E. Admitting physician has no significant financial interest

If the admitting physician has a direct or indirect financial interest of 5 percent or more in the provider, the latter cannot impose charges for excess costs upon the beneficiary.

Authorization to make charges for excess costs is effective only prospectively and does not extend beyond the end of the cost period for which the cost limit is applicable. Thus, where all requirements for imposing charges for excess costs (e.g., public notice of the charges) are not met, until after the beginning of the cost period for which the charges would be applicable, the charges can be made only during the remainder of the cost period.

Where program reimbursement for items or services to which the limits are applied plus the provider’s charges to beneficiaries exceed the provider’s actual cost for the cost period, program reimbursement will be reduced by the amount of the excess.

Where a provider requests a review of the applicable costs limits and the limit is raised as a result (e.g., because of a typical services) the provider is responsible for refunding to the beneficiary (or whoever paid the charges) amounts which, on the basis of the correction of the cost limit, were erroneously collected. Where the total erroneously collected on this basis from a beneficiary during the cost period is $5 or less, the provider need not make a refund unless the payer requests it. However, any amounts which are not refunded, either because they are within this tolerance or because the provider is unable to locate the beneficiary, will be offset against program payment.