Medicare Overpayment & Recoupment Defense Attorney | Healthcare Reimbursement Lawyer

Nationwide Defense for Medicare Overpayment Demands and Recoupments 

Hendershot Cowart P.C. defends healthcare providers nationwide against Medicare recoupment demands. With decades of healthcare law experience, we represent providers facing overpayment determinations, post-payment audits, and fraud investigations by the Centers for Medicare & Medicaid Services (CMS).

We combine proactive legal counsel with aggressive defense strategies to help you contest CMS overpayment demands and protect your practice from devastating financial penalties.

On this page:

• What Constitutes a Medicare Overpayment?
• What to Do if You Receive a Medicare Overpayment Demand Letter
• Medicare Overpayment Defense Services
• Appealing a Medicare Overpayment Decision
• How Far Back Can Medicare Go to Recoup Payments?
• What Happens If You Don't Return an Overpayment?
• How Are Medicare Overpayments Determined?
• Preventive Legal Counsel
• Overpayment Through Internal Audit? 
• Contact Hendershot Cowart P.C. 

Learn more about our Medicare repayment demand legal services. Call (713) 783-3110 for a confidential consultation.

What Constitutes a Medicare Overpayment?

According to CMS, an overpayment occurs when CMS pays a provider more than the amount due and payable under existing laws and regulations. Once identified, these overpayments create immediate debt obligations to the federal government, triggering the Medicare overpayment recovery process, which often begins with a demand letter.

A CMS overpayment demand letter should identify:

• The basis for CMS's overpayment determination
• Specific claims and dates of service in question
• Calculation methodology used for overpayment amounts
• Available deadlines for response and appeal options
• Interest accrual rates and recoupment timeline

Once CMS sends that demand letter, providers face strict timelines for response and repayment. Our healthcare overpayment defense attorneys can intervene to help protect your rights and minimize financial exposure.

What to Do if You Receive a Medicare Overpayment Demand Letter?

If you receive a demand letter, contact a Medicare audit defense attorney immediately. Your attorney can help you challenge the overpayment demand and ensure you meet all critical deadlines.

There are several ways to respond to a Medicare overpayment demand. You can:

• Make an immediate payment;
• Request immediate recoupment (give instructions to recover the overpayment from future payments); or
• Work with an attorney to challenge the audit findings and dispute the repayment demand.

Our Nationwide Medicare Overpayment Defense Services

You have the right to challenge the audit that led to the repayment demand and potentially overturn or minimize the financial impact of a Medicare repayment demand. 

Our Medicare overpayment attorney team provides comprehensive representation during all phases of Medicare audits, investigations, and recoupment proceedings. We handle cases involving Medicare Administrative Contractors (MAC), Recovery Audit Contractors (RAC), and Unified Program Integrity Contractors (UPIC) across all federal jurisdictions.

Based on which Medicare contractor audited your practice, we can dispute the overpayment demand using these approaches:

• Conduct Internal Audits: Following overpayment allegations, our Medicare overpayment lawyer team can assist with comprehensive internal audits. If legitimate billing errors are discovered, we manage Voluntary Refund submissions under Medicare's 60-day rule to minimize penalties, avoid False Claims Act liability, and demonstrate good-faith compliance.
• Submit a Medicare Rebuttal: For MAC determinations, providers have 15 calendar days to submit rebuttal statements. Our overpayment recoupment attorneys prepare comprehensive rebuttal statements that explain why recoupment should be stopped and offer documentation and evidence to support our reasoning.
• Enter RAC’s 30-Day “Discussion Period”: For overpayment determinations from a RAC (such as Cotiviti or Performant Recovery), providers have 30 days from the Review Results Letter to request a discussion period – essentially a pause button to allow providers to review the findings and respond. Our healthcare attorneys can present additional evidence to support disputed claims and challenge audit methodologies before formal recoupment begins.
• Request Physician-to-Physician Review: When medical necessity is questioned, we arrange direct communication between the treating physician and the RAC's medical director. This allows the physician to present their clinical rationale for the care provided through an informal teleconference.
• Negotiate Payment Arrangements: For cases where dispute isn't economically viable, we negotiate immediate payment plans or recoupment schedules that minimize practice disruption while satisfying federal requirements. We can also help you document financial hardship in order to request modified payments.
• File Formal Medicare Appeals: If overpayment determinations lack merit and informal appeals have been unsuccessful, our Medicare reimbursements lawyers can challenge CMS decisions through Medicare’s formal, five-level appeals process.

Appealing a Medicare Overpayment Decision

Medicare has a formal appeals process with five levels of review, each with specific timelines and requirements. Attorney representation is critical – especially at the hearing stage (level three), which allows healthcare providers to present evidence and testimony before an Administrative Law Judge.

Medicare’s five appeal levels include:

1. Redetermination by Medicare Administrative Contractor: The redetermination request is essentially your formal written argument to Medicare explaining why their initial payment decision was incorrect, supported by documentation and policy references. It's the foundation of your entire appeals case, so it should be thorough and well prepared.
2. Reconsideration by Qualified Independent Contractor (QIC): If the redetermination is unfavorable or only partially favorable, the provider may request in writing, within 180 days, a reconsideration performed by a QIC – independent contractors with fresh perspective on the disputed claims. 
3. Administrative Law Judge (ALJ) Hearing: You have 60 days to file your third-level appeal. At this level, an Administrative Law Judge (ALJ) will provide independent review of your case at a formal hearing. Providers and their attorney can present testimony and legal arguments similar to a court proceeding. If the ALJ level process reverses the Medicare overpayment determination, Medicare will refund both principal and interest collected, and pay interest on any recouped funds that Medicare took from ongoing Medicare payments.
4. Medicare Appeals Council Review: Again, you have 60 days to appeal to the next level. At this stage, a Department of Health and Human Services (HHS) Appeals Board (the Medicare Appeals Council) will review your case and issue a decision within 90 days of your request. 
5. Federal District Court Review: At the fifth and final level of appeal, a Federal District Court will review your case.

When valid first- and second-level appeals are filed, CMS cannot recoup overpayments until redetermination and reconsideration decisions are issued. Our overpayment recoupment attorneys can ensure appeals are filed on time to trigger these automatic stay protections.

How Far Back Can Medicare Go to Recoup Payments?

Medicare contractors typically review claims up to three years from filing dates under standard audit authority. 

However, specific circumstances can extend or limit these lookback periods:

• Standard RAC/MAC audits: Three years from claim payment date
• Self-disclosed overpayments: Six-year lookback period from overpayment receipt
• Fraud investigations: No statutory limitation period

Our healthcare overpayment defense attorneys help providers understand applicable limitation periods and develop strategies that minimize exposure during audit periods.

What Happens If You Don't Return an Overpayment?

Ignoring a Medicare overpayment demand triggers an escalating collection process that can devastate your practice's finances.

1. The 61-90 Day Warning: If you don't pay the full amount, CMS will send an "intent to refer" (ITR) letter within 61 to 90 days of the initial demand. This letter gives you one final chance to refund the overpayment or set up an Extended Repayment Schedule (ERS).
2. Treasury Collection Begins: Miss this deadline, and your Medicare Administrative Contractor (MAC) refers your debt to the U.S. Treasury or a Treasury-designated collection center to aggressively pursue payment.

The Treasury has extensive collection powers, including:

• Demand letters and phone calls
• Skip tracing to locate you and your assets
• Administrative offset (seizing federal payments owed to you)
• Private collection agency referrals
• Federal salary garnishment
• Administrative wage garnishment
• Referral to the Department of Justice for federal litigation

The bottom line: Medicare overpayment demands don't disappear. They escalate into federal debt collection with serious consequences for your practice and personal finances.

How Are Medicare Overpayments Determined?

Medicare overpayments are identified through multiple CMS contractor methods and data analysis systems, including: 

• Post-payment audits by MACs using statistical sampling
• RAC reviews targeting high-risk billing patterns
• Comprehensive Error Rate Testing (CERT) program random sampling
• Advanced data analytics identifying billing anomalies and outliers
• Provider self-audits and voluntary compliance program reporting
• Whistleblower complaints and fraud hotline reports
• HHS-Office of Inspector General targeted investigations

Common reasons for Medicare overpayment:

• Administrative and billing system errors affecting claim processing
• Documentation deficiencies that fail to support billed services
• Duplicate submissions for identical services and dates
• Furnishing and billing for excessive or non-covered services
• Incorrect coding that inflates reimbursement amounts
• Insufficient documentation to establish medical necessity
• Payment for excluded or medically unnecessary procedures
• Payments directed to incorrect payees or providers

The most effective protection against overpayments involves implementing comprehensive billing compliance programs with regular internal audits. 

Preventive Legal Counsel

Medicare regulations are complex and constantly evolving, making unintentional violations common among well-intentioned providers. When violations occur, subsequent healthcare fraud investigations create tremendous challenges and exposure to penalties that threaten both practices and professional licenses.

Proactive healthcare compliance is always the least costly option. Our federal healthcare compliance team can review your regulatory compliance program to reduce liability risk.

Key elements of a healthcare compliance program include:

• Regular internal auditing and monitoring of denial patterns 
• Monitoring Medicare coverage policies for regulatory updates and rule changes
• Staff training on compliance requirements and on identifying and reporting potential issues
• Maintaining complete, legible medical records that include the reason for encounter, relevant history, findings, test results, and dates of service
• Documentation of your good-faith compliance efforts

Our overpayment recoupment attorneys help providers implement compliance programs that identify potential issues before they become federal investigations.

Discovered an Overpayment Through Internal Audit? Medicare Offers a 60-Day Grace Period

If your practice identifies an overpayment – through internal audit, an overpayment demand, or otherwise – you can report and return the Medicare overpayment within 60 days (with a 180-day suspension of the deadline to conduct a “timely, good-faith” investigation into related overpayments).

Our Medicare reimbursement lawyers assist providers with:

• Documenting when the overpayment was discovered
• Leading the good-faith investigation into related overpayments
• Adhering to the strict investigation timeline to avoid False Claims Act liability
• Reporting and coordinating the return of overpayments – either through immediate payment, recoupment from future payments, or an extended payment plan

Proactive overpayment identification and prompt reporting demonstrate good-faith compliance that often reduces penalties and prevents formal enforcement actions.

Contact Hendershot Cowart P.C. for Medicare Overpayment Defense

If you're facing Medicare overpayment demands, audit notifications, or fraud investigations, don't navigate the complex federal healthcare regulatory system alone. 

Contact us for an initial consultation by calling (713) 783-3110 or contact us online. Our nationwide health law practice serves providers facing CMS overpayment and recoupment challenges in all 50 states.