---
kind: "section"
citation: "42 C.F.R. § 423.760"
title: "42"
number: "423.760"
heading: "Determinations regarding the amount of civil money penalties and assessment imposed by CMS."
url: "https://uscodex.org/cfr/42/423.760"
---

# §423.760. Determinations regarding the amount of civil money penalties and assessment imposed by CMS.

- (a) **Determining the appropriate amount of any penalty.** In determining the amount of penalty imposed under [§ 423.752(c)(1)](/cfr/42/423.752.md?p=c-1), CMS considers the following as appropriate:
  - (1) **The nature of the conduct.**
  - (2) **The degree of culpability of the Part D sponsor.**
  - (3) The adverse effect to enrollees which resulted or could have resulted from the conduct of the Part D sponsor.
  - (4) **The financial condition of the Part D sponsor.**
  - (5) **The history of prior offenses by the Part D sponsor or principals of the Part D sponsor.**
  - (6) Such other matters as justice may require.
- (b) **Amount of penalty.** CMS may impose civil money penalties in the following amounts:
  - (1) If the deficiency on which the determination is based has directly adversely affected (or has the substantial likelihood of adversely affecting) one or more Part D enrollees—up to $25,000 as adjusted annually under [45 CFR part 102](/cfr/45/part102.md) for each determination.
  - (2) If the deficiency on which the determination is based has directly adversely affected (or has the substantial likelihood of adversely affecting) one or more Part D enrollees, CMS may calculate a CMP of up to $25,000 as adjusted annually under [45 CFR part 102](/cfr/45/part102.md) for each Part D enrollee directly adversely affected (or with a substantial likelihood of being adversely affected) by a deficiency .
  - (3)
    - (i) **Definitions for calculating penalty amounts—**
      - (A) **Per determination.** The penalty amounts calculated under [paragraph (b)(1)](#b-1) of this section.
      - (B) **Per enrollee.** The penalty amounts calculated under [paragraph (b)(2)](#b-2) of this section.
      - (C) **Standard minimum penalty.** The per enrollee or per determination penalty amount that is dependent on the type of adverse impact that occurred.
      - (D) **Aggravating factor(s).** Specific penalty amounts that may increase the per enrollee or per determination standard minimum penalty and are determined based on criteria under [paragraph (a)](#a) of this section.
    - (ii) **CMS sets minimum penalty amounts in accordance with paragraphs (b)(1) and (2) of this section.**
    - (iii) CMS announces the standard minimum penalty amounts and aggravating factor amounts for per determination and per enrollee penalties on an annual basis.
    - (iv) CMS has the discretion to issue penalties up to the maximum amount under paragraphs [(b)(1)](#b-1) and [(2)](#b-2) of this section when CMS determines that an organization's non-compliance warrants a penalty that is higher than would be applied under the minimum penalty amounts set by CMS.
  - (4) For each week that a deficiency remains uncorrected after the week in which the Part D sponsor receives CMS' notice of the determination—up to $10,000 as adjusted annually under [45 CFR part 102](/cfr/45/part102.md).
  - (5) If CMS makes a determination that a Part D sponsor has terminated its contract other than in a manner described under 423.510 and that the Part D sponsor has therefore failed to substantially carry out the terms of the contract, $250 as adjusted annually under [45 CFR part 102](/cfr/45/part102.md) per Medicare enrollee from the terminated Part D sponsor or plans at the time the Part D sponsor terminated its contract, or $100,000 as adjusted annually under [45 CFR part 102](/cfr/45/part102.md), whichever is greater.
- (c) **Amount of penalty imposed by CMS or OIG.** CMS or the OIG may impose civil money penalties in the following amounts for a determination made under [§ 423.752(a)](/cfr/42/423.752.md?p=a):
  - (1) Civil money penalties of not more than $25,000 as adjusted annually under [45 CFR part 102](/cfr/45/part102.md) for each determination made.
  - (2) With respect to a determination made under § [423.752(a)(4)](/cfr/42/423.752.md?p=a-4) or [(a)(5)(i)](/cfr/42/423.752.md?p=a-5-i), not more than $100,000 as adjusted annually under [45 CFR part 102](/cfr/45/part102.md) for each such determination except with respect to a determination made under [§ 423.752(a)(5)](/cfr/42/423.752.md?p=a-5), an assessment of not more than the amount claimed by such plan or PDP sponsor based upon the misrepresentation or falsified information involved.
  - (3) Plus with respect to a determination made under [§ 423.752(a)(2)](/cfr/42/423.752.md?p=a-2), double the excess amount charged in violation of such paragraph (and the excess amount charged must be deducted from the penalty and returned to the individual concerned).
  - (4) Plus with respect to a determination made under [§ 423.752(a)(4)](/cfr/42/423.752.md?p=a-4), $15,000 as adjusted annually under [45 CFR part 102](/cfr/45/part102.md) for each individual not enrolled as a result of the practice involved.

## Notes

### Amendments

[72 FR 68735, Dec. 5, 2007, as amended at 74 FR 1548, Jan. 12, 2009; 79 FR 29966, May 23, 2014; 81 FR 61562, Sept. 6, 2016; 86 FR 6121, Jan. 19, 2021; 89 FR 30841, Apr. 23, 2024]

### Authority

Authority: 42 U.S.C. 1302, 1306, 1395w-101 through 1395w-152, and 1395hh.

### Source

Source: 70 FR 4525, Jan. 28, 2005, unless otherwise noted.

### Amendments

[72 FR 68735, Dec. 5, 2007, as amended at 74 FR 1548, Jan. 12, 2009; 79 FR 29966, May 23, 2014; 81 FR 61562, Sept. 6, 2016; 86 FR 6121, Jan. 19, 2021; 89 FR 30841, Apr. 23, 2024]