| (a) If a managed care organization (MCO) decides to
recoup an overpayment from a provider or FMSA because of a discovery
of fraud or abuse as permitted by §353.505 of this chapter (relating
to Recovery of Funds), the MCO must have due process procedures that
include the following:
(1) written notice to the provider or FMSA of the MCO's
intent to recoup overpayments that includes the following:
(A) a description of the basis for the intended recoupment;
(B) the specific claims that are the basis of the intended
recoupment;
(C) the process by which the provider or FMSA should
send information to the MCO about claims that are the basis of the
intended recoupment;
(D) the provider's or FMSA's option to seek an informal
resolution with the MCO of the intended recoupment; and
(E) the MCO's process for the provider or FMSA to appeal
the intended recoupment;
(2) a process for the provider or FMSA to seek informal
resolution; and
(3) a process for the provider or FMSA to appeal the
intended recoupment.
(b) An MCO may recoup an overpayment only if a provider
or FMSA:
(1) does not appeal the alleged overpayment; or
(2) appeals the alleged overpayment and the final decision
from the appeal is favorable to the MCO.
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