CMS Issues Frequently Asked Questions Document for Civil Money Penalties

Question mark drawn in white chalk on a rectangular chalkboard with a white frame.

by B. Smith

In a follow-up to the release of the final rule for Civil Money Penalties (CMPs), the Centers for Medicare and Medicaid Services (CMS) issued an alert regarding CMP frequently asked questions (FAQ).  Much of the alert reiterates the details of the rule, but the alert also includes several important clarifications in a question and answer format.

FAQ Highlights

Of note, in response to the question “What is subject to a penalty?” CMS clarifies that not only does Ongoing Responsibility for Medicals (ORM) and Total Payment Obligation to Claimant (TPOC) have to be reported in a timely fashion (i.e., within the one-year period after acceptance of ORM or settlement), but the record must also be accepted by CMS and not rejected due to error. In addition, CMS notes that ORM and TPOC will be evaluated separately, which means that one claim can be subject to two potential penalty situations.

Further, CMS states that because a random auditing system will be utilized to determine non-compliance, no limits will be placed on the number of times a Responsible Reporting Entity (RRE) can be audited. CMS also reviews the auditing system outlined in the rule, which we discussed in our recent blog, Analysis and Highlights: CMS’ Civil Money Penalties Final Rule.

If an individual becomes entitled to Medicare after ORM is assumed, the timeliness of reporting is based on the individual’s eligibility for, or entitlement to, Medicare. CMS also notes that if settlement occurs, but the TPOC amount is not determined until later, CMS will use the “TPOC Date” to determine timeliness unless the “Funding Delayed Beyond TPOC Date” is populated (then the “Funding Delayed Beyond TPOC Date” will be used).

Additional FAQ Items

Additional items from the alert are below:

  • In January 2024, CMS will be hosting webinars to share additional information about CMPs.
  • CMS also clarified that CMPs will not alter Section 111 obligations and RREs should continue to report as required.
  • CMS states that the key dates associated with the rule, as noted in the published text, are as follows:
    • October 11, 2023 – Publication of the rule in the Federal Register
    • December 11, 2023 – Effective date of the rule and when and it will be integrated into the Code of Federal Regulations
    • October 11, 2024 – The rule is applicable. From this date forward, RREs will be held accountable for ensuring that all records are reported in a timely manner
  • CMS again clarifies that the earliest date penalties can be issued is October 2025. This is one year after the rule is applicable. As such, RREs have a one-year period to report the required information before CMPs would potentially be imposed. There will be no look back period as penalties will be prospective in nature.
  • Additional questions about the reporting process should be posed to an RRE’s EDI representative and specific questions or comments regarding CMPs can be sent to the Section 111 CMP mailbox at [email protected].


When assessing your current Section 111 Reporting program, it will be important not only to determine who and how reporting to CMS is being completed, but also to confirm that this information is correct and has been accepted by CMS. CMS clearly states in this alert that records reporting ORM and TPOC must not be rejected due to error. As such, an RRE could report ORM and TPOC to CMS in the required timeframe, but if the record consists of errors preventing CMS from reviewing this data, the penalty clock can start ticking until actual acceptance of this information.

Your Section 111 Reporting partners/agents should be alerting you to situations where errors are preventing proper reporting and provide support on how to fix any errors. In addition, reporting systems should check for errors prior to your CMS quarterly submission to prevent rejection of records. Section 111 Reporting requires more than just data in and data out. Rather, those providing the data, extracting the data, and suppling the data to CMS, must be knowledgeable about the reporting process to help you avoid mistakes and potential penalties. A good way to assess whether your current Section 111 Reporting is being done accurately and timely is to conduct a Section 111 audit. A review of a sample of cases can help determine potential risks and identify opportunities to strengthen your reporting process.

IMPAXX offers Section 111 Reporting, Section 111 audit reviews, consultation services, and training. We look at your program holistically and provide a comprehensive approach to help you meet your reporting obligations. For additional information about Civil Money Penalties, Section 111 Reporting, or our related services, please contact the IMPAXX Settlement Consulting team at [email protected].