Study: Medicare Appeals Process Reforms Not Enough to Eliminate Backlog

The Centers for Medicare & Medicaid Services’ (CMS) current and proposed reforms may not be enough to eliminate the appeals backlog and restore a timely and fair appeals process.

That was the finding of a study published recently in the Journal of Hospital Medicine.

Researchers investigated all appeals reaching level three at three facilities: Johns Hopkins Hospital in Baltimore, University of Wisconsin Hospitals and Clinics in Madison, and University of Utah Hospital in Salt Lake City. They examined time spent at each appeal level and whether it met federally mandated deadlines, as well as the percentage accountable to hospitals versus government contractors or administrative law judges (ALJ). The study included all complex Part A appeals involving dates of service before Oct. 1, 2013 and reaching Level 3 (ALJ) as of May 1, 2016.

Of 219 Level 3 cases, 135 (61.6%) concluded at Level 3. Of these 135 cases, 96 (71.1%) were decided in favor of the hospital, 11 (8.1%) were settled in the CMS $0.68 settlement offer, and 28 (20.7%) were unfavorable to the hospital.

In terms of time spent, researchers found that an average of 1,663.3 days (more than 4.5 years), passed between the time the services were provided and the conclusion of the Medicare reimbursement audit and appeals process. Hospitals and government contractors were responsible for more than 70 percent of that time.

The backlog has meant delaying billions of dollars in Medicare reimbursements to hospitals, many of which are already strapped for cash.

As we previously wrote about in December, U.S. District Judge James E. Boasberg ordered the Department of Health and Human Services (HHS) to figure out how to reduce the backlog of pending cases before administrative law judges by 30 percent by the end of 2017, 60 percent by the end of 2018 and 90 percent by the end of 2019. All backlogged cases were to be eliminated by Dec. 31, 2020.

In March, HHS told the court that it anticipates its 687,382-claim backlog to exceed more than a million by the end of fiscal year 2021.

The study’s researchers said their results support recent steps taken by CMS to reform the appeals process, including shortening the look-back period from three years to six months. However, they also noted that their data demonstrates several areas of concern not addressed in a recent Government Accountability Office (GAO) report or in the rule proposed by CMS.

Researchers acknowledge that “Medicare fraud cannot be tolerated, and a robust auditing process is essential to the integrity of the Medicare program.” But they go on to note that “additional actions must be taken so that a just and efficient Medicare appeals system can be realized.”

The Health Law Offices of Anthony Vitale can assist providers with Administrative Law Judge overpayment representation, as well as alternative overpayment settlement options with CMS. Contact us for additional information at 305-358-4500 or send us an email to info@vitalehealthlaw.com and let’s discuss how we might be able to assist you.