Answers to Frequently Asked Questions (FAQs) Regarding Extended Repayment Plans (ERP)
What is an extended repayment plan (ERP)?
An ERP is a payment method used by providers to repay a Medicare overpayment over a fixed period. When a provider submits ERP documentation and it is subsequently approved by WPS, the provider will receive an approval notice detailing the terms of the ERP. The notice will include an amortization schedule that identifies the length of the repayment period, applicable interest rate, monthly payments, and the breakout of interest and principal. Where an ERP is approved, the period of repayment will be based on the determination date and will not exceed 60 months.
When should a provider submit a request for an ERP?
A provider can submit an ERP request at any time the overpayment is outstanding. However, to avoid the withholding of Medicare payments, the provider is encouraged to submit the ERP documentation, along with the first anticipated monthly payment within 15 days from the date of the first demand letter.
What documentation should be included with the ERP request?
Providers are required to submit a written request, multiple financial documents, and the first anticipated monthly payment. Please see Repayment Plan Checklist 
for a detailed listing of the required items.
What happens when an ERP request is received and is missing documentation?
If any of the required documentation is missing and there is no reasonable explanation, a letter will be issued requesting that the missing items be submitted within 15 days from the date of the notification letter.
What is the applicable interest rate on an ERP?
The interest rate on an overpayment that is repaid using an approved ERP is based on the rate that is in effect on the date of the first demand letter.
What happens when an ERP request is submitted without the first payment?
The provider's payments will be subject to a 30 percent withhold once the debt is eligible for withholding. The withhold will remain in place until the anticipated monthly payment is received. Any payment recovered will be applied towards the debt and will not be refunded. The provider can elect to have the first anticipated payment withheld from their Medicare payments by submitting a written request.
Are providers required to submit payments during the ERP review period?
During the ERP review period, the provider must submit the anticipated monthly payment based on the amortization schedule that is included with their documentation. The payments must be submitted 30 days from the date of the first demand letter.
How long does it take to approve or deny the ERP request?
Once all of the required documentation is received, WPS will have 20 days to approve, deny or make a recommendation to CMS. If the request is for 12 months or less, WPS will approve or deny the request. If the request is greater than 12 months, WPS will review the documentation and submit a recommendation to CMS, who will make the final determination.
When are the monthly payments due on an approved ERP?
The monthly payment must be submitted every 30 days from the determination date, which is the date of the first demand letter. The due date of the monthly payment will be identified in the approved amortization schedule.
What happens when an ERP request is denied?
WPS will issue a denial notice and the provider's Medicare payments will be placed on 100 percent withhold until the overpayment is liquidated.
What happens when the provider fails to submit a monthly payment on an approved ERP?
When a monthly payment is submitted late, the ERP is considered delinquent. The provider's payments will be placed on 100 percent withhold in an effort to recoup the monthly payment. The provider's payments will remain on withhold until the monthly payment is recovered in full.
When is an approved ERP considered to be in default?
After two consecutive monthly payments are missed, the approved ERP is considered to be in default. Collection efforts will resume and the provider's payments will be subject to 100 percent withhold until the debt is liquidated. The interest rate on the principal balance will change to the current prevailing rate, if the current prevailing rate is higher than the rate stated in the first demand letter.
What happens when an ERP is approved and an underpayment is subsequently determined for a different fiscal year end?
WPS will notify the provider of the underpayment and the provider will have 15 calendar days from the date of the notice to submit a statement including pertinent evidence (supporting documentation) as to why part or all of the underpayment should not be offset. If the provider submits a timely response, WPS will review the documentation and make a determination as to whether the underpayment should be released or applied in whole or in part to the ERP. Once a determination is made, WPS will issue a written notice to the provider. If the provider does not respond within the required time, WPS will offset the underpayment against the ERP.
What happens when there is an approved ERP and there is an adjustment to the overpayment based on a subsequent cost report settlement completed for the same fiscal year?
If the adjustment reduces the original overpayment, the principal and interest amounts will automatically be adjusted to reflect the decrease in the ERP and a letter and/or revised amortization schedule will be issued to the provider. The monthly payments will remain the same; however, the length of the ERP may change. If the adjustment increases the original overpayment, a new overpayment will be established and a first demand letter will be issued.
Page Last Updated: Thursday, 18-Mar-2010 05:48:29 CDT
