It is not only the weather outside that is frightful! The traditional Medicare administrative appeals process operates along a strict timetable that, in recent months, has been absolutely “snowed in” by the avalanche of requests for appeals hearings by Administrative Law Judges (ALJs) and significant administrative delays extending far beyond normal processing backlogs. These delays affect providers across the Medicare spectrum, including those who are contesting adverse coverage and reimbursement decisions, as well as those who are contesting overpayment determinations generated by Recovery Audit Contractor (RAC) or Zone Program Integrity Contractor (ZPIC) audits. On February 12, 2014, the U.S. Department of Health & Human Services’ Office of Medicare Hearings and Appeals (OMHA) hosted its first ever Medicare Appellant Forum to update appellants on the status of OMHA operations; describe OMHA initiatives aimed at reducing the backlog of OMHA-level appeals; offer advice to appellants for making the administrative-appeals process work more efficiently at the OMHA level; and solicit input from the appellant community on reducing the appeals backlog and improving the efficiency of OMHA’s processes.
At several points during the Forum, Chief ALJ Nancy Griswold and other speakers emphasized that OMHA has not imposed a moratorium; to the contrary, OMHA has continued to hold appeals hearings. OMHA’s process simply has changed due to the significant increases in workflow. Most significantly, in July 2013 OMHA implemented a deferred assignment process, which affects requests for hearings that were received by OMHA on or after April 2013. The new process has suspended assignments of new hearing requests until an adjudicator becomes available, to allow cases to be assigned on a first-in / first-out basis as each individual ALJ’s case docket is able to accommodate the additional work. Seemingly efficient, but with a significant effect—as of January 28, 2014, there is an estimated delay of up to 28 months until a hearing is assigned to an ALJ’s docket, and the estimated average wait time to obtain a hearing after assignment to an ALJ’s docket exceeds 6 months. When asked what OMHA’s statutory or regulatory authority is for establishing this deferred assignment process, Chief ALJ Griswold said that it is a “case management issue” and that OMHA does have regulatory authority to manage its workload.
During the Forum, various speakers provided the audience with numerous statistics, some of which really help to put OMHA’s dilemma into perspective:
- Between FY 2009 and the present (YTD FY 2014), OMHA’s average processing time for a single appeal has increased from 94.9 days to 329.8 days.
- In January 2012, OMHA was receiving 1,200 new requests for hearings per week; presently, OMHA is receiving more than 15,000 new requests for hearings per week.
Generally, ALJs have three different types of appeals cases in their normal workload: (1) traditional Medicare Part A / Part B appeals, (2) appeals associated with claims that may be reimbursable by both the Medicare and the Medicaid programs (“dual eligible appeals”); and (3) appeals from decisions by Medicare contractors that are reviewing claims outside the traditional Medicare Part A / Part B claims review process (e.g., RACs, ZPICs). Notably, in October 2009 the Centers for Medicare & Medicaid Services (CMS) permanently implemented the fee-for-service RAC program on a nationwide basis. Although OMHA has reported a rise in the ALJs’ workloads for all three types of cases, Chief ALJ Griswold acknowledged during the Forum that the rise in the number of Medicare contractor appeals has been the most significant.
Potential Relief on the Horizon?
Several of the Forum speakers discussed the steps that OMHA is taking in the short term, as well as those that OMHA is contemplating as more long term strategies, not only for managing the current workload but also for eliminating paper processing and bringing the agency’s technological capabilities into the 21st century. OMHA discussed programmatic initiatives including development of an adjudication manual so that all OMHA ALJs can follow uniform processes, consideration of statistical sampling methods (which only would be done with appellant consent) that could speed up the appeals process, particularly when an appellant has large numbers of claims they are appealing, and implementation of various alternative dispute resolution methods, which Chief ALJ Griswold noted may be a possible avenue for dealing with the large numbers of denials based on technical errors.
OMHA also is working on several technical initiatives. In the Spring of 2014, OMHA expects to launch the ALJ Appeal Status Information System (AASIS), a website which will provide public access to OMHA appeal status information, allow users to query multiple Level 2 and/or Level 3 appeal numbers, and access appeals data such as OMHA field office assignments, ALJ assignments and appeal status. In the second quarter of 2014, OMHA is hoping to launch a Medicare Appeals Template System (MATS), a document-generation system that will provide users with fillable forms to create individualized templates, with the goal of improving efficiency through increased data propagation. Longer term, anticipated for the Summer of 2016, OMHA hopes to launch an Electronic Case Adjudication and Processing Environment (ECAPE), a shared record system that will offer users functionality such as case intake, case assignment, workflow management, exhibiting, decision writing, closing and case management. ECAPE would allow appellants to electronically file appeals hearing requests, submit evidence in electronic form, view case files electronically, and send and receive communications to/from OMHA.
Comments from the Peanut Gallery: OMHA Is Not the “True Problem”
Attendees at the Forum were demonstrably appreciative of OMHA’s willingness to host the Forum and the efforts that OMHA is making to combat its current workload. However, when given the opportunity to ask questions, attendees provided clear and repeated feedback regarding their impression of the “true problem” – namely, the large numbers of denials at the first two levels of the appeals process. Level 1 of the appeals process is called redetermination and is performed by the same Medicare Administrative Contractor (MAC) that originally processed the claim. Level 2 of the appeals process is called reconsideration and is performed by a Qualified Independent Contractor (QIC). Among the issues that attendees cited were problems with the QICs transmitting the full record to the ALJs when cases move to the third level of appeal; large numbers of denials for “technical” (versus “medical necessity”) reasons; (c) refusals by the MACs and QICs to reopen their decisions, despite the goal of trying to resolve appeals at the lowest possible level of the appeals process; and allowing “clinical inference” at all levels of the appeals process. Attendees urged for better efforts by CMS to resolve the issues at the first two levels of the appeals process, which would not only make the appeals process smoother at all levels of the appeals process, but also would help OMHA reduce its workload if cases can be resolved more easily at the first two levels of the appeals process.
What comes next will be the true test. OMHA has laid out an aggressive plan for combatting its overwhelming workload. Appellants will be watching OMHA’s progress carefully, with the hope that programmatic and IT improvements to the system will help providers and beneficiaries to see relief more quickly as appeals are resolved more efficiently. OMHA is planning to publish a Federal Register notice to solicit public comments and suggestions regarding its efforts to streamline and reduce its workload, but timing for publication of this notice is unknown. The bigger question, however, is whether CMS will be responsive to the feedback from Forum attendees regarding the need for significant improvements at the first two levels of the appeals process. Time will tell … stay tuned.
 There are five levels in the Medicare administrative appeals process. The U.S. Department of Health & Human Services’ Office of Medicare Hearings and Appeals’ Administrative Law Judges hold hearings and issue decisions related to Medicare coverage determinations that reach the third level of the Medicare administrative appeals process.