Medicare Part D Overpayment Recovery

Medicare benefits, as part of the Social Security Administration, have been the subject of many controversies. One of the most recent was a case brought by a group of litigants against the efforts of the government to recover Medicare Part D benefits paid by mistake.

Confusion

• In 2006, the Social Security Administration distributed checks to Medicare recipients to refund a portion of their Medicare premiums because they had been mistakenly overcharged. Later it was discovered that the seniors had been charged correctly and that the refund check must be returned to the government.

Waivers

• Many seniors who received these checks had already cashed them and used the money. For them to return the money to the Social Security Administration would inflict a financial hardship. As a result these seniors were allowed to apply for a waiver of the overpayment and keep the money.

Part D

• Statutes concerning Medicare payments for Parts A, B, and C provide for recipients to be excused from returning overpayment provided they prove their hardship. Part D, the drug benefit portion of Medicare, was not included in this provision, and recipients of refunds of their premiums or portions of their premiums were not entitled to keep the money.

Affordable Care Act

• The health care reform act of 2010 clarifies the government's power to recover overpayment to Medicare Part D providers and recipients. Both seniors and drug companies must self-report and return overpayment within 60 days.