42 CFR § 423.360 - Reporting and returning of overpayments.

---
identifier: "/us/cfr/t42/s423.360"
source: "ecfr"
legal_status: "authoritative_unofficial"
title: "42 CFR § 423.360 - Reporting and returning of overpayments."
title_number: 42
title_name: "Public Health"
section_number: "423.360"
section_name: "Reporting and returning of overpayments."
chapter_name: "CENTERS FOR MEDICARE & MEDICAID SERVICES, DEPARTMENT OF HEALTH AND HUMAN SERVICES"
subchapter_number: "B"
subchapter_name: "MEDICARE PROGRAM"
part_number: "423"
part_name: "VOLUNTARY MEDICARE PRESCRIPTION DRUG BENEFIT"
positive_law: false
currency: "2026-04-05"
last_updated: "2026-04-05"
format_version: "1.1.0"
generator: "[email protected]"
authority: "42 U.S.C. 1302, 1306, 1395w-101 through 1395w-152, and 1395hh."
regulatory_source: "70 FR 4525, Jan. 28, 2005, unless otherwise noted."
cfr_part: "423"
---


# 423.360 Reporting and returning of overpayments.

(a) *Definitions.* For the purposes of this section the following definitions are applicable:

*Applicable reconciliation* means the later of either the annual deadline for submitting—

(i) PDE data for the annual Part D payment reconciliations referred to in § 423.343(c) and (d); or

(ii) Direct and indirect remuneration data.

*Funds* for purposes of this section, means any payment that a Part D sponsor has received that is based on data submitted by the Part D sponsor to CMS for payment purposes, including data submitted under § 423.329(b)(3), § 423.336(c)(1), § 423.343, and data provided for purposes of supporting allowable costs as defined in § 423.308 which includes data submitted to CMS regarding direct or indirect remuneration.

*Overpayment* means funds that a Part D sponsor has received or retained under title XVIII of the Act to which the Part D sponsor, after applicable reconciliation, is not entitled under such title.

(b) *General rule.* If a Part D sponsor has identified that it has received an overpayment, the Part D sponsor must report and return that overpayment in the form and manner set forth in this section.

(c) *Identified overpayment.* The Part D sponsor has identified an overpayment when the Part D sponsor knowingly receives or retains an overpayment. The term “knowingly” has the meaning set forth in 31 U.S.C. 3729(b)(1)(A).

(d) *Reporting and returning of an overpayment.* A Part D sponsor must report and return any overpayment it received no later than 60 days after the date on which it identified it received an overpayment.

(1) *Reporting.* A Part D sponsor must notify CMS of the amount and reason for the overpayment, using the notification process determined by CMS.

(2) *Returning.* A Part D sponsor must return identified overpayments in a manner specified by CMS.

(e) *Enforcement.* Any overpayment retained by a Part D sponsor is an obligation under 31 U.S.C. 3729(b)(3) if not reported and returned in accordance with paragraph (d) of this section.

(f) *Look-back period.* A Part D sponsor must report and return any overpayment identified within the 6 most recent completed payment years.

[79 FR 29963, May 23, 2014, as amended at 89 FR 98565, Dec. 9, 2024]