CMS’s S.111 daily CMPs rate for NGHP reporting increased to $1,512

By Mark Popolizio, J.D., Jeremy Farquhar

January 30, 2026 / 7 min read

In a new Section 111 development, the maximum daily civil monetary penalties (CMPs) amount regarding non-group health plan (NGHP) Section 111 reporting has been increased as announced in a Final Rule issued by the Department of Health and Human Services.^[1] This inflation increase to NGHP Section 111 CMPs amounts is part of wide-scale general annual CMPs inflation adjustments applied to numerous other federal statutes as announced in the Federal Register at 91 Fed. Reg. 3665 (January 28, 2026) titled as “Annual Civil Monetary Penalties Inflation Adjustment.” These newly released inflation adjustments update 45 CFR Part 102 (Adjustment of Civil Monetary Penalties for Inflation).

CMS S111 Daily CMP Rate $1512

As discussed below, the daily maximum CMPs amount pertaining to NGHP Section 111 reporting has now increased from $1,474 to $1,512 (a $38 increase). This updated figure of $1,512 is referenced as the “2025 maximum adjusted penalty.”^[2]

This update is particularly noteworthy as CMS just started its Section 111 audits in January with RREs now facing the real prospect of monetary fines since the start of CMS’s Section 111 reporting process over a decade ago. In this regard, CMS recently announced on its Section 111 webinar that it expects to complete its first audits in February and may start to issue CMPs notices to no-fault and liability RREs as early as March. CMS will start its audits of workers’ compensation submissions in July.

The authors outline this new update, and related matters, as follows:

Summary

The daily maximum CMPs amount pertaining to Section 111 NGHP reporting has been increased from $1,474 to $1,512 (a $38 increase) as announced in the Federal Register (January 28, 2026).^[3] The now replaced $1,474 figure had been in place since August 8, 2024.^[4]The newly adjusted maximum daily CMPs are now effective.^[5] From the authors’ research, CMS has not issued any information regarding this increase as of the time this article was drafted, nor had it published any information regarding the last inflation update made in August 2024 (which has now been replaced as noted above).

Background

Under the Medicare Secondary Payer (MSP) statute, Section 111 NGHP RREs are subject to CMPs, in pertinent part, “of up to $1,000 for each day of noncompliance with respect to each claimant.” (42 U.S.C. § 1395y(b)(8)(E)(i)).^[6]This amount is subject to an annual inflation adjustment.^[7]At the time CMS’s final rule was released in October 2023, the annually adjusted maximum daily CMPs amount was $1,428.^[8]This amount, as noted above, was then increased from $1,428 to $1,474 in August 2024.^[9]The new adjusted maximum daily CMPs rate, as noted above, is now $1,512 (Federal Register January 28, 2026).

As a refresher, NGHP RREs are subject to CMPs for untimely TPOC and ORM reporting under CMS’s CMPs final rule.^[10]In general, per 42 CFR § 402.1(22)(i), CMS may impose CMPs when the NGHP RRE “[f]ails to report any beneficiary record within 1 year from the date of the settlement, judgment, award, or other payment [TPOC], or the effective date where on-going payment responsibility for medical care [ORM] has been assumed by the entity” as more specifically defined in CMS’s final rule. Id. See our Section 111 FAQs for more information.

CMS will apply CMPs against NGHP RREs using a “three-tiered" approach based on the length of time an NGHP RRE is late in successfully submitting a required TPOC and/or ORM report.^[11] In this regard, as part of its October 2023 final rule, CMS, applying the statutory “base” figure of “up to $1,000,” calculated the “daily penalty” amount per each tier as follows: Under Tier 1, $250 (or 25% of the base max $1,000 figure) for each calendar day of non-compliance where the record is reported 1 year or more, but less than 2 years after, the required date.^[12]Under Tier 2, $500 (or 50% of the base max rate) for each calendar day of non-compliance where the record is reported 2 years or more, but less than 3 years after, the required reporting date.^[13] Finally, under Tier 3, $1,000 (100% of statutory base max rate) for each calendar day of non-compliance where the record is reported 3 years or more after the required reporting date. In addition, as part of the final rule, CMS noted that the total penalty for any one instance of noncompliance (at that time) would be no greater than $365,000.^[14]Importantly, CMS alerts the public that each of these starter “base” amounts, as well as the total maximum penalty amount are subject to annual inflation adjustments under 45 CFR part 102.^[15]

Updated CMPs rates based on the new inflation increase

Applying the inflation adjusted maximum daily CMPs amount of $1,512 utilizing CMS’s “tiered” CMPs calculation approach discussed above, the current CMPs rates are as follows:

Tier 1: $378 for each calendar day of non-compliance where the record is reported 1 year or more, but less than 2 years after, the required date.
Tier 2: $756 for each calendar day of non-compliance where the record is reported 2 years or more, but less than 3 years after, the required reporting date.
Tier 3: $1,512 (max rate) for each calendar day of non-compliance where the record is reported 3 years or more after the required reporting date.

For those interested, the new inflation adjusted rates contained in the Federal Register (January 28, 2026) result in the following “increases” from the prior and now replaced August 2024 rates: Tier 1 – an increase of $9.50; Tier 2 – an increase of $19; and Tier 3 – an increase of $38.

The current total maximum penalty amount for any single instance of noncompliance is $551,880 applying the adjusted inflation rate contained in the Federal Register (January 28, 2026), up from $538,010 which was the max rate per the now replaced August 2024 update.

To the authors’ knowledge, CMS has not yet officially released recalculated CMPs amounts based on the new inflation updates contained in the Federal Register (January 28, 2026). On this point, the authors note that CMS, to their knowledge, did not update their CMPs calculation following the August 2024 increase and instead they have continued to use the old max daily rate of $1,428 released back in October 2023 in their materials. Using this old rate, CMS’s materials reflect the following CMPs rates: (Tier 1 -$357); (Tier 2 -$714); and (Tier 3 - $1,428).^[16]

Of note, as part of its recent Section 111 webinar, CMS advised that, in terms of the monetary CMPs amount the RRE must pay, this will be based on the effective CMPs inflation adjusted amount at the time CMS’s initial audit occurs. On this point, CMS explained that if there is a subsequent inflationary adjustment to the CMPs rates before the RRE makes payment, the amount the RRE will pay will be based on the adjusted CMPs amount in place at the time of CMS’s initial audit, and not the subsequently increased rate. Similarly, CMS also explained that, while there would be time which would pass between the occurrence of the initial audit and when a CMP would be formally assessed, the clock would stop ticking in terms of the daily penalty calculation as of the date the non-compliance was identified via the initial audit. In addition, as part of this webinar, CMS also confirmed that it will only accept CMPs payment via Pay.gov eBill.

Going Forward

With CMS audits underway, NGHP RREs may wish to note this updated maximum daily CMPs amount as part of their Section 111 compliance protocols. In the interim, we will continue to monitor any future releases from CMS related to this CMPs inflation adjustment.

Of course, please do not hesitate to contact the authors if you have any questions or to learn how Verisk’s MSP Navigator reporting tool can help you improve you Section 111 reporting practices to avoid CMPs.

[1] As noted, the inflation adjustments have been released as a “Final Rule.” In this regard, the Department of Health and Human Services notes in the Federal Register that in this instance, the annual inflation adjustments are not subject to the notice and comment provisions of section 553 or the Administrative Procedures Act (APA) stating as follows:

Statutory and Executive Order Reviews and Waiver of Proposed Rulemaking

The 2015 Act requires Federal agencies to publish annual penalty inflation adjustments notwithstanding section 553 of the Administrative Procedure Act (APA). Section 4(a) of the 2015 Act directs Federal agencies to publish annual adjustments no later than January 15th of each year thereafter. In accordance with section 553 of the APA, most rules are subject to notice and comment and are effective no earlier than 30 days after publication in the Federal Register. However, section 4(b)(2) of the 2015 Act provides that each agency shall make the annual inflation adjustments ‘notwithstanding section 553’ of the APA. According to OMB’s Memorandum M–25–02, the phrase ‘notwithstanding section 553’ in section 4(b)(2) of the 2015 Act means that ‘the notice and comment process the APA generally requires—i.e., notice, an opportunity for comment, and a delay in effective date—is not required for agencies to issue regulations implementing the annual adjustment.’ Consistent with the language of the 2015 Act and OMB’s implementation guidance, the inflation adjustments set out in this rule are not subject to notice and an opportunity for public comment and will be effective immediately upon publication. Also, HHS finds that notice and comment procedures would be impracticable and unnecessary under the APA for the ministerial and technical changes in this rule. In addition, HHS is waiving notice and comment for the non-substantive technical corrections set out in this final rule. HHS finds good cause for issuing these changes as a final rule without prior notice and comment because these changes make technical clarifying edits to descriptions and corrections to inadvertent typographical errors from the last update. For these same reasons, HHS also finds good cause to make the final rule effective upon publication. Pursuant to OMB Memorandum M–25–02, HHS has determined that the annual inflation adjustment to the civil monetary penalties in its regulations does not trigger any requirements under procedural statutes and Executive Orders that govern rulemaking procedures. Annual Civil Monetary Penalties Inflation Adjustment, 91 Fed. Reg. 3665, 3666 (January 28, 2026) (amending 45 C.F.R. § 102.3).

[2] Annual Civil Monetary Penalties Inflation Adjustment, 91 Fed. Reg. 3665, 3667-3681 (January 28, 2026) (amending 45 C.F.R. § 102.3).

[3] Annual Civil Monetary Penalties Inflation Adjustment, 91 Fed. Reg. 3665, 3678 (January 28, 2026) (amending 45 C.F.R. § 102.3). As part of this update, the following is stated in the Federal Register: “The Department of Health and Human Services (HHS) is updating its regulations to reflect required annual inflation-related increases to the civil monetary penalty (CMP) amounts in its statutes and regulations, under the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015.” Annual Civil Monetary Penalties Inflation Adjustment, 91 Fed. Reg. 3665 (January 28, 2026) (amending 45 C.F.R. § 102.3).

[4] Annual Civil Monetary Penalties Inflation Adjustment, 91 Fed. Reg. 3665 (January 28, 2026) (amending 45 C.F.R. § 102.3).

[5] On this point, the Federal Register states: “This final rule is effective upon publication to the Federal Register … The adjusted civil monetary penalty amounts apply to penalties assessed on or after the date of publication to the Federal Register, if the violation occurred on or after November 2, 2015.” 91 Fed. Reg. 3665 (January 28, 2026) (amending 45 C.F.R. § 102.3). It is further noted that “[i]f the violation occurred before November 2, 2015, or a penalty was assessed before September 6, 2016, the pre-adjustment civil penalty amounts in effect before September 6, 2016, will apply.” Id. at 3666.

[6] 42 U.S.C. § 1395y(b)(8)(E)(i) states, in pertinent part, as follows: “An applicable plan that fails to comply with the [Section 111 reporting] requirements … may be subject to a civil money penalty of up to $1,000 for each day of noncompliance with respect to each claimant … A civil money penalty under this clause shall be in addition to any other penalties prescribed by law and in addition to any Medicare secondary payer claim under this subchapter with respect to an individual.” Id.

[7] See, 45 C.F.R. § 102.3. Further, as noted in n.2 above, the following is stated in the Federal Register: “The Department of Health and Human Services (HHS) is updating its regulations to reflect required annual inflation-related increases to the civil monetary penalty (CMP) amounts in its statutes and regulations, under the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015.” Annual Civil Monetary Penalties Inflation Adjustment, 91 Fed. Reg. 3665 (January 28, 2026) (amending 45 C.F.R. § 102.3).

[8] Annual Civil Monetary Penalties Inflation Adjustment, 88 Fed. Reg. 69531 (October 6, 2023) (amending 45 C.F.R. Part 102). On this point, the authors note that as part of CMS’s final rule released on October 11, 2023, the agency actually referenced the maximum daily CMPs amount as $1,325 based on the agency’s reference to a June 8, 2023 update contained in the Federal Register, cited by CMS as 87 Fed. Reg. 15101. See, Medicare Program; Medicare Secondary Payer and Certain Civil Money Penalties, 88 Fed. Reg. 70363, 70366, (October 11, 2023) (amending 42 C.F.R. Part 402 and 45 C.F.R. Part 102). However, of note, in reviewing CMS’s cite to 87 Fed. Reg, 15101, the authors note that this reflects that the $1,325 adjustment was actually made on (and became effective) March 17, 2022. Further, from the authors’ research, this amount was then amended to $1,428 on October 6, 2023 (approximately five days before CMS final rule release). See, Annual Civil Monetary Penalties Inflation Adjustment, 88 Fed. Reg. 69531 (October 6, 2023) (amending 45 C.F.R. Part 102). For reasons unknown to the authors, CMS did not include or reference this October adjustment in its final rule released on October 11, 2023, and instead referenced the maximum daily CMPs rate as $1,325 as noted above. In any event, CMS eventually referenced the $1,428 adjusted figure as noted in the Federal Register on October 6, 2023 as part of its release of a “corrected” final rule on November 27, 2023. See, Medicare Program; Medicare Secondary Payer and Certain Civil Money Penalties; Correction, 88 Fed. Reg. 82786 (November 27, 2023) Annual Civil Monetary Penalties Inflation Adjustment, 88 Fed. Reg. 69531 (October 6, 2023) (amending 45 C.F.R. Part 102). Further, as discussed later in this article, CMS ultimately used the $1,428 figure as part of its CMPs calculations announced by the agency as part of its January 18, 2024 webinar and its CMPs webpage. It would now appear that CMS will need to update its calculations based on the newly released daily maximum CMPs rate in the Federal Register (January 28, 2026).

[9] Annual Civil Monetary Penalties Inflation Adjustment, 89 Fed. Reg. 64815 (August 8, 2024) (amending 45 C.F.R. § 102.3).

[10] “TPOC” is the abbreviation for “total payment obligation to the claimant.” Very generally, under CMS’s TPOC reporting trigger, reporting is required upon claim resolution (or partial resolution) through a settlement, judgment, award, or other payment for cases in which the claimant is/was a Medicare beneficiary as of the TPOC date and where medicals were claimed and/or released, or the settlement, judgment, award, or other payment has the effect of releasing medicals. Under CMS’s current thresholds, physical trauma based liability, no-fault and workers’ compensation settlements greater than $750 are required to be reported under the Section 111 reporting process. The $750 threshold does not apply to settlements involving exposure, ingestion, or implantation cases. See generally, CMS’s Section 111 NGHP User Guide (Version 8.3, January 6, 2026), Chapter III and IV, Section 6.4.4.

“ORM” is the abbreviation for “on-going responsibility for medicals.” Very generally, CMS states that “the trigger for reporting ORM is the determination to assume ORM by the RRE, which is when the RRE learns, through normal due diligence, that the beneficiary has received (or is receiving) medical treatment related to the injury or illness sustained. Required reporting of ORM by the RRE does not necessarily require the RRE to have made payment for Medicare-covered items or services when the RRE assumed ORM, nor does a provider or supplier necessarily have to have submitted a claim for such items or services to the RRE for the RRE to assume ORM. The effective date for ORM is the DOI, regardless of when the beneficiary receives the first medical treatment or when ORM is reported.” See generally, CMS’s Section 111 NGHP User Guide (Version 8.3, January 6, 2026), Chapter III Section 6.3.

[11] See generally, Medicare Program; Medicare Secondary Payer and Certain Civil Money Penalties, 88 Fed. Reg. 70363, 70370, (October 11, 2023) (amending 42 C.F.R. Part 402 and 45 C.F.R. Part 102) and 42 C.F.R. § 402.105 (3)(i) and (ii).

[12] Id. at 70370.

[13] Id.

[14] Id.

[15] Id.

[16] See, CMS’s January 18, 2024 CMPs webinar (see slide 13 of CMS’s power point used during the webinar) and CMS’s NGHP Civil Money Penalties Webpage, Section: Penalty Amounts.

CMS’s Section 111 daily CMPs maximum rate for NGHP reporting increased to $1,512

Summary

Background

Updated CMPs rates based on the new inflation increase

Going Forward