Debt Selection and Verification

70.4 – Debt Selection and Verification (Rev. 12438; Issued: 01-04-24; Effective: 02-06-24; Implementation: 02-06-24) MSP Contractors shall select eligible delinquent debts from their existing debt (open AR balances) for issuance of a DCIA ITR to Treasury letter. The ITR will advise the debtor of CMS’s intention to refer the debt to Treasury for further collection, if left unresolved. The MSP Contractors must review and update debt information as necessary. For purposes of DCIA debt selection/referral criteria, an MSP debt becomes delinquent: (1) If the debt has not been paid in full by the payment date specified in the agency’s initial written notification (i.e., the agency’s first demand letter), unless other payment arrangements have been made, or (2) If at any time after such notification, the debtor defaults on a repayment agreement. Specific to MSP, the term “delinquent” is defined as an outstanding debt for which any of the following apply: (a) full payment has not been made, (b) no response from the debtor regarding the debt, or (c) no valid documented defense to the debt. All validated debt for which no valid defense has been presented to the MSP Contractor with full supporting documentation is considered to be legally enforceable. A debt is not considered delinquent unless one of the above conditions are met within 60 days of the day of the agency’s initial demand letter. For example, if a demand letter is issued on 1/1/2022, the debtor has 60 calendar days (3/4/2022) to respond to, pay, or otherwise dispute the debt. On 3/5/2022, the debt is delinquent for the first day. Therefore, any reference to a debt being a certain number of days delinquent refers to the number of days after the 60-day period, not the number of days from the initial demand letter. For purposes of debt selection and referral, any dollar threshold includes both outstanding principal and outstanding interest. See the Medicare Financial Management Manual (CMS Pub. 100-06), Chapter 4.