C.F.R. » Title 42 » CHAPTER IV—CENTERS FOR MEDICARE & MEDICAID SERVICES, DEPARTMENT OF HEALTH AND HUMAN SERVICES › SUBCHAPTER B—MEDICARE PROGRAM › PART 424—CONDITIONS FOR MEDICARE PAYMENT › Subpart F—Limitations on Assignment and Reassignment of Claims

42 C.F.R. § 424.73

Prohibition of assignment of claims by providers

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(a) Basic prohibition. Except as specified in paragraph (b) of this section, Medicare does not pay amounts that are due a provider to any other person under assignment, or power of attorney, or any other direct payment arrangement.

(b) Exceptions to the prohibition—(1) Payment to a government agency or entity. Subject to the requirements of the Assignment of Claims Act (31 U.S.C. 3727), Medicare may pay a government agency or entity under an assignment by the provider.

(2) Payment under assignment established by court order. Medicare may pay under an assignment established by, or in accordance with, the order of a court of competent jurisdiction if the assignment meets the conditions set forth in § 424.90.

(3) Payment to an agent. Medicare may pay an agent who furnishes billing and collection services to the provider if the following conditions are met:

(i) The agent receives the payment under an agency agreement with the provider;

(ii) The agent's compensation is not related in any way to the dollar amounts billed or collected;

(iii) The agent's compensation is not dependent upon the actual collection of payment;

(iv) The agent acts under payment disposition instructions that the provider may modify or revoke at any time; and

(v) The agent, in receiving the payment, acts only on behalf of the provider.

Payment to an agent will always be made in the name of the provider.
Notes of Decisions
Cited in 6 cases (1 in the last 5 years), 2001–2021 · leading case: DFS Secured Healthcare Receivables Trust v. Caregivers Great Lakes, Inc., 384 F.3d 338 (7th Cir. 2004).
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DFS Secured Healthcare Receivables Trust v. Caregivers Great Lakes, Inc., 384 F.3d 338 (7th Cir. 2004). “§ 1396a(a)(32); 42 CFR § 424.73 . Although it is reassuring to see that at least one issue of federal law managed to creep its way into this appeal, the appellants’ argument is without merit.”
Quantum Corp. Funding v. Assist You Home Health Care Servs. of Virginia, L.L.C., 144 F. Supp. 2d 241 (S.D.N.Y. 2001). “person,” 42 C.F.R. § 424.73 . Accordingly, the Agreements established that Medicare payments to the defendants would be placed in a “lockbox” at First Union Bank in Charlotte, North Carolina in defendants’ name and the contents of the lockbox would be forwarded to Quantum on a…”
Cong. of California Seniors v. Catholic Healthcare West, 87 Cal. App. 4th 491 (Cal. Ct. App. 2001). “63-65; 42 C.F.R. §§ 424.73 , 424.80.) 5. At various stages of cost-reporting, claims and calculation, the provider may seek review of the administrative decisions that are made, but both administrative and judicial review have been limited by the Medicare statute and regulations.”
World Bus. Lenders, LLC v. G7, Medicare & Medicate, No. 1:19-cv-01655 (D. Md. Feb. 28, 2020). · cites it 2× “§ 1395u(b)(6)); see also 42 C.F.R. § 424.73 (a) (“Medicare does not pay amounts that are due a provider to any other person under assignment, or power of attorney, or any other direct payment arrangement.”
Frankfort Rehab & Care, LLC v. MidCap Funding IV Trust, No. 3:20-cv-00059 (E.D. Ky. Sept. 22, 2021). “See 42 C.F.R. § 424.73 (b)(v) (2004). The secured party lacks control, and therefore lacks the ability to exercise remedies associated with a perfected security interest.”
Georgia Receivables v. Caregivers Great Lak, No. 03-1086 (7th Cir. Sept. 13, 2004). “§ 1396a(a)(32); 42 CFR § 424.73 . Although it is reassuring to see that at least one issue of federal law managed to creep its way into this appeal, the appellants’ argument is without merit.”
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