3 - Line 3, Interest Earned Since CNC Approval (Interest) –

(Rev. 5, 08-30-02)

A1-1933.3, A1-1953.3, B1-4933.3, B1-4953.3

The contractor enters the amount of interest earned in this fiscal year on CNC debt since

the date the debt was reclassified and included in Line 1, Beginning FY Balance and

interest earned on debts reclassified to CNC during the FY included in Line 2, New CNC

Debt on the current report.

310.4 - Line 4(a) through (e), Reclassified CNC Debt (Principal &

Interest)

(Rev. 91, Issued: 02-17-06, Effective: 03-17-06, Implementation: 03-17-06)

Reclassified CNC debt reported on Line 4a, Re-established as Active Accounts

Receivable (A/R) Due to Collection of Cash; Line 4b, Re-established as Active A/R Due

to Collection by Offset; and Line 4c, Re-established as Active A/R Due to Misstatement

or Misclassification must agree with the total amount reported on Line 6b, Transfers In

from CNC on Form CMS-H/M 751A/B. Medicare contractors must retain all

documentation supporting any reclassified amounts.

4. The contractor reports in Lines:

a. Re-established as Active Accounts Receivable (A/R) Due to Collection of

Cash (Principal & Interest). The contractor enters the amount of CNC debt

that is re-established as active debt because cash/checks have been

collected on CNC debts during the FY. Simultaneously, the amount of the

collection shall be reported on Line 6b, Transfers In from CNC and Line

4a, Cash/Check Collections on Form CMS-H/M751A/B. The effect of this

transaction will reclassify the debt from an inactive memorandum entry to

an active receivable that will be reported for financial statement purposes.

Additionally, if the outstanding balance of the CNC debt was greater than

the amount collected, the remaining balance of the debt shall remain in

CNC. Medicare contractors shall continue to accrue interest for debt that

has been reclassified as CNC.

b. Re-established as Active A/R Due to Collection by Offset (Principal and

Interest.) The contractor enters the amount of CNC debt that is re-

established as active debt because offsets have been made on CNC debt

during the FY. Simultaneously, the amount of the offset collection shall be

reported on Line 6b, Transfers In from CNC and Line 4b, Offset

Collections on Form CMS-H/M751A/B. The effect of this transaction will

reclassify the debt from an inactive memorandum entry to an active

receivable that will be reported for financial statement purposes.

Additionally, if the outstanding balance of the CNC debt was greater than

the amount collected, the remaining balance of the debt shall remain in

CNC. Medicare contractors shall continue to accrue interest for debt that

has been reclassified as CNC.

c. Re-established as Active A/R Due to Misstatement or Misclassification

(Principal & Interest). The contractor enters the amount of the CNC debt

that has been re-established to be active debt because the CNC debt is now

determined to be a misstatement or misclassification. Simultaneously, the

amount of the misstatement or misclassification shall be reported on Line

6b, Transfers In from CNC on Form CMS-H/M751A/B. The effect of this

transaction will reclassify CNC the debt from an inactive memorandum

entry to an active receivable that will be reported for financial statement

purposes.

d. Written-off Closed (Principal & Interest). The contractor enters the

number and amount of CNC debt that has been approved for written-off

closed during the FY. The receivables will be "closed" in its internal

systems. No further action will be taken on these debts. CNC debts that

are written-off as closed will not be reported on the financial statements,

and all collection activity (i.e., future offsets or interest accruals) and

servicing of the debt will be terminated. The debts will be closed within

the contractor's records, reports, and accounts receivable systems. These

debts will be written-off and closed through Form CMS-C/MC751A/B, on

line 4d. These debts shall not be reactivated on Form CMS-H/M751A/B.

e. NOTE: Medicare contractors cannot write-off debt until formal approval

has been received from the appropriate authorized official in accordance

with the existing CMS delegations of authority.

Other (Principal & Interest). The contractor shall use line 4e only to make

corrections to Form CMS-C/MC751A/B beginning principal and interest FY

balance. Medicare contractors must retain all documentation justifying any

adjustments made to the beginning balance.

310.5 - Lines 5(a) through (f), Amounts Transferred (Principal &

Interest - (Rev. 5, 08-30-02)

A1-1933.5, A1-1953.5, B1-4933.5, B1-4953.5

The contractor enters the amount of CNC debts that have been transferred in from or out

to Medicare contractors or CMS RO or CO during the FY. It shall not enter an amount on

these lines until it has received confirmation that the Medicare contractor, CMS RO or

CO, has accepted the debt. (See Exhibit 17, Transfer of Debt Between Reporting

Entities).

5. The contractor shall report in lines:

a. Transfers In from other Medicare Contractors (Principal & Interest). The

amount of CNC debt transferred in from other Medicare contractors

during the fiscal period.

b. Transfers Out to other Medicare Contractors (Principal & Interest). The

amount of CNC debt transferred out to other Medicare contractors during

the fiscal period.

c. Transfers In from CMS RO (Principal & Interest). The amount of CNC

debt transferred in from RO during the fiscal period.

d. Transfers Out to CMS RO (Principal & Interest). The amount of CNC

debt transferred out to RO during the fiscal period.

e. Transfers In from CMS CO (Principal & Interest). The amount of CNC

transferred in from CO during the fiscal period.

Transfers Out to CMS CO (Principal & Interest). The amount of CNC transferred out to

CO during the fiscal period.

Collection efforts do not cease when debt is reclassified to CNC. Medicare contractors

must recognize that all debts including CNC debt will continue to be referred (if eligible)

to the Program Support Center (PSC), Department of Health and Human Services

(DHHS) or the Treasury Offset Program (TOP).

Medicare contractors are expected to follow existing procedures for the routine referral of

delinquent debt to the Debt Collection Center (DCC) in accordance with the Debt

Collection Improvement Act (DCIA) of 1996.

Amounts transferred in from or out to other CMS locations or Medicare contractors for

the reporting period must be reconciled to the other entity's records for the same reporting

period prior to submission of the quarterly Forms CMS-750/751A/B. Medicare

contractors and other CMS locations must reconcile the transfers out lines to ensure that

only approved transfers are being reported. Documentation of the reconciliation must be

maintained and must indicate that a supervisory review of the reconciliation was

performed. See Exhibit 17 for instructions for the transfer of debt between other reporting

entities.

310.6 - Line 6, Ending Balance (Principal & Interest) - (Rev. 5, 08-30-

02)

A1-1933.6, A1-1953.6, B1-4933.6, B1-4953.6

The ending balance is a computed field, reporting the number (manual entry) and amount

of CNC debt outstanding as of the end of the reporting period. It equals:

Principal

Interest

Beginning FY balance (Line 1)

New CNC Debt (Line 2)

Interest Earned (Line 3)

Re-established as Active A/R Due to

Collection of Cash (Line 4a)

Re-established as Active A/R Due to

Collection of Cash (Line 4a)

Re-established as Active A/R Due to

Collection by Offset (Line 4b)

Re-established as Active A/R Due to

Collection by Offset (Line 4b)

Re-established as Active A/R Due to

Bankruptcy, Fraud & Abuse Litigation

or Appeal (Line 4c)

Re-established as Active A/R Due to

Bankruptcy, Fraud & Abuse Litigation

or Appeal (Line 4c)

Written-off Closed (Line 4d)

+/-

Other (Line 4e)

+/-

Other (Line 4e)

Transfers In From Medicare

Contractors/ RO/CO (Lines 5a, 5c, 5e)

Transfers In From Medicare

Contractors/ RO/CO (Lines 5a, 5c, 5e)

Transfers Out to Medicare

Contractors/ RO/CO (Lines 5b, 5d, 5f)

Transfers Out to Medicare

Contractors/ RO/CO (Lines 5b, 5d, 5f)

Ending Balance (Line 6)

NOTE: Although Line 6 is a calculated amount, the contractor must be able to provide a

detailed listing of all Non-MSP (or MSP, as applicable) CNC receivable balances that

support this line at any given period of time.

Section B - Aging of MSP or Non-MSP CNC Debt

310.7 - Line 1, Total Aged CNC Debt (Principal & Interest) –

(Rev. 5, 08-30-02)

A1-1933.7, A1-1953.7, B1-4933.7, B1-4953.7

The contractor enters the number and amount of MSP or Non-MSP CNC debt, as

applicable. The total dollar amount equals the sum of lines (a) through (e), and should

also equal Line 6, Ending Balance on Form CMS-C751A/B or Form CMS-MC751AB, as

applicable.

The contractor reports on lines (a) through (e) the dollar amounts of receivables aged

from the date of determination of the debt for the respective time periods listed. For Non-

MSP, it provides an explanation in the remarks section regarding why debts in category

(d) and (e) were not recommended for written-off closed.

Section C - Collection Information

310.8 - Collections on CNC Debt (Principal & Interest) - (Rev. 5, 08-30-

02)

A1-1933.8, A1-1953.8, B1-4933.8, B1-4953.8

The contractor enters the number and amounts of cash/checks/offsets actually collected

on Non-MSP or MSP CNC debt, as applicable that is reported on Line 4a, Re-established

as Active A/R Due to Collection of Cash, and Line 4b, Re-established as Active A/R Due

to Collection by Offset.

Section D - Status CNC Debt over 181 Days

310.9 - Status of CNC Debt over 181 Days (Principal & Interest) - (Rev.

17, 05-02-03)

The contractor enters the total number and amount of delinquent receivables 181 days

delinquent and greater, which are in one of the following categories:

(a) Referred to the Department of the Treasury for Cross Servicing. For MSP,

this means debts entered into the DCS. For Non-MSP, this means debts that have

been transmitted to DCC by CMS Central Office and the Medicare contractor has

acknowledged and verified the validity and accuracy of the debts transmitted.

(b) Not Eligible for Referral, the number and dollar amount is equal to the sum of

lines (1) through (11) of this section.

1) Bankruptcy;

2) Appeal;

3) Department of Justice/Litigation;

4) Fraud and Abuse Investigation, if the contractor has received specific

instructions from the investigating unit (i.e., Office of Inspector General or

Office of General Counsel, etc.) not to attempt collection;

5) Deceased Debtor, debts where the debtor is deceased and the estate is

closed.

6) Debts less than $25;

7) Federal Entity Debts, MSP only, where the only entity which received

the last demand letter is the employer and the employer is a Federal

agency;

8) Beneficiary Debts, Non-MSP only;

9) Pending Request for Waiver or Compromise;

10) CMS Identified Exclusions, MSP only, debts where CMS has

identified a specific debt or group of debtors as excluded from DCIA

referral.

11) Other Exclusions, must footnote.

the Treasury for cross servicing but not yet referred.

400 - Exhibits - (Rev. 5, 08-30-02)

A1-1960, B1-4960

Exhibit 1

CMS-750A Contractor Financial Reports, Hospital Insurance (HI) Statement of

Financial Position/Statement of Operations

Exhibit 2

CMS-750B Contractor Financial Reports, Supplementary Medical Insurance

(SMI) Statement of Financial Position/Statement of Operations

Exhibit 3

CMS-751A Status of Accounts Receivable, Hospital Insurance (HI)

Exhibit 4

CMS-751B Status of Accounts Receivable, Supplementary Medical Insurance

(SMI)

Exhibit 5

Form CMS-C751A Status of Non-MSP Currently Not Collectible (CNC)

Accounts Receivable, Hospital Insurance (HI)

Exhibit 6

Form CMS-C751B Status of Non-MSP Currently Not Collectible (CNC)

Accounts Receivable, Supplementary Medical Insurance (SMI)

Exhibit 7

Form CMS-M751A Status of Medicare Secondary Payer (MSP) Accounts

Receivable, Hospital Insurance (HI)

Exhibit 8

Form CMS-M751B Status of Medicare Secondary Payer (MSP) Accounts

Receivable, Supplementary Medical Insurance (SMI)

Exhibit 9

Form CMS-MC751A Status of MSP Currently Not Collectible (CNC) Accounts

Receivable, Hospital Insurance (HI)

Exhibit 10

Form CMS-MC751B Status of MSP Currently Not Collectible (CNC) Accounts

Receivable, Supplementary Medical Insurance (SMI)

Exhibit 11

Medicare Contractor Account Definitions, Data Element Definitions

Exhibit 12

Accounts Payable, Protocol for Estimating Claims

Exhibit 13

Periodic Interim (PIP) Payments Protocol for Estimating Payables/Receivables on

the CMS-750A/B, Statement of Financial Position

Exhibit 14

Protocol for Estimating Allowance for Uncollectible Accounts

Exhibit 15

Protocol for Prorating Intermediary Time Account Balances Between the CMS

750A (HI) and the CMS 750B (SMI)

Exhibit 16

Electronic Certification

Exhibit 17

Transfer of Debt Between Reporting Entities

Exhibit 18

Collection Reconciliation/Acknowledgement Form

Exhibit 19

Procedures for Non-MSP Reclassification as Currently Not Collectible (CNC)

Exhibit 20

Procedures for MSP Reclassification as Currently Not Collectible (CNC)

Exhibit 21

CMS Policy for Recognizing Accounts Receivable

400.1 - Exhibit 1 - Statement of Financial Position and Statement of

Operations - HI/SMI - (Rev. 5, 08-30-02)

A1-1960 Exhibit 1, B1-4960.1

The FI submits the HI report (Form CMS-H750A). Both FI and carrier submit the SMI

report (Form CMS-H750B).

• The HI report, in applicable line item descriptions, refers to "provider" and the

SMI report refers to "physicians, provider or supplier".

• For the SMI report (Form CMS-H750B), the FI completes the items dealing with

cost reports, PIP, and credit balances; but the carrier omits them. Also, the

intermediary inserts data relating to the Provider Overpayment Report (POR),

while the carrier inserts data relating to the Physician Supplier Overpayment

Report (PSOR).

Exhibit 1 (Cont.)

Contractor Financial Reports

Statement of Financial Position

Hospital Insurance (HI)

As of __________________

Contractor Name

ID Number

_______________________

__________

Assets

Balance

Cash

Benefits Account

_______________

Time Account

_______________

Undeposited Collections

_______________

Total Cash

_______________

Accounts Receivable

Non-Medicare Secondary Payments (Non-MSP) Overpayments

Provider (Carriers Omit)

_______________

Cost Report Settlements (Carriers Omit)

_______________

Claims Accounts Receivable (Carriers Omit)

_______________

PIP Accrual (Carriers Omit)

_______________

Credit Balances (Carriers Omit)

_______________

Other (Carriers Omit)

_______________

Physician/Supplier Overpayments (Intermediaries

Omit)

_______________

Beneficiaries

_______________

Total Non-MSP

_______________

Medicare Secondary Payer (MSP)

Group Health Plan

Data Match

_______________

Non-Data Match

_______________

MSP Provider/Physician/Supplier/Beneficiary

Liability (including WC, Auto, No Fault, MSP

beneficiary and other MSP)

MSP Beneficiary

_______________

Other MSP

_______________

Total MSP

_______________

CMS-H750A/B

Exhibit 1 (Cont.)

Contractor Financial Reports

Statement of Operations

Hospital Insurance (HI)

As of _______________

Contractor Name

ID Number

_______________________

__________

Other (footnote)

_______________

Total Accounts Receivable

_______________

Advances to Others

Advance Payments

_______________

Accelerated Payments (Not applicable to carriers)

_______________

Total Advances

_______________

Interest Receivable

_______________

Other Assets (footnote)

_______________

Liabilities

Balance

Accounts Payable

Unprocessed Claims

Benefits Payable

_________________

Provider

PIP Providers A Cost Report Settlements (Carriers

Omit)

_________________

PIP Providers A Estimated Payable Accrual (Carriers

Omit)

_________________

Non-PIP Providers A Underpayments (Interim

Reviews) (Carriers Omit)

_________________

Non-PIP Providers A Underpayments (Cost

Settlements) (Carriers Omit)

_________________

Claims Withheld for Non-receipt of Cost Reports

(Carriers Omit)

_________________

Physicians/Suppliers (Intermediaries Omit)

_________________

Beneficiaries

_________________

Claims on the Payment Floor

_________________

CMS-H750A/B

Exhibit 1 (Cont.)

Contractor Financial Reports

Statement of Operations

Hospital Insurance (HI)

As of _______________

Contractor Name

ID Number

_______________________

__________

Suspended Payments

Claims

________________

Common Working File (CWF)

_________________

MR/UR Prepayment Review

_________________

Medicare Secondary Payer (MSP)

_________________

Total Accounts Payable

_______________

Accrued Interest Payable

_______________

Other Liabilities

Unapplied Receipts

_______________

Excess Recoupments

_______________

Due Medicaid

_______________

Other (footnote)

_______________

Total Other Liabilities

_______________

TOTAL LIABILITIES

_______________

Fund Account Balance

Cumulative Results of Operations

_______________

TOTAL LIABILITIES AND FUND ACCOUNT BALANCE

_______________

Revenue

Amount

Interest Revenue

Line 3

Adjustments (Interest)

Line 5a

Waivers (Interest)

Line 5h

Write-offs (Bad Debts)(Interest)

Line 6a

Transfers in from other Medicare Contractors

Line 5b

Transfers out to other Medicare Contractors

Line 5c

Transfers in from CNC (Interest)

Line 6b

Transfers out to CNC (Interest)

Line 6c

Transfers in from other CMS Locations (POR/PSOR (as

applicable)) (Interest)

Line 5d

CMS-H750A/B

Exhibit 1 (Cont.)

Contractor Financial Reports

Statement of Operations

Hospital Insurance (HI)

As of _______________

Contractor Name

ID Number

_______________________

__________

Transfers out to other CMS Locations (POR/PSOR (as

applicable)) (Interest)

Line 5e

Transfers in from other CMS Locations (Not POR/PSOR (as

applicable)) (Interest)

Line 5f

Transfers out to other CMS Locations (Not POR/PSOR (as

applicable)) (Interest)

Line 5g

Draws on Letter of Credit

________________

Other Revenue (footnote)

________________

TOTAL REVENUE

________________

Expense

Operating/Program Expense

Line 2 + Benefit Expense

Adjustments (Principal)

Line 5a (CR or DR)

Transfers In from other Medicare Contractors (Contra

Account)

Line 5b

Transfers Out to other Medicare Contractors (Principal)

Line 5c

Transfers In from CNC (Contra Account)

Line 6b

Transfers Out to CNC (Principal)

Line 6c

Transfers In from other CMS Locations (POR and Not

POR) (Contra Account)

Line 5d&5f

Transfers Out to other CMS Locations (POR and Not

POR) (Principal)

Line 5e&5g

Less: Waivers (Principal)

Line 5h

Less: Write-offs (Bad debts) (Principal)

Line 6a

CMS-H750A/B

Exhibit 1 (Cont.)

Contractor Financial Reports

Statement of Operations

Hospital Insurance (HI)

As of _______________

Contractor Name

ID Number

_______________________

__________

Total Program Expense

________________

Interest Expense

CPT Interest

________________

Other Interest

________________

Other Expense (footnote)

________________

Prior Period Adjustments (footnote)

TOTAL EXPENSE

________________

NET RESULTS OF OPERATIONS

________________

OTHER DATA (Intermediaries)

Value of 1

PIP Payment Cycle in ensuing quarter

________________

CMS-H750A/B

400.2 - Exhibit 2 - Statement of Financial Position and Statement of

Operations - SMI - (Rev. 5, 08-30-02)

This report is a duplicate of the above Exhibit 1, Statement of Financial Position and

Statement of Operations - HI, except:

• The HI report, in the applicable line item descriptions, refers to "provider", and

the SMI report refers to "provider, physician, and supplier".

• For the SMI report (CMS-750B), the FI completes the items dealing with cost

reports, PIP, and credit balances; but the carrier omits them. Also, the

intermediary inserts data relating to the Provider Overpayment Report (POR),

while the carrier inserts data relating to the Physician Supplier Overpayment

Report (PSOR).

400.3 - Exhibit 3 - Status of Accounts Receivable - HI

(Rev. 111; Issued: 10-27-06; Effective: 04-01-07; Implementation: 04-02-07)

This exhibit is the same as Exhibit 4, Status of Accounts Receivable – SMI, with the

following exceptions:

Section B, items 5d through 5g and Section D, items 5d and 5e refer to the POR for the

HI report and refer to the POR/PSOR for the SMI report. Only intermediaries enter POR

data on both the HI report and the SMI report. Only carriers enter the PSOR data on the

SMI report.

CMS-751A is the CMS Form Number for the HI (Part A) report.

CMS-751B is the CMS Form Number for the SMI (Part B) report.

Exhibit 3 (Cont.)

Status of Accounts Receivable

Hospital Insurance (HI)

As of _________________

Contractor Name

ID Number

_______________________

__________

Section A: Outstanding Receivables

Principal

Interest

Number

Dollars

Number

Beginning FY Balance

_________

__________

_________

_______

2a.

New Receivables

_________

__________

2b.

Accrued Receivables

_________

__________

Interest Earned

_________

_______

4a.

Cash/Check Collections

__________

_________

4b.

Offset Collections

__________

_________

4c.

Collections Deposited at Another Location

__________

_________

5a.

Adjusted Amounts

__________

Internal Adjustments

__________

_________

Auditor/Consultant Adjustments

__________

_________

5b.

Transfers In from other Medicare Contractors

__________

_________

5c.

Transfers Out to other Medicare Contractors

__________

_________

5d.

Transfers In from other CMS Locations, POR/PSOR

__________

_________

5e.

Transfers Out to other CMS Locations, POR/PSOR

__________

_________

5f.

Transfers In from other CMS Locations,

not POR/PSOR

__________

_________

5g.

Transfers Out to other CMS Locations,

not POR/PSOR

__________

_________

5h.

Waivers

__________

_________

6a.

Amounts Written-off (Bad Debts)

__________

_________

6b.

Transfers In from CNC

__________

_________

6c.

Transfers Out to CNC

__________

_________

Ending Balance

_________

__________

___________

_______

Current

__________

___________

Non-current

__________

Allowance for Uncollectible Accounts

__________

Total Receivables Net of Allowance

__________

___________

10.

Cash/Offsets received for Receivables at

Another Location

__________

___________

CMS-H751A

Exhibit 3 (Cont.)

Status of Accounts Receivable

Hospital Insurance (HI)

As of _________________

Contractor Name

ID Number

_______________________

__________

Section B: Delinquent Receivables

Principal

Interest

Number

Dollars

Number

Total Not Delinquent

_________

__________

___________

_______

Total Delinquent

_________

__________

___________

_______

(a)

1 - 30 days

__________

___________

(b)

31 - 60 days

__________

___________

(c)

61 - 90 days

__________

___________

(d)

91 - 180 days

__________

___________

(e)

181 - 365 days

__________

___________

(f)

1 - 2 years

__________

___________

(g)

2 - 6 years

__________

___________

(h)

6 - 10 years

__________

___________

(i)

Over 10 years

__________

___________

Total Delinquent 1 - 180 days

_________

__________

_________

_______

(a)

In Bankruptcy

__________

_________

(b)

In Appeal

__________

_________

(c)

At Department of Justice

__________

_________

(d)

Referred for Cross Servicing

__________

_________

(e)

Other Status

__________

_________

(f) In the Process of Internal Offset (Previously Under

MMA Section 935 Appeal)

Total Delinquent 181 days & over

_____

__________

_________

_______

Referred for Cross Servicing

__________

_________

Not Eligible for Referral

In Bankruptcy

__________

In Appeal

__________

At Department of Justice

__________

Fraud and Abuse Investigation

__________

Deceased Debtor and Estate Closed

__________

Debts Less than $25

__________

Federal Entity Debts, MSP only, where

the only entity which received the last

demand letter is the employer and the

employer is a Federal agency;

__________

Beneficiary Debts, Non-MSP only;

__________

Pending Request for Waiver or

Compromise

__________

10)

CMS Identified Exclusions, MSP only,

debts where CMS has identified a

specific debt or group of debtors as

excluded from DCIA referral.

__________

11)

Other Exclusions, must footnote.

__________

12)

In the Process of Internal Offset.

(Previously Under Medicare

Modernization Act (MMA) Section 935

Appeal)

__________

Eligible for Referral; debts that are

eligible for referral to the Department of

the Treasury for cross-servicing but not

yet referred.

__________

Exhibit 3 (Cont.)

Status of Accounts Receivable

Hospital Insurance (HI)

As of _________________

Contractor Name

ID Number

_______________________

__________

Section C: Other Collections

4c.

Collections Deposited at another Location

Principal

Dollars

Interest

Dollars

Contractor/Region

____________________

__________

_________

____________________

__________

_________

____________________

__________

_________

____________________

__________

_________

____________________

__________

_________

10.

Cash Offsets Received for Receivables at another Location

Principal

Dollars

Interest

Dollars

Contractor/Region

____________________

__________

_________

____________________

__________

_________

____________________

__________

_________

____________________

__________

_________

____________________

__________

_________

Collections on Delinquent Debt _________

__________

_________

________

Section D: Transferred Receivables

5c.

Transfers Out to other Medicare Contractors

Principal

Dollars

Interest

Dollars

Contractor Number

____________________

__________

_________

____________________

__________

_________

____________________

__________

_________

____________________

__________

_________

____________________

__________

_________

CMS-H751A

Exhibit 3 (Cont.)

Status of Accounts Receivable

Hospital Insurance (HI)

As of _________________

Contractor Name

ID Number

_______________________

__________

5d.

Transfers Out to other CMS Locations, POR

1. Boston

__________

_________

2. New York

__________

_________

3. Philadelphia

__________

_________

4. Atlanta

__________

_________

5. Chicago

__________

_________

6. Dallas

__________

_________

7. Kansas City

__________

_________

8. Denver

__________

_________

9. San Francisco

__________

_________

10. Seattle

__________

_________

11. Central Office

__________

_________

5e.

Transfers Out to other CMS Locations, Not on POR

1. Boston

__________

_________

2. New York

__________

_________

3. Philadelphia

__________

_________

4. Atlanta

__________

_________

5. Chicago

__________

_________

6. Dallas

__________

_________

7. Kansas City

__________

_________

8. Denver

__________

_________

9. San Francisco

__________

_________

10. Seattle

__________

_________

11. Central Office

__________

_________

CMS-H751A

400.4 - Exhibit 4 - Status of Accounts Receivable - SMI - (Rev. 5, 08-30-

02)

This exhibit is the same as Exhibit 3, with the following exceptions:

• Section B, items 5d through 5g and Section D, items 5d and 5e refer to the POR

for the HI report and refer to the POR/PSOR for the SMI report.

• Only intermediaries enter POR data on both the HI report and the SMI report.

• Only carriers enter the PSOR data on the SMI report.

• Form CMS-H751A is the CMS Form Number for the HI (Part A) report.

• Form CMS-H751B is the CMS Form Number for the SMI (Part B) report.

400.5 - Exhibit 5 - Status of Non-MSP Debt - CNC - HI

(Rev. 111; Issued: 10-27-06; Effective: 04-01-07; Implementation: 04-02-07)

The screen formats in exhibits 5 and 6 are identical except 5 is for HI non-MSP and 6 is

for SMI non-MSP.

MSP debt is reported in exhibits 9 and 10.

Exhibit 5 (Cont.)

One of: Status of Non-MSP Debt - CNC; or Status of MSP Debt - CNC will be shown.

One of: Hospital Insurance (HI); or Supplementary Medical Insurance (SMI) will be shown

As of ___________________

Contractor Name

ID Number

_______________________

__________

Section A: CNC Debt

Principal

Interest

Number

Dollars

Number

Beginning FY Balance

______

__________

___________

_______

New CNC Debt

______

__________

___________

_______

Interest Earned Since CNC Approval

___________

Reclassified CNC Debt

Re-established as Active A/R due to collection of cash

______

__________

___________

____

Re-established as Active A/R due to collection by offset

______

__________

___________

____

Re-established as Active A/R due to bankruptcy, fraud &

abuse, litigation and appeal

______

__________

___________

____

Written-off Closed

______

__________

___________

____

Other

______

__________

___________

____

Amounts Transferred

Transfers In from Medicare Contractors

______

__________

___________

____

Transfers Out to Medicare Contractors

______

__________

___________

____

Transfers In from CMS RO

______

__________

___________

____

Transfers Out to CMS RO

______

__________

___________

____

Transfers In from CMS CO

______

__________

___________

____

Transfers Out to CMS CO

______

__________

___________

____

Ending Balance

______

__________

___________

_______

CMS-C751A

Exhibit 5 (Cont.)

Status of Non-MSP Debt - CNC

Hospital Insurance (HI)

As of _________________

Contractor Name

ID Number

_______________________

__________

Section B: Aging of CNC Debt (from the determination date)

Total CNC Debt

______

__________

___________

_______

(a)

181 - 1 year

__________

___________

(b)

1 - 2 years

__________

___________

(c)

2 - 6 years

__________

___________

(d)

6 - 10 years *

__________

___________

(e)

Over 10 years *

__________

___________

* Provide an explanation why debts in these categories were not recommended for write-off closed

Section C: Collection Information

Collections on CNC Debt

______

__________

___________

_______

Section D: Status CNC Debt over 181 Days

Total Delinquent

Referred for Cross Servicing

__________

_________

Not Eligible for Referral

In Bankruptcy

__________

_________

In Appeal

__________

_________

At Department of Justice

__________

_________

Fraud and Abuse Investigation

__________

_________

Deceased Debtor and Estate Closed

__________

_________

Debts Less than $25

__________

_________

Federal Entity Debts, MSP only, where the only entity which

received the last demand letter is the employer and the

employer is a Federal agency;

__________

_________

Beneficiary Debts, Non-MSP only;

__________

_________

Pending Request for Waiver or Compromise

__________

_________

10)

CMS Identified Exclusions, MSP only, debts where CMS

has identified a specific debt or group of debtors as excluded

from DCIA referral.

__________

_________

11)

Other Exclusions, must footnote.

__________

_________

12)

In the Process of Internal Offset (Previously Under MMA,

Section 935 Appeal)

__________

_________

Eligible for Referral; debts that are eligible for referral to the

Department of the Treasury for cross-servicing but not yet

referred.

__________

_________

CMS-C751A

400.6 - Exhibit 6 - Status of Non-MSP Debt - CNC - SMI - (Rev. 5, 08-

30-02)

See Section 400.5, Exhibit 5 – Status of Non-MSP Debt – CNC – HI

The formats in exhibits 5 and 6 are identical except 5 is for HI non-MSP and 6 is for

SMI. non-MSP.

MSP debt is reported in exhibits 9 and 10.

400.7 - Exhibit 7 - Status of MSP Accounts Receivable - HI – (Rev. 5, 08-

30-02)

This is an exact duplicate of Exhibit 3, except that the data is limited to data involving

Medicare as secondary payer.

This exhibit, and Exhibit 8, Status of MSP Accounts Receivable - SMI, are identical with

the following exceptions:

• Section B, items 5d through 5g and Section D, items 5d and 5e refer to the POR

for HI reports and refer to the POR/PSOR for the SMI report.

• Only carriers enter the PSOR data on the SMI report.

• The CMS Form Number for this report (HI) is CMS-M751A.

• The CMS Form Number for the SMI report is CMS-M751B.

400.8 - Exhibit 8 - Status of MSP Accounts Receivable - SMI –

(Rev. 5, 08-30-02)

See Exhibit 3, above.

400.9 - Exhibit 9 - Status of MSP Debt - CNC - HI - (Rev. 5, 08-30-02)

See Exhibit 5 – Status of Non-MSP Debt – CNC – HI.

400.10 - Exhibit 10 - Status of MSP Debt - CNC - SMI - (Rev. 5, 08-30-

02)

See Exhibit 5 – Status of Non MSP Debt – CNC –SMI.

400.11 - Exhibit 11 - Medicare Contractor Account Definitions - Data

Element Definitions - (Rev. 5, 08-30-02)

Medicare Contractor Account Definitions

Data Element Definitions

Account Number

Title

1000

Assets

1100

Cash

1100.01

Part A and Part B

1100.01.01

Benefit Account

1100.01.02

Time Account

1110

Undeposited Collections

1110.01

Part A and Part B

1110.01.01

Undeposited Collections

1310

Accounts Receivable

1310.01

Part A and Part B

1310.01.01

Non-MSP Overpayments

1310.01.01.01

Provider

1310.01.01.01.01

Cost Report Settlements (FI)

1310.01.01.01.02

Claims Accounts Receivable (FI)

1310.01.01.01.03

PIP Accrual (FI)

1310.01.01.01.04

Credit Balance (FI)

1310.01.01.01.05

Other (FI)

1310.01.01.02

Beneficiaries

1310.01.01.03

Physicians/Suppliers

1310.01.04

Medicare Secondary Payer (MSP)

1310.01.04.01

Group Health Plan

1310.01.04.01.01

Data Match

1310.01.04.01.02

Non-Data Match

1310.01.04.02

Liability MSP

1310.01.04.02.01

MSP Beneficiary

1310.01.04.02.02

MSP Provider/Physician Supplier

1310.01.04.03

Other MSP

1310.01.99

Other

1311

Advances to Others

1311.01

Part A and Part B

1311.01.01

Advance Payments

1311.01.02

Accelerated Payments

Medicare Contractor Account Definitions

Data Element Definitions

Account Number

Title

1330

Interest Receivable

1330.01

Part A and Part B

1990

Other Assets

1990.01

Part A and Part B

2000

Liabilities

2110

Accounts Payable

2110.01

Part A and Part B

2110.01.01

Unprocessed Claims

2110.01.02

Benefits Payable

2110.01.02.01

Provider

2110.01.02.01.01

-PIP Provider Cost Report Settlements

2110.01.02.01.02

-PIP Provider Estimated Payable Accrual

2110.01.02.01.03

-Non-PIP Provider Underpayments Interim Rate

2110.01.02.01.04

-Non-PIP Provider Underpayments (Cost Report Settlement)

2110.01.02.01.05

Claims Withheld for Non-receipt of Cost Reports

2110.01.02.02

Beneficiaries

2110.01.02.03

Physicians/Suppliers

2110.01.02.04

Claims on the Payment Floor

2110.01.03

Suspended Payments

2110.01.03.01

Claims

2110.01.03.02

Common Working File (CWF)

2110.01.03.03

MR/UR Prepayment Review

2110.01.03.0

Medicare Secondary Payer (MSP)

2140

Accrued Interest Payable

2140.01

Part A and Part B

2990

Other Liabilities

2990.01

Part A and Part B

2990.01.01

Unapplied Receipts

2990.01.02

Excess Recoupments

2990.01.03

Due Medicaid

2990.01.04

Other

3010

Fund Account Balance

Medicare Contractor Account Definitions

Data Element Definitions

Account Number

Title

3310

Cumulative Results of Operations

3310.01

Part A and Part B

5000

Revenue

5303

Interest Revenue

5303.01

Part A and Part B

5303.01.01

Adjustments/Waivers (Contra Account)

5303.01.02

Write-off Closed/Transfers

5303.01.02.01

Bad Debt (Contra Account)

5303.01.02.02

Transfers Out to Other CMS Locations (Contra Account)

5303.01.02.02.01

Transfers In from Other CMS Locations

5303.01.02.03

Transfers Out to CNC (Contra Account)

5303.01.02.03.01

Transfers In from CNC

5303.01.02.04

Transfers Out to Other Medicare Contractors (Contra Account)

5303.01.02.04.01

Transfers In from Other Medicare Contractors

5700

Appropriated Capital Used

5700.01

Part A and Part B, Draws on Letter of Credit

5900

Other Revenue

5900.01

Part A and Part B

5900.01.01

Other

6000

Expense

6100

Operating/Program Expense

6100.01

Part A and Part B

6101

Waivers

6101.01

Part A and Part B

6101.01.02

Transfers Out to Other CMS Locations (Contra Account)

6101.01.02.01

Transfers In from Other CMS Locations

6101.01.03

Transfers Out to CNC (Contra Account)

6101.01.03.01

Transfers In from CNC

6101.01.04

Transfers Out to Other Medicare Contractors (Contra Account)

Medicare Contractor Account Definitions

Data Element Definitions

Account Number

Title

6101.01.04.01

Transfers In from Other Medicare Contractors

6106

Write Offs/Transfers

6106.01

Part A and Part B

6106.01.01

Bad Debts

6330

Interest Expense

6330.01

Part A and Part B

6330.01.01

CPT Interest

6330.01.02

Other Interest

6909

Other Expense

6909.01

Part A and Part B

7400

Prior Period Adjustments

7400.01

Part A and Part B

Medicare Contractor Account Definitions

Data Element Definitions

The account numbers used in this chart are for reference purposes only. They are not

mandated for use by Medicare contractors.

Account Number

Title

1000

Assets

The contractor reports amounts of physical items or rights to

ownership

1100

Cash

The contractor reports monetary resources on hand or on deposit

with banks or other financial institutions. Balances are the end of

quarter amounts per the contractor's books.

1100.01

Part A and Part B

The contractor reports cash allocable for Hospital Insurance (HI)

and Supplementary Medical Insurance (SMI) activities. HI data

must reconcile to Column E, Line 1, on Form CMS-

1522, Monthly

Contractor Financial Report. SMI data must reconcile to Column

E, Line 2. Prorate the Time Account by the number of checks and

electronic funds transfers (EFTs) issued for HI or SMI services.

Account Number

Title

(See Exhibit 15 Protocol for Prorating Intermediary Time Account

Balances between HI and SMI.)

1100.01.01

Benefits Account

The contractor reports the Federal Health Insurance Benefits

Account by HI and SMI

1100.01.02

Time Account

The contractor reports the balance as of the end of the quarter in

the Federal Health Insurance Time Account by HI and SMI.

1110

Undeposited Collections

1110.01

Part A and Part B

The contractor reports undeposited collections for HI and SMI

activities

1110.01.03

Undeposited Collections

The contractor reports collections on hand not deposited within the

accounting period. Undeposited collections include those items

received by the last day of the quarter that will be deposited during

the subsequent quarter. The contractor prorates undeposited

collections on the basis of Column D, Funds Expended, on Form

CMS-1522, Monthly Contractor Financial Report for Part A (HI)

and Part B (SMI). Report deposits in transit as part of the book

balance for either 1100.01.01, Benefits Account, or 1100.01.02,

Time Account. It reports amounts due from others. A receivable is

the identification of an overpayment for services rendered. CMS

will only recognize receivables related to Fraud and Abuse once

they are litigated by the Department of Justice (DOJ)

1310.01.01

Overpayments

The contractor accounts receivable for overpayments. It includes

amounts that exceed adjudicated claims processed, cost reports

settled, or other authorized payments. This includes, but is not

limited to, overpayments resulting from adjustment bills. It

reclassifies any overpayment when Medicare is deemed as

secondary payer to 1310.01.04, MSP

1310.01.01.01

Provider

The intermediary reports overpayments for institutional providers.

This includes, but is not limited to, those items listed on the

Provider Overpayment Report (POR) and the Credit Balance

Summary Report. Include periodic interim payments (PIP) in

Account Number

Title

excess of PIP bills. Include overpayments resulting from the

receipt of cost reports, tentative settlements or cost settlements

when the Notices of Provider Reimbursement (NPR) are prepared.

It includes overpayments from PRRB settlements when the Notices

of Correction (NOC) are prepared. This is not a carrier function.

1310.01.01.01.01

Cost Report Settlements

The intermediary reports the accounts receivable as a result of cost

report settlements, interim rate reviews and overpayments as a

result of accelerated payments

1310.01.01.01.02

Claims Accounts Receivable

The intermediary reports the accounts receivable as a result of

claims accounts receivable. This is not a carrier function.

1310.01.01.01.03

PIP Accrual

The intermediary reports the amount accrued for the (estimated)

accounts receivable PIP. (See Exhibit 13 Protocol for Estimating

Payables and Receivables for PIP). This is not a carrier function.

1310.01.01.01.04

Credit Balances

The intermediary reports the accounts receivable as a result of

credit balance reports This is not a carrier function.

1310.01.01.02

Beneficiaries

The contractor reports overpayments for beneficiaries. This

includes, but is not limited to, those items listed on the CMS-2174,

Carrier Beneficiary Overpayment Activity Report.

1310.01.01.03

Physicians/Suppliers

The carrier reports overpayments for physicians and suppliers. This

includes, but is not limited to, those items listed on the

Physician/Supplier Overpayment Report (PSOR) This is not an

intermediary function.

1310.01.04

Medicare Secondary Payer

The contractor reports accounts receivable for amounts due as a

result of MSP activity, and based on documented debts due

Medicare for all debtors. Debtors are employers, insurers,

providers, beneficiaries or other persons to whom a demand letter

has been issued

1310.01.04.01

Group Health Plan (GHP)

Account Number

Title

1310.01.04.01.01

Data Match (FI)

The contractor includes the amounts identified (CMS supplied

receivables via tapes with an identified report ID on MPaRTS) as a

result of MSP activity for which a demand letter has been issued

for IRS/SSA Data Match cases. Outstanding receivables are the

amount of debt that has been demanded and payment has not yet

been received

1310.01.04.01.02

Non-Data Match (FI)

The contractor includes the amounts identified (debt specific to

GHP debt, working aged, disability, End-Stage Renal Disease

(ESRD) as a result of MSP activity for which a demand letter has

been issued. Outstanding receivables are the amount of debt that

has been demanded and payment has not yet been received

1310.01.04.02

Liability MSP

The contractor includes the amounts (inclusive of all workman's

compensation, automobile/no fault and liability debt, this includes

CMS identified cases) due to MSP activity for which a settlement

has been reached related to liability cases. Outstanding receivables

are the amount of debts that have been demanded, subsequent to

settlement and/or other action, and payment has not yet been

received.

1310.01.04.02.01

MSP Beneficiaries

1310.01.04.02.02

MSP Providers/Physicians/Suppliers Outstanding receivables are

the amount of MSP initiated debts that have been demanded and

payment has not yet been received.

1310.01.04.03

Other MSP

The contractor includes the amounts due as a result of other MSP

activity for which a valid MSP debt has been recognized.

1310.01.99

Other

The contractor reports actual or estimated other accounts

receivable. It includes those receivables not otherwise classified in

the categories presented above. It provides an identifying footnote

on CAFM of the nature of this receivable

1311

Advances to Others

The contractor reports payments made to providers, physicians, or

suppliers in anticipation of claims being processed. Advances are

Account Number

Title

not to be considered as accounts receivable. It does not include

them on Form CMS-751A/B, Status of Account Receivable report

1311.01

Part A and Part B

The contractor reports advance payments and accelerated payments

attributable to HI and SMI activities

1311.01.01

Advance Payments

The contractor the outstanding balance for payments authorized by

CMS instructions for advanced payments based on actual provider

claims data. If not recovered according to CMS instructions, it

reclassifies and reports as overpayments

1311.01.02

Accelerated Payments (FI)

The intermediary reports the outstanding balance for payments

authorized by CMS instructions for accelerated payments based on

actual provider claims data. If not recovered according to CMS

instructions, it reclassifies and reports as overpayments This is not

a carrier function.

1330

Interest Receivable

The contractor reports interest receivable on accounts receivable. It

accrues interest through the last day of the reporting period.

1330.01

Part A and Part B

The contractor reports HI and SMI interest receivable on accounts

receivable, including extended repayment plans

1990

Other Assets

The contractor reports assets that are not otherwise classified. It

provides an identifying footnote in the remarks section of Form

CMS-750A/B report.

1990.01

Part A and Part B

The contractor reports HI and SMI unclassified assets.

2000

Liabilities

The contractor reports amounts owed after processing Medicare

claims and related activities

2110

Accounts Payable Report amounts owed after processing Medicare

claims or other authorized expenditures. This includes, but is not

limited to, underpayments resulting from adjustment bills

Account Number

Title

2110.01

Part A and Part B

The contractor reports accounts payable attributable to HI and SMI

activities

2110.01.01

Unprocessed Claims

The contractor reports the value of the accounts payable for

unprocessed claims received in-house that have not yet started

processing. The actual value may be developed after the reporting

period but before the required date for reporting. It uses the 30 day

rolling average for the number of claims received and not

processed to determine the number of average unprocessed claims.

2110.01.02

Benefits Payable

The contractor reports accounts payable for those claims that have

completed processing checks, but have not yet been issued nor

offsets applied. This includes, but is not limited to, underpayments

resulting from adjustment bills. It includes claims approved by the

Common Working File (CWF) and claims not approved by the

CWF, but approved by the RO for payment outside the CWF.

2110.01.02.01

Provider

The intermediary reports benefits payable to institutional providers

of Medicare services. This includes, but is not limited to the

following: accounts receivable accrual where the periodic interim

payment (PIP) bills is in excess of periodic interim payme

nts (PIP);

underpayments from receipt of accepted cost reports, tentative

settlements and final cost settlements, when Notices of Provider

Reimbursement (NPR) are prepared; and underpayments for PRRB

settlements, when Notices of Correction (NOC) are prepared, etc

This is not a carrier function.

2110.01.02.01.01

PIP Providers - Cost Report Settlements

The intermediary reports benefits payable to PIP providers as a

result of Cost Report Settlements This is not a carrier function.

2110.01.02.01.02

PIP Providers - Estimated Payable Accrued

The intermediary reports the amount accrued for the (estimated)

accounts payable PIP. (See Exhibit 13 Protocol for Estimating

Payables and Receivables for PIP). This is not a carrier function.

2110.01.02.01.03

Non-PIP Providers - Underpayments (Interim Rate)

The intermediary reports benefits payable to Non-PIP providers as

a result of Interim Rate Reviews This is not a carrier function

Account Number

Title

2110.01.02.01.04

Non-PIP Providers - Underpayments (Cost Report Settlement)

The intermediary reports benefits payable to Non-PIP providers as

a result of Cost Report Settlements This is not a carrier function.

2110.01.02.01.05

Claims Payments Withheld for Non-receipt of Cost Reports

The intermediary reports benefits payable for claims withheld for

payment for non-receipt of provider cost reports This is not a

carrier function.

2110.01.02.02

Beneficiaries

The contractor reports benefits payable to beneficiaries for

reimbursement for Medicare services.

2110.01.02.03

Physicians/Suppliers

The carrier reports benefits payable to physicians or suppliers of

Medicare services. This includes, but is not limited to,

underpayments of quarterly Health Professional Shortage Area

(HPSA) bonus amounts for which a c

heck has not been issued. Not

an intermediary function.

2110.01.02.04

Claims on the Payment Floor Adjudicated claims not yet paid

2110.01.03

Suspended Payments

The contractor reports actual or estimated benefits payable for

claims that were suspended from payment to allow for additional

processing.

2110.01.03.01

Claims

The contractor reports estimated benefits payable for claims

needing additional information or further development, including

CWF rejects and adjustments

210.01.03.02

Common Working File (CWF)

The contractor reports benefits payable for claims that are pending

submission or were submitted to the CWF for approval.

2110.01.03.03

MR/UR Prepayment Review

The contractor reports estimated benefits payable, based on a

developed rate, suspended for MR/UR before payment. The

payables after MR/UR are in 2110.01.02, Benefits Payable

2110.01.03.04

Medicare as Secondary Payer (MSP)

Account Number

Title

The contractor reports benefits payable that are suspended for

investigation of third party liability for MSP prior to payment

2140

Accrued Interest Payable

The contractor reports actual or estimated interest payable on

Medicare liabilities through the end of the reporting period

including, but not limited to, pending claims, court settlements,

claims payment timeliness (CPT), etc.

2140.01

Part A and Part B

The contractor reports HI and SMI interest payable on Medicare

liabilities

2990

Other Liabilities

The contractor reports liabilities not otherwise classified. It

provides an identifying footnote in the remarks section of Form

CMS-750A/B report.

2990.01

Part A and Part B

The contractor reports other liabilities attributable to HI and SMI

activities.

2990.01.01

Unapplied Receipts

The contractor reports amounts deposited and not yet applied to an

accounts receivable.

2990.01.02

Excess Recoupments

The contractor reports amounts recovered from overpayments or

from other sources in excess of receivables established and which

are eligible for refund. It includes those payables identified as due

to third party liability payers, e.g., excess recoupment of MSP

recoveries being returned to the third party.

2990.01.03

Due Medicaid

The contractor reports Medicare claims reimbursements withheld

based on RO instructions for payment to Medicaid.

2990.01.99

Other

The contractor reports actual or estimated amounts payable not

otherwise classified. These include, but are not limited to, claims

payments withheld to satisfy Internal Revenue Service liens, court

liens, unidentified receipts that have not been applied to an account

receivable. It provides an identifying footnote in CAFM.

Account Number

Title

3010

Fund Balance Fund balance reflects the cumulative results of

program operations and extraordinary items. It equals the

difference between assets and liabilities.

3310

Cumulative Results of Operations

These accounts track the net difference between income and

expense activity as reported on the Statement of Operations. This

account is updated with the current year-to-date net results of

operations

3310.01

Part A and Part B

The contractor reports HI and SMI interest revenue from accounts

receivable. It includes current fiscal period earned interest, and any

adjustments. It also includes accrued interest in account 1330,

Interest Receivable

5000

Revenue and Other Financing Sources

The contractor reports the amount of income from Medicare

activities. Typical sources are draws on letter of credit, interest and

recoveries of amounts expended in prior periods.

5303

Interest Revenue

The contractor reports interest earned from accounts receivable.

5303.01

Part A and Part B

The contractor reports HI and SMI interest revenue from accounts

receivable. Include current fiscal period earned interest, and any

adjustments. This will also include accrued interest in account

1330, Interest Receivable.

5303.01.01

Adjustments/Waivers (Interest)

The contractor reports the reduction of the amounts of interest

receivable based on Collections on Delinquent Debt in accordance

with §§1862(b) and 1870(c) of the Social Security Act. It

reconciles this with Form CMS-751A/B, Status of Accounts

Receivable, Line 5h, Waivers (Interest).

5303.01.02

Write-offs Closed/Transfers (Interest)

The contractor reports interest receivable for which collection

efforts have been abandoned or that have been transferred to

another Medicare contractor or other CMS location. These

accounts must be reconciled with the receiving Medicare

contractor or other CMS location.

Account Number

Title

5303.01.02.01

Amounts Written-Off Closed (Bad Debts) (Interest)

The contractor reports interest receivables for which collection is

no longer being pursued according to CMS regulations. It

reconciles this with Form CMS-751A/B, Status of Accounts

Receivable, Line 6a, Amounts Written-off Closed (Bad Debts).

5303.01.02.02

Transfers Out to other CMS Locations (POR/PSOR & Not

POR/PSOR) (Interest). POR not applicable to carriers.

The contractor reports interest receivable transferred to other CMS

locations. Reconcile with Form CMS-751A/B, Status of Accounts

Receivable, Line 5e, Transfers Out to Other CMS Locations,

POR/PSOR, (interest) and Line 5g, Transfers Out to Other CMS

Locations, Not POR/PSOR, (interest). POR not applicable to

carriers.

5303.01.02.02.01

Transfers In from other CMS Locations (POR/PSOR & Not

POR/PSOR) (Interest). POR not applicable to carriers.

The contractor reports interest receivable that has been transferred

to your location from other CMS locations in the current period. It

reconciles this with Form CMS-751 A/B, Status of Accounts

Receivable, Line 5d, Transfers In from Other CMS Locations,

POR, (interest), and Line 5f, Transfers In from Other CMS

Locations, Not POR, (interest). POR not applicable to carriers.

5303.01.02.03

Transfers Out to CNC (Interest)

The contractor reports interest receivable transferred to CNC in

accordance with CMS regulations. It transfers the full amount of

interest due on the debt. It reconciles this with Form CMS-C751,

Status of Non-MSP Debt - CNC, Line 2, New CNC A/R (interest)

and Line 6c, Transfers Out to CNC

5303.01.02.03.01

Transfers In from CNC (Interest)

The contractor reports interest receivable that has been transferred

in to its location from CNC.

5303.01.02.04

Transfers Out to other Medicare Contractors (Interest)

The contractor reports interest receivable transferred to other

Medicare contractors. Reconcile with Form CMS-751A/B, Status

of Accounts Receivable, Line 5c, Transfers Out to Other Medicare

Contractors.

5303.01.02.04.01

Transfers in from other Medicare Contractors (Interest)

Account Number

Title

The contractor reports interest receivable transferred to your

location from other Medicare contractors. It reconciles this with

Form CMS-751A/B Status of Accounts Receivable, Line 5b,

Transfers In from Other Medicare Contractors (Interest)

5700

Appropriated Capital Used

The contractor reports the amount of Medicare funds drawn to be

matched against current period expense. This amount must be

consistent with amounts reported on Form CMS-1521, Contractor

Draws on Letter of Credit, and on Form CMS-1522, Monthly

Contractor Financial Report. The contractor does not include

administrative draws through the Payment Management System

(PMS), (Smartlink)

5700.01

Part A and Part B, Draws on Letter-of-Credit

5900

Other Revenue

The contractor reports revenue not otherwise classified. It provides

identifying footnote(s) in the remarks section of Form CMS-750

A/R report

5900.01

Part A and Part B

The contractor reports HI and SMI other revenue

5900.01.01

Other

The contractor reports revenue not otherwise classified

6000

Expense

The contractor reports the outflow of assets or incurrence of

liabilities during a period resulting from rendering Medicare

services.

6100

Operating/Program Expense

The contractor reports net benefits costs incurred throughout the

FY. The expense is the adjusted benefits outlay in cash or its

equivalent and accrued liabilities incurred in carrying out the

Medicare program. This includes, but is not limited to, adjustments

for MSP recoveries, reconsiderations, and pending litigation.

6100.01

Part A and Part B

The contractor reports HI and SMI benefit program expense.

6101

Waivers (Principal)

Account Number

Title

The contractor reports HI and SMI waiver expense.

6101.01

Part A and Part B

The contractor reports the reduction of the amounts receivable

based on application of §§1862(b) and 1870(c) of the Social

Security Act. It reconciles this with Form CMS-751A/B, Status of

Accounts Receivable, Line 5h, Waivers.

6101.01.02

Transfers Out to other CMS Locations (Principal)

The contractor reports accounts receivable transferred to other

CMS locations. It reconciles this with Form CMS-751A/B, Status

of Accounts Receivable, Line 5e, Transfers Out to Other CMS

Locations, POR/PSOR and Line 5g, Transfers to Other CMS

Locations, Not POR/PSOR. POR not applicable to carriers.

6101.01.02.01

Transfers In from other CMS Locations (Principal)

The contractor reports accounts receivable amounts that have been

transferred to its location from other CMS locations in the current

period. It reconciles this with Form CMS-751 A/B, Status of

Accounts Receivable, Line 5d, Transfers In from Other CMS

Locations, POR/PSOR (principal), and Line 5f, Transfers In from

Other CMS Locations, Not POR/PSOR (principal). POR not

applicable to carriers.

6101.01.03

Transfers Out to CNC (Principal)

The contractor reports accounts receivable amounts that have been

transferred to CNC in accordance with CMS regulations. . It

reconciles this with Form CMS-C751A/B, Status of Non- MSP

Debt - CNC, Line 2, New CNC A/R, and Line 6c Transfers Out to

CNC of Form CMS-

751A/B, Status of Accounts Receivable report.

It transfers the full amount of principal due.

6101.01.03.01

Transfers In from CNC (Principal)

The contractor reports accounts receivable amounts that have been

re-established as an active accounts receivable. It reconciles this

with Form CMS-751A/B, Status of Accounts Receivable, Line 6b,

Transfers In from CNC

6101.01.04

Transfers Out to other Medicare Contractors (Principal)

The contractor reports HI and SMI accounts receivable transferred

out to a Medicare contractor for collection. It reconciles this with

Form CMS-751A/B, Status of Accounts Receivable, Line 5c,

Transfers to Other Medicare Contractors.

Account Number

Title

6101.01.04.01

Transfers In from other Medicare Contractors (Principal)

The contractor reports HI and SMI accounts receivable transferred

to your location from other Medicare contractors. It reconciles this

with Form CMS-

751 A/B, Status of Accounts Receivable, Line 5b,

Transfers In from Other Medicare Contractors.

6106

Write-offs Closed/Transfers (Principal)

The contractor reports accounts receivable for which collection

efforts have been abandoned, or that have been transferred to

another Medicare contractor or other CMS location. These

accounts must be reconciled with the receiving Medicare

contractor or other CMS location.

6106.01

Part A and Part B

The contractor reports HI and SMI accounts receivable written off

or transferred.

6106.01.01

Amounts Written-Off Closed (Bad Debts) (Principal)

The contractor reports receivables for which collection is no longer

being pursued according to CMS rules. It reconciles this with Form

CMS-751A/B, Status of Accounts Receivable, Line 6a, Amounts

Written-off Closed (Bad Debts).

6330

Interest Expense

The contractor reports interest expense incurred for claims for

Medicare benefits or accounts payable.

6330.01

Part A and Part B

The contractor reports HI and SMI interest expense.

6330.01.01

Claims Payment Timeliness (CPT) Interest

The contractor reports interest paid for claims that failed the claims

payment timeliness (CPT) requirement. It reconciles this with

Form CMS-1522, interest paid, claims timeliness.

6330.01.02

Other Interest

The contractor reports interest for other late payments. It reconciles

this with Form CMS-1522, interest paid, provider underpayments.

6909

Other Expense

The contractor reports benefit expenses not reported in named

categories or otherwise classified. It provides an identifying

footnote in the remarks section of Form CMS-750A/B report.

Account Number

Title

6909.01

Part A and Part B

The contractor reports HI and SMI unclassified benefit expenses.

7400

Prior Period Adjustments

The contractor reports adjustments for prior period activity to

restate assets, liabilities, etc. It provides an identifying footnote in

the remarks section of Form CMS-750 report.

7400.01

Part A and Part B

The contractor reports HI and SMI prior period adjustments.

400.12 - Exhibit 12 - Accounts Payable - Protocol for Estimating Claims

- Form CMS-H750A/B, Statement of Financial Position - (Rev. 5, 08-30-

02)

A1-1960.12, B1-4960.12

Accounts Payable Protocol for Estimating Claims

Form CMS-H750A/B, Statement of Financial Position

The amounts recorded in accounts payable (A/P) may be estimated based on actual

volumes and historical rates; therefore, the FI or carrier calculates and accrues a new

estimated liability each reporting period and reverses the accrual for the previous period

in full. It charges the expense accounts, rather than the A/P, as actual payments are made.

INTERMEDIARY PROCEDURES

Methodology for Calculating Average Reimbursement Amount and Average Interest for

Pricing Claim Liabilities

To assign an estimated value to claims for which the amount to be paid is unknown, the

contractor counts claims and multiplies the total by the average reimbursement amount

(net of interest) and an average interest amount (CPT), if applicable, determined as

follows:

The intermediary calculates the average reimbursement amount by taking a representative

sample of the most recent 12 months of paid claims history. It totals the reimbursement

amount minus interest and divides by the total number of claims processed. It calculates

the Claims Payment Timelines (CPT) by adding the interest from the same claims and

divides by the total number of claims (not just those bearing interest).

The intermediary performs these calculations by bill types and will be segregated

between Part A and Part B. (See Intermediary Manual, Part 3, §3894.3.)

GENERAL PROCEDURES

These methods may be used to assign an estimated value to claims in the following

categories:

1. In-house, unprocessed claims; and

MR/UR

PRO

2. Claims suspended for prepayment review

Claims

MR/UR

PRO

400.13 - Exhibit 13 - Periodic Interim Payments (PIP) Protocol for

Estimating Payables/Receivables for the Forms CMS-H750/751A/B,

Statement of Financial Position and Status of Accounts Receivable

Report (Intermediaries Only) - (Rev. 5, 08-30-02)

A1-1960.13, B1-4960.13

Periodic Interim Payments (PIP)

Protocol for Estimating Payables/Receivables for the Form CMS-H750/H751A/B,

Statement of Financial Position and Status of Accounts Receivable Reports

It is necessary to report on Form CMS-H750, a cumulative estimated accounts receivable

or payable for all fiscal periods since the provider's last accepted cost report period. To

estimate this amount, the intermediary performs the following steps:

1. It determines the total amount for PIP bills processed for the fiscal period less

outlier amounts;

2. It compares the PIP bills amount to the actual PIP cash payment and lump sum

payments (checks issued) made during the fiscal period. This does not include any

outlier payments that may have been issued on the same check with the PIP;

3. It reports the amount that PIP bills exceed the PIP cash payment as an account

payable; and

4. It reports the amount that PIP cash payment exceeds the PIP bills as an account

receivable.

For example: If the provider's FY ends on December 31, then the cost report should be

received and accepted before the June 30 reporting period. The following demonstrates

how the PIP accumulations would be reported for this provider.

Period Ending

Reporting

December 31

Assuming all prior year cost reports have been accepted,

the only entry on the books for this provider would be

the estimated accounts receivable or accounts payable

after comparing PIP payments to claims submitted since

January 1st to current.

March 31

Given the same assumption regarding prior cost reports,

the PIP estimate for this provider will include the entire

prior FY for the provider (January 1 - December 31)

unless the cost report has been filed and accepted, and

the current FY for the provider (January 1- March 31).

June 30

Given the same assumption regarding prior cost reports,

assuming the latest cost report has now been received

and accepted and the appropriate accounts receivable or

accounts payable are booked, the PIP estimated for this

provider will now include only the current FY for the

provider (January 1- June 30).

Sept 30

Given the same assumption regarding prior cost reports,

assuming the latest cost report has now been received

and accepted, the PIP estimate for this provider will now

include only the current FY for the provider (January 1-

September 30).

400.14 - Exhibit 14 - Protocol for Estimating Allowance for

Uncollectible Accounts Forms CMS-H/M751A/B, Status of Accounts

Receivable

(Rev. 115, Issued: 01-24-07; Effective Date: 04-01-07; Implementation Date: 04-02-

07)

The Federal Accounting Standards Advisory Board (FASAB) recommends through

Statement of Federal Financial Accounting Standard Number 1 (Paragraphs 44&45) that

losses on receivables should be recognized when it is more likely than not that the

receivables will not be totally collected. The phrase "more likely than not" means more

than a 50 percent chance of loss occurrence. An allowance for estimated uncollectible

amounts should be recognized to reduce the gross amount of receivables to its net

realizable value. The allowance for uncollectible amounts should be re-estimated on each

annual financial reporting date (at a minimum) and when information indicates that the

latest estimate is no longer correct. These losses should be measured through a systematic

methodology. The systematic methodology should be based on analysis of both

individual accounts and a group of accounts as a whole.

Accounts that represent significant amounts, i.e., greater that $1 million, should be

individually analyzed to determine the loss allowance. Loss estimation for individual

accounts should be based on (a) the debtor's ability to pay, (b) the debtor's payment

record and willingness to pay, and (c) the probable recovery of amounts from secondary

sources, including liens, garnishments, cross collections and other applicable collection

tools.

The entire allowance for losses generally cannot be based solely on the results of

individual account analysis. In many cases, information may not be available to make a

reliable assessment of losses on an individual account basis or the nature of the

receivables may not lend itself to individual account analysis. In these cases, potential

losses should be assessed on a group basis.

CMS has implemented FASAB's recommendations and has developed this protocol for

Medicare contractors to follow for estimating the allowance for uncollectible accounts.

The following section outlines this methodology.

Protocol for Estimating Allowance for Uncollectible Accounts

Medicare contractors must recognize on Line 8, Allowance for Uncollectible Accounts,

on Forms CMS-H/M751A/B, an estimated amount for uncollectible debt in order to

reduce the gross amount of receivables to its net realizable value. Medicare contractors

must re-estimate the allowance for uncollectible amounts on March 31 and September 30

of each FY and when information indicates that the latest estimate is no longer correct.

Medicare contractors must measure potential losses due to uncollectible amounts through

a systematic method. This systematic method must be based on an analysis. The analysis

requires that receivables be further stratified into sub-groups (i.e., Cost Report Settlement

Activity, Claims Accounts Receivable, Credit Balances, Group Health Plan (GHP) MSP,

Liability MSP and Other Accounts Receivables). The subgroups are somewhat different

for Group 1 - Fiscal Intermediaries, as compared to Group 2 - Carriers.

Group 1 (Fiscal Intermediaries)

Sub-Group 1

1. Cost Report Settlements Activity (Non MSP)

2. Claims Accounts Receivable, Credit Balances & Other Accounts

Receivables (Non-MSP)

Sub-Group 2

1. Group Health Plan (Data Match/Non Data Match) MSP

2. Liability MSP

For Group 1, Subgroup 1, fiscal intermediaries must perform the following steps to

calculate and validate the allowance for uncollectible accounts.

1. Calculate the allowance based on the historical collection percentage (see detailed

instructions below) for Non-MSP as a whole.

2. Individual Account Analyses: For cost report settlement activity only, fiscal

intermediaries will identify and total those provider debts that meet certain risk

characteristics (i.e., bankruptcy, terminations, poor collection history, no

collection activity for 6 months or more). These will be considered risk accounts,

and the fiscal intermediary should total all risk accounts identified through this

analysis.

3. Compute the total delinquencies exceeding 180 days (Section B of Forms CMS

H/M751A/B "Delinquent Receivables").

4. Compare the three estimated amounts calculated in Steps 1, 2 & 3 and identify the

amount that ensures that the net receivable is reported at its realizable value.

For Group 1, Subgroup 2, the fiscal intermediary must perform the following steps to

calculate and validate the allowance for uncollectible accounts.

1. Calculate the allowance based on the historical collection percentage (see

detailed instructions below) for MSP as a whole.

2. Compute the total delinquencies exceeding 180 days (Section B of Forms CMS-

H/M751A/B "Delinquent Receivables").

3. Compare the two estimated amounts calculated in Steps 1 & 2 and identify the

amount that ensures that the net receivable is reported at its realizable value.

Historical Collection Percentage Calculation

A - Determine Total Receivables Eligible for Collection. (Using Forms CMS

H/M751A/B)

Required Formula:

Beginning Balance

(Line 1)

Plus: New Receivables

(Line 2a)

Plus/Less: Adjusted Amounts

(Line 5a)

(plus if positive number less if negative number)

Plus: Transfers In from other Medicare Contractors

(Line 5b)

Plus: Transfers In from other CMS locations, POR &

Not POR

(Lines 5d & 5f)

Plus: Transfers In from CNC

(Lines 6b)

Less: Transfers Out to other Medicare Contractors

(Line 5c)

Less: Transfers Out to other CMS locations, POR & Not

POR

(Lines 5e & 5g)

Less: Waivers & Amounts Written Off (Bad Debts) (Lines 5h & 6a)

Less: Transfers Out to CNC

Equals: Total Receivables Available to be Collected

(Line 6c)

B - Determine Rate of Collections

Line 4a, Cash/Check Collections plus Line 4b, Offsets Collection plus Line 4c,

Collections Deposited At Another Location divided by Total Receivables Available to be

Collected (number calculated from Step A) multiplied times 100 determines the rate of

collections percentage.

C - Determine the Allowance Rate

1.00 minus the percentage determined from Step B, equals the allowance rate

D - Average the Percentage Calculated in Step C with a 5-year Historical Allowance Rate

(if available, if not available, maintain statistical data to develop historical rate, and

proceed to Step E).

E - Calculate the Allowance

Multiply the allowance rate from Step C or Step D by the sum of Line 7, Ending Balance

less Line 2b, Accrued Receivables.

Group 2 (Carriers)

Sub-Group 1

1. Claims Accounts Receivable, Credit Balances & Other Accounts

Receivables (Non-MSP)

Sub-Group 2

1. Group Health Plan (Data Match/Non Data Match) MSP

2. Liability MSP

For Group 2, Subgroup 1, the carrier must perform the following steps to calculate and

validate the allowance for uncollectible accounts.

1. Calculate the allowance based on the historical collection percentage (see detailed

instructions below) for Non-MSP as a whole.

2. Compute the total delinquencies exceeding 180 days (Section B of Forms CMS-

H/M751B "Delinquent Receivables").

3. Compare the two estimated amounts calculated in Steps 1 & 2 and identify the

amount that ensures that the net receivable is reported at its realizable value.

For Group 2, Subgroup 2, the carrier must perform the following steps to calculate and

validate the allowance for uncollectible accounts.

1. Calculate the allowance based on the historical collection percentage (see detailed

instructions below) for MSP as a whole.

2. Compute the total delinquencies exceeding 180 days (Section B of Forms CMS-

H/M751B "Delinquent Receivables").

3. Compare the two estimated amounts calculated in Steps 1 & 2 and identify the

amount that ensures that the net receivable is reported at its realizable value.

Historical Collection Percentage Calculation

A. Determine Total Receivables Eligible for Collection. (Using Forms CMS-H/M751B)

Required Formula:

Beginning Balance

(Line 1)

Plus: New Receivables

(Line 2a)

Plus/Less: Adjusted Amounts

(Line 5a)

(plus if positive number less if negative number)

Plus: Transfers In from other Medicare Contractors

(Line 5b)

Plus: Transfers In from other CMS locations, POR &

Not POR

(Lines 5d & 5f)

Plus: Transfers In from CNC

(Line 6b)

Less: Transfers Out to other Medicare Contractors

Less: Transfers Out to other CMS locations, POR & No

Less: Waivers & Amounts Written Off (Bad Debts)

(Line 5c)

(Line 5e & 5g)

(Line 5h & 6a)

Less: Transfers Out to CNC

(Line 6c)

Equals: Total Receivables Available to be Collected

B. Determine Rate of Collections

Line 4a, Cash/Check Collections plus Line 4b, Offsets Collections plus Line 4c,

Collections Deposited At Another Location divided by Total Receivables Available to be

Collected (number calculated from Step A) multiplied times 100 determines the rate of

collections percentage.

C. Determine the Allowance Rate.

1.00 minus the percentage determined from Step B, equals the allowance rate

D. Average the percentage calculated in Step C with a 5-year historical allowance rate (if

available, if not available, maintain statistical data to develop historical rate, and go

proceed to Step E).

E. Calculate the Allowance

Multiply the allowance rate from Step C or Step D (Group 2, Carriers Section) by Line 7,

Ending Balance.

Medicare contractors are required to compare the results of the estimated allowance

based on the protocol and report on Line 8, Allowance for Uncollectible Accounts, the

amount that ensures that the net receivable is reported at its realizable value. The

Medicare contactors are required to maintain supporting documentation that includes the

assumptions used to calculate the allowance amount reported on Forms CMS

H/M751A/B. The documentation must be available for review by CMS, OIG, GAO or

other parties as required.

Note: Medicare contractors may apply the same method of results of the principal

comparison (Col. D, Example 400.14.3) to estimate the interest allowance amount (Col.

E, Example 400.14.3) to be reported on Line 8, Allowance for Uncollectible Accounts, of

the Forms CMS H/M 751A/B. For example, the method of results for the Non-MSP

principal is delinquencies exceeding 180 days. The Medicare contractor has the option to

report on the allowance matrix for interest (Sub-Group 1, Col. E) the amount equal to the

delinquencies exceeding 180 days from the interest column on Form CMS 751. The

method of results for the MSP principal is the historical collection percentage. The

Medicare contractor has the option to report on the allowance matrix for interest (Sub-

Group 2, Col. E) the amount equal to the same percentage calculated for MSP principal,

multiplied by Line 7, ending balance from the interest column on Form CMS 751. The

method selected by the Medicare contractor used to estimate the interest allowance shall

ensure that the net interest receivable is reported at its realizable value.

Each Medicare contractor must complete the Allowance for Uncollectible Accounts

Matrix (Attachment I or Attachment II) for the periods ending March 31 and September

30 of each year. The accounts matrix is to be mailed to CMS CO. The March 31

Allowance for Uncollectible Accounts Matrix is due on April 21 and the September 30

Allowance for Uncollectible Accounts matrix is due on October 21. The Medicare

contractor must submit a separate Allowance for Uncollectible Accounts Matrix for each

Form CMS 751 (i.e. H751A, H751B of A, H751B and H751B-DMERC).

Please submit your matrix(s) via email to [email protected] as well as a

hard copy to the following address:

Centers for Medicare & Medicaid Services

Division of Financial Reporting and Policy

Attention: Director of DFRP

Mail Stop: N3-11-17

7500 Security Boulevard

Baltimore, Maryland 21244

Example 400.14.1

H751

Non-MSP M751

Section A: Outstanding Receivables

Principal

Principal Principal

Beginning FY Balance

329,345,200

188,945,200

140,400,000

2a.

New Receivables

80,050,600

57,500,600

22,550,000

2b. Accrued Receivables 40,455,000

40,455,000

Interest Earned

4a. Cash/Check Collections (218,697,200)

(202,697,200)

(16,000,000)

4b.

Offset Collections (424,000) (424,000)

4c.

Collections Deposited at another Location (50,000)

(50,000)

5a. Adjusted Amounts

Internal Adjustments (4,409,000)

(2,319,000)

(2,090,000)

Auditor/Consultant Adjustments

(5,617,400)

5b. Transfers In from other Medicare Contractors 10,242,000

10,242,000

5c. Transfers Out to other Medicare Contractors

(160,000)

5d.

Transfers In from other CMS Locations, POR

304,000

5e.

Transfers Out to other CMS locations, POR

(247,600)

5f. Transfers In from other CMS Locations, Not POR

126,000 126,000

5g.

Transfers Out to other CMS Locations, Not POR (150,000)

(150,000)

5h. Waivers (292,000)

(292,000)

6a. Amounts Written-off (Bad Debts)

(536,000)

6b.

Transfers In from CNC -

6c. Transfers Out to CNC

(106,420,000) (2,089,600)

(104,330,400)

7. Ending Balance

123,519,600

83,978,000

39,541,600

a. Current

92,639,700

62,983,500

29,656,200

b. Non-current 30,879,900

20,994,500

9,885,400

Allowance for Uncollectible Accounts (49,745,910) (29,327,200)

(20,418,710)

Total Receivables Net of Allowance 73,773,690

54,650,800

19,122,890

10. Cash/Offsets Received for Receivables at Another Location

H751 Non-MSP M751

Section B: Delinquent Receivables Principal

Principal Principal

1. Total Not Delinquent

239,000 186,000

53,000

2. Total Delinquent 123,280,600

83,792,000

39,488,600

(a) 1-30 days 6,150,302 4,182,736

1,967,566

(b) 31-60 days 20,341,299

13,825,680 6,515,619

16,346,304 7,629,765

(d) 91-180 days 29,511,844

20,110,080

9,401,764

(e) 181-365 days 12,316,710 8,371,915

3,944,795

(f) 1-2 years 30,797,413

20,940,700 9,856,713

(g) 2-6 years 86,850

7,285 79,565

(h) 6-10 years 15,113

3,200 11,913

(I) over 10 years 85,000

4,100 80,900

Status of Accounts Receivable

Hospital Insurance (HI)

As of March 31, 2003

Example 400.14.2

Historical Collection Percentage Calculation

H751A Non-MSP M751A

A. Determine Total Receivable Eligible for Collection Principal Principal Principal

Beginning FY Balance

329,345,200 188,945,200 140,400,000

2a. New Receivables 80,050,600 57,500,600 22,550,000

5a. Adjusted Amounts

Internal Adjustments (4,409,000) (2,319,000) (2,090,000)

Auditor/Consultant Adjustments (5,617,400) (5,617,400) -

5b. Transfers In from other Medicare Contractors 10,242,000 10,242,000 -

5c. Transfers Out to other Medicare Contractors (160,000) - (160,000)

5d. Transfers In from other HCFA Locations, POR 304,000 304,000 -

5e. Transfers Out to other HCFA locations, POR (247,600) (247,600) -

5f. Transfers In from other HCFA Locations, Not POR 126,000 126,000 -

5g. Transfers Out to other HCFA Locations, Not POR (150,000) (150,000) -

5h. Waivers (292,000) - (292,000)

6a. Amounts Written-off (Bad Debts) (536,000) - (536,000)

6b. Transfers In from CNC - - -

6c. Transfers Out to CNC (106,420,000) (2,089,600) (104,330,400)

Total Receivables Available to be Collected 302,235,800 246,694,200 55,541,600

B. Determine Rate of Collections

4a. Cash/Check Collections 218,697,200 202,697,200 16,000,000

4b. Offset Collections 424,000 424,000 -

4c. Collections Deposited at another Location 50,000 50,000 -

Total Collections 219,171,200 203,171,200 16,000,000

Rate of Collections (Total Collections divided by Adjusted

Total Eligible for Collection) N/A 82% 29%

[ 203,171,200 / 246,694,200 = .82 or 82%]

C. Determine Allowance Rate

1.00 minus (-) the percentage determined for Step B N/A 18% 71%

[1.00 - Rate of Collections (1.00 - 0.82 = 0.18 or 18%)]

D. 5-year Average (if available)

(.50+.46+.48+.43+ Allowance Rate from Step C)/5 = N/A 41% 52%

FY 99 = 50%

FY 00 = 46%

FY 01 = 48%

FY 02 = 43%

FY 3/03 =

E. Calculate the Allowance

Multiply the ending balance less PIP accrual (Line 7 - PIP accrual) by the allowance rate

(Step C or Step D)

7. Ending Balance 123,519,600 83,978,000 39,541,600

2b. (Less) Accrued Receivables-(PIP Accrual Only) (40,455,000) (40,455,000) -

Adjusted Ending Balance 83,064,600 43,523,000 39,541,600

Allowance for Uncollectible Accounts 38,232,020 17,813,310 20,418,710

Allowance for Uncollectible Accounts

Example 400.14.3

Systematic Analysis Comparison H751A

Non-MSP MSP

Historical Collection % 38,232,020

17,813,310

20,418,710

Individual Account Analysis 15,000,800 15,000,800

Delinquencies Exceeding 180 days 43,301,086

29,327,200

13,973,886

400.14 - Exhibit 14 - Protocol for Estimating Allowance for Uncollectible Accounts

Attachment I - Fiscal Intermediary

Allowance for Uncollectible Accounts Matrix

Group 1 Col. A Col. B Col. C Col. D Col. E

Historical

Individual Delinquencies Estimated

Collection % Account Exceeding 180 Days Allowance for

Total Analysis Total Total Uncollectible A/R

Sub-Group 1 (Non-MSP)

Cost Report Settlements,

Claims A/R, Credit Balance &

Other Accounts Receivables

17,813,310 15,000,800 29,327,200

29,327,200 4,768,143

Sub-Group 2 (MSP)

Group Health Plan (Data-Match

& Non-Data Match),

Liability 20,418,710 13,973,886 20,418,710 3,319,762 (Amount reported on M751A/B)

Total 38,232,020 15,000,800 43,301,086 49,745,910

8,087,905

Amount Reported on H751A

Each Medicare contractor will be required to complete the allowance for uncollectible account matrix on

March 31

and

September 30 of each year.

In addition, this matrix is to be mailed to CMS CO. Supporting documentation must include assumptions used to calculate the allowance for uncollectible

accounts and should be available for review by CMS, OIG, GAO or other parties as required. The matrix must be submitted to the following address/email

(provided above) on April 21 and October 21. If these dates occur on a holiday or weekend, the matrix is due the following Federal workday.

Status of Accounts Receivable

Hospital Insurance (HI)

As of March 31, 2003

Estimated Allowance

See Attached Workpapers

for Uncollectible A/R

(Interest Only)

Justification for amount

reported on Line 8

400.14 - Exhibit 14 - Protocol for Estimating Allowance for Uncollectible Accounts

Attachment I - Fiscal Intermediary

Allowance for Uncollectible Accounts Matrix

Group 1 Col. A Col. B Col. C Col. D Col. E

Historical Individual Delinquencies Estimated

Collection % Account Exceeding 180 Days Allowance for

Total Analysis Total Total Uncollectible A/R

Sub-Group 1 (Non-MSP)

Cost Report Settlements,

Claims A/R, Credit Balance &

Other Accounts Receivables

Sub-Group 2 (MSP)

Group Health Plan (Data-Match

& Non-Data Match),

Liability

(Amount reported on M751A/B)

Total

Amount Reported on H751A/B

Each Medicare contractor will be required to complete the allowance for uncollectible account matrix on March 31 and September 30 of each year.

In addition, this matrix is to be mailed to CMS CO. Supporting documentation must include assumptions used to calculate the allowance for uncollectible

accounts and should be available for review by CMS, OIG, GAO or other parties as required. The matrix must be submitted to the following address/email

(provided above) on April 21 and October 21. If these dates occur on a holiday or weekend, the matrix is due the following Federal workday.

Estimated Allowance

See Attached Workpapers

for Uncollectible A/R

(Interest Only)

Justification for amount

reported on Line 8

400.14 - Exhibit 14 - Protocol for Estimating Allowance for Uncollectible Accounts

Attachment II - Carrier

Allowance for Uncollectible Accounts Matrix

Group 2 Col. A Col. B Col. C Col. D Col. E

Historical Individual Delinquencies Estimated

Collection % Account Exceeding 180 Days Allowance for

Total Analysis Total Total Uncollectible A/R

Sub-Group 1 (Non-MSP)

Claims A/R, Credit Balance &

Other Accounts Receivables

Sub-Group 2 (MSP)

Group Health Plan (Data-Match

& Non-Data Match),

Liability

(Amount reported on M751A/B)

Total Amount Reported on H751B

Each Medicare contractor will be required to complete the allowance for uncollectible account matrix on March 31 and September 30 of each year.

In addition, this matrix is to be mailed to CMS CO. Supporting documentation must include assumptions used to calculate the allowance for uncollectible

accounts and should be available for review by CMS, OIG, GAO or other parties as required. The matrix must be submitted to the following address/email

(provided above) on April 21 and October 21. If these dates occur on a holiday or weekend, the matrix is due the following Federal workday.

Estimated Allowance

See Attached Workpapers

for Uncollectible A/R

(Interest Only)

Justification for amount

reported on Line 8

400.15 - Exhibit 15 - Protocol for Prorating Intermediary Time Account

Balances Between Form CMS-H750A (HI) and Form CMS-H750B

(SMI) - (Rev. 5, 08-30-02)

A1-1960.15, B1-4960.15

Protocol for Prorating Intermediary Time

Account Balances Between Form CMS-H750A (HI) and Form CMS-H750B (SMI)

The contractor selects a representative sample of checks and EFT payments issued and

determines the ratio of the number of HI checks/EFT payments to the number of SMI

checks/EFT payments. Checks or EFT payments for both HI and SMI will be split 50-50.

It uses this ratio to prorate the time account balance for the financial reports.

400.16 - Exhibit 16 - Electronic Certification - (Rev. 5, 08-30-02)

A1-1960.16, B1-4960.16

Electronic Certification

The Electronic Certification process requires that the Chief Financial Officer (CFO) enter

their password in the certifying official's current password field on the remarks page of

Form CMS-H750A/B and Form CMS-H751A/B. When the password is keyed in, the

CFO's name and title will appear on the document, and allow the document to be

submitted electronically through the CAFM. For security purposes, the new password

field is present to allow the certifying official to change the password assigned by CMS

to one only the CFO knows.

Two people are required to submit a certified report. The preparer may input the financial

data, but cannot certify the reports. The CFO may not input data. The preparer must

retrieve the report in order to allow certification.

1. From the CAFM Main Menu select option 2 - Data Entry

2. Select the type of report to certify

3. From the Data Entry Menu select option 5 - Update Remarks

4. Select the package (report) to certify

5. Enter the certifying official's current password

If there are no serious errors (use PF6 SHOW ERRS to show errors), the contractor may

submit the report (use PF2 SUBMIT to submit the report) and it will be accepted.

If the contractor is working in a worksheet and decides to certify and submit the report, it

may either use the function keys (PF7 PAGE- and PF8 PAGE+), enter FREM (find

remarks) on the transporter line or use the jump key (PF9 JUMP) to go to the remarks

page.

The contractor must re-enter its password if it reviews any portion of the report after

certification and prior to submission even if no changes are made. CAFM will not store

the contractor's password.

400.17 - Exhibit 17 - Instructions for the Transfer of Debt Between

Reporting Entities - (Rev. 5, 08-30-02)

A1-1960.17, B1-4960.10

Instructions for the Transfer of Debt Between Reporting Entities

CMS continues to receive criticism from the OIG and its financial statement auditors for

being inconsistent in methods of transferring accounts receivable cases to and from

Medicare contractors, and other CMS locations. This criticism is a direct result of the

lack of a formalized process and specific instructions for transferring accounts receivable

cases between reporting entities.

For financial reporting purposes, the term "referred" is used when a case is not physically

sent to the receiving entity for collection purposes. In a "referral" situation, the receiving

entity merely "advises and/or assists" the referring entity on what actions to take next

with respect to the debt. The responsibility to collect and report the accounts receivable

remains with the referring entity and must be reported as part of the ending accounts

receivable balance on their Form CMS-H751A/B, Status of Accounts Receivable report.

A "transfer" results when a copy of the up-to-date overpayment case file is physically

"transferred" to another reporting entity, i.e., the RO, CO or another Medicare contractor.

Along with the case file, the transferring entity must attach a "Transfer Request and

Notification of Acceptance" form (see Exhibit 17, Attachment I for intermediaries (parts

A and B transfers and Attachment II for carriers). This form will serve as both: 1) the

transferring entity's request to transfer the case(s), and 2) the receiving entity's

notification of acceptance of the transfer.

The transferring entity must complete the form and sign Line 1. The form summarizes the

case(s) requiring transfer approval. No entry will be made on Form CMS-751A/B at this

time. Upon receipt of the form, the entity receiving the request will sign Line 2 of the

form and forward a copy of the form back to the transferring entity. This will notify the

transferring entity of the receipt of the request. The receiving entity will process the

request within 30 days of receipt of the transfer, and will return a copy of the Transfer

Request and Notification of Acceptance form indicating the case(s) approved for transfer

by signing Line 3 of the form.

Only upon receipt of the form signed by the receiving entity, will the transferring entity

update its internal systems to reflect the transfer of the accounts receivable to the

receiving entity. The transferring entity will reflect the dollar amount of the case(s)

approved for transfer on the appropriate transfers out line of Form CMS-H751A/B (Line

5c, Transfers Out to Other Medicare Contractors; Line 5e, Transfers Out to Other CMS

Locations, POR/PSOR; Line 5g, Transfers Out to Other CMS Locations, Not on

POR/PSOR). Also upon receipt of the form, the transferring entity must sign Line 4 and

forward a copy to the receiving entity to acknowledge receipt of the formal approval for

transfer.

The receiving entity will update all internal systems, as well as the POR/PSOR to reflect

the transfer. The location or Medicare contractor number must also be updated in the

POR/PSOR system to reflect the transfer. In addition, the receiving entity will reflect the

dollar amount of the case(s) approved for transfer on the appropriate transfers in line of

Form CMS-H751A/B (Line 5b, Transfers In from Other Medicare Contractors; Line 5d,

Transfers In From Other CMS Locations, POR/PSOR; Line 5f, Transfers In from Other

CMS Locations, Not POR/PSOR).

Prior to submission of the quarterly Form CMS-H750/751A/B, reporting entities must

reconcile the transfers in and transfers out lines to ensure approved transfers are only

being reported. In addition to the requirement to maintain detailed transaction level

documentation to support these lines, reporting entities must also retain copies of the

signed Transfer Request and Notification of Acceptance forms.

Exhibit 17, Attachment I

TRANSFER REQUEST AND NOTIFICATION OF ACCEPTANCE FORM

INTERMEDIARY PART A OR PART B - ACCOUNTS RECEIVABLE (Indicate whether HI or SMI)

Provider

Name

Provider

Number

Cost

Report

Period

Overpayment

Determination

Date

Original

Amount

Outstanding

Principal

Balance

Outstanding

Interest

Balance

Acceptance

Of Transfer

Yes/No

Reason for

Rejection

Line 1:Requesting/Transferring Entity Official: (Signature required)

Total Dollar Amount Requested for Transfer: $____________

Title:_____________________

Telephone:_________________

Date Requested:_________

Line 2: Acknowledgement of Receipt of (Signature required)__(Date received)___

Request Form

Line 3: Approving/Receiving Entity Official: (Signature required)

Total Dollar Amount Approved for Transfer: $____________

Title:_____________________

Telephone:_________________

Date Approved:_________

Line 4: Acknowledgement of Receipt of (Signature required)___(Date received)___

Approved Form

Exhibit 17 - Attachment II

TRANSFER REQUEST & NOTIFICATION OF ACCEPTANCE FORM

CARRIER ACCOUNTS RECEIVABLE

Provider

Name

Provider

Number

Claim Number

Claim Paid

Date

Overpayment

Determination

Date

Original

Amount

Outstanding

Principal

Balance

Outstanding

Interest

Balance

Acceptance

Of Transfer

Yes/No

Reason for

Rejection

Line 1:Requesting/Transferring Entity Official: (Signature required)

Total Dollar Amount Requested for Transfer: $____________

Title:_____________________

Telephone:_________________

Date Requested:_________

Line 2: Acknowledgement of Receipt of (Signature required)__(Date received)___

Request Form

Line 3: Approving/Receiving Entity Official: (Signature required)

Total Dollar Amount Approved for Transfer: $____________

Title:_____________________

Telephone:_________________

Date Approved:_________

Line 4: Acknowledgement of Receipt of (Signature required)___(Date received)___

Approved Form

400.18 - Exhibit 18 - Collection Reconciliation/Acknowledgement Form - (Rev. 5, 08-30-

02)

A1-1960.18, B1-4960.11

Collection Reconciliation/Acknowledgement Form

There are instances where one reporting entity has received and deposited cash/check/offset/electronic funds

transfers (EFTs) for a receivable that is being reported by another entity. In this situation, accounts

receivable cases will not be transferred to the location where the deposit of the money is made. To ensure

proper matching and application of the collection of monies to the outstanding receivable, the "Collection

Reconciliation/Acknowledgement" form must be completed. This form must be completed by the entity

(Medicare contractor, CMS RO or CO) receiving a collection for an accounts receivable that is currently

being reported on the financial reports (Forms CMS-H751A/B-CMS-R751A/B) of another entity.

Medicare contractors are required to ensure that internal controls are in place over the cash/check receipts

process to ensure adequate accounting, recording and custody of Medicare assets.

Treatment of Collections Made by a Medicare Contractor for an Account Receivable at Another Medicare

Contractor Location (applies to Non-Medicare Secondary Payer (MSP) accounts receivables and MSP

accounts receivables)

If a Medicare contractor collects a debt on behalf of another Medicare contractor, whether the receipt was

solicited or unsolicited, then the collection must be forwarded to the Medicare contractor that has the

accounts receivable. In these instances, the Medicare contractor receiving the collection would deposit the

collection and re-issue that amount to the Medicare contractor that is reporting the accounts receivable. The

Medicare contractor reissuing the check should ensure that proper segregation of duties exist over the check

re-issuance (e.g., that the preparer is different from the check authorizer).

The re-issued check must be made payable to "Medicare." In addition, the check must be accompanied by a

completed Collection Reconciliation/Acknowledgement Form (see MIM §1960.18 and MCM §4960.11),

any correspondence received, and a copy of the original check including the postmark date. The CFO for

Medicare Operations for the Medicare contractor reporting the accounts receivable should be contacted and

informed of the pending check. A listing of CFO contacts has been issued to each Medicare contractor CFO.

The deposit and re-issuance of the collection will only affect the CMS-H750A/B of the Medicare contractor

that received the collection. The Collection Reconciliation/Acknowledgement Form will allow for tracking

of the payment.

Upon receipt of the check and Collection Reconciliation/Acknowledgement Form, the Medicare contractor

reporting the receivable will apply its normal cash receipt procedures. However, a signed copy of the

Collection Reconciliation/Acknowledgement Form must be returned to the Medicare contractor that sent the

collection.

MSP additional information: Medicare contractors should follow the deposit and re-issue process whenever

another Medicare contractor has the account receivable or another Medicare contractor is or should be the

lead Medicare contractor. If there is no account receivable established but Medicare contractor X is the lead

and Medicare contractor Y receives payment, Medicare contractor Y should follow the deposit/re-issue

process. If there is no lead established and Medicare contractor Y receives payment, Medicare contractor Y

should do an electronic referral via the Electronic Correspondence Referral System (ECRS) and follow the

deposit/re-issue process if another Medicare contractor is assigned lead. This rule should be followed even if

the non-lead Medicare contractor has an interest and/or has paid some of the claims at issue.

Treatment of Collections Made by a Medicare Contractor for an Account Receivable at a CMS Regional

Office Location (applies to Non-MSP accounts receivables and MSP accounts receivables.)

If a Medicare contractor collects a debt on behalf of a CMS RO location, whether the receipt was solicited or

unsolicited, then the account receivable balance must be transferred to the Medicare contractor that received

the collection. In these instances, the Medicare contractor receiving the collection would initiate the process

by completing the Collection Reconciliation/Acknowledgement Form and sending it to the CMS RO who is

reporting the receivable to notify them of the collection. The Medicare contractor that received the collection

would deposit any cash or checks received into unapplied receipts, which would be reported as a liability

until the transfer is complete.

In turn, the CMS RO reporting the receivable will complete the Transfer Request and Notification of

Acceptance Form (TRNA) described in §1960.17 of the MIM and §4960.10 of the MCM. (The use of the

TRNA is also discussed in question number 68.) Once both parties sign the TRNA, the transfer is considered

complete and the collection would then be applied to the account receivable. The CMS RO transferring the

receivable would record the account receivable on Line 5c, Transfer Out to other Medicare Contractors. The

Medicare contractor receiving the account receivable would record it on Line 5d/5f, Transfers In from other

CMS Locations POR/PSOR or Not on POR/PSOR and the applicable collection on either Line 4a,

Cash/Check Collections or Line 4b, Offset Collections.

Only in the instance where a collection is made by offset for an account receivable at a CMS RO location

can notification of the offset be e-mailed. The e-mail must be retained for audit trail purposes. The e-mail

notification must be followed-up with the actual Collection Reconciliation/Acknowledgement Form and the

Transfer Request and Notification of Acceptance form with all the appropriate signatures. Furthermore,

since offsets may only be identified after being applied, the offset transaction must be moved manually on

the Forms CMS-751A/B (i.e., the full amount of the accounts receivable prior to the offset must be shown as

a transfer in and the amount of the offset must be captured on Line 4b, Offset Collection.) To assist in

accounting for these offset transactions ONLY, Medicare contractors can prepare the Collection

Reconciliation/Acknowledgement Form(s) on a monthly basis.

Treatment of Collections Made by A Medicare Contractor for an Account Receivable at CO

Non-MSP: If Medicare contractors receive collections on debt that is at the Debt Collection Center (DCC),

and that debt is being reported by CO, the Medicare contractor must notify the CO by submitting the

Collection Reconciliation/Acknowledgement form (refer to §1960.18 of the MIM and §4960.11 of the

MCM). In addition, the receipt should be deposited into unapplied receipts until the actual account

receivable is transferred back to the Medicare contractor.

Once CO receives the Collection Reconciliation/Acknowledgement form, it will perform the necessary steps

to update the collection information in the Debt Collection System (DCS) and the Provider Overpayment

Reporting (POR) system or the Physician/Supplier Overpayment Reporting (PSOR) system. CO will change

the accounts receivable location code in DCS from "H," which means CO is reporting the account receivable

to "C," which means the Medicare contractor is reporting the account receivable. CO will also update the

POR/PSOR with the appropriate location code of "IDC," which means the fiscal intermediary at debt

collection or "CDC," which means the carrier at debt collection (i.e., the debt has been forwarded to debt

collection but the debt is still on the books of the fiscal intermediary or carrier). If a balance is remaining

after posting the collection, the debt will remain at DCC for cross servicing/TOP.

To allow the Medicare contractors to properly apply the collection in their internal systems, CO will then

transfer the receivable back to the Medicare contractor using the TRNA (refer to §1960.17 of the MIM and

§4960.10 of the MCM). Upon CO receiving the signed TRNA from the Medicare contractor, CO will cease

to report the receivable on its Form CMS-R751A/B. Once the TRNA has been signed and the receivable has

been transferred, the Medicare contractor will record the transfer in of the receivable on Line 5d, Transfers

In from other CMS Locations, POR/PSOR, or Line 5f, Transfers In from other CMS Locations, Not

POR/PSOR. The receipt would then be applied to the account receivable and the collection would be

recorded on Line 4a, Cash/Check Collections or Line 4b, Offset Collection on the appropriate Form CMS-

H751A/B.

MSP: If Medicare contractor X has an account receivable other than a debt which has been referred to the

Department of Health and Human Services (DHHS) Program Support Center (PSC) under the DCIA and the

CO/RO receives payment, the Medicare contractor should use Line 4c, Collections Deposited at Another

Location and footnote in the comments section of the Form CMS-M751A/B that the CO/RO received the

payment. An example of this type of receipt would be coordination of benefits contractor misrouted checks.

Usage of the Collection Reconciliation/Acknowledgement Form

In the instance where a Medicare contractor, RO or CO receives a collection (whether cash, checks, offset or

EFT) the entity receiving the collection must complete lines 1 through 10 of the form and attach all

documentation showing the collection and the re-issued check, if applicable. In the instance where a RO

receives cash/checks and does not maintain a Medicare bank account to deposit the funds received, the RO

must complete lines 1 through 10 of the form and attach the cash/check. This form should be forwarded to

the reporting entity no later than (15) fifteen days before the end of the quarter. The entity receiving the form

and the check must sign the form on line 11 and forward a copy of the form to the official who signed line

10, no later than (15) fifteen days after receipt of the form. This will acknowledge the receipt of the form

and the check.

Collection Reconciliation/Acknowledgement Form

1. Location of A/R_________________________(i.e., Medicare contractor, RO, or CO)

2. Location of the Collection _________________(i.e., Medicare contractor, RO, or CO. If RO

Collection, indicate such even though actual deposit is made at Central Office)

3. Region_________ Medicare contractor Name and Number_________________________

4. Non-MSP Accounts Receivable

Provider/Physician/Supplier) Number_______________

Provider/Physician/Supplier Name__________________________________

Overpayment Determination Date__________________

Claim Number_________________

Cost Report Year ___________________

MSP Accounts Receivable

Debtor Name ______________________________________

HIC # / Report ID___________________________________

Determination Date__________________

Beneficiary Name ___________________________________

5. Was debt in CNC status prior to this collection:__________________(Yes/No)

6. Date of Collection (Postmark or Government Collection date)______________

7. Type of Collection ____________________ (i.e., cash/check or offset)

Check Number or Government Collection Number _____________________________

Amount of Collection $__________________

Amount Applied to Principal $__________________

Amount Applied to Interest $__________________

8. Collection Reported in quarter ending__________________

9. A/R Reported in quarter ending_______________________

_____________________________

10. Signature of Official at Location

Where Collection is Reported

11. Signature of Official at Location Where

Reduction of A/R is Recorded

Phone #________________________

Fax #__________________________

Phone #________________________

Fax #__________________________

400.20 - Exhibit 20 - Procedures for Reporting Currently Not Collectible (CNC) Debt

(Rev. 18, 05-02-03)

(Rev. 315, Issued: 05-17-19, Effective: 06-18- 19, Implementation: 06-18-19)

The term Medicare beneficiary identifier (Mbi) is a general term describing a beneficiary's Medicare

identification number. For purposes of this manual, Medicare beneficiary identifier references both the

Health Insurance Claim Number (HICN) and the Medicare Beneficiary Identifier (MBI) during the new

Medicare card transition period and after for certain business areas that will continue to use the HICN as

part of their processes.

A1-1960.19, A1-1960.20, B1-4960.12, B1-4960.13

As part of its effort to improve financial reporting, CMS has implemented the category of currently not

collectible (CNC) for delinquent debt that is unlikely to be collected within a reasonable time frame. The

CMS' CNC policy provides that CNC debt will not be recognized as an active accounts receivable (A/R) for

financial statement reporting purposes because to do so would overstate the true economic value of the

assets on the financial statements. While CNC debts are not A/R reported on the financial statements,

Medicare contractors must continue appropriate recovery efforts for these debts until they are recommended

and approved by CMS for "write-off - closed" as such, these debts must remain in their internal system for

interest accrual and offset. The CNC process permits and requires the use of tools of the Debt Collection

Improvement Act (DCIA) of 1996. By using these tools delinquent debt will be worked until the end of its

statutory collection life cycle.

Criteria for Selection

All A/R, whether it is classified as Medicare Secondary Payer (MSP) or Non-MSP, that are 180 days

delinquent must be recommended for CNC reclassification. The A/R must be 180 days delinquent (i.e., 240

days old if the repayment time frame is 60 days or 210 days old if the repayment time frame is 30 days) as

of the last day of the quarter prior to the quarter in which the CNC recommendation is submitted for RO

approval.

All MSP A/R means all demanded debt, without regard to whether the debt is Group Health Plan (GHP)

based or liability/no-fault/workers' compensation based and without regard to the type of debtor (employer,

insurer, beneficiary, provider/supplier, etc.). Where the MSP recovery demand letter stated that the debt was

due and payable 30 days from the date of the demand, the debt is delinquent on day 31 if it has not been paid

in full or there is no valid documented defense for the unpaid amount. Where the MSP recovery demand

letter stated that the debt was due and payable 60 days from the date of the demand, the debt is delinquent on

day 61 if it has not been paid in full or there is no valid documented defense for the unpaid amount.

All Non-MSP A/R means all demanded debt without regard to whether the debt is

provider/physician/supplier or beneficiary-based. This includes debts that are not normally reported

(separately or in summary entries) in the POR/PSOR systems, as long as they meet the CNC criteria. These

debts should be listed separately, must be identified as not on the POR/PSOR, and the type of debt must be

listed on the CNC request form in the comments section. Debts that are excluded from this definition are as

follows:

• Debts with a principal balance of less than $25. Although these debts may satisfy the CNC criteria,

Medicare contractors should recommend the termination of collection activity and request approval

by the Regional Office (RO) to write this debt off as "write-off closed" in accordance with Title 42

of the Code of Federal Regulations, Section 405.376(e)(3), since the cost of further collection action

is likely to exceed any recovery.

• Debts with a collection within the last 180 days. Hence, the debt must be 180 days delinquent

without any collection/recoupment activity within the last 180 day time period for CNC

reclassification.

Additionally, all accounts receivable that meet the CNC criteria will be reclassified as CNC without regard

to whether or not the debt is in bankruptcy, under fraud and abuse investigation, has an appeal pending at

any level, is in litigation/negotiation, or is for a deceased debtor. However, if a Medicare contractor believes

that a particular A/R meets the criteria for both "write-off - closed" and CNC, the A/R should be

recommended for "write-off - closed." Medicare contractors may not recommend CNC for less than the full

amount of an outstanding debt.

NOTE: For GHP-based MSP A/R where the demand was issued to the employer, insurer, or third party

administrator, GHP, or other plan sponsor, the debt includes all of the claims in a demand to a debtor for a

particular beneficiary. For GHP Data Match (DM) recoveries, this would be all of the claims associated with

a particular Mistaken Payment and Recovery Tracking System (MPaRTS) Report ID although a single cover

letter might have been issued for multiple beneficiaries' Medicare reimbursed claims. For duplicate primary

payment recovery demands to a provider/supplier (including physician), the debt includes all claims in the

recovery demand regardless of the number of beneficiaries involved. For liability, no-fault, or workers'

compensation, the debt includes all claims in the recovery demand.

A debt's eligibility for DCIA referral to a Department of the Treasury designated Debt Collection Center

(DCC) for further collection efforts, including the Treasury Offset Program (TOP) has no bearing on or

relationship to whether or not the debt should be reclassified as CNC. As such, debts referred to the DCC

should also be recommended for CNC reclassification as long as it meets the CNC criteria.

The Department of the Treasury and the Office of Management and Budget require that Agencies submit

reports to them on financial management and performance data so that debt collection programs and policies

can be evaluated. Thus, CMS is requiring its Medicare contractors to report and monitor CNC debt on a

quarterly basis.

Quarterly Review of Debt for CNC Reclassification & Approval

Medicare contractors must continuously review all debt and quarterly request approval to reclassify debts as

CNC. Recommendations for the approval of MSP and Non-MSP CNC should be sent to your RO MSP

Coordinator or the RO Debt Collection staff respectively. These reports should be sent by hard copy

accompanied with a disk no later than the first day of the second month of each quarter (i.e., November 1,

February 1, May 1, and August 1). The CFO of Medicare Operations must sign the hard copy and include a

preprinted address label with the hard copy for the return of the approved CNC recommendations. Medicare

contractors are required to submit negative reports if there are no debts eligible for CNC for a particular

quarter.

ROs are responsible for approval or denial of all recommendations for CNC based upon the criteria set forth

in these instructions. RO approval will be by the Assistant Regional Administrator (ARA) for Financial

Management. ROs will complete their review of the Medicare contractors' recommended CNC and return

their approval or denial of such reclassifications by the first day of the last month of each quarter (i.e.,

December 1, March 1, June 1, and September 1). ROs may return a hard copy via fax or a soft copy via disk

annotated to show approval or denial by the RO ARA for Financial Management, in order to meet the

required time frame for approval, but this must be followed by a hard copy that was signed and dated by the

ARA for Financial Management. ROs will also send copies of the signed RO approval or denial letter only,

each quarter to CMS CO to the attention of the Director, Division of Financial Oversight, Office of

Financial Management (for both MSP and Non-MSP approvals). The ROs must maintain the detailed

reports that support the amounts approved/disapproved.

The CNC action should not be taken nor should any changes be made to the A/R on any internal systems

(Medicare contractor systems or other systems which Medicare contractors have responsibility for updating)

for CNC until the recommendation for CNC has been processed by CMS, approved in writing, and returned

to the Medicare contractor. The listing of approved CNC will be returned to the contractors by the ROs.

Receipt of this approval authorizes the Medicare contractor to reclassify the A/R, and update the A/R and

associated case in all appropriate systems. When the A/R is reclassified as CNC, the associated case file

must be annotated to show that a particular A/R was reclassified as CNC and the date/quarter of the action.

Reclassification as CNC does not close the associated case.

If a full or partial collection for the A/R is received between request and approval of CNC reclassification,

then the collection should be applied. The contractor must make the necessary adjustment to the debt to

reflect the payment and place the remaining amount, if any, in CNC when the RO approval is received.

However, when the approval is received, the contractor must then notify the RO of the change in the amount

originally approved for CNC as well as the reason why. If the contractor has this issue with multiple debts

recommended for CNC, they need to furnish this information to the RO on a debt specific basis, not just on

an aggregated basis. This must be communicated to the RO contact in writing. In addition, this

documentation should be maintained for audit/review purposes.

NOTE: MPaRTS does not need to be updated for Data Match debt when the MSP A/R is reclassified as

CNC.

The CMS approval of A/R reclassified as CNC must be retained and available upon request (from the Office

of the Inspector General or any other internal or external review organization) in accordance with retention

procedures in the Medicare Intermediary and Carrier Manuals. This CMS approval must also be annotated

by the Medicare contractor to indicate the date/quarter when the A/R was reclassified.

Data Requirements and Format for Recommendations for MSP CNC

MSP A/R recommended for CNC requires the submission of the following information to the Medicare

contractor's RO MSP coordinator: (see Attachment I for the recommended format)

• Medicare Contractor Name and Number

• Medicare Contractor Mailing Address

• Medicare Contractor Contact Person/Phone/Fax/E-mail

• Type of MSP Debt [GHP or non-GHP (this includes liability, no-fault, and workers' compensation)]

• Beneficiary Medicare beneficiary identifier

• Beneficiary Name

• Name of Debtor or Insurer for GHP-based debts where the current debtor is the

insurer/employer/third party administrator/GHP/other plan sponsor

• Type of Debtor [A=insurer/employer/third party administrator/GHP/other plan sponsor;

B=provider/supplier (including physicians); C=beneficiary, D=other (must specify)]

• Date of Initial Recovery Demand Letter to current debtor

• Delinquency Date

• Original A/R Amount for the current debtor

• Existing A/R Amount (principal and interest listed separately, as well as a total amount for principal

plus interest; HI/SMI must also be listed and reported separately)

• Date of Last Payment, Collection, Recoupment, Offset, or Adjustment Activity (provide date or

"none")

• Tax Identification Number (TIN) for debtor. The TIN is the Employer Identification Number (EIN)

or Social Security Number (SSN)

• DCS Status Code (if applicable).

NOTE: The debtor is the individual or entity to whom the last recovery demand was issued. Where the

demand was issued to an individual in their capacity as legal counsel or representative of any type, the

debtor is the beneficiary, provider/supplier (including physician), or other individual or entity being

represented. Where recovery is being pursued from the attorney or other representative in their own right,

the debtor is the attorney or other representative.

The above listed data elements are mandatory for CNC for all MSP A/R established October 1, 2000 or

later. It is also mandatory for all MSP A/R with a recovery demand date of October 1, 2000, or later,

regardless of when the MSP A/R was established. For CNC recommendations for MSP A/R established

prior to October 1, 2000, Medicare contractors may submit recommendations without the following data

elements if the CNC recommendation certifies that these data elements are not readily available: Beneficiary

name and Medicare beneficiary identifier where the beneficiary is not the debtor; Insurer name where the

insurer is not the debtor; and Type of debtor.

If a Medicare contractor has bulk MSP A/R on the GTE system for older Data Match and non-Data Match

GHP debt, the contractor - for these MSP A/R only - must: 1) Identify the A/R as a bulk receivable on the

GTE system, 2) Identify the insurer, 3) Identify the date of the demand, and 4) Identify the associated dollar

amounts for principal and interest. Any contractor who created bulk receivables for GHP-based MSP debt

using any system other than GTE must contact their RO for assistance. The RO will, in turn, discuss the

issue with CO.

Data Requirements and Format for Recommendations for Non-MSP CNC

Non-MSP A/R recommended for CNC require the submission of the following information to the Medicare

contractor's RO Debt Collection contact: (see Attachments II & III for the recommended format)

• Medicare Contractor Name and Number

• Medicare Contractor Mailing Address

• Medicare Contractor Contact Person/Phone/Fax

• Provider/Physician/Supplier/Beneficiary Name and Number (if applicable)

• Claim Number (PSOR)

• Claim Paid Date (PSOR) or Cost Report Date (POR)

• Overpayment Determination Date

• POR/PSOR Status Code

• Overpayment Type

• Original Amount of Debt

• Balance Outstanding (principal and accrued interest listed separately)

• Date Interest Accrued Through

• Date of Last Payment, Offset or Recoupment

• POR/PSOR Balance (principal and interest listed separately for POR; for PSOR, principal balance

only) - For Part A, indicate POR balance if Contractor submits request for Part B of A separately

• POR/PSOR Location Code

• DCS Status Code (if applicable)

• For FIs Only - Part B of A debt can be submitted on the same listing (principal and interest)

Each listing must contain a written certification that all of the required criteria for CNC are met. The CFO of

Medicare Operations must sign CNC recommendations. The CFO's signature constitutes his/her certification

to all information/statements contained in the recommendation.

Financial Reporting and Reconciliation of CNC Debts

Debts that have received approval for CNC reclassification must be reported in the following manner:

• On Form CMS-751A/B or CMS-M751A/B the amount reclassified as CNC, including principal and

interest, will be recorded on Line 6c, Transfers Out to CNC with a corresponding entry on Line 2,

New CNC Debt on Form CMS-C751A/B or CMS-MC751A/B. This will reduce the ending balance

reflected on the applicable form.

• Debts that are reclassified as CNC may still be collected. If a collection occurs, the following actions

should take place: (1) On Form CMS-C751A/B or CMS-MC751A/B an adjustment for the amount of

the collection should be recorded on Line 4a, Reclassified as Active A/R Due to Collection of Cash

or Line 4b, Reclassified as Active A/R Due to Collection by Offset; (2) The amount of the collection

should also be included in Section C - Collection Information of Form CMS-C751A/B or CMS-

MC751A/B; and (3) The amount of the collection should be simultaneously recorded on Line 6b,

Transfers in from CNC and Line 4a, Cash/Check Collections or Line 4b, Offset Collections of Form

CMS-751A/B or CMS-M751A/B. As such, if a collection takes place, only the collection would be

reclassified with the collection being applied against interest first, then principal. If the collection

does not satisfy the entire debt, the remaining balance of that debt would remain in CNC.

Medicare contractors must continue to accrue interest for debt that has been reclassified as CNC.

Additionally, CMS recognizes that for those systems where interest is updated automatically, the interest

submitted with a recommendation for CNC may differ from the interest shown in the Medicare contractor's

system at the time the Medicare contractor receives approval for CNC. The CMS approval of the principal

and interest recommended for CNC is sufficient support for the subsequent reclassification, including any

increase in the interest, as long as the principal remains the same. Any additional interest that accrues prior

to CNC reclassification would be reported on Form CMS-751A/B or CMS-M751A/B on Line 3, Interest

Earned. Then the debt would be reclassified to the appropriate form.

Medicare contractor systems must be able to maintain transaction level detail of debt that has been

reclassified as CNC to enable future collection activities and to maintain a proper audit trail.

Regional Offices will ensure that amounts approved as CNC are properly reported on contractor Forms

CMS-751A/B or CMS-M751A/B and CMS-C751A/B or CMS-MC751A/B.

Systems Update - Non-MSP Only

Medicare Contractor Internal Systems and POR/PSOR System:

Contractors are responsible for the timely update of CNC status in the POR/ PSOR systems and internal

systems. A CNC date field has been added in the POR/PSOR and additional status codes have been

developed. The date of CNC approval (i.e., the date of the cover letter signed by the ARA) must be entered

in the CNC date field. The update must be performed within ten calendar days of receiving the CNC

approval. Do not change the location code of the debt. Regional Offices will monitor the POR/PSOR

systems to ensure contractor compliance.

Additional Status Codes for POR/PSOR:

POR Codes

PSOR Codes

Code Description

CNC

Write-off Closed (disabled effective 2/6/02)

CNC - DCIA Letter Sent

Reactivate - Bankruptcy (will no longer be used)

Reactivate - Payment Received

Reactivate - Appeal/Litigation/Fraud & Abuse Investigation (will no

longer be used)

Reactivate - Compromise

Reactivate - Extended Repayment Agreement

CNC Debt - Written-off Closed

Reactivate - Other

NOTE: For debts that are at the DCC location and reclassified to CNC, the "3" (POR) or "03" (PSOR)

status code would be used. Furthermore, the "9" must be accompanied by a valid closed date. Cases with a

status code of "09" (POR) or "9" (PSOR) and a valid closed date will be rolled to the history file at the end

of the quarter. In addition to updating the POR/PSOR with the appropriate status codes for the reactivation,

the CNC date previously inputted should be removed. Updating the CNC Date field in the PSOR requires

the user to enter zeroes in the CNC Date field and pressing the enter key.

Debt Collection System (DCS)

The CMS' CO Division of Financial Reporting and Debt Referral staff will continue to update the Debt

Collection System (DCS) with approved CNC status for debts that have been referred for Cross

Servicing/TOP.

Additional Considerations for MSP A/R

These instructions only apply to established MSP A/R. They may not be used to close MSP liability/no-

fault/workers' compensation leads where no settlement, judgment or award exists and no recovery demand

has been issued.

Some Medicare contractors may still have old MSP-based provider/supplier (including physician) debt or

MSP-based beneficiary debt which has not been reported on their Form CMS-M751A/B and which has been

referred to the RO under non-MSP rules or otherwise treated as a non-MSP receivable. Old MSP-based debt

that has been treated as non-MSP debt (that is tracked and processed under non-MSP rules) should be

treated as non-MSP debt for CNC purposes as well.

Medicare contractors may only recommend CNC for a MSP A/R that is being reported as part of their

ending MSP A/R balance. MSP A/R that have been transferred to the ROs for referral to other agencies or

entities such as, the Department of Justice or Office of General Counsel will be addressed by the ROs. CO

will address MSP A/R with CO locations. MSP A/R that have been referred to another location, without

transfer, remain the responsibility of the Medicare contractor.

Previously some Medicare contractors processed/tracked MSP-based provider/supplier (including physician)

A/R and/or MSP-based beneficiary A/R as non-MSP A/R and did not include such A/R on their Form CMS-

M751A/B report. Medicare contractors may no longer do this for new MSP A/R. Any pre-existing MSP-

based provider/supplier (including physician) A/R and/or MSP-based beneficiary A/R that are not reflected

in the Medicare contractor's Form CMS-M751A/B report may not be recommended for MSP CNC. Pre-

existing MSP-based provider/supplier (including physician) A/R and/or MSP- based beneficiary A/R that

have been tracked/processed, or otherwise treated as non-MSP debt should follow the rules for non-MP

CNC

Exhibit 20 - Attachment I

MSP Accounts Receivable: Contractor Recommendation for Reclassification as CNC

Medicare Contractor Name and Number:

Medicare Contractor Contact Person/Phone/Fax/E-mail Address:

Medicare Contractor Mailing Address:

Part A-HI, or Part B-SMI - as applicable (show which)

Intermediaries report Part A and/or Part B

Carriers report Part B only

Type of MSP

Debt

Bene.

Medicare

beneficiary

identifier

Bene.

Name

Debtor

Name

Debtor Type

Date of

Initial

Demand

Original

Amount

Current

Principal

Balance

(HI)

Current

Interest

Balance

(HI)

Current

Principal

Balance

(SMI)

Current

Interest

Balance

(SMI)

Total

Principal

and

Interest

Date of Last

Payment,

Offset, Recoup.

Or Adjustment

TIN of

Current

Debtor

(Provide totals for each column if applicable)

CFO of Medicare Operations: (signature required)

(Signature constitutes certification that all CMS specified criteria for CNC reclassification are met.)

Associate Regional Administrator/Division of Financial Management: (signature required) ___ Concur ___NonConcur

Date of Referral to RO : ___________

Date of RO decision: ___________

Date/quarter when approved MSP A/R were reclassified as CNC: ___________

Attachment II

This is an exact duplicate of Attachment 1, "MSP Accounts Receivable: Contractor

Recommendation for Reclassification as CNC" for Part B Intermediary Claim Activity.

The heading at the top of the spreadsheet is "Part B of A" - SMI, instead of "Part A - HI."

Intermediaries report their SMI data on this report.

400.21 - Exhibit 21 - CMS Policy for Recognizing Accounts Receivable -

(Rev. 5, 08-30-02)

A1-1960.21, B1-4960.21

CMS Policy for Recognizing Accounts Receivable

Overview

The majority of the Medicare accounts receivable balances reported by CMS in its

financial statements are comprised of overpayments made to providers, physicians,

suppliers, beneficiaries, insurers, employers and other entities. The primary responsibility

for identifying, recording, collecting, and reporting overpayments lies with CMS's

Medicare contractors. CMS defines an "overpayment" as Medicare funds that a provider,

physician/supplier, beneficiary, insurer, employer, or other entity has received in excess

of amounts due and payable under the Medicare statute and regulations. Once a

determination of an overpayment has been made, the amount so determined is a debt that

is owed to the Medicare program. For financial reporting purposes, this overpayment or

debt must be recognized as an accounts receivable and reported as an asset in CMS's

financial statements.

CMS has adopted the financial reporting definition for the recognition of an accounts

receivable set forth by the Federal Accounting Standards Advisory Board (FASAB). The

FASAB recommends generally accepted accounting standards and principles for the

Federal Government. The FASAB sets these standards and principles so that Federal

agencies' financial reports include understandable, relevant, and reliable information

about the financial position, activities, and results of operations of the United States

government and its component units.

According to the FASAB's Statement on Federal Financial Accounting Standard Number

1 (SFFAS No.1), Accounting for Selected Assets and Liabilities,

"Accounts receivables are amounts that an entity claims for payment

from others. They arise from claims to cash or other assets."

Additionally, the FASAB recommends, "A receivable should be

recognized when a Federal entity establishes a claim to cash or other

assets against other entities, either based on legal provisions, such as a

payment due date (e.g., taxes not received by the date they are due), or

goods or services provided. If the exact amount is unknown, a

reasonable estimate should be made."

For financial reporting purposes, recognition means the process of formally recording an

item into the financial statements of an entity as an asset, liability, revenue, expense, or

the like. In the case of Medicare contractors, recognition would equate to recording the

accounts receivable on Form CMS-H750A/B and Form CMS-H751A/B Contractor

Financial Reports.

Recognition Policy

CMS and its Medicare contractors will recognize and report an accounts receivable as of

the date a demand letter is sent to the debtor. Specifically, contractors will recognize and

record an accounts receivable (Non-Medicare Secondary Payer (MSP) and MSP

overpayments) as of the date of the demand letter on Line 2a, New Receivables of Form

CMS-H751A/B Status of Accounts Receivable Report. The act of sending out the

demand letter is the event that triggers the recognition of an accounts receivable. The

purpose of the demand letter is to notify the debtor of the existence of the overpayment,

and to request payment. Chapter 4, Debt Collection, §§10 and 130 outline the language

and information that, at a minimum, a demand letter must contain. A demand letter must

contain the name and address of the debtor, the amount of the overpayment, terms of how

interest will be assessed, date when repayment is due, and the debtor's rights to appeal.

All these items are consistent with the definition recommended by the FASAB as

outlined above.

It is important for Medicare contractors to ensure that they retain copies of a demand

letter(s) sent. The demand letter provides documentation or evidence of the actual debt

and recovery efforts taken. It must be kept in each case file with other associated case

documents or correspondence if the case is referred to the Department of Justice; referred

for debt cross-servicing; requested by CMS, Office of Inspector General (OIG) or

General Accounting Office (GAO) during audits/reviews. This information is necessary

and needed to support the debt.

Unless otherwise specifically noted, this policy is applicable to both non-MSP and MSP

overpayments. The following are specific circumstances where application of this policy

will not apply, i.e., when an accounts receivable would be recognized even though a

demand letter has not been issued or, vice versa, where sending a demand letter would

not necessarily require the recognition of an accounts receivable.

• Accounts Receivables Due to Unfiled Cost Reports; and

• Consent Settlement Agreements.

These two circumstances are not all inclusive. If there is a specific situation that is not

described above, Medicare contractors should consult CMS for further guidance.

Accounts Receivable Due to Unfiled Cost Reports

Through analysis of Federal financial accounting standards and regulations, CMS

believes that recognition of a receivable prior to the filing of a cost report significantly

overstates net assets and ultimately net position. Furthermore, CMS believes that current

accounting procedures for recognizing accounts receivables due to a provider's failure to

file a cost report timely does not adhere to the accounting principles articulated in

Statement of Federal Financial Accounting Standards Number (SFFAS No.) 1 -

Accounting for Selected Assets and Liabilities, SFFAS No. 5 - Accounting for Liabilities

of the Federal Government, and SFFAS No. 7 - Nonexchange Revenue (Measurement &

Recognition), as well as Generally Accepted Accounting Principles (GAAP) of

conservatism and matching. Based on this analysis, the failure to file a cost report does

not complete the earnings process, and accordingly, no accounting event has occurred. As

such, the recognition of a receivable prior to the completion of the earnings process

(receipt or filing of a cost report) is poor matching. In addition, SFFAS Nos. 5 and 7

states that liabilities and nonexchange revenue should only be recognized when a past

event or exchange transaction has occurred, use of resources (inflow or outflow) are

probable and can be reasonably estimated or measured. Without the actual submission of

the cost report, CMS cannot reasonably estimate the amount of the receivable, as required

by SFFAS No. 1.

Therefore, unfiled cost report receivables will no longer be reported on the Form CMS-

H;750 Contractor Financial Report and Form CMS-H751, Status of Accounts Receivable

Report. CMS's current financial reporting instructions require Medicare fiscal

intermediaries to place providers who have not filed a timely cost report on 100 percent

penalty withhold, and recognize and demand a receivable based on the value of all

interim payments made to the provider in, and subsequent to, the cost reporting period,

without considering the value of actual services performed during that period. Federal

debt collection regulations allow CMS to demand repayment of the full amount paid to a

provider during a cost reporting period if a provider fails to comply with the requirements

to file a cost report in a timely manner. However, for financial reporting purposes, CMS

recognizes that the entire amount being demanded does not truly represent funds owed to

CMS. Since the provider has performed services, the true economic value of the

receivable demanded is overstated. In fact, CMS may have a liability upon settlement.

Cost report receivables should not be accrued until related cost reports are received, and

CMS can support the existence of a receivable through provider agreement, such as filing

a cost report, filing a cost report without sufficient payment, or a court ruling in favor of

CMS.

As a result, for financial reporting purposes, CMS is revising its policy for reporting

unfiled cost reports as an accounts receivable, unless the fiscal intermediary is aware of a

unique situation where recording an accounts receivable would be appropriate. Fiscal

intermediaries will continue to reflect an overpayment on the Provider Overpayment

Reporting (POR) system based on the value of all interim payments made to the provider

in, and subsequent to, the cost reporting period.

However, effective for the March 31, 2001 reporting period, accounts receivable for

unfiled cost reports will no longer be reported on Form CMS-H750 and Form CMS-

H751. CMS will continue to monitor and manage the status of unfiled cost reports

through the POR system, without overstating accounts receivable on the financial

statements. All other processes related to unfiled cost reports remain unchanged. Fiscal

intermediaries must continue to: (1) Place the providers on 100 percent penalty withhold,

(2) Demand the submission of delinquent cost reports from providers based on current

debt collection regulations, and (3) Refer the debt in accordance with the requirements of

the Debt Collection Improvement Act of 1996.

Fiscal intermediaries must ensure that Line 7, Ending Balance, of Form CMS-H751 does

not include any receivables due to unfiled cost reports. If accounts receivables due to

unfiled cost reports were included in the December 31, 2000 Form CMS-H751, these

receivables must be zeroed out by recording a downward adjustment for these amounts

on Line 5a, Reclassified/Adjustments, on Form CMS-H751 and provide a specific

footnote in the remarks section of the report identifying the nature and amount of the

adjustment.

Consent Settlement Agreements Resulting from Comprehensive Medical Reviews

(CMRs)

Typically, postpayment reviews of claims are conducted for a specified

provider/physician/supplier or group in order to evaluate their billing patterns over a

selected period of time. CMRs are performed to determine whether a suspected

provider/physician/supplier or groups are providing noncovered or medically unnecessary

services. A CMR is a thorough analysis of a sample of processed claims and all pertinent

data (such as medical record, beneficiary payment history, etc.) for selected

providers/physicians/suppliers for a specified time period. CMRs are usually targeted to

providers/physicians/suppliers who have demonstrated aberrant billing and/or practice

patterns.

If a CMR determines that an incorrect amount of money has been paid to the

provider/physician/supplier, the contractor must assess an overpayment based on

instructions outlined in the contractor manuals. Per Chapter 3, Overpayments, there are

three different types of overpayments that result from a CMR: Actual overpayment,

projected overpayment, and limited projected overpayment. The type of sample used

during a CMR determines how Medicare contractors are to assess and demand money

back from the provider or physician/supplier who was overpaid.

An actual overpayment is, for the actual claims reviewed, the sum of the payments (based

on the amount paid to the provider/physician/supplier and Medicare approved amounts)

made to a provider/physician/supplier for services which were determined to be not

medically necessary or incorrectly billed. If an actual overpayment is assessed, Medicare

contractors must send a demand letter for the amount of the actual overpayment and

recognize an accounts receivable on Line 2a, New Receivables, of Form CMS-H751.

A projected overpayment is defined as the numeric overpayment obtained by projecting

an overpayment from a statistically valid random sample (SVRS) to all similar claims in

the universe under review. Medicare contractors must notify the provider or

physician/supplier of the overpayment, and refer the case to the Medicare contractor's

overpayment staff to demand and collect the overpayment. Medicare contractors must

send a demand letter for the amount of the projected overpayment and recognize an

accounts receivable on Line 2a, New Receivables, of Form CMS-H751.

A limited projected overpayment is the numeric overpayment obtained by projecting an

overpayment from a limited sample or limited SVRS subsample to all similar claims in

the universe under review. If this type of overpayment is assessed, Medicare contractors

have three overpayment assessment options. The Medicare contractor can assess an

actual overpayment; a projected overpayment based on a SVRS by performing an

expanded CMR; or can offer the provider or physician/supplier a consent settlement

based on the potential projected overpayment amount. Again, if an actual or project

overpayment is assessed, Medicare contractors must send a demand letter, and recognize

an accounts receivable on Line 2a, New Receivables, of Form CMS-H751.

If a consent settlement is offered to the debtor, the consent settlement document must

carefully explain what rights a debtor waives by accepting the consent settlement. It must

contain a binding statement that a debtor agrees to waive any rights to appeal the decision

regarding the potential overpayment determination. If this option is used, the Medicare

contractors must not recognize an account receivable until a consent settlement is signed

and agreed to by the debtor and CMS.

400.22 - Exhibit 22 - Accounts Receivable Trending Analysis Procedures

(Rev. 120, Issued: 04-27-07; Effective: 07-01-07; Implementation: 07-02-07)

The Centers for Medicare & Medicaid Services (CMS) utilizes contractors to manage and

administer the fee-for-service portion of the Medicare program. Medicare contractor

financial reports provide a method of reporting financial activities by the contractors as

required by the Chief Financial Officers (CFO) Act of 1990. The Medicare contractors

are required to maintain accounting records in accordance with federal government

accounting principles and applicable government laws and regulations and are required to

use double entry bookkeeping and accrual basis accounting. The due date for Medicare

contractors using the Healthcare Intergraded General Ledger Accounting System

(HIGLAS) Financial Statements, is seven calendar days after the close of the period and

twenty-one calendar days for Medicare contractors using the Contractor Administrative

and Financial Management (CAFM) system. If the date occurs on a holiday or a

weekend, the report is due the following Federal workday. These dates are subject to

change during the accelerated reporting periods. The major financial reports in HIGLAS

are the Balance Sheet, the Income Statement, Summary 2 Trial Balance, and the CMS

Report on Receivables Due From the Public (CMS TROR). The financial reports in

CAFM consist of the Statement of Financial Position (Form CMS-750) and Status of

Accounts Receivable (Form CMS-751). The system accumulates and reports by fund, as

there are separate reports for Part A Hospital Insurance (HI) trust fund, Part B

Supplementary Medical Insurance (SMI) trust fund, and the general fund (Interest). The

accounts receivable activity is reported for the fiscal year-to-date for the period of the

report. These reports include Accounts Receivable (AR) activity for Medicare Secondary

Payer (MSP) and non Medicare Secondary Payer (non-MSP) accounts.

Accounts receivable represent amounts owed by health care providers, insurers, third

party administrators, beneficiaries, employers, and other government agencies. Medicare

accounts receivable is comprised of various components with the balance derived from

MSP and non-MSP receivables, as well as miscellaneous amounts owed the program

from various sources. The Financial Statements include receivable balances consisting

of, or are due to cost report settlements, claims accounts receivable, periodic interim

payments (PIP) and other overpayments. The detailed activity for these components are

included in the 751 (CAFM) and TROR. Also, include on The Financial Statements HI

and SMI balances consisting of receivables specific to Data Match, non-Data Match,

liability (including workers compensation (WC), auto, no-fault) and MSP beneficiary

debts. The detailed activity for the MSP components is included in the M751 and/or

CMS TROR.

Medicare contractors must maintain and make available lead schedules and detailed

documentation to support all amounts reported.

Objective

To ensure that accounts receivable balances reported are reasonable, Medicare

contractors are required to perform trending procedures. Trending procedures can be

used as an important tool to identify potential errors, system weaknesses, or inappropriate

patterns of accounts receivable accumulation, collections, transfers or write-

offs. Trending procedures involve comparisons of recorded amounts to expectations

developed by the Medicare contractors. To properly apply trending procedures, it is

necessary to take the following steps:

Compare Current Year Amounts with Comparative Financial Data

In comparing current-period financial results with prior-period financial results, there is

an implied assumption that the volume of activity in the two periods is comparable. If

there has been a substantial change in volume, it is necessary to take this change into

account and to quantify the change, when making the comparisons. For example, if a

contractor's Accounts Receivable balance has increased by 10 percent, it is necessary to

determine and document the reason for the increase. The increase may be the result of

transitions of providers, new legislation, etc.

Understand Identified Variances and Document the Results

Medicare contractors must identify and provide an explanation for variances that meets

the thresholds outlined in these procedures. Typically, this will be accomplished

primarily through inquiry of operations personnel in the Audit and Reimbursement, MSP,

Medical Review, and other areas that report and track accounts receivable balances. If an

explanation does not adequately describe the variance, the Medicare contractors must

perform additional procedures such as review of detail transactions to identify the

underlying cause(s) of any unusual changes.

The causes for the variances should be quantified. For example, if the change was

mainly attributable to a contractor transition, then the total amount of receivables

transitioned should be identified and included in the Medicare contractors' work papers.

Methodology

Trending & Comparative Analysis for Accounts Receivables

The primary emphasis for performing trend analysis is focusing on the change in the

ending principal accounts receivable balance. The ending principal accounts receivable

balance is comprised of non-MSP and MSP accounts receivables. For FIs, the non-MSP

overpayment sections consist of four major components (cost report settlements, PIP,

claims accounts receivable, and credit balances). For Carriers, the non-MSP

overpayment section consists of two main areas: 1) amounts owed from beneficiaries and

2) amounts owed from physicians/suppliers.

These two areas consist of two major components (claims accounts receivable and credit

balances). For both FI’s and Carriers, the MSP section consists of three major

components (Data Match, non-Data Match, and liability (including WC, auto, no-fault)).

In order to properly identify and understand variances, an analysis must be performed at

the component level. Although the instructions specify ending principal accounts

receivable balance, Medicare contractors must have available an explanation of any

significant change in the ending interest accounts receivable balance and any other

sections on the CMS-750/751 and the TROR meeting these thresholds. The

explanation should be available for review by the CMS, Office of the Inspector

General, General Accounting Office and /or other related parties.

Prior to the certification of the CMS-750/751 and/or the CMS TROR, Balance Sheet and

Income Statement, each Medicare contractor must perform the following steps on a

quarterly basis. The CFO for Medicare Operations' certification of these reports is

indicative that trending procedures have been performed.

HIGLAS Financial Reports

HIGLAS Medicare contractor shall use the following HIGLAS reports to perform the

quarterly accounts receivable trend analysis.

• CMS TROR Reconciliation Worksheet (HIGLAS I) -The HIGLAS Medicare

contractor prepared excel spreadsheet.

• CMS Beginning Balance Report – This report identifies the beginning balances

by MSP/non-MSP category by fund (See Attachment BBrpt).

• CMS Transaction Register - This report identifies the new established receivables

by MSP/non-MSP category by fund (See Attachment TALn2rpt).

• CMS Transaction Register Report Line 3 – This report is the cumulated accrued

interest for the reporting period (See Attachment TALn3rpt).

• CMS Adjustment Register - The Line 3 report is the cumulated adjustments for

interest. The Line 5 & 6 report is the cumulated adjustments for principal (See

Attachments AdjLn3rpt and AdjLn5&6rpt).

• CMS AR Overpayment Report - This report is receivables balance by MSP/non-

MSP components (See Attachment AROvrrpt).

• CMS Applied Collection Register – This report identifies the cash receipts by

MSP/non-MSP category by fund (See Attachment AppCollrpt).

CMS TROR Detail Reconciliation (HIGLAS I)

Step (1)

Use the CMS TROR(s) to populate the Non-Federal and/or Federal sections

(Columns K and L) of the HIGLAS I worksheet.

Step (2)

Use the CMS Beginning Balance Report to populate Line 1 (Beginning FY

Balance) for HI-Fund 050961 (MSP/Non-MSP) Columns (Columns E and F),

SMI-Fund 050960 (MSP/Non-MSP) Columns (Columns G and H) and Interest-

Fund 050720 (MSP/Non-MSP) Columns (Columns I and J) of the HIGLAS I

worksheet (Non-Federal and/or Federal sections).

Step (3)

Use the CMS Transaction Register to populate Line 2 (New Receivables) for HI-

Fund 050961 (MSP/Non-MSP) Columns and SMI-Fund 050960 (MSP/Non-

MSP) Columns of the HIGLAS I worksheet (Non-Federal and/or Federal

sections).

Step (4)

Use the CMS Transaction Register (support Line 3) to populate Line 3a (Accruals

(+) New Interest Receivables) for the Interest-Fund 050720 (MSP/Non-MSP)

Columns of the HIGLAS I worksheet (Non-Federal and/or Federal sections)

Step (5)

Use the CMS Adjustment Register (support Line 3) to populate Line 3b (Accruals

(+) Interest Adjustments) for Interest-Fund 050720 (MSP/Non-MSP) Columns of

the HIGLAS I worksheet (Non-Federal and/or Federal sections).

Step (6)

Use the CMS Applied Collections Register to populate (Line 4, Collections On

Receivables), Line 4A (At Agency-Cash/Checks-Offsets), for HI-Fund 050961

(MSP/Non-MSP) Columns, SMI-Fund 050960 (MSP/Non-MSP) Columns and

Interest-Fund 050720 (MSP/Non-MSP) Columns of the HIGLAS I worksheet

(Non-Federal and/or Federal sections).

Step (7)

Use the CMS Adjustment Register to populate Line 5a (Reclassified/Adjusted

Amounts) for HI-Fund 050961 (MSP/Non-MSP) Columns, SMI-Fund 050960

(MSP/Non-MSP) Columns and Interest-Fund (MSP/Non-MSP) Columns of the

HIGLAS I worksheet (Non-Federal and/or Federal sections).

Step (8)

Use the CMS Adjustment Register to populate (Line 6, Amounts Written-Off))

Line 6A (Currently Not Collectible) and Line 6B (Written-Off and Closed) for

HI-Fund 050961 (MSP/Non-MSP) Columns, SMI-Fund 050960 (MSP/Non-

MSP) Columns and Interest-Fund 050720 (MSP/Non-MSP) Columns of the

HIGLAS I worksheet (Non-Federal and/or Federal sections). Note: Line 6 is the

sum of Line 6A plus Line 6B.

Step (9)

Compare the Line by Line activity of the Total Detail Activity Report (Column

B) to the Line by Line activity of the Total CMS TROR (Column A). The Total

Detail Activity Report is the sum of the HI-Fund Columns, SMI-Fund Columns

and the Interest-Fund Columns (Columns E through J). The Total CMS TROR

Column is the sum of the Non-Federal/Federal CMS TROR (Columns K and L).

The Medicare contractor must provide an explanation for variances identified in

Column C, when the total variance (Line 7, Column C) is more then +/- 10

percent of Line 7, Ending Balance of the CMS TROR (Column A).

Step (10)

Sum the amounts reported in Step 1 through Step 8 for HI-Fund 050961

(MSP/Non-MSP) Columns, SMI-Fund 050960 (MSP/Non-MSP) Columns and

Interest-Fund 050720 (MSP/Non-MSP) Columns of the HIGLAS I worksheet.

The total of the sum of the Columns shall equal the amount reported on Line 7,

Ending Balance of the CMS TROR (Column A), Detail Activity Report (Column

B) and the Summary 2 Trial Balance (HI-Fund 050961, SGL 131002, SMI-Fund

050960, SGL 131002 and Interest-Fund 050720 SGL 134004).

Step (11)

Use the CMS AR Overpayment Register to populate the AR Overpayments

Report section (component breakout) of the HIGLAS I worksheet for HI-Fund

050961 (MSP/Non-MSP) Columns, SMI-Fund 050960 (MSP/Non-MSP)

Columns and Interest-Fund 050720 (MSP/Non-MSP) Columns.

NOTE: HIGLAS Medicare contractors reporting Non-Federal/Federal accounts

receivable amounts shall repeat Step 1 through Step 11 for both types of debtors. The

HIGLAS contractor shall sum the Non-Federal/Federal activity and report the sum of the

amounts in the appropriate comparative Attachment (Attachments I, I-A, II, II-A, IV, IV-

A, V & V-A.

Accounts Receivable Trend Analysis Attachments (CAFM and/or HIGLAS)

Step (1)

Compare the current quarter Non-MSP overpayments section of Form(s) CMS-

H750 and/or CMS AR Overpayments section of the HIGLAS I worksheet

Columns F and H (FIs/Carriers) component line items to the same component line

items in the prior quarter (i.e. 06/30/02 versus 03/31/02) and the current quarter to

the prior year's quarter (i.e. 06/30/02 versus 06/30/01). Calculate the dollar and

percentage difference for each component line item. (See Attachments I & I-A for

the required format.)

NOTE: For FIs, due to the seasonal nature of the cost report settlements, PIP, etc.,

independent quarter activity in the current year should not be the only analysis compared

to the preceding quarter. Comparisons should always be performed from current period

year-to-date activity to prior period year-to-date activity for the same period of time (i.e.

06/30/02 versus 06/30/01).

Step (2)

Compare the current quarter MSP section of Form(s) CMS-H750 and/or CMS AR

Overpayments section of the HIGLAS I worksheet Columns E and G

(FIs/Carriers) component line items to the same component line items in the prior

quarter and prior year. Calculate the dollar and percentage difference for each

component line item. (See Attachments II & II-A for the required format.)

Step (3)

Verify that the dollar amount for each component line item is supported by lead

schedules (detailed documentation) and/or HIGLAS activity reports. Any errors

or misstatements identified as a result of this analysis must be corrected prior to

the submission of Forms CMS-750/751 and/or CMS TROR, Balance Sheet and

Income Statement.

Step (4)

The sum of the components for the Non-MSP overpayments sections (See

Attachments I & I-A) plus the sum of the components for the MSP sections (See

Attachments II & II-A) must equal the ending balances reported on Line 7, of

Form(s) CMS-H751A/B and/or detail report activity section of the HIGLAS I

worksheet Columns E, F, G, and H (FIs/Carriers). The sum of the components for

the Non-MSP overpayments sections must equal the ending balances reported on

Line 7, of Attachments IV and IV-A and/or detail report activity report section of

the HIGLAS I worksheet Columns F and H for the current and prior quarters. The

sum of the components for the MSP sections must equal the ending balances

reported on Line 7, of Form(s) CMS-M751 and/or detail report activity section of

the HIGLAS I worksheet Columns E and G (FIs/Carriers) (See Attachments V &

V-A) for the current and prior quarters.

Step (5)

Provide explanations for each component line item where the amount changed

meets the threshold of +/-15 percent and the amount changed is +/- 5 percent of

the components ending balance. (See Attachments I, I-A, II & II-A)

Supporting Analysis

Step (1)

Ensure the current year beginning balance is the same amount as the prior year's

ending balance and the beginning balance for the prior year's quarter is the same

as the beginning balance of the final quarterly report for that FY (i.e., 06/30/01

and 09/30/01). Additionally, for the second through fourth quarter periods, ensure

that the beginning balances are unchanged from the amount reported as the first

quarter beginning balances.

Note: In the first quarter following a contractor’s transition to HIGLAS the

beginning balance will not equal the previous quarters beginning balance and/or

the prior year beginning balance. The differences are related to the prior year PIP

accrual and/or transition clean up (e.g. approved write-offs of non-supported

debts, valid documented defense, etc.). Medicare contractors shall reconcile the

CAFM and HIGLAS beginning balances and provide an explanation for identified

variances.

Step (2)

Compare the current quarter Form(s) CMS-H/M751 and/or detail report section of

the HIGLAS I worksheet Columns E, F, G and H line items to the same line items

in the prior quarter and prior year. Calculate the dollar and percentage difference

for each line item for Section A of Forms CMS-H/M751. and/or detail report

section of the HIGLAS I worksheet Columns E, F, G and H (See Attachments IV,

IV-A, V & V-A)

NOTE: The Medicare contractors are not required to perform trending procedures or

provide variance explanations on the line items of Forms CMS-H/M751 and/or detail

report section of the HIGLAS I worksheet Columns E, F, G, and H. However, the above

steps should be used to assist the Medicare contractor in providing an explanation for the

variances identified in Attachments I, I-A, II & II-A.

Overall Summary

Step (1)

Document conclusions in a summary memorandum (See Attachment VI) to be

included with HIGLAS I worksheet, Attachments I, I-A, II, II-A, IV, IV-A, V &

V-A and submit to the CFO for Medicare Operations for sign off approval.

For example, the Medicare contractor must identify any external and/or internal

factors that attributed to the variances.

External factors might include (1) Medicare contractor transitions from the

Medicare program, (2) seasonal variances such as provider year-ends, (3) new

legislation impacting reimbursement policies, MSP policies, etc., (4) current

economic conditions (provider termination, bankruptcy, extended repayment

schedules, etc.).

Internal factors might include (1) turnover of key personnel, (2) changes in

accounting guidance or CMS priorities/initiatives, (3) reporting system

modifications, (4) number of contractor processing sites.

Step (2)

Medicare contractors shall submit a signed approved copy of the summary memorandum

(See Attachment VI). In addition, HIGLAS contractors shall submit the HIGLAS

Financial Reports, Attachments I, I-A, II, II-A, IV, IV-A, V & V-A, the CMS TROR

Reconciliation Worksheet (HIGLAS I), and the CMS HIGLAS Contractor Trend

Analysis Checklist (Attachment H-II), to the regional office for final approval.

Note: The summary memorandum (See Attachment VI) and the analysis schedules

(HIGLAS I, Attachments I, I-A, II, II-A, IV, IV-A, V & V-A) will be reviewed and

approved by the CFO for Medicare Operations and the region's Associate Regional

Administrator (ARA). The ARA will review the trend analysis submitted by the

Medicare contractor and either approve or request additional explanation and/or

documentation. The ARA must notify the Medicare contractor by phone, email or fax no

later than February 15, May 15, August 15, and November 8 as to the

approval/disapproval. The ARA must allow the Medicare contractor no less than two

days (upon receipt of the request) to provide the additional documentation needed to

support their variance. Upon receiving the request, the Medicare contractor has no more

than four days to provide the additional documentation to the ARA. If the ARA’s request

for any additional information can not be submitted by the due dates, the ARA must

notify the CO Division of Financial Reporting and Policy (DFRP) (by phone, email or

fax) and provide a date when the Medicare contractor’s trend analysis will be forwarded

to the CO. Upon receipt of notification that the CO review process is completed, the

ARA will submit a signed approved copy of the summary memorandum to the Medicare

contractors and CO, DFRP.

III. Due Date

The analysis must be submitted to each contractor's respective regional office on

February 8, May 8, August 8, and November 1 (The third/fourth quarter due dates may

change due to the accelerated time periods. Medicare contractors will be notified of these

changes by a Joint Signature Memorandum (JSM)). The ARA must review the Medicare

contractors' submissions and forward them to CO by February 15, May 15, August 15,

and November 8. If that date occurs on a holiday or a weekend, the report is due the

following Federal workday. The Medicare contractor and the ARA may email or fax the

analysis by the due dates and immediately follow up with a hard copy.

NOTE: The ARA will submit a copy of the Medicare contractors' summary

memorandums and the analysis schedules to the CO/DFRP. The CO will notify the RO

by email upon receipt of the Medicare contractors’ trend analysis. The CO will review

the Medicare contractors’ analysis schedules and may request additional documentation.

The CO is not responsible for approving or denying the Medicare contractors' trend

analysis. If additional documentation is needed, the CO will notify the RO by email

within 14 days upon receipt of the Medicare contractors’ analysis schedules. Upon the

completion of the CO’s review, CO will notify the RO by email that no additional

information is needed and the CO’s review process is completed. The ARA will sign and

approve the Medicare contractors’ summary memorandum, and submit a signed approved

copy to the CO, DFRP and to the Medicare contractors.

CMS HIGLAS TROR Reconciliation Worksheet

HIGLAS I (Non-Federal/Federal)

Part I - Status of Receivables

HIGLAS I

Section A (Col. A) (Col. B) (Col. C) (Col. D)

(Col. E) (Col. F) (Col. G) (Col. H) (Col. I) (Col. J) (Col. K) (Col. L)

(Total Non-Federal/Federal) (Col. K + L) (Col. E+F+G+H+I+J)

List of Detailed Reports

Receivables and Collections TROR Total Detail

Report Activity Registers Variance HIGLAS Source MSP Non-MSP MSP Non-MSP MSP Non-MSP Non-Fed Fed

(1) Beginning FY Balance 2,888 76,000,000 76,000,000

Beginning Balance Rpt

14,000,000 25,000,000 10,000,000 25,000,000 1,000,000 1,000,000 69,750,000 6,250,000

(2) New Receivables (+) 24,632 200,000,000 200,000,000

Transaction Register

35,000,000 100,000,000 15,000,000 50,000,000 0 0 187,500,000 12,500,000

(3) Accruals (+) (New Interest Receivables) 1,576,728 1,576,728 76,728 1,500,000 1,557,546 19,182

Transaction Register (support line 3) 500,000 500,000

Transaction Register

0 500,000 500,000 0

CMS Adjustment Register (support line 3) 1,076,728 1,076,728

Adjustment Register

76,728 1,000,000 1,057,546 19,182

(4) Collections on Receivables (-) (120,815,566) (120,815,566)

0 (4,081,254) (94,709,110) (3,000,000) (17,925,202) (100,000) (1,000,000) (119,020,253) (1,795,314)

(A) At Agency-Cash/Checks (9,231,254) (9,231,254)

Applied Collections

(4,081,254) (1,000,000) (3,000,000) (1,000,000) (100,000) (50,000) (7,435,941) (1,795,314)

-Offsets (111,584,312) (111,584,312)

Applied Collections

(93,709,110) (16,925,202) (950,000) (111,584,312) 0

(B) At Third Party 0 0

(D) Other - Must footnote 0 0

(5) Adjustments 1,093 (5,774,224) (5,774,224)

Adjustment Register

(975,538) (4,042,637) (296,554) (226,534) (59,757) (173,204) (5,441,262) (332,962)

(A) Reclassified/Adjusted Amounts (+ or -) 1,093 (5,774,224) (5,774,224) (975,538) (4,042,637) (296,554) (226,534) (59,757) (173,204) (5,441,262) (332,962)

(B) Adjustments Due to Sale of Assets (+ or -) 0 0

(6) Amounts Written-Off (-) 152 (1,940,261) (1,940,261)

0 (220,610) (1,303,694) (50,464) (222,153) (23,149) (120,191) (1,866,706) (73,555)

(A) Currently Not Collectible (-) 146 (1,862,750) (1,862,750)

Adjustment Register

(209,275) (1,252,857) (37,313) (222,153) (22,991) (118,161) (1,795,355) (67,395)

(B) Written-Off and Closed Out (-) 6 (77,511) (77,511)

Adjustment Register

(11,335) (50,837) (13,151) 0 (158) (2,030) (71,351) (6,161)

(7) Ending Balance (TROR/Activity Registers) 2,889

149,046,677 149,046,677 0

(x)

43,722,598 24,944,559 21,652,982 56,626,111 893,822 1,206,605 132,479,326 16,567,351

AR Overpayments Report: HIGLAS Source MSP Non-MSP MSP Non-MSP MSP Non-MSP Total Total

Cost Report Settlements 19,800,000 19,800,000

AR Overpayment Rpt

9,000,000 10,000,000 800,000 19,800,000 0

Claims Accounts Receivable 49,308,754 49,308,754

AR Overpayment Rpt

12,000,000 37,308,754 0 49,308,754 0

Credit Balances 303,621 303,621

AR Overpayment Rpt

303,621 0 0 303,621 0

Other 13,359,902 13,359,902

AR Overpayment Rpt

5,000,000 7,958,297 401,605 13,359,902 0

Physician/Supplier 0 0 0 0

Beneficiary 0 0 0 0

GHP(Data/non-Data Match) 22,322,019 22,322,019

AR Overpayment Rpt

18,822,019 3,000,000 500,000 16,741,514 5,580,505

MSP Prov/Phys/Supp/Bene 0 0 0 0

MSP Beneficiary (Liability) 40,210,579 40,210,579

AR Overpayment Rpt

22,900,000 17,010,579 300,000 30,157,934 10,052,645

Other MSP (Liability) 3,741,803 3,741,803 2,000,000 1,642,982 98,821 2,806,352 935,451

Total Overpayment Reports 149,046,678 149,046,678 43,722,019 26,303,621 21,653,561 55,267,051 898,821 1,201,605 132,478,078 16,568,600

Difference (TROR/Activity Registers vs. Ovrpymnt Rpt) (1)

(a)

(1)

(b)

579 (1,359,062)

(579) 1,359,060 (4,999) 5,000 1,248 (1,249)

(x) = variance between the detail activity registers vs. the TROR

(a) = variance between the TROR vs.overpayments reports

(b) = variance between the detail activity registers vs. overpayments reports

Note: Contractors are required to provide variance explanations for the amounts reported on the AR Overpayments Report

CMS TROR

Interest - Fund 050720

HI - Fund 050961

SMI - Fund 050960

CMS Beginning Balance Report

Attachment BBrpt

Beginning Balance Report Report Date: 06-JAN-06 01:06 PM

As of Date: 30-SEP-2005 Page: X of X

ORGANIZATION: Contractor ABC User Name: GDH0

As of Date: 30-SEP-05

Workload Low: Contractor #

Workload High: Contractor #

Transaction Type Low:

Transaction Type High:

AR Number Low:

AR Number High:

Customer Number Low:

Customer Number High:

Customer Profile Class Low:

Customer Profile Class High:

Include CNC Receivables/Debit Memos: Y

Show Invoices with Negative Fund Level Balances Only?:

Open/Closed/Both:

Type of Receivable: A

Customer Class: NONFEDERAL

Summary Only: Y

Totals for all Workloads

HI Fund SMI Fund GEN Fund Total

------------------------- ------------------------- ------------------------- -------------------------

MSP Balances 14,000,000.00 10,000,000.00 1,000,000.00 25,000,000.00

NonMSP Balances 25,000,000.00 25,000,000.00 1,000,000.00 56,000,000.00

------------------------- ------------------------- ------------------------- -------------------------

Total 39,000,000.00 35,000,000.00 2,000,000.00 76,000,000.00

CMS Transaction Register

Attachment TALn2rpt

Transaction Register as of 31-DEC-05

Current Date 06-JAN-2006 01:08:36

Request ID 123456

Support TROR Line2 Y

Fiscal Year 2006

Workload Id Low Contractor ABC

Workload Id High Contractor ABC

Quarter

As of Date 31-DEC-05

Type Of Receivable A

Customer Class NONFEDERAL

GL Date Low

GL Date High

Invoice Date Low

Invoice Date High

Transaction Type Low

Transaction Type High

Invoice Class

Co. Segment Low

Co. Segment High

CMS SET OF BOOKS

Invoice Currency : USD

No. of Lines 24632

Summary Information :

----------------------

FUND YEAR MSP NON MSP Total

050960 XXXX 0.00 50,000,000.00 50,000,000.00

XXXX 15,000,000.00 0.00 15,000,000.00

--------------------------- ---------------------------- ----------------------------

Fund Total 15,000,000.00 50,000,000.00 65,000,000.00

050961 XXXX 0.00 100,000,000.00 100,000,000.00

XXXX 35,000,000.00 0.00 35,000,000.00

--------------------------- ---------------------------- ----------------------------

Fund Total 35,000,000.00 100,000,000.00 135,000,000.00

---------------------------- --------------------------- ---------------------------

Report Total 50,000,000.00 150,000,000.00 200,000,000.00

CMS Transaction Register

Attachment TALn3rpt

Transaction Register as of 31-DEC-05

Current Date 06-JAN-2006 01:09:15

Request ID 417123

Support TROR Line2 N

Fiscal Year 2006

Workload Id Low

Workload Id High

Quarter

As of Date 31-DEC-05

Type Of Receivable A

Customer Class NONFEDERAL

GL Date Low

GL Date High

Invoice Date Low

Invoice Date High

Transaction Type Low DM-INTEREST

Transaction Type High DM-LATE FEE INTEREST

Invoice Class

Co. Segment Low

Co. Segment High

CMS SET OF BOOKS

Invoice Currency : USD

No. of Lines 375

Summary Information :

----------------------

FUND YEAR MSP NON MSP Total

050720 XXXX 0.00 500,000.00 500,000.00

--------------------------- ---------------------------- ----------------------------

Fund Total 0.00 500,000.00 500,000.00

---------------------------- --------------------------- ---------------------------

Report Total 0.00 500,000.00 500,000.00

CMS Adjustment Register

Attachment AdjLn3rpt

Adjustment Register as of 31-DEC-05

Report Date: 06-JAN-06 13:09:50

Page 1 / 2Request ID 734123

Summary Report Y

Fiscal Year 2006

Quarter Number

As of Date 31-DEC-05

Type Of Receivable Administrative Receivables

Customer Class NONFEDERAL

Receivable Activity From

Receivable Activity To

Include Line 3 Only Y

TROR SUMMARY INFORMATION

------------------------------

FUND MSP NON MSP TOTAL COUNT

GEN -050720XXXX0D00 76,727.70 1,000,000.00 1,076,727.70 1414

-------------------- -------------------- --------------------- --------------

REPORT TOTAL 76,727.70 1,000,000.00 1,076,727.70 1414

CMS Adjustment Register

Attachment AdjLn5&6rpt

Adjustment Register as of 31-DEC-05

Report Date: 06-JAN-06 13:09:50

Page 1 / 2

Request ID 317123

Summary Report Y

Fiscal Year 2006

Quarter Number

As of Date 31-DEC-05

Type Of Receivable Administrative Receivables

Customer Class NONFEDERAL

Receivable Activity From

Receivable Activity To

Include Line 3 Only N

TROR SUMMARY INFORMATION

------------------------------

FUND MSP NON MSP TOTAL COUNT

GEN -050720XXXX0D00 (59,756.87) (173,204.12) (232,960.99) 342

HI -050961XXXX0DC0 (975,538.15) (4,042,636.65) (5,018,174.80) 215

SMI -050960XXXX0DC0 (296,554.15) (226,533.54) (523,087.69) 272

-------------------- -------------------- --------------------- --------------

REPORT TOTAL (1,331,849.17) (4,442,374.31) (5,774,223.48) 829

FUND MSP NON MSP TOTAL COUNT

GEN -050720XXXX0D00 (22,990.98) (118,160.76) (141,151.74) 65

HI -050961XXXX0DC0 (209,274.75) (1,252,856.76) (1,462,131.51) 38

SMI -050960XXXX0DC0 (37,313.17) (222,153.20) (259,466.37) 39

-------------------- -------------------- --------------------- --------------

REPORT TOTAL (269,578.90) (1,593,170.72) (1,862,749.62) 142

FUND MSP NON MSP TOTAL COUNT

GEN -050720XXXX0D00 (158.36) (2,030.22) (2,188.58) 3

HI -050961XXXX0DC0 (11,334.88) (50,837.02) (62,171.90) 2

SMI -050960XXXX0DC0 (13,151.05) 0.25 (13,151.30) 2

-------------------- -------------------- --------------------- --------------

REPORT TOTAL (24,644.29) (52,867.49) (77,511.78) 7

CMS AR Overpayment Report

Attachment AROvrrpt

AR Overpayment Report as of 31-DEC-05

Report Date: 06-JAN-06 12:30:58

Page 1 / 3

Request ID: 476123

Workload Low..................................:

Workload High.................................:

Comparative Summary(Yes/No)...................: N

As of Date1 Summary Only(Yes/No)..............: Y

As of Date1...................................: 31-DEC-05

As of Date2(Comparative)......................:

Invoice Class.................................:

Customer Class................................: NONFEDERAL

Transaction Type Low..........................:

Transaction Type High.........................:

Co. Segment Low...............................:

Co. Segment High..............................:

SUMMARY OF OVERPAYMENTS AS OF 31-DEC-05

------------------------------------------------

MSP OVERPAYMENT HI -050961 SMI-050960 INT-050720 TOTAL

------------------------------------------------------------------------------------------------------------------------------------------

BENE-LIABILITY 22,900,000.00 17,010,579.00 300,000.00 40,210,579.00

GROUP HEALTH PLAN 18,822,019.00 3,000,000.00 500,000.00 22,322,019.00

MSP PROV/PHY/SUPP/BENE 0.00 0.00 0.00 0.00

OTHER-LIABILITY 2,000,000.00 1,642,982.00 98,821.00 3,741,803.00

------------------------ ----------------------- ---------------------- ----------------------

MSP TOTAL 43,722,019.00 21,653,561.00 898,821.00 66,274,401.00

NON MSP OVERPAYMENT HI -050961 SMI-050960 INT-050720 TOTAL

------------------------------------------------------------------------------------------------------------------------------------------

BENEFICIARY 0.00 0.00 0.00 0.00

CLAIMS ACCOUNT RECEIVABLE 12,000,000.00 37,308,754.00 0.00 49,308,754.00

COST REPORT SETTLEMENT 9,000,000.00 10,000,000.00 800,000.00 19,800,000.00

CREDIT BALANCES 303,621.00 0.00 0.00 303,621.00

OTHER 5,000,000.00 7,958,297.00 401,605.00 13,359,902.00

PIP ACCRUAL 0.00 0.00 0.00 0.00

------------------------ ----------------------- ---------------------- ----------------------

NON MSP TOTAL 26,303,621.00 55,267,051.00 1,201,605.00 82,772,277.00

------------------------- ---------------------- ---------------------- ----------------------

MSP AND NON-MSP TOTAL 70,025,640.00 76,920,612.00 2,100,426.00 149,046,678.00

====================== ==================== =================== ==================

CMS Applied Collection Register

Attachment AppCollrpt

CMS APPLIED COLLECTIONS REGISTER As of 31-DEC-05

Report Date: 06-JAN-06 01:10 PM

Page 2 of 8

Request ID: 422123

REPORT PARAMETERS

Show Detail : N

Support TROR : Y

Fiscal Year : 2006

As of Date : 31-DEC-2005

GL Date From :

GL Date To :

Cash Receipt Batch Number From :

Cash Receipt Batch Number To :

Cash Receipt Number From :

Cash Receipt Number To :

Credit Memo Number From :

Credit Memo Number To :

Invoice/Debit Memo Number From :

Invoice/Debit Memo Number To :

Customer Name From :

Customer Name To :

Workload ID From : Contractor #

Workload ID To : Contractor #

Type of Receivable : A

Customer Class : NONFEDERAL

TRENDING SUMMARY FOR ALL WORKLOADS AMOUNT SUBTOTAL/TOTAL

PRINCIPAL

GEN Non-MSP OFFSET

OTHER 8,633.00

Subtotal OFFSET 8,633.00

Total GEN Non-MSP 8,633.00

Total GEN Collections 8,633.00

HI MSP CASH

INSURER 31,254.00

EMPLOYER 150,000.00

BENEFICIARY 3,900,000.00

Subtotal CASH 4,081,254.00

Total HI MSP 4,081,254.00

Non-MSP 4A

PROVIDER -3,000,000.00

Subtotal 4A -3,000,000,00

CASH

PROVIDER 4,000,000.00

Subtotal CASH 4,000,000.00

OFFSET

PROVIDER 93,709,110.00

Subtotal OFFSET 93,709,110.00

Total HI Non-MSP 94,709,110.00

CMS Applied Collection Register

Attachment AppCollrpt

Total HI Collections 98,790,364.00

TRENDING SUMMARY FOR ALL WORKLOADS AMOUNT SUBTOTAL/TOTAL

SMI MSP CASH

EMPLOYER 100,000.00

BENEFICIARY 2,900,000.00

Subtotal CASH 3,000,000.00

Total SMI MSP 3,000,000.00

Non-MSP 4A

PROVIDER -1,000,000.00

Subtotal 4A -1,000,000.00

CASH

PROVIDER 2,000,000.00

Subtotal CASH 2,000,000.00

OFFSET

PROVIDER 16,925,202.00

Subtotal OFFSET 16,925,202.00

Total SMI Non-MSP 17,925,202.00

Total SMI Collections 20,925,202.00

Total Collections - PRINCIPAL $119,724,199.00

INTEREST

GEN MSP CASH

OTHER 100,000.00

Subtotal CASH 100,000.00

Total GEN MSP 100,000.00

Non-MSP CASH

OTHER 50,000.00

Subtotal CASH 50,000.00

OFFSET

OTHER 941,367.00

Subtotal OFFSET 941,367.00

Total GEN Non-MSP 991,367.00

Total GEN Collections 1,091,367.00

Total Collections - INTEREST $1,091,367.00

CMS Applied Collection Register

Attachment AppCollrpt

TOTAL COLLECTIONS - Principal and Interest By Debtor Type

OTHER 708,220.00

INSURER 12,003.00

EMPLOYER 240,073.00

ROVIDER 113,794,976.00

BENEFICIARY 6,060,294.00

--------------------

REPORT TOTAL $120,815,566.00

========================

CMS Medicare Accounts Receivable Non-MSP (Part A HI)

Contractor ABC

Attachment I

SOURCE: CMS AR Overpayment Report (HIGLAS I Worksheet)

SCOPE: If percentage change is greater than +/- 15% and amount change +/- 5 % of the combined component ending balances.

(A-B)

(C/B x 100%)

C D

12/31/2005 9/30/2005

$ Change % Change Note

Cost Report Settlements 14,000,000

17,000,000$

(3,000,000) -17.65% 1

Claims 12,000,000 13,000,000 (1,000,000) -7.69%

NER

PIP 0 0 0 0.00%

NER

Credit Balance 303,621 0

303,621 0.00%

NER

Other 0 0 0 0.00% NER

Total Non-MSP

26,303,621$ 30,000,000$

(3,696,379)$

-12.32%

Total TROR

24,944,560$

29,025,250

Variance (Over/Under Application) 1,359,061$

974,750$

5% of Combined Ending Balance

1,315,181

$ ($26,303,621 x 5%)

No Explanation Required (NER)

(1) Cost Report Settlements-The total variance for the Non-MSP (HI) balance for the current quarter reflects a decrease

of $3.7 million compared to the prior quarter. The bulk of this variance is a result of the change in Cost Report Settlements

a decrease of $3 million. The primary cause of this variance is due to the result of the larger hospitals with the potential

for large overpayments being settled in the last quarter of the year.

CMS Medicare Accounts Receivable Non-MSP (Part A HI)

Contractor ABC

Attachment I-A

SOURCE: CMS AR Overpayment Report (HIGLAS I Worksheet) & H750A

SCOPE: If percentage change is greater than +/- 15% and amount change +/- 5 % of the combined component ending balances.

(A-B) (C/B x 100%)

A B C D

12/31/2005 12/31/2004 $ Change % Change Note

Cost Report Settlements 14,000,000$ 13,000,951$ 999,049 7.68%

NER

Claims 12,000,000 13,000,000 (1,000,000) -7.69%

NER

PIP 0 14,000,000 (14,000,000) -100.00%

(4)

Credit Balance 303,621 0 303,621 0.00%

NER

Other 0 0 0 0.00% NER

Total Non-MSP 26,303,621$ 40,000,951$ (13,697,330)$

-34.24%

Total TROR 24,944,560$ 40,000,951$

Variance (Over/Under Application) 1,359,061$ -$

5% of Combined Ending Balance

1,315,181$ ($26,303,621 x 5%)

No Explanation Required (NER)

(4)

PIP Accrual - HIGLAS Medicare contractors are no longer required to report an estimate PIP accrual.

CMS Medicare Accounts Receivable MSP (Part A HI)

Contractor ABC

Attachment II

SOURCE: CMS AR Overpayment Report (HIGLAS I Worksheet)

SCOPE: If percentage change is greater than +/- 15% and amount change +/- 5 % of the combined component ending balances.

(A-B) (C/B x 100%)

A B C D

12/31/2005 9/30/2005 $ Change % Change Note

GHP(Data/non-Data Match)

18,822,019 23,050,000 (4,227,981) -18.34% (2)

MSP Provider/Physician/Supplier - - 0.00%

NER

MSP Beneficiary (Liability) 22,900,000 19,120,000 3,780,000 19.77% (3)

Other MSP (Liability) 2,000,000 - 2,000,000 0.00%

NER

Total MSP 43,722,019$ 42,170,000$ 1,552,019$

3.68%

Total TROR 43,722,598$ 41,317,525$

Variance (Over/Under Application) (579)$ 852,475$

5% of Combined Ending Balance

2,186,101$ ($43,722,019 x 5%)

No Explanation Required (NER)

(2) GHP-HIGLAS does not break down GHP between Data Match and Non-Data Match. GHP overall has

decreased by $4.2 million in comparison to the previous quarter. Non-Data Match receivables decreased by

$3 million, which reflects a significant decrease in the number of demands produced since the implementation of

ReMas during FY 2005.

CMS Medicare Accounts Receivable MSP (Part A HI)

Contractor ABC

Attachment II-A

SOURCE: CMS AR Overpayment Report (HIGLAS I Worksheet) & H750A

SCOPE: If percentage change is greater than +/- 15% and amount change +/- 5 % of the combined component ending balances.

(A-B)

(C/B x 100%)

A B

C D

12/31/2005

12/31/2004 $ Change

% Change

Note

GHP(Data/non-Data Match)

18,822,019

21,322,019

(2,500,000) -11.72%

(5)

MSP Provider/Physician/Supplier - - 0.00%

NER

MSP Beneficiary (Liability) 22,900,000

24,000,000

(1,100,000)

-4.58%

NER

Other MSP (Liability) 2,000,000

- 2,000,000 0.00%

NER

Total MSP 43,722,019$

45,322,019$ (1,600,000)

-3.53%

Total TROR

43,722,598

45,322,019

Variance (Over/Under Application)

(579)$

5% of Combined Ending Balance

2,186,101$

($43,722,019 x 5%)

No Explanation Required (NER)

(5)

Currently GHP-HIGLAS does not break out Data Match and Non-Data Match. GHP overall has

decreased by $2.5 million in comparison to the previous year. Since the implementation of ReMAS during

FY 2005, the Non-Data Match receivables reflects the significant decrease.

CMS Medicare Accounts Receivable Non-MSP (Part A HI)

Contractor ABC

Attachment IV

SOURCE: Detail Activity Reports (HIGLAS I Worksheet)

Part I - Status of Receivables

Section A

Receivables and Collections

12/31/2005 9/30/2005 $ Change %Change

(1) Beginning FY Balance 25,000,000 22,613,882 2,386,118 10.55%

(2) New Receivables (+)

100,000,000 91,601,759 8,398,241 9.17%

(3) Accruals (+) (New Interest Receivables)

(4) Collections on Receivables (-) (94,709,110) (81,520,069) (13,189,041) 16.18%

(A) At Agency-Cash/Checks (1,000,000) (42,043,277) 41,043,277 -97.62%

-Offsets

(93,709,110) (39,476,792) (54,232,318) 137.38%

(B) At Third Party

(D) Other - Must footnote

(5) Adjustments (4,042,637) (3,655,694) (386,943) 10.58%

(A) Reclassified/Adjusted Amounts (+ or -) (4,042,637) (3,655,694) (386,943) 10.58%

(B) Adjustments Due to Sale of Assets (+ or -)

(6) Amounts Written-Off (-) (1,303,694) (14,628) (1,289,066) 8812.32%

(A) Currently Not Collectible (-) (1,303,694) (14,628) (1,289,066) 8812.32%

(B) Written-Off and Closed Out (-) 0 0 0 0.00%

(7) Ending Balance (TROR/Activity Registers) 24,944,560 29,025,250

(4,080,690) -14.06%

Total Collections 94,709,110 81,520,069

Total Adjusted Receivables 119,653,670 110,545,319

Collection Percentage 79.15% 73.74%

HI - Fund 050961

CMS Medicare Accounts Receivable Non-MSP (Part A HI)

Contractor ABC

Attachment IV-A

SOURCE: Detail Activity Reports (HIGLAS I Worksheet), H751A & M751A

Part I - Status of Receivables

Section A

Receivables and Collections

12/31/2005 12/31/2004 $ Change %Change

(1) Beginning FY Balance 25,000,000 22,613,882 2,386,118 10.55%

(2) New Receivables (+)

100,000,000 90,976,509 9,023,491 9.92%

(3) Accruals (+) (New Interest Receivables) 14,000,000

(14,000,000)

(4) Collections on Receivables (-) (94,709,110) (83,384,118)

(11,324,992) 13.58%

(A) At Agency-Cash/Checks (1,000,000) (45,067,576) 44,067,576 -97.78%

-Offsets

(93,709,110) (38,316,542) (55,392,568) 144.57%

(B) At Third Party

(D) Other - Must footnote

(5) Adjustments (4,042,637) (4,155,694) 113,057 -2.72%

(A) Reclassified/Adjusted Amounts (+ or -) (4,042,637) (4,155,694) 113,057 -2.72%

(B) Adjustments Due to Sale of Assets (+ or -)

(6) Amounts Written-Off (-) (1,303,694) (49,628) (1,254,066) 2526.93%

(A) Currently Not Collectible (-) (1,303,694) (49,628) (1,254,066) 2526.93%

(B) Written-Off and Closed Out (-) 0 0 0 0.00%

(7) Ending Balance (TROR/Activity Registers) 24,944,560 40,000,951 (1,056,391) -2.64%

Total Collections 94,709,110 83,384,118

Total Adjusted Receivables 119,653,670 109,385,069

Collection Percentage 79.15% 76.23%

HI - Fund 050961

CMS Medicare Accounts Receivable MSP (Part A HI)

Contractor ABC

Attachment V

SOURCE: Detail Activity Reports (HIGLAS I Worksheet)

Part I - Status of Receivables

Section A

Receivables and Collections

12/31/2005 9/30/2005 $ Change %Change

(1) Beginning FY Balance 14,000,000 18,000,000 (4,000,000) -22.22%

(2) New Receivables (+)

35,000,000 34,453,226 546,774 1.59%

(3) Accruals (+) (New Interest Receivables)

(4) Collections on Receivables (-) (4,081,254) (18,589,335) 14,508,081 -78.05%

(A) At Agency-Cash/Checks (4,081,254) (18,589,335) 14,508,081 -78.05%

-Offsets

0 0 0 0.00%

(B) At Third Party

(D) Other - Must footnote

(5) Adjustments (975,538) 12,142,077 (13,117,615) -108.03%

(A) Reclassified/Adjusted Amounts (+ or -) (975,538) 12,142,077 (13,117,615) -108.03%

(B) Adjustments Due to Sale of Assets (+ or -)

(6) Amounts Written-Off (-) (220,610) (4,688,443) 4,467,833 -95.29%

(A) Currently Not Collectible (-) (209,275) (4,685,151) 4,475,876 -95.53%

(B) Written-Off and Closed Out (-) (11,335) (3,292) (8,043) 244.32%

(7) Ending Balance (TROR/Activity Registers) 43,722,598 41,317,525 2,405,073 5.82%

Total Collections 4,081,254 18,589,335

Total Adjusted Receivables 47,803,852 59,906,860

Collection Percentage 8.54% 31.03%

HI - Fund 050961

CMS Medicare Accounts Receivable MSP (Part A HI)

Contractor ABC

Attachment V-A

SOURCE: Detail Activity Reports (HIGLAS I Worksheet) & M751A

Part I - Status of Receivables

Section A

Receivables and Collections

12/31/2005 12/31/2004 $ Change %Change

(1) Beginning FY Balance 14,000,000 18,000,000 (4,000,000) -22.22%

(2) New Receivables (+)

35,000,000 31,074,736 3,925,264 12.63%

(3) Accruals (+) (New Interest Receivables)

(4) Collections on Receivables (-) (4,081,254) (2,598,173) (1,483,081) 57.08%

(A) At Agency-Cash/Checks (4,081,254) (2,598,173) (1,483,081) 57.08%

-Offsets

0 0 0 0.00%

(B) At Third Party

(D) Other - Must footnote

(5) Adjustments (975,538) (685,700) (289,838) 42.27%

(A) Reclassified/Adjusted Amounts (+ or -) (975,538) (685,700) (289,838) 42.27%

(B) Adjustments Due to Sale of Assets (+ or -)

(6) Amounts Written-Off (-) (220,610) (468,844) 248,234 -52.95%

(A) Currently Not Collectible (-) (209,275) (468,515) 259,240 -55.33%

(B) Written-Off and Closed Out (-) (11,335) (329) (11,006) 3345.25%

(7) Ending Balance (TROR/Activity Registers) 43,722,598 45,322,019 (1,599,421) -3.53%

Total Collections 4,081,254 2,598,173

Total Adjusted Receivables 47,803,852 47,920,192

Collection Percentage 8.54% 5.42%

HI - Fund 050961

CMS Medicare Accounts Receivable (Part A HI)

Contractor ABC

AR Summary Memorandum

Period Ending ___________________________

Attachment VI

(1)

Cost Report Settlements-The total variance for the Non-MSP (HI) balance for the current quarter reflects a

decrease of $3.7 million compared to the prior quarter. The bulk of this variance is a result of the change in

cost report settlement a decrease of $3 million. The primary cause of this variance is due to the result of

of the larger hospitals with the potental for large overpayments being settled in the last quarter of the year.

(2)

GHP-HIGLAS does not break down GHP between Data Match and Non-Data Match. GHP overall has

decreased by $4.2 million in comparison to the previous quarter. Non-Data Match receivables decreased by

$3 million, which reflects a significant decrease in the number of demands produced since the implementation of

ReMas during FY 2005.

(3)

MSP Beneficiary-increased by $3.7 million and is the result of an increase in workload for total demands.

(4)

PIP Accrual - HIGLAS Medicare contractors are no longer required to report an estimate PIP accrual.

(5)

Currently GHP-HIGLAS does not break out Data Match and Non-Data Match. GHP overall has

decreased by $2.5 million in comparison to the previous year. Since the implementation of ReMAS during

FY 2005, the Non-Data Match receivables reflects the significant decrease.

Prepared by: Date

Reviewed by: Date

CFO for Medicare Operations approval: ________________________________

Date

ARA approval:___________________________________________________ Date

The following represents the summary for the changes in the accounts receivable balance for the current quarter.

Attachment H-II

CMS HIGLAS Contractor Trend Analysis Checklist

Contractor Number

Contractor Name

Period

Medicare Contractor has submitted the following HIGLAS reports.

_____ CMS Report On Receivables Due From the Public (Attachment

HI GLAS I

_____ CMS Beginning Balance Report (Attachment

BBrpt

_____ CMS Transaction Register Report Line 2 (Attachment

TALn2rpt

_____ CMS Transaction Register Report Line 3 (Attachment

TALn3rpt

_____ CMS Adjustment Register Report for Line 3 (Attachments

AdjLn3rpt

_____ CMS Adjustment Register Report for Lines 5 and 6 (Attachments

AdjLn5& 6rpt

_____ CMS AR Overpayment Report(Attachment

AROvrrpt

_____ CMS Applied Collections Report (Attachment

AppCollrpt

_____ CMS Summary 2 Trail Bal ance.

_______________________________________ Date: _________________________

Preparer Signature

400.23 – Exhibit 23 – Instructions for the Benefits Payable Survey

(Rev. 105, Issued: 08-25-06, Effective/Implementation: 09-30-06)

CMS is required to prepare fiscal year financial statements in accordance the Office of

Management and Budget’s (OMB’s) accelerated mandated schedule. In order to meet the

accelerated timeframes, CMS requests specific contractor financial data for the

preparation and audit of CMS’ annual financial statements.

For inclusion in the year-end CMS financial statements, the Office of the Actuary

(OACT) prepares the Medicare Incurred But Not Reported (IBNR) estimate which is

based on actuarial estimates. Due to the complexity of the actuarial estimate and the

availability of data, OACT prepares this estimate for yearend statements only. The

Medicare IBNR estimate represents the amount of CMS claims incurred but not yet paid

at the end of the fiscal year (FY) and is a summation of five different components:

(1) the incurred to approval of payment amount – represents Medicare Services

provided, for which, a corresponding claim has not been approved for payment

and also is referred to as the incurred to approved amount;

(2) the retroactive settlements on cost reports amount – represents the estimated net

liability for cost reports awaiting final settlement and is also referred to as the cost

settlement amount;

(3) the approval to actual payment amount – represents the aggregate claims

approved for payment, for which, the corresponding reimbursement has not been

issued and is also referred to as the approved to paid amount;

(4) the paid to cleared amount – represents the aggregate claims for which checks

have been issued, but have not cleared the Medicare contractor’s financial

institution and is also referred to as the outstanding checks amount; and

(5) the advance payments under Periodic Interim Payment (PIP) amount – represents

the bi-weekly payments for estimated benefit payments for plans under such a

payment plan and is also referred to as the PIP amount.

The data required for items (3) through (5) is obtained directly from the Medicare

contractors and is submitted via the Benefits Payable survey (Attachment I, II, and/or III).

Typically, the survey is sent to the Medicare contractors in May or June of the current

FY.

Due to the on-going transition to the Healthcare Integrated General Ledger Accounting

System (HIGLAS) by the Medicare contractors, the data elements on the survey which

are required for submission have been revised. Instructions for each data element on the

attachments are discussed below.

1) PIP – value of the first periodic interim payment (PIP) cycle paid in the ensuing

month for the end of the month being reviewed. (Fiscal intermediaries

ONLY)

CAFM contractors should continue to utilize their shared system to obtain this

amount. If the payment cycle has not been run, please provide an estimate of

this amount. Do not include pass through costs.

HIGLAS contractors should obtain this amount from their 810 interface report.

If the payment cycle has not been run, please provide an estimate of this

amount. Do not include pass through costs.

2) Claims on the payment floor – Adjudicated claims not yet paid for both Health

Insurance (HI) and Supplemental Medical Insurance (SMI), if applicable.

CAFM contractors should continue to utilize their shared system to obtain this

amount. The amount reported on the survey must agree to the amount reported

on the year-end Form CMS-750A and/or 750B, Statement of Financial Position.

HIGLAS contractors should obtain this amount from their Summary 2 Trial

Balance, GL account 216002, Entitlement Benefit Due/Payable – Adjudicated

Claims.

3) Claims on Hold –This amount would include claims held resulting from Do Not

Forward, providers being investigated for fraud, claims payments due to

bankrupt providers. This amount does not include the amount for claims

withheld for non-receipt of cost reports. Amounts must be provided for both HI

and SMI, if applicable. (CAFM Contractors only).

CAFM contractors should obtain this amount from their shared system. The

amount reported on this survey must agree to the applicable portion reported on

the Other Liabilities (footnote) line of the year end Form CMS-750, Statement

of Financial Position. The amount should include claims held in accordance

with CR 5047, Hold on Medicare Payments.

4) Outstanding Checks – The amount of checks and EFT payments that have been

issued, but have not cleared the Medicare contractor’s banking institution.

Amounts must be provided for both HI and SMI, if applicable.

CAFM contractors should obtain this amount from their banking institution or

internally generated documentation. The amount reported on the survey must

agree to outstanding check amount reported on the September 1522, Monthly

Contractor Financial Report.

HIGLAS contractors should obtain this amount from their Summary 2 Trial

Balance, GL account 212001 - Accounts Payable Disbursements in Transit.

5) Health Professional Shortage Area payments (HPSA) – the bonus amount paid

to physicians for eligible services rendered in zip code areas that fall fully

within a designated HPSA area or are dominant to the area based on a

determination by the U.S. Postal Service and/or;

Physician Scarcity Area (PSA) – the bonus amount paid to the primary care and

specialty physicians providing eligible services in the counties with the lowest

20% ratio of primary care or specialty physicians to Medicare beneficiaries

and/or;

Transitional Outpatient Payments (TOPs) - the amount paid to rural hospitals

having 100 or fewer beds that are not classified as a sole community hospital.

(Fiscal intermediaries ONLY)

If PSA/HPSA and/or TOPs payments were disbursed on or before the last day

of the quarter/month, enter amount as zero. If PSA/HPSA and/or TOPs

payments are disbursed on or after the first day of the quarter/month, provide

the amount of the payments. Contractors must provide these amounts for both

HI and SMI, if applicable.

CAFM contractors should obtain this information from their shared system, if

applicable.

HIGLAS contractors should obtain these amounts from their 810H and 810

files, if applicable. HIGLAS contractors should also provide a footnote to

disclose whether the amounts indicated for these payments are included in GL

account 216002, Entitlement Benefit Due/Payable – Adjudicated Claims.

Time Account Balances (Attachment IV)

The CMS reports the aggregate total Part A and total Part B Time Account balances as

Medicare trust fund “Cash and Other Monetary Assets” on the balance sheet in its annual

CMS Financial Report. Previously, these account balances were obtained from the Form

CMS-750 reports; however, the year-end 750 due date is typically extended until after

annual financial statements must be completed. Therefore, time account balances as of

September 30, FY end, must be submitted as part of the attached Benefits Payable Survey

– Attachment IV. Fiscal intermediaries should prorate their time account balances

between HI and SMI.

Due Dates

The annual Joint Signature Memorandum outlining the accelerated financial reporting

timeframes for FY end Medicare contractor financial reports will provide the due date for

the Benefits Payable Survey (Attachments I, II and/or III) as well as the Time Account

Balance information (Attachment IV).

Attachment 1

Contractor No. ______ HI BENEFITS PAYABLE SURVEY

INTERMEDIARY For Period Ending: September 30, 20xx

1. PIP Providers

Value of the First PIP Cycle Paid in the ensuing month ___________

for the end of the month being reviewed. (If the payment cycle has not been run,

please provide an estimate of this amount.

Do not include Pass Through Costs.)

NOTE: HIGLAS contractors should obtain this amount from their

810 interface file.

2. Claims on the Payment Floor (in dollars) ___________

(CAFM Contractors – Amount must agree to amount reported on the

September Form CMS-750)

NOTE: HIGLAS contractors should obtain this amount from their

Summary 2 Trial Balance GL account 216002, Entitlement

Benefit Due/Payable – Adjudicated Claims.

3. Claims on Hold (in dollars) – CAFM contractors ONLY ___________

(Amount should be obtained from the Other Liabilities line on the

Form CMS-751)

4. Outstanding Checks (in dollars) ___________

(Amount must include outstanding EFTs and agree to the

outstanding check amount on the September Form CMS-1522)

NOTE: HIGLAS contractors should obtain this amount from their

Summary 2 Trial Balance GL account 212001, Accounts Payable

Disbursements in Transit.

5. PSA/HPSA/TOPS payments (in dollars) ___________

(If payments were disbursed on or before the last day of the

quarter/month, enter amount as zero. If payments are disbursed

after the 1

day of the quarter/month, provide the amount of the payments)

NOTE: HIGLAS contractors should obtain these amounts from their

810H and 810 files, if applicable. HIGLAS contractors should also provide a

footnote to disclose whether the amounts indicated for these payments are

included in GL account 216002, Entitlement Benefit Due/Payable – Adjudicated

Claims

Attachment 2

Contractor No. ______ SMI BENEFITS PAYABLE SURVEY

INTERMEDIARY For Period Ending: September 30, 20xx

1. Claims on the Payment Floor (in dollars) ___________

(CAFM Contractors – Amount must agree to amount reported on the

September Form CMS-750)

NOTE: HIGLAS contractors should obtain this amount from their

Summary 2 Trial Balance GL account 216002, Entitlement

Benefit Due/Payable – Adjudicated Claims.

2. Claims on Hold (in dollars) – CAFM contractors ONLY ___________

(Amount should be obtained from the Other Liabilities line on the

Form CMS-751)

3. Outstanding Checks (in dollars) ___________

(Amount must include outstanding EFTs and agree to the

outstanding check amount on the September Form CMS-1522)

NOTE: HIGLAS contractors should obtain this amount from their

Summary 2 Trial Balance GL account 212001, Accounts Payable

Disbursements in Transit.

4. PSA/HPSA/TOPS payments (in dollars) ___________

(If payments were disbursed on or before the last day of the

quarter/month, enter amount as zero. If payments are disbursed

after the 1

day of the quarter/month, provide the amount of the payments)

NOTE: HIGLAS contractors should obtain these amounts from their

810H and 810 files, if applicable. HIGLAS contractors should also provide a

footnote to disclose whether the amounts indicated for these payments are

included in GL account 216002, Entitlement Benefit Due/Payable – Adjudicated

Claims

Attachment 3

Contractor No. ______ BENEFITS PAYABLE SURVEY

CARRIER For Period Ending: September 30, 20xx

1. Claims on the Payment Floor (in dollars) ___________

(CAFM Contractors – Amount must agree to amount reported on the

September Form CMS-750)

NOTE: HIGLAS contractors should obtain this amount from their

Summary 2 Trial Balance GL account 216002, Entitlement

Benefit Due/Payable – Adjudicated Claims.

2. Claims on Hold (in dollars) – CAFM contractors ONLY ___________

(Amount should be obtained from the Other Liabilities line on the

Form CMS-751)

3. Outstanding Checks (in dollars) ___________

(Amount must include outstanding EFTs and agree to the

outstanding check amount on the September Form CMS-1522)

NOTE: HIGLAS contractors should obtain this amount from their

Summary 2 Trial Balance GL account 212001, Accounts Payable

Disbursements in Transit.

4. PSA/HPSA payments (in dollars) ___________

(If payments were disbursed on or before the last day of the quarter,

enter amount as zero. If payments are disbursed after the 1

day of the

quarter, provide the amount of the payments)

NOTE: HIGLAS contractors should obtain these amounts from their 810H and

810 files, if applicable. HIGLAS contractors should also provide a footnote to

disclose whether the amounts indicated for these payments are included in GL

account 216002, Entitlement Benefit Due/Payable – Adjudicated Claims

Attachment 4

FEDERAL HEALTH INSURANCE TIME ACCOUNT

Contractor No. ______

INTERMEDIARY For Period Ending: September 30, 20xx

Part A Balance (in dollars) ____________

Part B Balance (in dollars): ____________

FEDERAL SUPPLEMENTARY MEDICAL INSURANCE

TIME ACCOUNT

Contractor No. ______

CARRIER For Period Ending: September 30, 20xx

Part B Balance (in dollars) ____________

400.24 - Exhibit 24 – Benefits Payable Trending Analysis Procedures

(Rev. 105, Issued: 08-25-06, Effective/Implementation: 09-30-06)

Objective

To ensure that benefit payable balances reported on the survey are reasonable, Medicare

contractors are required to perform trending procedures. Trending procedures can be used

as an important tool to identify potential errors, omissions, system weaknesses, or

inappropriate patterns of adjustments or accumulation. Trending procedures involve

comparisons of current fiscal year (FY) benefit payable data to prior year benefit payable

data submitted on the Benefits Payable surveys.

Compare Current Year Amounts with Comparative Financial Data

In comparing current-period financial results with prior-period financial results, there is

an implied assumption that the volume of activity in the two periods is comparable. If

there has been a substantial change in volume, it is necessary to take this change into

account and to quantify the change, when making the comparisons. For example, if a

contractor's PIP balance has increased by 10 percent, it is necessary to determine and

document the reason for the increase. The increase may be the result of new PIP

providers or increased settlement activity.

Understand Identified Variances and Document the Results

Medicare contractors must identify and provide an explanation for variances that meet the

thresholds outlined in these procedures. If an explanation does not adequately describe

the variance, the Medicare contractors must perform additional procedures such as a

review of detail transactions to identify the underlying cause(s) of any unusual changes.

The causes for the variances should be quantified. For example, if the change was

attributable to a change in the number of claim cycles, then include the number of

additional claims on the payment floor attributed to the additional cycles as well as the

reason why additional cycles were added.

Methodology

The primary reason for performing trend analysis is to focus on the change in the ending

balances of PIP, claims on the payment floor, and outstanding checks. All explanations

should be available for review by CMS, Office of the Inspector General, Government

Accountability Office and /or other related parties.

Each Medicare contractor must perform the following steps on a year end basis,

beginning with FY ending September 30, 2006. The CFO for Medicare Operations' must

submit the explanations via email as evidence that he/she has reviewed the trending

explanations. To properly apply trending procedures, it is necessary to complete the

following steps:

Benefits Payable Trending Analysis Procedures for FIs and carriers

Step (1)

Compare the value of the first PIP cycle paid in the ensuing month for the end of

the month being reviewed, the claims on the payment floor amount, and the

outstanding check amount reported on the current FY’s Benefits Payable survey

to the same line items reported on the prior year’s Benefits Payable survey (i.e.

9/30/06 vs. 9/30/05) for all lines of business applicable to each contractor number.

Calculate the dollar and percentage difference for each item. (See Attachments I,

II, and III for the required formats).

NOTE: Trending on the amount of Claims on hold and Physician Scarcity Area

(PSA) payments, Health Professional Shortage Area (HPSA) payments, and

Transitional Outpatient Payments (TOPs) will not be required until FY 2007.

Step (2)

Verify that the dollar amount for each item is supported by lead schedules and/or

detailed documentation. Any errors or misstatements identified as a result of this

analysis must be corrected prior to the submission of the Form CMS-750 report,

the Form CMS-1522 report and/or CMS Balance Sheet, CMS Income Statements

and CMS Summary 2 Trial Balance.

Step (3)

PIP (for FIs only)

Provide explanations where the dollar amount change is at least +/-$2 million or

equates to a 100 percentage change.

Claims on the payment floor

Provide explanations where the dollar amount change is at least +/- $10 million or

equates to a 100 percentage change.

Outstanding checks

Provide explanations where the dollar amount change is at least +/- $3 million or

equates to a 100 percentage change.

Step (4)

Document conclusions in a summary memorandum (See Attachment IV) to be

included with Attachments I, II, and III and provide to the CFO for Medicare

Operations for submission to CMS.

Due Date

The analysis must be submitted by the CFO of Medicare Operations via email to the

Division of Financial Reporting and Policy (DFRP) contact identified in the Joint

Signature Memorandum outlining the accelerated financial reporting timeframes for

Medicare contractor financial reports and is due the day following the submission of the

Benefits Payable Survey by 8:00 pm Eastern Daylight Time. If a copy of the analysis is

signed by the CFO, scanned, and attached to the email sent to the DFRP contact, the CFO

is not required to send the email directly. If this date occurs on a holiday or a weekend,

the analysis must still be submitted by this due date. Please notify the DFRP contact if a

problem arises.

The DFRP contact will review the summary memorandums and the analysis schedules

and may request additional explanations and/or documentation to support the Medicare

contractors' analysis schedules. The DFRP contact will contact the Medicare contractor

by phone to request any additional documentation needed to support existing variances.

A response is requested as soon as possible, but no later than two days from the day of

request.

410 – Unsolicited Voluntary Refunds

410.1 - General Information

(Rev. 50, 07-30-04)

All Medicare contractors receive unsolicited/voluntary refunds (i.e. monies received not

related to an open accounts receivable). Following are detailed instructions on how to

identify, process, track and report unsolicited/voluntary refund checks received from

providers/physicians/suppliers, and other entities (e.g., beneficiaries, insurers, employers,

third party administrators (TPAs), etc.). These instructions shall not supersede other

CMS guidance provided regarding the recovery and collection action on “demanded”

debt, where an accounts receivable has already been established. If monies are received

and the results of a contractor’s investigation identify the existence of an established

receivable, then the refund shall not be considered an “unsolicited/voluntary refund”

within the context of the following instructions, and would not be reported on Exhibit 2

of these instructions (see section 410.9).

Intermediaries generally receive unsolicited/voluntary refunds from providers in the form

of an adjustment bill, but may receive some unsolicited/voluntary refunds from providers

and third party payers as checks. Carriers generally receive checks from physicians,

suppliers and third party payers. Substantial funds are returned to the trust funds each

year through such unsolicited/voluntary refunds.

Acceptance/deposit of the voluntary refund check in no way limits the rights of the

Federal Government or any of its agents to pursue any appropriate criminal, civil, or

administrative remedies arising from or relating to these or any other claims.

410.2 - Office of the Inspector General (OIG) Initiatives

(Rev. 50, 07-30-04)

The OIG, working with the Department of Justice and CMS, has initiatives to help

combat health care fraud and abuse and to encourage health care

providers/physicians/suppliers, and other entities to comply with the rules and regulations

of Federal health care programs. Some of these initiatives include guidance, corporate

integrity agreements (CIAs), and the OIG Self-Disclosure Protocol. The OIG Self-

Disclosure Protocol is voluntary while the CIAs are mandatory. These initiatives are

designed to ensure that the providers/physicians/suppliers, and other entities refund

inappropriately received Medicare monies back to the trust funds.

CIAs are entered into between a health care provider/physician/supplier/other entity and

OIG as part of a global settlement of a fraud investigation. Under the CIA (which can be

for a period ranging from 3 to 5 years), the provider/physician/supplier or other entity is

required to undertake specific compliance obligations, such as designating a compliance

officer, undergoing training, and auditing. The provider/physician/supplier or other

entity must report regarding their compliance activities on an annual basis to the OIG,

which is responsible for monitoring the agreements.

The OIG Self-Disclosure Protocol was produced by the OIG to provide guidance to

health care providers/physicians/suppliers and other entities that decide to voluntarily

disclose irregularities in their dealings with the Federal health care programs. The

decision to follow the OIG Self-Disclosure Protocol rests exclusively with the

provider/physician/supplier and other entity. The OIG Self-Disclosure Protocol is

intended to facilitate the resolution of only matters that, in the provider/physician/supplier

and other entity’s reasonable assessment, potentially violates Federal, criminal, civil, or

administrative laws. It should be noted that providers/physicians/suppliers and other

entities who self-disclose to the OIG sign an agreement stating that any refunds submitted

as part of the self-disclosure process are not subject to appeal.

410.3 - Unsolicited/Voluntary Refund Accounts

(Rev. 50, 07-30-04)

All Medicare systems shall be able to separately distinguish and track

unsolicited/voluntary refund checks which result from a 1) provider/physician/supplier

and other entity under a CIA; 2) Provider/physician/supplier and other entity under the

OIG Self-Disclosure Protocol; and 3) Straight Refund (a straight refund is a refund from

a provider/physician/supplier, or other entity who is not under a CIA nor the OIG Self-

Disclosure Protocol). All Medicare systems shall have the ability to identify and produce

a report that distinguishes a refund as a CIA, OIG Self-Disclosure Protocol, or straight

refund at the point of disposition (i.e., after investigation of the origin of the refund).

To assist in identifying providers/physicians/suppliers under a CIA, Medicare contractors

should access the OIG Web site (http://www.oig.hhs.gov/fraud/cias.html) for a list of all

providers/physicians/suppliers, and other entities under a CIA. The OIG Web site will

also give the effective date of the CIA. To obtain the termination date of the CIA, click

on the CIA agreement. The time period of the CIA is contained within the agreement. If

the Web site does not provide enough information to determine whether a CIA agreement

is in existence, the contractor shall contact the provider as part of their

investigation/resolution of the unsolicited/voluntary refund. Because OIG Self-

Disclosure Protocol agreements are voluntary, contractors may not be aware of this

agreement unless a provider/physician/suppliers or other entity specifically notifies them.

Providers/physicians/suppliers under an OIG Self-Disclosure Protocol agreement are not

given on the OIG Web site. The OIG will send a letter directing the

provider/physician/supplier to refund money back to the Medicare contractor when the

OIG has completed the Self-Disclosure matter and determined that an

unsolicited/voluntary refund should be collected rather than a civil settlement pursued. A

copy of the letter is included as Exhibit 3. The OIG will also send a copy of the letter to

the attention of the Chief Financial Officer for Medicare Operations at the Medicare

contractor. The OIG will direct the provider/physician/supplier to identify that the refund

check is the result of an OIG Self-Disclosure Protocol agreement. The

provider/physician/supplier will have 30 days to refund the contractor. If the contractor

does not receive the refund within 30 days, the contractor shall notify the Office of

Counsel to the Inspector General (OCIG) attorney assigned to the OIG Self-Disclosure

Protocol matter, as identified in the letter.

410.4 - Receiving and Processing Unsolicited/Voluntary Refund Checks

When Identifying Information is Provided

(Rev. 315, Issued: 05-17-19, Effective: 06-18- 19, Implementation: 06-18-19)

The term Medicare beneficiary identifier (Mbi) is a general term describing a

beneficiary's Medicare identification number. For purposes of this manual, Medicare

beneficiary identifier references both the Health Insurance Claim Number (HICN) and

the Medicare Beneficiary Identifier (MBI) during the new Medicare card transition

period and after for certain business areas that will continue to use the HICN as part of

their processes.

The following instructions shall not supersede the present Program Integrity Manual

(PIM) that references procedures for handling unsolicited refunds where there is a

voluntary repayment and referral to law enforcement. The following procedures shall be

followed when unsolicited/voluntary refund checks are received:

1) Do not return any check submitted by a provider/physician/supplier and other

entities that is made payable to the Medicare program.

2) To ensure that repayment of Medicare funds is handled properly, Medicare

contractors shall deposit such a check within 24 hours of receipt in accordance

with Chapter 5, Financial Reporting Manual, section 100.3 and record the check

in the account entitled “Other Liabilities – Unapplied Receipts” per Form CMS-

750 instructions found in Chapter 5, Financial Reporting, Section 210.

3) If any checks are not deposited within the 24-hour period, contractors shall

record those undeposited checks in the account entitled “Assets/Cash –

Undeposited Collections” per Form CMS-750 instructions found in Chapter 5,

Financial Reporting, Section 210. Medicare contractors shall implement

internal controls to ensure the safeguarding of these Medicare checks until

deposit.

4) If the specific Patient/Medicare beneficiary identifier information was provided,

the contractor shall deposit the check and make/initiate the appropriate

adjustments, depending on the entity making the refund and the purpose of the

refund, either to the claims and/or to the claim history file within 60 days from

the check’s date of deposit for Non-Medicare Secondary Payer (MSP), or 100

days from the initial ECRS inquiry for MSP. For those contractors whose

checks are received through a locked box, appropriate claims adjustments shall

be updated within 60 days of receipt of the bank’s notification of deposit for

Non-MSP, and 100 days from the initial ECRS inquiry for MSP.

5) If the provider/physician/supplier, or other entity is not participating in the Self-

Disclosure Protocol, contractors shall ensure that any MSN, or Remittance

Advice, generated as the result of the claims adjustment contains appeals

language, where appropriate. If necessary, contractors should determine the

proper handling of unsolicited/voluntary refunds on any open or re-openable

cost report.

6) No appeal rights shall be afforded, as stated in Exhibit 1, if the

provider/physician/supplier, or other entity 1) does not submit the specific

Patient/Medicare beneficiary identifier information, or 2) is participating in a

Self-Disclosure Protocol agreement.

7) The Medicare contractor shall establish an accounts receivable in the Medicare

system that shall be recognized on line 2a, New Accounts Receivable on Form

CMS-751 report within 60 days after the deposit of the voluntary refund for

Non-MSP, or 100 days from initial ECRS inquiry for MSP. In addition, the

Medicare contractor shall reduce the “Other Liabilities” account for the same

amount, and shall apply the refund to the established accounts receivable and

recognize the collection on line 4a, Cash/Check Collections on Form CMS-751

report.

8) The accounts receivable shall be established using the last name of the debtor

that issued the check or on whose behalf the check was issued, as well as the

debtor’s employer/tax identification number and/or provider or beneficiary

number. If the debtor’s employer/tax identification number or provider or

beneficiary number is unavailable, then the first four letters of the debtor’s name

and last four digits of the bank account number on the check shall be used as

identifying information for setting up the accounts receivable. All Medicare

systems shall have the ability to manually complete this procedure.

9) If the amount of the unsolicited/voluntary refund check exceeds the amount of

the original claim, Medicare contractors shall check all categories of open

account(s) receivable for that provider/physician/supplier or other entity

including those established as a result of medical review, benefit integrity (BI)

review, cost reports, other overpayment demands, and MSP demands. If an

outstanding receivable is identified, the contractor shall apply the remaining

amount of the unsolicited/voluntary refund to the outstanding receivable

balance. If there are multiple outstanding accounts receivables, then the excess

funds should be applied to the oldest accounts receivable first – interest then

principal.

10) Medicare contractors shall not automatically refund excess recoupments to the

provider/physician/supplier, or other entity. Contractors shall only refund

excess recoupments when no other outstanding accounts receivable exists, or

written documentation/evidence clearly supports that Medicare is not entitled to

the money or was not the intended recipient of the refund check. Contractors

shall follow the non-MSP provider/physician/supplier refund process when

encountering MSP provider/physician/supplier unsolicited/voluntary refunds.

Monies voluntarily sent in from beneficiaries (or a representative of) and/or

insurers or other third party payers may be refunded only if COBC determines,

after 100 days, no issue exists or an issue exists which results in the lead

contractor identifying Medicare’s claim to be less than the refunded amount.

For example, many times an attorney may remit payment for the total

conditional amount prior to a formal demand.

11) The Medicare contractor shall be responsible for completing Exhibit 1 (or

facsimile thereof) as appropriate and reporting it on Exhibit 2.

12) Contractors are not required to report the established accounts receivable on the

Physician Supplier Overpayment Reporting System (PSOR). (This requirement

does not preclude the contractor from reporting the receivable on the PSOR for

non-MSP, if current systems already do so. The contractor shall not report MSP

accounts receivable on the PSOR.)

410.5 - Handling Checks or Associated Correspondence with

Conditional Endorsements

(Rev. 50, 07-30-04)

Conditional endorsements are statements on the face of the check or associated

correspondence, which might suggest that the payer has discharged its obligation by

writing “paid in full” or like phrases that the payer intends as satisfaction/ extinguishment

of the debt. Guidelines from the General Accounting Office (GAO) state that agencies

must be extremely careful to avoid an unintended accord and satisfaction (i.e., an

agreement to accept a payment in full for an amount less than the amount claimed).

The following instruction shall be applied to checks or associated correspondence with a

conditional endorsement:

1) Medicare contractors shall deposit such a check within 24 hours of receipt in

accordance with CMS’s Medicare Financial Management Manual, Chapter 5

Financial Reporting, section 100.3 and record the check in the account entitled

“Other Liabilities – Unapplied Receipts” per Form CMS-750 instructions found

in Chapter 5, Financial Reporting, Section 210.

2) If any checks are not deposited within a 24-hour period, contractors shall record

those checks in the account entitled “Assets/Cash – Undeposited Collections”

per Form CMS-750 instructions found in Chapter 5, Financial Reporting,

section 210. Medicare contractors shall implement internal controls to ensure

the safeguarding of these Medicare checks until deposit.

3) Contractors shall immediately notify the debtor and/or the entity on whose

account the check is drawn, if not the debtor, by certified mail. The following

statement is suggested: This is to acknowledge the receipt of the repayment

in the amount of $XX, check number XX. The matter is being researched;

however, the amount of the repayment may be insufficient to discharge the

obligation and the debt may not be fully extinguished.

4) The check(s) shall than be processed as outlined under section 410.4 or 410.6 as

applicable.

The infrequent receipt of checks with conditional endorsements should not negatively

impact your production process. The standard letter needed to meet this requirement

shall be added to your automated letter processing or generated from a personal

computer.

410.6 - Receiving and Processing Unsolicited/Voluntary Refund Checks

When Identifying Information is not Provided

(Rev. 315, Issued: 05-17-19, Effective: 06-18- 19, Implementation: 06-18-19)

The term Medicare beneficiary identifier (Mbi) is a general term describing a

beneficiary's Medicare identification number. For purposes of this manual, Medicare

beneficiary identifier references both the Health Insurance Claim Number (HICN) and

the Medicare Beneficiary Identifier (MBI) during the new Medicare card transition

period and after for certain business areas that will continue to use the HICN as part of

their processes.

After depositing unsolicited/voluntary refund checks in accordance with section 410.4

above, Medicare contractors shall do the following:

For Non-MSP Checks

1) If no specific Patient/Medicare beneficiary identifier information was provided

with the unsolicited/voluntary refund, the contractor shall contact the

provider/physician/supplier, or other entity sending the refund check for further

information. Exhibit 1 (overpayment refund) contains the minimum claim

specific data necessary to process the refund. The contractor should use this

form during phone inquiry or attach it to a letter to the

provider/physician/supplier requesting further information regarding the

submitted refund.

2) When there is no identifying information provided, the contractor shall perform

the research necessary to obtain the minimum data required to meet the

reporting requirements in Exhibit 2 (Summary Report). If the information is

being collected via a telephone inquiry, the contractor employee conducting the

inquiry shall inform the provider/physician/supplier, or other entity verbally that

if the specific Patient/ Medicare beneficiary identifier information is not

provided, no appeal rights can be afforded.

The minimum reporting data shall include:

a. Provider/physician/supplier, or other entity’s name, number, and Tax ID

number.

b. Identification of whether the provider/physician/supplier, or other entity

has a CIA with the OIG or are under the OIG Self-Disclosure Protocol;

and whether it is a straight refund (i.e., a provider not under a CIA or OIG

Self-Disclosure Protocol).

c. The reason(s) for each refund.

d. The total number of refund checks (in the case of a check with multiple

providers/reason codes, each instance shall be counted separately).

e. The total dollar amount of refunds.

3) Medicare contractors shall have 60 days from deposit of the check to obtain the

minimum claim specific data required to apply the check. The contractor shall

take at least one documented follow-up action during the 60-day period to

obtain the data.

4) If the minimum claim specific data required to apply the refund is obtained

from the provider/physician/supplier, or other entity within 60 days from the

check’s date of deposit, the contractor shall make/initiate any appropriate

adjustments to the identified claims and/or the claim history file for the amount

of the refund. The contractor shall establish an account(s) receivable and apply

the balance of the check to the account(s) receivable from the “Other

Liabilities” account within 60 days after the deposit of the voluntary refund.

The contractor shall ensure that any Remittance Advice or MSN generated as a

result of the claim adjustment contains the appropriate appeals language, if

applicable.

5) If the minimum claim specific data required to apply the refund is not obtained

from the provider/physician/supplier, or other entity within 60 days from the

check’s date of deposit, the “Other Liabilities” account shall be reduced and an

accounts receivable due to a straight refund shall be established for the amount

of the unapplied unsolicited/voluntary refund. All Medicare systems shall allow

contractors the ability to set up accounts receivable using either the

provider/physician/supplier, or other entity or beneficiary number.

6) In both instances, the Medicare contractor shall establish an accounts receivable

in the Medicare system that shall be recognized on line 2a, New Accounts

Receivable on Form CMS-751 report within 60 days after the deposit of the

voluntary refund. In addition, the Medicare contractor shall perform a

simultaneous transaction to apply the refund to the established accounts

receivable and recognize the collection on line 4a, Cash/Check Collections on

Form CMS-751 report.

7) The accounts receivable shall be established using the last name of the debtor

identified on the check, as well as the debtor’s employer/tax identification

number and/or provider or beneficiary number. If the debtor’s employer/tax

identification number or provider or beneficiary number is unavailable, then the

first four letters of the debtor’s name and last four digits of the bank account

number on the check shall be used as identifying information for setting up the

accounts receivable. All Medicare systems shall have the ability to manually

complete this procedure.

8) If the amount of the unsolicited/voluntary refund check exceeds the amount of

the original claim, Medicare contractors shall check all categories of open

account(s) receivable for that provider/physician/supplier including those

established as a result of medical review, BI review, cost reports, other

overpayment demands, and MSP demands. If an outstanding receivable is

identified, the contractor shall apply the remaining amount of the

unsolicited/voluntary refund to the outstanding receivable balance. If there are

multiple outstanding accounts receivables, then the excess funds should be

applied to the oldest accounts receivable first – interest then principal.

9) Medicare contractors shall not automatically refund excess recoupments to the

provider/physician/supplier, or other entity. Contractors shall only refund

excess recoupments when no other outstanding accounts receivable exists, or

written documentation/evidence clearly supports that Medicare is not entitled to

the money or was not the intended recipient of the refund check.

10) The Medicare contractor shall be responsible for ensuring the completion of

Exhibit 1 (or facsimile thereof) and reporting it on Exhibit 2 upon final

disposition of the unsolicited/voluntary refund (i.e., after investigation of the

origin of the refund).

11) Contractors are not required to report the established accounts receivable on the

PSOR. (This requirement does not preclude the contractor from reporting the

receivable on the PSOR if current systems already do so.)

For MSP Checks

1) The Medicare contractor shall determine if there is an existing case and/or

accounts receivable. If this is an existing case and/or accounts receivable, the

contractor shall follow normal recovery procedures. If there is no case and/or

accounts receivable, and there is indication of MSP involvement, the contractor

shall send an MSP inquiry via the Electronic Correspondence Referral System

(ECRS) to the MSP Coordination of Benefits Contractor (COBC) within 20

days from the check’s date of deposit. The 45-day correspondence timeframe is

not appropriate for addressing checks either solicited or unsolicited.

Contractors shall identify checks during the initial mail sort and place a priority

on their resolution and distribution. When referring information to the COBC

for MSP investigation, the contractor shall forward all pertinent data. All

fields on the ECRS Inquiry screen shall be completed if the data is

available on the returned check or any accompanying correspondence.

Information in the informant fields such as telephone numbers, point of

contact, etc. are critical to COBC development efforts.

2) Medicare contractors shall only allow 100 days from the date of the ECRS

inquiry for a response from the COBC before taking action with respect to the

“unapplied receipts.” This time period will also allow for the COBC to develop

the case. If additional information is obtained after the initial inquiry that would

help facilitate the processing and research of information, the COBC Consortia

Representative shall be contacted and provided the additional information, via

fax or telephone, to assist in completing the research. The contractor shall not

send a second ECRS inquiry. A total of 120 days from the check’s date of

deposit will be allowed to bring closure to the unapplied receipt.

3) If the minimum reporting information from the MSP COBC is provided within

100 days from the initial ECRS inquiry, the contractor shall make/initiate any

appropriate adjustments to either the identified claims and/or the claim history

file for the amount of the refund, depending on the entity making the refund and

the purpose of the refund. The Medicare contractor shall establish an account(s)

receivable and apply the balance of the check to the account(s) receivable from

the “Other Liabilities” account. If as a result of applying the voluntary refund

the contractor identifies additional dollars specific to the issue in CWF, a

demand letter shall be sent for the remaining amount owed.

4) If, within 100 days from the initial ECRS inquiry, 1) the minimum reporting

information is not provided, 2) a response has not been received from the MSP

COBC, or 3) a response from the COBC indicates they could not obtain a

response (e.g., CM Code 62), Medicare contractors shall establish an accounts

receivable and apply the balance of the check to the account(s) receivable from

the “Other Liabilities” account. For COBC no response codes specific to a

provider/physician/supplier unsolicited/voluntary refund, contractors should do

the full claim adjustment but use a non-MSP reason (i.e., billed in error), which

would then not need an MSP record to be established on CWF. The contractor

shall report the refund in Exhibit 2 (Unsolicited/Voluntary Refund - Summary

Report), and annotate with reason code 16. In addition, Exhibit 1 and/or the

contractor’s supporting documentation shall specify the refund as received with

no reason for refund and/or no MSP response.

5) The Medicare contractor shall establish an accounts receivable in the Medicare

system and that shall be recognized on line 2a, New Accounts Receivable on

Form CMS-M751 report within 100 days after the initial ECRS inquiry. In

addition, the Medicare contractor shall perform a simultaneous transaction to

apply the refund to the established accounts receivable and recognize the

collection on line 4a, Cash/Check Collections on Form CMS-M751 report. The

contractor shall initiate normal MSP recovery action for any remaining

outstanding balance owed.

6) The accounts receivable shall be established using the last name of the debtor

that issued the check or on whose behalf the check was issued, as well as the

debtor’s employer/tax identification number and/or provider or beneficiary

number. If the debtor’s employer/tax identification number or provider or

beneficiary number is unavailable, then the first four letters of the debtor’s name

and last four digits of the bank account number on the check shall be used as

identifying information for setting up the accounts receivable. All Medicare

systems shall have the ability to manually complete this procedure.

7) If the amount of the unsolicited/voluntary refund check exceeds the amount of

the original claim, Medicare contractors shall check all categories of open

account(s) receivable for that provider/physician/supplier or other entity

including those established as a result of medical review, BI review, cost

reports, other overpayment demands. If an outstanding receivable is identified,

the contractor shall apply the remaining amount of the unsolicited/voluntary

refund to the outstanding receivable balance. If there are multiple outstanding

accounts receivables, then the excess funds should be applied to the oldest

accounts receivable first – interest then principal.

8) Medicare contractors shall not automatically refund excess recoupments to the