US · guidance
CMS Pub. 100-16, ch. 12, § 30.2
The Novation Agreement Provisions
Exhibit 1 contains a Model novation agreement. This agreement is intended to serve only
as a guide in preparing a draft novation agreement. MA organizations may need to revise
the model, as necessary or appropriate, to conform to the circumstances of a particular
transaction involving a change of ownership.
Any novation agreement shall contain the following provisions:
• Assumption of contract obligations. The new owner must assume the transferor’s
entire Medicare book of business and all obligations under the contract.
• Waiver of right to reimbursement. The previous owner must waive its rights to
reimbursement for covered services furnished during the rest of the current
contract period.
• Guarantee of performance. The previous owner must guarantee for the remainder
of the current contract year and, if the bid has already been submitted by the
original owner entity, for the upcoming contract year, that the new owner will
carry out all terms of the contract.
• Records access. The previous owner must agree to make its books and records
and other necessary information available to the new owner and to CMS to permit
an accurate determination of costs for the final settlement of the contract period.
History
(Rev. 113, Issued: 05-17-13, Effective: 05-17-13, Implementation: 05-17-13)
Provenance
- Source
- cms.gov
- Retrieved
- 2026-08-25
- Edition
- iom-2026-08-25
- Content hash
51f1ae46d24f4c148175546d4843d7e0f2c61a0166395891ead7093e480d6169
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