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CMS Launches New NGHP Civil Money Penalties Webpage

October 4, 2024
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by B. Smith

The Centers for Medicare and Medicaid Services (CMS) has launched a new webpage regarding Section 111 Civil Money Penalties (CMPs) for Non-Group Health Plans (NGHP). The webpage reviews the CMP process and is now available at the following link https://www.cms.gov/medicare/coordination-benefits-recovery/mandatory-insurer-reporting-nghp/nghp-civil-money-penalties.

CMS provides some clarification and illustrations on the webpage including a CMP workflow document. As noted previously by CMS, beginning January 2026 and continuing, CMS will randomly select 250 records per year to audit which will consist of both Group Health and NGHPs records. CMS defines a “record as follows:

For the purposes of compliance with mandatory insurer reporting obligations, a “record” is defined as any individual occurrence of a Total Payment Obligation to Claimant (TPOC) or Ongoing Responsibility for Medicals (ORM) for a Medicare beneficiary that must be submitted via the Section 111 reporting process. Note: If a particular case has both an ORM and a TPOC component, this will constitute two records.

CMS also notes that records will include both Section 111 records and non-Section 111 records which consist of a Total Payment Obligation (TPOC) and/or Ongoing Responsibility for Medical (ORM) that has been reported through other coordination of benefits collection methods such as a self-report from the claimant. CMS provides an example to illustrate untimely reporting and penalty amounts:

Example: An RRE’s record is randomly selected for a CMS quarterly audit. The RRE reported the TPOC on May 1, 2026, but the Medicare beneficiary settled their liability case on February 5, 2025.

    • The record should have been reported no later than February 5, 2026, but was actually reported 85 days later.
    • The RRE would be subject to a CMP for the period between February 5, 2026, and May 1, 2026. A penalty amount of $250 per day of noncompliance, 85 days, would be applied. An Informal Notice identifying the noncompliant record would be issued with a potential CMP amount of $21,250 (as adjusted for inflation).

CMS will only communicate with the RRE when there is a potential instance of non-compliance. In addition to walking through the notice and appeal process, CMS reminds RREs that they must ensure their Profile Report recertification has been completed and includes accurate information as the Authorized Representative will receive a copy of the CMP correspondence and a copy will be issued to the Account Manager. CMS also highlights that it is the RRE’s responsibility and not the reporting agent’s responsibility to ensure that Section 111 records are submitted timely.

Section 111 CMPs are coming and ensuring that reporting is timely and accurate is imperative to avoid penalties and excessive costs. If you are working with a reporting agent, you should ensure that they provide transparency in the reporting process and feedback to help alert you to potential penalty situations. Section 111 Audits are also an important tool to avoid penalties and identify mistakes in your reporting program. For more information about IMPAXX’s Section 111 Reporting Services including Section 111 Reporting, Audits, training and consultation services, please contact the Settlement Consulting team at [email protected].