General Accounting Office Issues Findings Regarding Medicare Appeals Backlog

Earlier this month, the United States General Accounting Office (GAO) issued its monthly anticipated report (the Report) to Congress about the status of the Medicare Appeals backlog.  The Report states on the first page, “Opportunities Remain to Improve Appeals Process,” which is a gross understatement and will likely be received with frustration by unpaid providers.  At least it appears the backlog is on Congress’ radar and someone is trying to do something to improve this very difficult problem that adversely impacts so many providers.

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To be fair, it appears the system has overwhelmed the government.  In 2015, HHS noted that Level 3 was receiving more than one year’s worth of work every 8 weeks.  The government simply cannot keep up with the appeals volume that attends the appeals process it created. The Report provides extensive review of the layered, Medicare appeals process and data about the results of appeals frilled by providers in recent years.

On the bright side, the Report provides some indication that sticking with the appeals process can ultimately pay off.  For example, successful, full reversals of level 2 appeals decisions were as follows:

2010 – 60.4 %

2011 – 56 %

2012 – 62.8%

2013 – 61.3%

2014 – 55.4 %

Nevertheless, the considerable backlog of appeals cases and very significant delays in resolving appeals continue to burden providers.  An Appendix to the Report outlines the following legislative proposals related to the Medicare Fee-For-Service Appeals Process:

1. Provide the Office of Medicare Hearings and Appeals (OMHA) and Departmental Appeals Board (DAB) authority to use Recovery Auditor (RA) collections (to expand the authority of HHS to allow RA program recoveries to fully fund RA-related appeals at OMHA and DAB)
2. Establish a refundable filing fee (to allow HHS to invest in the appeals system to improve responsiveness and efficiency/refundable to successful appellants)
3. Allow prior authorization for Medicare fee-for-service items and services (to extend CMS’ prior authorization authority to all Medicare fee-for-service items and services/especially those at highest risk of improper payment)
4. Pay RA after Level 2 makes a decision on appealed claims (to align the RA contingency fee payments with the outcome of the appeal, ensuring that CMS has assurance of the RA’s determination before making payment)
5. Sample and consolidate similar claims for administrative efficiency (to allow for adjudication of appeals through the use of sampling and extrapolation techniques)
6. Remand appeals to Level 1 with the introduction of new evidence (would incentivize appellants to include all evidence early in the appeals process and ensure the same record is reviewed and considered at subsequent levels of appeal)
7. Establish magistrate adjudication for claims with an amount in controversy below new ALJ amount in controversy threshold (to allow OMHA to use attorneys, called “Medicare Magistrates” to adjudicate appealed claims with lower amounts in controversy
8. Expedite procedures for claims with no material fact in dispute

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*Disclaimer: Thoughts shared here do not constitute legal advice.

Source:  General Accounting Office