Lawsuit blocks CMS repayment campaign

The Medicare and Social Security agencies’ efforts to recoup money erroneously refunded to beneficiaries have been stymied by a new lawsuit.

The Centers for Medicare and Medicare Services (CMS) has temporarily halted its campaign to get back the Part D premiums it mistakenly returned to 230,000 beneficiaries this summer.

The Center for Medicare Advocacy, on behalf of the Gray Panthers and the Pennsylvania-based Action Alliance of Senior Citizens, has initiated a lawsuit to block CMS from reclaiming the money. The group filed the suit on Friday in federal district court in Washington.

The plaintiffs say some beneficiaries are entitled to a “waiver of recovery” exempting them from repayment. CMS did not inform beneficiaries that they might qualify and get to keep the money despite being warned of the threat of a lawsuit, according to the Center for Medicare Advocacy.

CMS maintains that the waiver of recovery policy does not apply in these cases.

Sen. Jay Rockefeller (D-W.Va.), who has criticized CMS over the refunds, commented, “I hope the agency will move swiftly to notify beneficiaries of their rights under the law.”