Medicare Appeals: CMS Tries to Speed the Process & Unjam the Backlog

On Oct. 2, CMS proposed revisions to rules for appealing adverse Medicare claim determinations (Proposed Rules).  The goal is to speed the process that currently takes three to four years and loosen the backlog that has been damming the appeals flow for years.

Why Should You Care?
Having to wait several years is problematic for any business, notes Stephen Azia, a shareholder with Baker Donelson. And, while you can defer any required Medicare repayment during the first two levels of appeal, you must pay out the money before starting the third (although you may be to get an order staying repayment). “That can put you out of business,” says Azia.

How Medicare Appeals Work
Labs and other providers denied a Medicare Parts A, B, or D, claim may appeal through four levels:

• The first two levels are with contractors;
• The third level is before an administrative law judge (ALJ); and
• The fourth level is to a federal district court provided that the amount in controversy meets the required minimum.

While the process is fair, it’s also slow and results in the buildup of significant appeals backlogs over time, especially at the third, ALJ level. Right now, it may take an additional two to three years after the first two levels just to get before an ALJ, according to Azia.

2017 Reforms
In Jan. 2017, CMS issued a Final Rule to streamline the appeals process, reduce pending appeals and encourage resolution of cases still in the pipeline earlier in the appeals process by:

• Permitting designation of final Medicare Appeals Council decisions as precedential to provide more consistency in decisions;
• Expanding the Office of Medicare Hearings and Appeals (OMHA) available adjudicator pool;
• Simplifying proceedings involving CMS or CMS contractors;
• Clarifying regulations that may result in unnecessary appeals;
• Creating process efficiencies by eliminating unnecessary steps; and
• Addressing areas for improvement previously identified by stakeholders.

New Proposals
The 2017 changes have had only marginal impact with appeals still taking several years. The Oct. 2 Proposed Rules pick up where the 2017 reforms left off. Most of the proposals are technical changes but there are a few substantive items as well, notes Baker Donelson attorney Kathleen Salsbury:

• Let appellants submit Medicare Parts A and B claims and Part D coverage determinations appeals without signatures;
• Reduce timeframe for vacating a Part A or B claims or Medicare Part D coverage determinations dismissal from 6 months to 180 days;
• Presumption that date of receipt of ALJ (or attorney adjudicator) decision or dismissal is 5 calendar days after the date of the notice of decision or dismissal, unless there’s evidence to the contrary.

Final Take
The Proposed Rules, the comments for which end on Dec. 3, are positive news to the extent they signal the government’s seriousness in tackling the appeals backlog. Azia also notes that efforts are being made to hire more ALJs. “There’s a real problem with the system,” he says. “You’re supposed to have a quick, efficient hearing and that’s not happening.”