§ 423.760 Determinations regarding the amount of civil money penalties and assessment imposed by CMS. ( a ) *Determining the appropriate amount of any penalty.* In determining the amount of penalty imposed under § 423.752(c)(1), CMS considers the following as appropriate: ( 1 ) The nature of the conduct.
( 2 ) The degree of culpability of the Part D sponsor.
( 3 ) The adverse effect to enrollees which resulted or could have resulted from the conduct of the Part D sponsor.
( 4 ) The financial condition of the Part D sponsor.
( 5 ) The history of prior offenses by the Part D sponsor or principals of the Part D sponsor.
( 6 ) Such other matters as justice may require.
( b ) *Amount of penalty.* CMS may impose civil money penalties in the following amounts: ( 1 ) If the deficiency on which the determination is based has directly adversely affected (or has the substantial likelihood of adversely affecting) one or more Part D enrollees—up to $25,000 as adjusted annually under 45 CFR part 102 for each determination.
( 2 ) If the deficiency on which the determination is based has directly adversely affected (or has the substantial likelihood of adversely affecting) one or more Part D enrollees, CMS may calculate a CMP of up to $25,000 as adjusted annually under 45 CFR part 102 for each Part D enrollee directly adversely affected (or with a substantial likelihood of being adversely affected) by a deficiency .
( 3 ) ( i ) Definitions for calculating penalty amounts— ( A ) *Per determination.* The penalty amounts calculated under paragraph (b)(1) of this section.
( B ) *Per enrollee.* The penalty amounts calculated under paragraph (b)(2) of this section.
( C ) *Standard minimum penalty.* The per enrollee or per determination penalty amount that is dependent on the type of adverse impact that occurred.
( D ) *Aggravating factor(s).* Specific penalty amounts that may increase the per enrollee or per determination standard minimum penalty and are determined based on criteria under paragraph (a) of this section.
( ii ) CMS sets minimum penalty amounts in accordance with paragraphs (b)(1) and (2) of this section.
( iii ) CMS announces the standard minimum penalty amounts and aggravating factor amounts for per determination and per enrollee penalties on an annual basis.
( iv ) CMS has the discretion to issue penalties up to the maximum amount under paragraphs (b)(1) and (2) of this section when CMS determines that an organization's non-compliance warrants a penalty that is higher than would be applied under the minimum penalty amounts set by CMS.
( 4 ) For each week that a deficiency remains uncorrected after the week in which the Part D sponsor receives CMS' notice of the determination—up to $10,000 as adjusted annually under 45 CFR part 102.
( 5 ) If CMS makes a determination that a Part D sponsor has terminated its contract other than in a manner described under 423.510 and that the Part D sponsor has therefore failed to substantially carry out the terms of the contract, $250 as adjusted annually under 45 CFR part 102 per Medicare enrollee from the terminated Part D sponsor or plans at the time the Part D sponsor terminated its contract, or $100,000 as adjusted annually under 45 CFR part 102, whichever is greater.
( c ) *Amount of penalty imposed by CMS or OIG.* CMS or the OIG may impose civil money penalties in the following amounts for a determination made under § 423.752(a): ( 1 ) Civil money penalties of not more than $25,000 as adjusted annually under 45 CFR part 102 for each determination made.
( 2 ) With respect to a determination made under § 423.752(a)(4) or (a)(5)(i), not more than $100,000 as adjusted annually under 45 CFR part 102 for each such determination except with respect to a determination made under § 423.752(a)(5), an assessment of not more than the amount claimed by such plan or PDP sponsor based upon the misrepresentation or falsified information involved.
( 3 ) Plus with respect to a determination made under § 423.752(a)(2), double the excess amount charged in violation of such paragraph (and the excess amount charged must be deducted from the penalty and returned to the individual concerned).
( 4 ) Plus with respect to a determination made under § 423.752(a)(4), $15,000 as adjusted annually under 45 CFR part 102 for each individual not enrolled as a result of the practice involved.
[72 FR 68735, Dec. 5, 2007, as amended at 74 FR 1548, Jan. 12, 2009; 79 FR 29966, May 23, 2014; 81 FR 61562, Sept. 6, 2016; 86 FR 6121, Jan. 19, 2021; 89 FR 30841, Apr. 23, 2024]