(SEC)

If the contractor cannot complete the determination within the applicable deadline, then the contractor shall furnish notice of such delay to the provider or suppl ier, shall take no action to impose the penalty at issue, and shall seek to resolve the issues causing the delay.  If the contractor determines that all of the conditions specified in 10.2 have been met, then the contractor shall approve the provider or s uppliers request for a penalty waiver and shall not impose, or shall rescind, the penalty at issue.   If the contractor determines that any condition among those specified in 10.2 has not been met, then the contractor shall deny the provider or suppliers  request for a penalty waiver and shall thereafter consider the penalty at issue solely under the terms of the authority for imposing such penalty or under such other authority as may be applicable in the circumstance.   10.10 - Notice of the Penalty Waiver  Determination  (Rev. 739, Issued: 11- 01-05, Effective: 07- 24-03, Implementation: 01 -19-06)  The contractor shall furnish notice to the provider or supplier of the contractors penalty waiver determination.   If the penalty waiver was not granted in whole or  in part, the notice must specify the basis for the adverse determination.  Every notice of a penalty waiver determination must include statements: a) that the provider or supplier has a right to a reconsideration of the penalty waiver determination, b) de scribing the means for filing a request for reconsideration, c) specifying the deadline for making such a request, and d) that the provider may also request a hearing and may present written evidence and arguments.  The contractor should elect to furnish notice concerning the penalty waiver determination coincident with, or in lieu of, its determination regarding the imposition of the penalty under the penalty authority.  10.11 - Reconsideration of the Penalty Waiver Determination  (Rev. 739, Issued: 11- 01-05, Effective: 07- 24-03, Implementation: 01 -19-06) A provider or supplier may request a reconsideration of an adverse penalty waiver determination.   The provider or supplier must file such request for reconsideration in accordance with the procedures and deadline specified in the notice of the adverse determination described in 10.10 above.  If a request for reconsideration is timely filed by the provider or supplier, the contractor shall reconsider its penalty waiver determination and shall allow the provider or supplier to be heard concerning the basis of the provider or suppliers request or to submit written arguments and evidence in support of its contentions, provided such written arguments and evidence are submitted within 30 days of the provider or  suppliers request for reconsideration or within 10 days of any hearing that may be requested  on the matter, whichever is later.   The contractor shall complete its reconsideration within 30 days of receiving such request, of any hearing that may be conducted on the matter, or of any filing of written arguments or evidence, whichever is later.   The contractor shall make a reconsideration decision based on the standards specified in this section and furnish appropriate notice of such decision to the provide r or supplier.   10.12 - Recordkeeping (Rev. 739, Issued: 11- 01-05, Effective: 07- 24-03, Implementation: 01 -19-06)  The contractor must compile a record of each penalty waiver determination.   Such record must include all documentary material that relates to  a particular matter, regardless of form or format.   Such record shall be associated with the record concerning the penalty in question and shall be retained and disposed of in accordance with the record retention policies and procedures that apply to the maintenance of the associated penalty record.   In the case of a request for which no certain penalty attaches, such as in the case of a transfer, the penalty waiver record shall be retained and disposed of in accordance with the record retention policies a nd procedures that apply to claims records generally.   10.13 - Reporting  (Rev. 739, Issued: 11- 01-05, Effective: 07- 24-03, Implementation: 01 -19-06)  Contractors shall submit both detailed and summary quarterly reports of penalty activities and shall attach to such reports documentation of all previously unreported erroneous guidances.   10.14 - Corrective Action  (Rev. 739, Issued: 11- 01-05, Effective: 07- 24-03, Implementation: 01 -19-06)  Upon a determination that a particular guidance is erroneous, if corrective action with respect to such guidance has not previously been taken, the contractor shall take appropriate action to eliminate or mitigate the effects of the erroneous guidance.   10.15 - Effective Date  (Rev. 739, Issued: 11- 01-05, Effective: 07- 24-03, Implementation: 01 -19-06)  This section applies to guidance issued on or after July 24, 2003 (that relates to Medicare fee-for-service).  Transmittals Issued for this Chapter   Rev #  Issue Date  Subject  Impl Date  CR#  R739CP  11/01/2005  Initial Publication of Chapter -Erroneous Guidance -Basis to Waive Penalty  01/19/2006  3898  Back to top of chapter