CMS Pub. 100-06, ch. 3, § 140

This section outlines the required actions that Contractors must implement to safeguard the Medicare

Trust Fund when a provider files for bankruptcy. Although the term "provider” is used throughout this

chapter for consistency, these provisions are equally applicable to suppliers and physicians. However,

use of the term "provider" does not imply that the Medicare program classifies suppliers and physicians

as providers under its definitions. The section also explains how to accurately report the Centers for

Medicare & Medicaid Services' (CMS) accounts receivable balances and support CMS's efforts in

effectively evaluating and managing bankruptcy cases. This section does not address bankruptcy issues

related to debts arising under the Medicare Secondary Payer (MSP) provisions.

This chapter will guide Contractor staff through the initial stages of a provider bankruptcy. It is not

intended to be, and cannot serve as, a step-by-step process from beginning to end. Bankruptcy is

litigation. Bankruptcy law and the bankruptcy court affect all the actions CMS, and its Contractors take

concerning a bankrupt Medicare provider. Therefore, Contractor staff shall consult closely with the

servicing CMS Office or CMS Counsel. In some cases, attorneys from the Department of Justice (DOJ)

in Washington, D.C. or the United States Attorney's Offices will work directly with CMS. However, in

most cases, the servicing CMS Office will be in contact with the assigned CMS Counsel.