What Are the Critical Process Steps to Medicare Conditional Payment Resolution?

If your personal injury practice involves Medicare beneficiaries, conditional payment resolution is not optional. It is a legal requirement and a high-risk area if mishandled. Understanding the process and taking the right steps can protect your client, your firm from malpractice risk, and your firm’s reputation. Here’s what you need to know.

1. Notify Medicare Immediately

Once a claim is opened, you must report the case to the Benefits Coordination and Recovery Center (BCRC). This alerts Medicare to a potential recovery situation and initiates their file. Failing to notify early risks delays and future complications. You also need to submit proof of representation and required authorizations. Without that, you won’t get access to key information.

2. Review the Rights and Responsibilities Letter

After notice, BCRC issues a Rights and Responsibilities (RAR) letter. This letter outlines what documentation is required and what you can expect. From this point forward, all communication must include Medicare’s correspondence cover sheet. Many firms overlook this and delay their own timelines.

3. Audit the Conditional Payment Letter (CPL)

About 65 days after issuing the RAR letter, BCRC will send a Conditional Payment Letter. This is not the final amount Medicare is owed. It’s a snapshot of what Medicare has paid so far for injury-related treatment. You must audit this document and dispute unrelated charges. If you skip this step, your client may pay more than necessary.

4. Watch for a Conditional Payment Notice (CPN)

If CMS learns about the settlement before you’ve submitted final details, it issues a CPN. This gives you 30 days to act. You must dispute unrelated items, send in procurement costs, and provide settlement documents. If you miss this window, CMS will issue a demand without accounting for your client’s legal costs.

5. Submit the Settlement Details

Once the case resolves, send final settlement information to BCRC immediately. Medicare needs this to calculate the correct demand, apply reductions, and set the final repayment amount by issuing a final demand.

6. Receive and Pay the Final Demand

Medicare issues a Final Demand letter after receiving the settlement notice. This is the only binding amount. Do not rely on earlier numbers. The Final Demand reflects all related charges up to the settlement date and includes reductions for procurement costs. You have 60 days to pay it. After that, interest accrues monthly. At 90 days, you receive an Intent to Refer notice. At 150 days, it goes to Treasury and that referral adds federal collection pressure to your file.

Why You Cannot Rely on the CPL

CMS makes this clear: the Conditional Payment Letter is not final. It is an interim figure. If you disburse based on the CPL, you risk underpaying Medicare. One law firm that did so faced enforcement and financial penalties from the Department of Justice. Always wait for the Final Demand before cutting checks.

Process Summary: Pre- and Post-Settlement

Pre-Settlement Steps:

• Report the case and submit documentation
• Receive and review the RAR letter
• Review the CPL and dispute unrelated charges

Post-Settlement Steps:

• Submit final settlement details
• Receive Final Demand letter
• Pay the demand within 60 days to avoid interest and Treasury referral.

Why This Matters to Your Practice

The process is not just time-consuming. It creates liability. Conditional payment obligations are statutory. Errors can trigger malpractice claims, interest charges, and DOJ action. Outsourcing this process to experts like Synergy ensures compliance and protects your recoveries. Our specialists know the CMS logic, portal limitations, and dispute strategies that matter.

The firms that treat Medicare compliance as core risk management, not an afterthought, avoid the pitfalls and deliver more value to their clients.