§1396m Withholding of Federal Share of Payments for Certain Medicare Providers

Summary

The Secretary can reduce the federal Medicaid money a State gets when certain hospitals or other providers either owe Medicare money or won’t give the information needed to figure out what they owe. This applies to institutions that have or had Medicare provider agreements and to other providers who accepted Medicare payment assignments and who, in the year before the quarter, filed no Medicare claims or filed claims worth less than the Medicare overpayments. The cut can’t be bigger than the smaller of two amounts: the federal share of what the State paid that provider, or the total Medicare overpayments to that provider. The State may be required to withhold the same amount from the provider. The Secretary must give at least 60 days’ notice before taking action, make rules to decide how setoffs work, return any amounts taken that turn out to be too much, and put recovered money back into the Medicare trust funds. A provider cannot demand those withheld amounts from the State if the Secretary ordered the withholding.