H.R. 6863 — CAT Act of 2025

This section states congressional findings concerning Medicare and Medicaid program integrity, including that in 2020, 139 million individuals received coverage through these programs at a federal cost of approximately $1.5 trillion, of which $3.1 billion consisted of fraudulent claims. The findings further declare that Centers for Medicare & Medicaid Services (CMS) use of Unified Program Integrity Contractors (UPICs) has been effective at identifying fraud but that current law lacks adequate transparency and due process requirements prior to CMS or UPIC suspension of Medicare payments for up to one year based on credible allegations of fraud, routinely extended without evidence of necessity, thereby risking the financial viability of good faith providers and Medicare beneficiaries' access to care.

This section revises Medicare procedures for suspending payments to providers of services and suppliers pending investigation of a credible allegation of fraud (under SSA section 1862(o)) by (1) limiting such suspensions and investigations to 180 days unless the Secretary determines good cause for extension; (2) specifying that a credible allegation of fraud includes the following items: (A) a fraud hotline tip (as defined by the Secretary), (B) mere error (as defined by the Secretary), and (C) a billing error found during an audit attributable to human error; (3) requiring the Secretary, subject to an exception to protect investigation integrity, to provide the provider or supplier with detailed information on each allegation at least 30 days before suspension and investigation updates (i.e., findings, anticipated timeline, and opportunity for questions) at least every 30 days thereafter, with noncompliance requiring immediate resumption of payments plus accrued interest; (4) requiring an annual report to Congress, due not later than 180 days after the end of each fiscal year beginning with FY2025, on the number, bases, durations, and reinstatement timelines for such payment suspensions under Medicare, Medicare Part D, Medicare Advantage plans, and Medicaid; and (5) directing the Secretary to establish, within 180 days of enactment and after stakeholder consultation, an independent appeals process for resolving payment suspension appeals in a timely manner. The amendments apply to investigations initiated after the date of enactment.