HHS Proposal Aims to Reduce Medicare Appeals Backlog

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By Eric Topor

June 28 — Reducing the backlog of Medicare coverage and payment appeals is the aim of a proposal issued June 28 by the HHS.

However, a hospital industry group that has sued the government over the backlog said the new rule likely isn't enough to fix the problem.

The proposed rule (RIN:0991-AC02) is part of an effort to make the administrative law judge hearing process more efficient and reduce appeals, the Department of Health and Human Services said. The rule noted that as of April 30, the Office of Medicare Hearings and Appeals had over 750,000 pending appeals, while that office's “adjudication capacity was 77,000 appeals per year.”

The HHS estimates that the proposed changes would reduce appeals heading to ALJs by approximately 23,650 per year.

A Government Accountability Office report released earlier in June found that ALJ appeals continue to grow despite procedural reforms already in place, and said additional systemic reforms were needed to fix the backlog of appeals (116 HCDR, 6/16/16). The GAO report noted several actions that could reduce the influx of Medicare appeals, and some of those proposals were adopted in the new proposed regulations.

Comments (docket HHS-2015-49) on the proposal are due Aug. 29. The proposal will be published July 5.

Hospitals Skeptical

American Hospital Association Executive Vice President Tom Nickels said in a June 28 statement that the group was “skeptical that these proposals will do more than scratch the surface of the severe backlog in ALJ appeals that has led to hospitals facing multi-year waits for hearings.”

Nickels said the AHA was “deeply disappointed that HHS has not made more progress in addressing the delays despite the more than two years since the delays began,” and chastised the HHS for issuing the proposed rule “just days before HHS was required to respond in court to show progress in resolving the backlog as part of our lawsuit challenging the ALJ delays.”

In February, the U.S. Court of Appeals for the District of Columbia Circuit ruled that the worsening appeals backlog merited a second look as to whether a court order was necessary to provide the due process that providers were owed under statutory appeal rules (27 HCDR, 2/10/16). The appeals court ordered a lower court to re-evaluate the backlog of Medicare provider appeals.

The AHA's lawsuit is now back at the U.S. District Court for the District of Columbia, which gave the HHS until July 1 to show that the agency was making progress in curbing the backlog.

New Appeal Rules

The GAO's report cited repetitive Medicare claims that are essentially identical and recur monthly as an appeals process inefficiency that should be addressed.

The proposed new §401.109(a) would empower the chair of the Departmental Appeals Board (DAB) to designate certain decisions of the Medicare Appeals Council as precedential across all departments where the Centers for Medicare & Medicaid Services has jurisdiction, and enable more consistent appeals decisions and allow providers to better determine whether an appeal of their claim is advisable, the HHS said.

Only certain MAC decisions specifically selected by the DAB chair “in which a significant legal or factual issue was fully developed on the record and thoroughly analyzed” would be deemed precedential. Notice of precedential MAC decisions would be published in the Federal Register, and publicly posted on the HHS's website, with certain identifying information redacted where appropriate, the proposal said.

Additionally, the HHS proposed empowering certain “attorney adjudicators” to handle some aspects of appeals, including issuing appeal dismissals when an appellant withdraws an ALJ hearing request, remands for additional information and conducting reviews of lower level contractor denials. The HHS said allowing attorney adjudicators to handle these types of matters that don't necessarily require an ALJ hearing allow the judges to “focus on cases going to a hearing.” Matters that were decided by an attorney adjudicator would still be appealable to an ALJ.

The proposed rule would also direct lower-value claims to attorney adjudicators, or for determinations of whether the claim meets the minimum amount in controversy threshold for an ALJ hearing of $200.

To contact the reporter on this story: Eric Topor in Washington at etopor@bna.com

To contact the editor responsible for this story: Kendra Casey Plank at kcasey@bna.com

For More Information

The proposed rule is at http://src.bna.com/gkP. The appeals court ruling in AHA's case is at http://src.bna.com/gld.

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