CMS Solicits Public Comment on Monetary Penalties

CMS Solicits Public Comment on Monetary Penalties

On December 10, 2013, CMS issued an advanced notice of proposed rulemaking that solicits public comment on specific practices for which civil money penalties may or may not be imposed for failure to comply with MSP reporting requirements for certain group health plans (GHP) and non-group health plan arrangements (NGHP).

The MMSEA Act of 2007 established reporting requirements for certain GHP and NGHP arrangements including GHP self-insurers, governmental entities, and employee organization plans and including NGHP liability insurance (including self-insurance), no-fault insurance, and workers’ compensation arrangements.

Reporting by these two entities enables CMS to determine when another insurance provider is the primary payer making Medicare the secondary payer and the individual is a Medicare beneficiary. CMS uses this information in the Medicare claims payment process to prevent inappropriate payments and seek reimbursement if Medicare covered medical expenses when another entity was really responsible for payment.

The MMSEA authorizes Medicare to impose monetary penalties against GHPs and NGHPs who do not comply with the reporting requirements. On January 10, 2013, Congress enacted the Strengthening Medicare and Repaying Taxpayers Act of 2012 (SMART Act), which changed the requirement for applying penalties to NGHPs.


In order to implement the statutory provisions regarding the imposition of monetary penalties, CMS is soliciting public comment regarding the following proposals:

  • Practices for which monetary penalties would or would not be imposed on GHPs and NGHPs who are responsible for reporting information to CMS. This includes criteria and/or mechanisms CMS may use to evaluate whether and when it would impose CMPs.
  • Methods to determine the dollar amounts for monetary penalties to be levied against a NGHP for non-compliance.
  • Definitions and criteria that constitute “good faith effort(s)” by NGHPs to identify a Medicare beneficiary for the purposes of reporting.

The advanced notice of proposed rulemaking rule is now posted in the Federal Register ( CMS is accepting comments on the proposed rule until February 10, 2014.

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