Skip to main content


60-day 'Look-back' Rule Change Creates Challenges for Providers

By John Commins  
   March 18, 2016

A legal expert discusses the implications of Medicare's final rule governing billing and coding errors on physicians practices and hospitals.

A final rule change issued last month by the Centers for Medicare & Medicaid Services could have a significant impact on how physician practices address billing and coding errors dating back six years.

John Fanburg, managing partner and chair of the health law practice at Brach, Eichler in Roseland, NJ, spoke with HealthLeaders Media about the final rule and what physician practices should do to prepare for any billing discrepancies, and what the potential implications are for hospitals. The following is an edited transcript.

HLM: What does this rule change do?

Fanburg: The issue had to go with how far back the provider had to go to make the refund. For some time there has been this 60-day timeframe within which to make the refund due to the overpayment.

There has been some ambiguity as to when that clock runs and the proposed rule required the timeframe to go back 10 years. For obvious reasons, the healthcare industry totally rejected and lobbied against a 10-year look-back period, but they did settle on six.

Some providers would say that is not much better, but at least it’s not 10. The rule clarified the use of the word ‘identification:’ When the overpayment is identified, what does that really mean, and what is the look-back period. These were critical for providers to understand how to be compliant.

HLM: What was the look-back period before the rule change?

Fanburg: There was always a proposed rule. No one was ever clear. There was a statute of limitations argument and depending upon the case it could be four, five, or six years.

HLM: When does the clock start on the 60-day identifier?

Fanburg: Where they ended up is when the provider knew or should have reasonably known. That could be played with as well. So, they impose an obligation to make reasonable inquiry if something were to happen. They are saying that if you get some type of credible inquiry or report you have an obligation relatively quickly based upon the facts to make due inquiry in terms of whether or not there was a problem.

Lots of things can be inadvertent. For example, the practice sees their Medicare reimbursement jump up for no apparent reason. It could be coding mistakes, which occur all the time. Sometimes there is a computer glitch and a different code goes out.

Maybe, in more egregious situations, the practice is involved in some type of fraudulent action. Maybe a provider who you thought was licensed is not licensed, whether it’s a physician or a physician assistant, etc. And when it is identified or comes to the level of being a problem, the group has to make relatively quick inquiry to determine whether or not that has happened. That is when the clock would start to run.

HLM: What should a practice do if they think they’ve got a problem?

Fanburg: I usually recommend that they bring in an independent third party and do a quick assessment to determine if their suspicions are correct, because a lot of times the provider really doesn’t know the magnitude of the economics that is called for so that they can comply.

The government is trying to make this as user-friendly as possible (although some might disagree) because they want the providers to voluntarily do this. It is a lot easier for providers to voluntarily do it than for the government to do audits and investigations, or wait for their hotline tips to identify. They seem to be very cooperative when a provider comes to them voluntarily and they respond in kind.

HLM: What sort of challenges are created with this six-year look-back period?

Fanburg: Let’s say a physician leaves the practice, retires, is bought out, and all of a sudden two years later there’s an identified overpayment. They go back six years. This retired physician was part of the practice at that time who received their pro rata portion of the money.

John Commins is a content specialist and online news editor for HealthLeaders, a Simplify Compliance brand.

Get the latest on healthcare leadership in your inbox.