357
‘‘(1) CONDUCT OF RANDOM PREPAYMENT RE-
VIEW.—
‘‘(A) IN GENERAL.—A medicare adminis-
trative contractor may conduct random prepay-
ment review only to develop a contractor-wide
or program-wide claims payment error rates or
under such additional circumstances as may be
provided under regulations, developed in con-
sultation with providers of services and sup-
pliers.
‘‘(B) USE
OF
STANDARD
PROTOCOLS
WHEN CONDUCTING PREPAYMENT REVIEWS.—
When a medicare administrative contractor con-
ducts a random prepayment review, the con-
tractor may conduct such review only in accord-
ance with a standard protocol for random pre-
payment audits developed by the Secretary.
‘‘(C) CONSTRUCTION.—Nothing in this
paragraph shall be construed as preventing the
denial of payments for claims actually reviewed
under a random prepayment review.
‘‘(D) RANDOM
PREPAYMENT
REVIEW.—
For purposes of this subsection, the term ‘ran-
dom prepayment review’ means a demand for
358
the production of records or documentation ab-
sent cause with respect to a claim.
‘‘(2) LIMITATIONS
ON
NON-RANDOM
PREPAY-
MENT REVIEW.—
‘‘(A) LIMITATIONS ON INITIATION OF NON-
RANDOM
PREPAYMENT
REVIEW.—A medicare
administrative contractor may not initiate non-
random prepayment review of a provider of
services or supplier based on the initial identi-
fication by that provider of services or supplier
of an improper billing practice unless there is a
likelihood of sustained or high level of payment
error (as defined in subsection (i)(3)(A)).
‘‘(B) TERMINATION OF NON-RANDOM PRE-
PAYMENT REVIEW.—The Secretary shall issue
regulations relating to the termination, includ-
ing termination dates, of non-random prepay-
ment review. Such regulations may vary such a
termination date based upon the differences in
the circumstances triggering prepayment re-
view.’’.
(b) EFFECTIVE DATE.—
(1) IN GENERAL.—Except as provided in this
subsection, the amendment made by subsection (a)
359
shall take effect 1 year after the date of the enact-
ment of this Act.
(2) DEADLINE
FOR
PROMULGATION
OF
CER-
TAIN REGULATIONS.—The Secretary shall first issue
regulations under section 1874A(h) of the Social Se-
curity Act, as added by subsection (a), by not later
than 1 year after the date of the enactment of this
Act.
(3) APPLICATION
OF
STANDARD
PROTOCOLS
FOR
RANDOM
PREPAYMENT
REVIEW.—Section
1874A(h)(1)(B) of the Social Security Act, as added
by subsection (a), shall apply to random prepayment
reviews conducted on or after such date (not later
than 1 year after the date of the enactment of this
Act) as the Secretary shall specify.
(c) APPLICATION TO FISCAL INTERMEDIARIES AND
CARRIERS.—The provisions of section 1874A(h) of the So-
cial Security Act, as added by subsection (a), shall apply
to each fiscal intermediary under section 1816 of the So-
cial Security Act (42 U.S.C. 1395h) and each carrier
under section 1842 of such Act (42 U.S.C. 1395u) in the
same manner as they apply to medicare administrative
contractors under such provisions.
360
SEC. 835. RECOVERY OF OVERPAYMENTS.
(a) 
IN
GENERAL.—Section 
1893 
(42 
U.S.C.
1395ddd) is amended by adding at the end the following
new subsection:
‘‘(f) RECOVERY OF OVERPAYMENTS.—
‘‘(1) USE OF REPAYMENT PLANS.—
‘‘(A) IN
GENERAL.—If the repayment,
within 30 days by a provider of services or sup-
plier, of an overpayment under this title would
constitute a hardship (as defined in subpara-
graph (B)), subject to subparagraph (C), upon
request of the provider of services or supplier
the Secretary shall enter into a plan with the
provider of services or supplier for the repay-
ment (through offset or otherwise) of such over-
payment over a period of at least 6 months but
not longer than 3 years (or not longer than 5
years in the case of extreme hardship, as deter-
mined by the Secretary). Interest shall accrue
on the balance through the period of repay-
ment. Such plan shall meet terms and condi-
tions determined to be appropriate by the Sec-
retary.
‘‘(B) HARDSHIP.—
‘‘(i) IN
GENERAL.—For purposes of
subparagraph (A), the repayment of an
361
overpayment (or overpayments) within 30
days is deemed to constitute a hardship
if—
‘‘(I) in the case of a provider of
services that files cost reports, the ag-
gregate amount of the overpayments
exceeds 10 percent of the amount paid
under this title to the provider of
services for the cost reporting period
covered by the most recently sub-
mitted cost report; or
‘‘(II) in the case of another pro-
vider of services or supplier, the ag-
gregate amount of the overpayments
exceeds 10 percent of the amount paid
under this title to the provider of
services or supplier for the previous
calendar year.
‘‘(ii) RULE
OF
APPLICATION.—The
Secretary shall establish rules for the ap-
plication of this subparagraph in the case
of a provider of services or supplier that
was not paid under this title during the
previous year or was paid under this title
only during a portion of that year.