[Code of Federal Regulations] [Title 42, Volume 2] [Revised as of October 1, 2002] From the U.S. Government Printing Office via GPO Access [CITE: 42CFR420.410] [Page 812-814] TITLE 42--PUBLIC HEALTH HUMAN SERVICES PART 420--PROGRAM INTEGRITY: MEDICARE--Table of Contents Subpart E--Rewards for Information Relating to Medicare Fraud and Abuse, and Establishment of a Program to Collect Suggestions for Improving Medicare Program Efficiency and to Reward Suggesters for Monetary Savings Sec. 420.410 Establishment of a program to collect suggestions for improving Medicare program efficiency and to reward suggesters for monetary savings. (a) Definitions. As used in this section, the following definitions apply: Payment means a monetary award given to a suggester in recognition of, [[Page 813]] and as a reward for, a suggestion adopted by CMS that improves the efficiency of, and results in monetary savings to, the Medicare program. Savings means the monetary value of the net benefits the Medicare program derives from implementing the suggestion. Suggester means an individual, a group of individuals, or a legal entity such as a corporation, partnership, or professional association, not otherwise excluded under Sec. 420.410(d), who submits a suggestion under this section. Suggestion means an original idea submitted in writing. Suggestion program means the specific procedures and requirements established by CMS for receiving suggestions from the suggester on methods to improve the efficiency of the Medicare program, evaluating the suggestions and, if appropriate, paying a reward to the suggester for adopted suggestions that result in improved efficiency and produce monetary savings to the Medicare program. (b) General rule. CMS may make payment for adopted suggestions that increase the efficiency of the Medicare program and result in monetary savings. CMS only makes payment for suggestions in instances in which a reward is not otherwise provided by law. The determination to adopt a suggestion, to reward the suggester, and the method of calculating a reward are at the sole discretion of CMS. (c) Eligibility. Except as specified in paragraph (d) of this section, any individual, group of individuals or legal entity, such as a corporation, partnership or professional association, is eligible to submit a suggestion and be considered for a reward under this suggestion program if the suggestion is submitted to CMS in the manner set forth in paragraph (e) of this section. (d) Exclusions. Medicare contractors, their officers and employees, individuals who work for Federal agencies under a contract, employees of Federally-sponsored research and demonstration projects, Federal officers and employees, and immediate family members of these individuals, are excluded from receiving payment under the suggestion program. If, after the suggester receives a reward payment, CMS determines that the suggester was ineligible to receive the reward, CMS is not liable for the reward payment and the suggester must refund all monies received. (e) Requirements for submitting suggestions--(1) To be considered, the suggestion must be in writing, mailed to CMS, and must include the following information: (i) A description of an existing problem or need; (ii) A suggested method for solving the problem or filling the need; and (iii) If known, an estimate of the savings potential that could result from implementing the suggestion. (2) Suggestions must be mailed to: Centers for Medicare & Medicaid Services Suggestion Program, 7500 Security Blvd., Baltimore, Maryland 21244-1850. (3) Any suggesters interested in receiving a reward must provide CMS with the following information: An individual suggester must provide his or her name, a group of suggesters must provide the names of all the group members, and a legal entity must provide its name and the name of its representative. All suggesters must provide an address, telephone number, and any other identifying information that CMS needs to contact the suggester for additional information and, where applicable, to mail the reward. (f) Evaluation process--(1) Relevant factors. CMS evaluates all suggestions on the basis of the following factors: (i) Originality of suggestion. (ii) An estimate of potential monetary savings to the Medicare program. (iii) The extent to which Medicare program efficiency would be improved if CMS adopts the suggestion. (iv) Accuracy of the information reflected in the suggestion. (v) Feasibility of implementation. (vi) Nature and complexity of the suggestion. (vii) Any other factors that appear to be relevant. (2) Evaluation time limit. CMS concludes the evaluation process in a reasonable amount of time, not to exceed 2 years from the receipt date, taking into consideration the complexity of the suggestion, the number of possible implementation strategies, and CMS's current workload. [[Page 814]] (g) Basis for reward payment--(1) General rule. If CMS determines that it is appropriate to make a reward payment for a suggestion adopted in whole or in part, that results in improved efficiency and monetary savings to the Medicare program, the payment is based on-- (i) The actual first-year net savings to the Medicare program, or (ii) The average annual net savings to the Medicare program expected to be realized over a period of not more than 3 years if-- (A) An improvement is expected to yield monetary savings for more than 1 year and implementation involves substantial costs; or (B) Monetary savings are negligible in the first year but are expected to substantially increase in subsequent years. (2) Reward payment amount. CMS determines the amount of a reward payment using the following formula: (i) Net savings from $1,000 to $10,000--10 percent of the savings, with a minimum award amount of $100; (ii) Net savings of $10,001 to $100,000--$1,000 for the first $10,000 of savings, plus 3 percent of the net savings over $10,000; (iii) Net savings of more than $100,000--$3,700 for the first $100,000 of savings, plus 0.5 percent of savings over $100,000, with a maximum award amount of $25,000. (h) Adoption of suggestion and issuance of reward payment--(1) Adoption. Upon completing its evaluation, CMS decides whether to adopt a suggestion. If CMS receives the same or an overlapping suggestion from two or more unrelated parties, CMS will consider a reward only for the suggestion CMS received first, if the suggestion or overlapping part of the suggestion are identical, and CMS has adopted that part. If the suggestions are not identical, CMS will consider rewarding the suggestion received first, if it is feasible and CMS is able to adopt and implement the suggestion. If the first suggestion cannot be implemented, CMS may consider rewarding the suggestion received next, even if it is similar, provided CMS can adopt and implement the suggestion. (2) Issuance of reward payment. After the reward payment amount is determined, as described in paragraph (g) of this section, CMS mails payment to the suggester (or to the legal representatives referenced in paragraph (k) of this section) only after the suggestion has been in operation for 1 year. (i) Group suggestions. When CMS deems that a reward payment is appropriate for a suggestion submitted by a group of individuals, CMS pays an equal share of the reward to each of the individuals identified in the group. If an organization such as a corporation, partnership, or professional association submits a suggestion, CMS makes a single reward payment to that organization. (j) Change in name or address. It is the suggester's responsibility to notify CMS of any change of address or other relevant information. If the suggester fails to update CMS on any change in this information, and the reward payment mailed to the suggester is returned to CMS, the suggester must claim the reward payment by contacting CMS within 1 year from the date CMS first mailed the reward payment to the suggester. CMS does not pay interest on rewards that, for any reason, are delayed or are not immediately claimed. (k) Incapacitated or deceased suggester. If the suggester is incapacitated or has died, an executor, administrator, or other legal representative may claim the reward on behalf of the suggester or the suggester's estate. The claimant must submit certified copies of the letters testamentary, letters of administration, or other similar evidence to CMS showing his or her authority to claim the reward. The claim must be filed within 1 year from the date on which CMS first attempted to pay the reward to the individual who submitted the suggestion. (l) Maintenance of records--(1) CMS retains records related to the administration of the suggestion program in accordance with 36 CFR part 1228 (the regulations for the National Archives and Records Administration). (2) CMS does not disclose information submitted under the suggestion program, except as required by law. [64 FR 66401, Nov. 26, 1999] [[Page 815]]