Final Rule on Medicare Reporting Civil Monetary Penalties Extended 1 Year Until February 2024; CMS Releases Top 10 Section 111 Non-Group Health Plan Reporting Errors Chart
Final Rule on Section 111 Penalties Delayed 1 Year
The Final Rule outlining Centers for Medicare & Medicaid Services (CMS)’ guidance around Civil Monetary Penalties (CMPs) of up to $1000 per day/per claim —which may be issued against Non-Group Health Plan (NGHP) Responsible Reporting Entities (RREs) for noncompliant MMSEA Section 111 reporting—has been delayed for an additional year, with a newly anticipated release date of February 18, 2024.
Workers’ compensation, general liability, and no-fault primary plan insurers (including self-insured entities) have long been aware that CMS sought to impose its Final Rule on CMPs by February 18, 2023, as the Proposed Rule was originally published in February 2020 with a proposed final action date 3 years post-publication. Once the Final Rule is released, CMS may start imposing CMPs against noncompliant RREs 60 days after its Effective Date.
Late last week as the due date was approaching, a notice was published in the Federal Register noting the 1-year delay of the Final Rule. The notice can be found here. Noteworthy as to CMS’ reasoning for the 1-year extension is the following:
We are not able to meet the initial targeted 3-year timeline for publication due to delays related to the need for additional, time-consuming data analysis resulting from public inquiry. It was not possible to conclude this data analysis on the initial, targeted timeline for the proposed rule because public listening sessions raised additional concerns that CMS believed were important to properly and thoroughly research prior to publishing the final rule. We have decided that it is critical to conduct additional analysis about the economic impact of the rule. We are preparing additional data analysis and predictive modeling to better understand the economic impact of the proposed rule across different insurer types. This data analysis is designed to review the actual current reporting and model potential penalties that would be imposed were the final rule in place. Along with delays resulting from the agency's focus on the COVID- 19 public health emergency, we determined that additional time is needed to address the complex policy and operational issues that were raised. We are extending the publication deadline so as to provide the most accurate, complete, and robust data possible to confirm the intent and economic impact of the final rule. This document extends the timeline for publication of the final rule for one year until February 18, 2024.
CMS Releases Top 10 Section 111 Non-Group Health Plan Reporting Error Codes
The chart referencing the top 10 Section 111 NGHP Reporting Error codes from July 1- December 31, 2022 can be found here. CMS did reference these Top 10 reporting errors during a webinar on December 6, 2022 and most recently released these Top 10 errors just last week as a standalone document. Some of the more noteworthy errors, which are not soft errors, relate to the lack of an ICD diagnosis code as well as a missing TPOC amount. RREs should take note of these common errors and be sure to correct them timely. Failure to correct an error can cause the Section 111 report to not be accepted, thus exposing the RRE to potential Civil Monetary Penalties.
Sanderson Firm Commentary:
The delay of the CMP Final Rule is not surprising, especially given the mounting pressure on CMS to ensure that any CMPs which are levied against workers’ compensation, general liability, and no-fault RREs are fair, consistent, and not levied so as to cause severe economic impact to insurers. Further, the Covid-19 pandemic certainly is a justifiable reason as to why CMS may not have been able to timely release the Final Rule.
What does it all mean, in our opinion? CMS certainly could have withdrawn the Proposed Rule entirely and started from scratch. The fact that CMS still intends to issue the Final Rule in 1 year is telling because it signals that CMS is serious about placing enforcement behind MMSEA Section 111 reporting. Additionally, the recent Section 111 webinar as well as the release of the most common Section 111 errors is indicative that CMS wants RREs to submit their data timely and accurately.
While RRE insurers have been gifted another year, now is the time to make sure that your reporting program and data is in order. At Sanderson Firm, we are finding that a true consultative approach to reporting may not be occurring by many Section 111 reporting vendors. For example, if your reporting agent is providing you with an error report for your Section 111 data but does not partner with your organization to explain what the errors mean and how to correct them, or is not providing oversight to ensure your errors are corrected, your reporting agent is potentially leaving your claims organization exposed to CMPs of up to $1000 per day/per claim come February of 2024.
At Sanderson Firm, we provide a comprehensive, consultative, and partnered approach to our Medicare Section 111 Reporting Services. From implementation to ongoing oversight, we provide critical communication, expert data analysis, and customized guidance to our clients every step of the way to maximize compliance. Sanderson Firm also provides Section 111 reporting audits to assist insurers in assessing their current compliance with Section 111 reporting guidelines. To learn more about our Section 111 services and for any questions on this extended Final Rule timeline, please contact me at heather@sandersoncomp.com.
