[Code of Federal Regulations]
[Title 42, Volume 2]
[Revised as of October 1, 2007]
From the U.S. Government Printing Office via GPO Access
[CITE: 42CFR403.310]

[Page 53-54]
 
                         TITLE 42--PUBLIC HEALTH
 
                             HUMAN SERVICES
 
PART 403_SPECIAL PROGRAMS AND PROJECTS--Table of Contents
 
      Subpart C_Recognition of State Reimbursement Control Systems
 
Sec.  403.310  Reduction in payments.

    (a) General rule. If CMS determines that the satisfactory assurances 
required of a State under Sec.  403.304(c) and, if applicable, Sec.  
403.304(d) have not been met, or will not be met, with respect to any 
36-month period, CMS will reduce Medicare payments to individual 
hospitals being reimbursed under the State's system or, if applicable, 
under the Medicare payment system, in an amount equal to the amount by 
which the Medicare payments under the system exceed the amount of 
Medicare payments to such hospitals that otherwise would have been made 
not using the State system. The amount of the recoupment will include, 
when appropriate, interest charges computed in accordance with Sec.  
405.378 of this chapter.
    (b) Recoupment procedures. The amount of the overpayment will be 
recouped on a proportionate basis from each of those hospitals that 
received payments under the State system that exceeded the payments they 
would have received under the Medicare payment system. Each hospital's 
share of the aggregate excess payment will be determined on the basis of 
a comparison of the hospital's proportionate share of the aggregate 
payment received under the State system that is in excess of what the 
aggregate payment would have been under the Medicare payment system. 
Recoupments may be accomplished by a hospital's direct payment to the 
Medicare program or by offsets to future payments made to the hospital.
    (c) Alternative recoupment procedures. As an alternative to the 
recoupment procedures described in paragraph (b)

[[Page 54]]

of this section and subject to CMS's acceptance, the State may provide, 
by legislation or legally binding regulations, procedures for the 
recoupment of the amount of payments that exceed the amount of payments 
that otherwise would have been paid by Medicare if the State system had 
not been in effect.
    (d) Rule for existing Medicare demonstration projects. In cases of 
existing Medicare demonstration projects where the expenditure test is 
to be applied by a rate of increase factor, the amount of the excess 
payment will be determined, for the three hospital cost reporting 
periods beginning before October 1, 1986, by a comparison of the State 
system's rate of increase to the national rate of increase. Recoupment 
of excessive payments will be assessed and recouped as described in this 
section.

[51 FR 15492, Apr. 24, 1986, as amended at 61 FR 63748, Dec. 2, 1996]