CMS Pub. 100-08, ch. 8, § 8.3.1.1

Suspensions

(Rev.: 13762; Issued: 05-27-26; Effective: 06-29-26; Implementation: 06-29-26)

A payment suspension may be used when the UPIC, law enforcement, or CMS

determines that a credible allegation of fraud exists against a provider or supplier

(hereinafter referred to as provider). For purposes of section 8.3 et seq., these types of

payment suspensions will be called “fraud suspensions.”

Fraud suspensions may also be imposed for reasons not typically viewed within the

context of false claims. For example:

• The Quality Improvement Organization (QIO) has reviewed inpatient claims

and determined that the diagnosis related groups (DRGs) have been upcoded.

• The UPIC or MAC may suspect a violation of the physician self-referral ban.

For this reason, the violation may be considered the cause for a payment

suspension since claims submitted in violation of this statutory provision

must be denied and any payments made would constitute an overpayment.

• Even though services are rendered and may be determined as medically

necessary and reasonable by the Medicare contractor, law enforcement has

credible allegations of kickbacks.

• Forged signatures on medical record documentation (e.g., Certificates of

Medical Necessity (CMN), treatment plans, etc.) and/or other

misrepresentations on Medicare claims or associated forms to obtain

payment that would result in an overpayment determination.

Whether or not the UPIC recommends a payment suspension to CMS, the final

determination is determined on a case-by-case basis and requires review and analysis of

the allegation and facts. The following information is provided to assist the UPIC in

deciding when to recommend a payment suspension to CPI.

A. Complaints

There is considerable latitude with regard to complaints alleging fraud, waste, and abuse.

The provider’s Medicare history, including the volume and frequency of complaints

concerning the provider, and the nature of the complaints all contribute to whether a

payment suspension should be referred to CPI. If there is a credible allegation(s) that a

provider is submitting or may have submitted false claims, the UPIC may recommend a

fraud suspension to CPI only after the UPIC has vetted the provider in accordance with

Pub. 100-08, chapter 4, section 4.6. (If the MAC identifies the potential fraud issue from

a complaint, the MAC shall refer its information to the respective UPIC for

development).

B. Requests for Suspension of Payment

For initial UPIC requests to suspend payments, the UPIC shall inform its assigned BFL

of the potential suspension. The BFL will discuss all findings with the UPIC. After

informing the BFL about the suspension, the contractor shall complete the payment

suspension Administrative Action Recommendation (AAR) and submit the payment

suspension recommendation via the UCM if the contractor determines such action is

warranted. The AAR shall serve as the UPIC’s documented recommendation for CMS’

consideration of a payment suspension and, when completed, include the UPIC’s

findings and all pertinent provider/supplier information. The AAR, draft notice of

suspension, and all other relevant documentation that supports the suspension

recommendation shall be uploaded by the contractor as part of the UCM submission.

The UPIC shall also prepare and submit, if appropriate, a payment suspension referral

package to CPI via the UCM for all requests received from (but not limited to):

• CMS

• Office of Inspector General (OIG)

• Federal Bureau of Investigation (FBI)

• Assistant United States Attorney (AUSA)

• Other law enforcement agencies

C. Other Situations

Other situations that may be considered when recommending a fraud suspension to CPI

include, but are not limited to:

• Provider has pled guilty to, or been convicted of, Medicare, Medicaid,

TRICARE, or private health care fraud and is still billing Medicare for

services;

• Federal/State law enforcement has subpoenaed the records of, or executed a

search warrant upon, a health care provider billing Medicare;

• Provider has been indicted by a Federal Grand Jury for fraud, theft,

embezzlement, breach of fiduciary responsibility, or other misconduct

related to a health care program;

• Provider presents a pattern of evidence of known false documentation or

statements sent to the UPIC or the MAC; e.g., false treatment plans, false

statements on provider application forms.

D. Good Cause Exceptions

Reference is made in 42 CFR §405.371(b)(1) that allows for good cause exceptions to

not suspend payments or continue a payment suspension when there are credible

allegations of fraud. These exceptions may be considered for approval by CMS if any

apply:

• Law enforcement has requested that a payment suspension not be imposed

because such action may compromise or jeopardize its investigation;

• CMS/CPI has determined that a beneficiary access to care issue may exist

and potentially cause a danger to life or health in whole or part;

• CMS/CPI has been determined that other administrative remedies may be

implemented that would be more effective in protecting Medicare funds

(such as revocation, prepayment review); or

• CMS determines that the imposition or the continuation of a payment

suspension is not in the best interest of the Medicare program.

Every 180 calendar days after the initiation of a payment suspension based on credible

allegations of fraud, CMS is required to evaluate whether there is good cause to terminate

the payment suspension. Good cause to terminate a payment suspension is deemed to

exist if the payment suspension has been in effect for 18 months. However, there are two

exceptions. The first exception is that the case has been referred to and is being

considered by the OIG for an administrative action such as a civil monetary penalty or

permissive exclusion, or such administrative action is pending, and the OIG has made its

request to not terminate the payment suspension in writing. The second exception is that

the Department of Justice has submitted a written request to extend the payment

suspension based on the ongoing investigation and its anticipation of filing a criminal or

civil action or both, or based on a pending criminal or civil action or both. (See 42 CFR

§405.371(b)(2) and §405.371(b)(3).)

CMS/CPI makes the final decision on whether good cause to terminate exists, based on

the totality of the circumstances. For all fraud suspensions, the UPICs shall submit

requests to CPI via the UCM within 14 calendar days before the suspension expires. CPI

will evaluate the request to consider whether good cause to terminate the payment

suspension exists.