AHLA. U. Medicare Claims Appeals Soup to Nuts. Thomas E. Herrmann Strategic Management Services LLC Alexandria, VA

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1 AHLA U. Medicare Claims Appeals Soup to Nuts Thomas E. Herrmann Strategic Management Services LLC Alexandria, VA James P. Kelly Kelly Law Firm PC Atlanta, GA Donna K. Thiel King & Spalding LLP Washington, DC Institute on Medicare and Medicaid Payment Issues March 25-27, 2015

2 AMERICAN HEALTH LAWYERS ASSOCIATION INSTITUTE ON MEDICARE AND MEDICAID ISSUES MARCH 26,2015 THE MEDICARE APPEALS COUNCIL - FINAL AGENCY DECISION TOM HERRMANN SENIOR VICE PRESIDENT SERVICES, LLC THERRMANN@STRATEGICM.COM (703) MEDICARE APPEALS COUNCIL DEPARTMENTAL APPEALS BOARD - DHHS 2 Chair Administrative Appeals Judges (4) Attorney Advisors Legal Assistants 1

3 Medicare Appeals Council Jurisdiction Appeals of Administrative Law Judge (ALJ) decisions may be filed by appellants (providers, suppliers, and beneficiaries) 3 "Agency Referrals" are filed by Maximus - the Administrative Qualified Independent Contractor (ADQIC) - on behalf of the Centers for Medicare & Medicaid Services (CMS) Applicable Regulations - Appeals Filed by Providers, Suppliers and Beneficiaries A party to an ALJ hearing may request MAC review within 60 days of receipt of an ALJ decision or dismissal 42 CFR (a)(2). An appellant who files a request for ALJ review and does not receive a decision, dismissal, or remand order within 90 days, may file a request with the ALJ to escalate the appeal to the MAC, and if the ALJ does not act within 5 days, may request MAC review 42 CFR A request for escalation must be filed with both the ALJ and the MAC 42 CFR (b). A party does not have the right to a hearing before the MAC 42 CFR (a). The MAC s review is de novo. The MAC will consider all the evidence in the administrative record 42 CFR The MAC may adopt, modify, or reverse an ALJ decision, or remand the case to an ALJ for further proceedings 42 CFR (a). 4 2

4 Applicable Regulations - Contents of an Appeal A request for review should be filed with the MAC using Form DAB-101. See 5 Alternatively, a written request containing the information specified on the DAB-101 may be filed 42 CFR (a). A request for MAC review must identify the portions of the ALJ action with which the appellant disagrees and explain why; e.g. the ALJ decision is inconsistent with a statute, regulations, CMS Ruling, or other authority 42 CFR (b). The MAC will limit its review of an ALJ action to those exceptions raised by a party in the request for review unless the beneficiary is an unrepresented beneficiary 42 CFR (c). A party may request and receive from the MAC a copy of all or part of the record of the ALJ hearing. The party may be asked to pay the costs associated with providing this information 42 CFR Applicable Regulations - Contents of an Appeal (Cont d) 6 The MAC will give a party the opportunity to file a brief or other written statement about the facts and law relevant to a case. Any party who submits a brief or statement must send a copy to all other parties 42 CFR The MAC will limit its review to the evidence contained in the record before the ALJ unless the ALJ decision addresses a new issue that the parties were not afforded the opportunity to address at the ALJ level 42 CFR (a). If new evidence related to issues previously considered by the QIC is submitted to the MAC by a provider or supplier, the MAC must determine whether there is good cause for the late submission. If the MAC determines that good cause does not exist, the MAC will exclude the evidence and not consider it 42 CFR (c). 3

5 Medicare Appeals Council (MAC) Statistics 7 Appeals Received: 4500 Appeals Resolved: 2515 MAC took action (reverse, modify, or remand ALJ decision): 47% MAC affirmed ALJ decision: 22% MAC dismissed appeal on procedural grounds: 31% Historically, 8-10% of all ALJ unfavorable/partially favorable decisions are appealed to the MAC. Significant MAC Decisions in DME: In the Case of Liberator Medical Supply (May 9, 2014) Medicare's consolidated billing requirements do not allow a Part B supplier to bill for supplies provided on a date when the beneficiary is in a Part A covered episode of care. Procedural: In the Case of Massachusetts Health (February 27, 2014 There was no denial of due process when an ALJ denied a video-teleconference hearing and instead held a telephone hearing. SNF: In the Case of L.R. (February 21, 2014) Medicare coverage for SNF services denied despite the appellant's reliance on the Jimmo v. Sebelius litigation and settlement. Statistical Sampling: In the case of Sans Bois Health Services, Inc. (October 14, 2014) Upheld an extrapolated overpayment based on the use of a valid sampling methodology. decisions/mac_decisions.html 4

6 Federal Court Decisions Upholding MAC Decisions in 2014 Doctors Testing Center et al. v. Sebelius, (8th Circuit 2015), 2015 WL Upheld the MAC's decision that a physician's intent to have audiology testing performed must be documented in advance; it is not sufficient for the physician to only accept and use results subsequent to testing. Caring Hearts Personal Care Home Services v. Sebelius, (D. Kansas, August 28, 2014). Upheld the use of sampling to establish an extrapolated overpayment amount for non-covered home health services despite the fact that on appeal several of the sampled claims were upheld. Taransky v. Sebelius, 760 F. 3d 307 (2014), pet. for cert. filed Dec. 24, Upheld the MAC's determination that the plaintiff's settlement included medical expenses so she remained responsible for reimbursing the Medicare program for conditional payments made on her behalf. Also upheld the MAC's conclusion that a state court's stipulated order regarding a tort settlement did not constitute a court order "on the merits." 9 Enhancements to the MAC Review Process A priority is being given to beneficiary and pre-service appeals (i.e. Medicare Part C). Appeals filed by an appellant with identical legal issues and no significant factual issues are being consolidated, and one MAC decision is issued. Conversion to electronic filing and record transmission. Currently, Agency referrals from the AdQIC to the MAC (including case records) are being sent electronically. Goal in 2015 is to implement a system whereby appellants will be able to electronically file requests for review with the MAC. 10 5

7 Recommendations for Better Advocacy Before the Medicare Appeals Council File a Request for Review either through postal delivery or facsimile - but not both - and include the entire ALJ decision. Do not send duplicate copies of documents already in the case record. Do not send "new evidence" unless it can be shown that there is "good cause" to submit such evidence at this late stage in the appeals process. See 42 CFR Not applicable to unrepresented beneficiaries. Specify the portions of the ALJ decision that are being appealed, and state why. 42 CFR (b). 11 If submitting a request for escalation of a case from OMHA to the MAC, indicate "Escalation Mailstop" on the envelope so that it gets timely review by the MAC. Agency Referrals by the AdQIC Maximus has a contract with CMS to serve as the AdQIC and review all OMHA ALJ decisions. On behalf of CMS, the AdQIC may file a requests with the MAC for own motion review. 12 This is the only opportunity in the appeals process to present the CMS position on the merits of an appeal (other than the rare case where CMS seeks "party" or participant status at the ALJ hearing) 6

8 Statistics on AdQIC Referrals 13 MAC reported that it received 271 agency referrals for "own motion" review by the MAC in Of these referrals, 94% were granted. Statistics in FY 2014 relating to the MAC's action with respect to Agency Referrals: Reverse ALJ Decision: 52.8% of cases receiving "own motion" review Modify ALJ Decision: 1.7% of cases Remand: 27.4% Dismiss Request for ALJ Hearing: 12.2% Decline Agency Referral: 5.9% Applicable Regulations AdQIC Referrals to the MAC CMS or any of its contractors may refer a case to the MAC if in their view, the decision or dismissal contains an error of law material to the outcome of the claim or presents a broad policy or procedural issue that may affect the public interest. 42 CFR (b)(i). 14 CMS may also request that the MAC take own motion review of a case if CMS or a contractor participated at the ALJ level, and the decision or dismissal is not supported by preponderance of evidence in the record or the ALJ abused his or her discretion. 42 CFR (b)(ii). The AdQIC s referral to the MAC must be filed within 60 days after the ALJ decision or dismissal is issued and state the reasons why CMS believes the MAC should review the case on its own motion 42 CFR (b((2). A party to the ALJ s action may file exceptions to the referral by submitting written comments to the MAC within 20 days of the referral notice 42 CFR (b)(2). A party submitting comments to the MAC must send them to CMS (i.e. the AdQIC) and all other parties to the ALJ decision 42 CFR (b))(2). 7

9 Cases that the AdQIC May Refer to the Medicare Appeals Council The ALJ decision is contrary to the law, regulation, or CMS manual provisions. 15 The ALJ decision is inconsistent with prior Council decision(s). Seek to promote consistency in adjudication of Medicare claims appeals. Seek to clarify Medicare coverage issues that are unclear. Applicable Regulations MAC Action on a Case Referred by the AdQIC The MAC will accept a case for review (where CMS did not participate in the ALJ proceedings) if the ALJ decision or dismissal contains an error of law material to the outcome of the case or presents a broad policy or procedural issue that may affect the general public interest 42 CFR (c)(2). 16 In a case where CMS participated or was a party in the ALJ proceedings, the MAC may also accept review if there was an abuse of discretion by the ALJ or the decision is not consistent with the preponderance of evidence in the record 42 CFR (c)(1). In a case that the MAC accepts for review, it may adopt, modify, or reverse the ALJ decision, remand the case to an ALJ, or dismiss the hearing request in a case 42 CFR (d). If the MAC does not act within 90 days of the agency s referral (unless extended), the ALJ decision or dismissal is binding on the parties to the ALJ decision 42 CFR (d). 8

10 AdQIC Effectuation Process TheAdQIC is the "clearinghouse" for ALJ decisions in Medicare Part A and B cases. After an ALJ decision is issued, OMHA sends the decision and case record to the AdQIC. The AdQIC creates an electronic record from the "hard copy" case file and audio recording of the administrative hearing. The AdQIC reviews the ALJ decision and record and within 10 days sends an effectuation notice to the appropriate payment contractor in cases where there is a favorable or partially favorable decision. The contractor has 30 days to effectuate an ALJ decision forwarded to them by the AdQIC. Exceptions: The ALJ reopens a case to amend or correct a decision The AdQIC seeks clarification of a decision from the ALJ The case is referred to the Medicare Council for "Own Motion" review. 17 9