Audit and Compliance



Recently, a federal judge in the District of Columbia asked the American Hospital Association (AHA) for ideas on how the U.S. Department of Health and Human Services (HHS) can deal with the substantially large volume of Medicare appeals backlog at the Administrative Law Judge (ALJ) appeals level. As of June 2017, the Office of Medicare, Hearing and Appeals (OMHA) had 607,402 appeals pending with a current estimated wait time of three years for an administrative law judge to process a provider's appeal. At this rate, the backlog is predicted to reach 950,520 appeals by the end of Fiscal Year 2021.

The AHA and a group of hospitals filed a law suit in 2014 against the Secretary of HHS. The substance of the law suit was that the length of time it takes to challenge a Medicare Recovery Audit Contractor (RA) decision at the ALJ level of appeal violates the statutory deadlines set forth in 42USC section 1395ff of the Social Security Act. The statute requires that the ALJs "conduct and conclude a hearing" and render a decision within 90 days of the date a request for hearing is filed—a much shorter timeframe than the current three-year waiting period. Under Medicare rules a provider has five levels of appeals to use when a Medicare claim is denied.

U.S. District Judge James Boasberg reportedly expressed frustration toward HHS during a recent hearing over the agency's inability to find a solution for the staggering backlog. Judge Boasberg told AHA to provide the court with a list of recommendations to cull the backlog by June 22, 2018. In turn, HHS will have until July 6, 2018 to respond to the proposed suggestions.

We are extremely pleased with the Judge's request to the AHA. Clearing the appeals back-log will not only help providers but will also improve the effectiveness of the overall appeal process moving forward. Over the years we have seen the significant growth in appeals as our clients enter these cases into the TRACKER™ PRO solution to monitor their appeal status and track potential financial impact. The judge is correct in turning this situation over to the industry representatives to come up with a solution. We are confident that the AHA and its members will make good suggestions to the court. One obvious solution would be to require HHS to offer settlements to all providers with pending appeals as they did a few years ago. Many hospital providers accepted the settlement offer in order to clear the appeals off their books. We have yet to learn about other options being discussed but are sure that AHA will publish its comments for the hospital industry to review when ready. We will continue to monitor this issue moving forward and provide updates where appropriate.