Reproduced with permission from BNA’s Medicare Report, 27 MCR 737, 8/12/16. Copyright 姝2016 by The Bureau
of National Affairs, Inc. (800-372-1033) http://www.bna.com
A Favorable, New Climate for Challenging Medicare Appeals
BYDAVID TOLLEY AND GREER DONLEY
Over the past decade, health care providers seeking
to challenge Medicare claim denials have faced in-
creasing delays in reaching what many consider
the most important step in the Medicare appeals
process—a hearing before an impartial administrative
law judge (‘‘ALJ’’) (the prior two steps are decided by
Medicare contractors who often have a financial inter-
est adverse to that of the provider).
1
Strikingly, provid-
ers succeed at overturning denials more than half of the
time according to CMS’s 2014 data—and even more fre-
quently in previous years
2
—while individual provider
data suggests success rates are often much higher than
54%.
3
Providers currently wait years for an ALJ to hear
their appeal even though providers are statutorily en-
titled to an ALJ hearing and determination within 90
days of the provider’s initial request for ALJ review.
4
Prior to 2010, CMS frequently met this deadline.
5
In
2010, however, the Recovery Audit Contractor program
was implemented, and things changed dramatically
(and quickly).
6
This program, which incentivized recov-
ery auditors to find overpayments by giving them a fi-
nancial share in any recoupments they identified, has
been credited with kick starting an appeals backlog as
the number of appeals quickly and dramatically out-
1
CTRS.FOR MEDICARE &MEDICAID SERVS., U.S. DEP’TOFHEALTH
&HUMAN SERVS., MEDICARE PARTS A&BAPPEALS PROCESS (Feb.
2015), https://www.cms.gov/Outreach-and-Education/
Medicare-Learning-Network-MLN/MLNProducts/downloads/
MedicareAppealsprocess.pdf.
2
U.S. GOV’TACCOUNTABILITY OFFICE,NO. GAO-16-366, MEDI-
CARE FEE-FOR-SERVICE:OPPORTUNITIES REMAIN TO IMPROVE APPEALS
PROCESS 21-22 (2016), http://www.gao.gov/assets/680/
677034.pdf.
3
See, e.g.,Am. Hosp. Ass’n v. Burwell, 812 F.3d 183, 188
(D.C. Cir. 2016) (‘‘[T]he American Hospital Association[] re-
ported that they had appealed 52% of RAC denials, and that
66% of these appeals that had been completed were success-
ful.’’).
4
42 U.S.C. § 1395ff(d)(1)(A).
5
Adjudication Timeframes, Dep’t Health & Human Ser-
vices., Office of Medicare Hearings & Appeals (last updated
April 29, 2015), http://www.hhs.gov/omha/important_notice_
regarding_adjudication_timeframes.html.
6
AM.HOSP.ASS’N,THE REAL COST OF THE INEFFICIENT MEDICARE
RAC PROGRAM 2 (Mar. 1, 2016), http://www.aha.org/content/15/
hospsurveyreport.pdf; U.S. GOV’TACCOUNTABILITY OFFICE,SUPRA
note 2 at 15.
David Tolley is an associate in the Boston
office of Latham & Watkins and a member of
the firm’s Global Recruiting Committee. He
advises health care organizations, including
academic medical centers, hospitals, health IT
companies, medical device manufacturers and
other organizations on a variety of regula-
tory, compliance and litigation matters. He
can be reached at mailto:david.tolley@
lw.com.
Greer Donley is an associate in the Washing-
ton, D.C., office of Latham & Watkins. She
counsels hospital, pharmaceutical, medi-
cal device, food and other related industry cli-
ents in matters concerning violations of the
False Claims Act and regulatory issues involv-
ing the Centers for Medicare & Medicaid Ser-
vices and the Food and Drug Administration.
She can be reached at mailto:greer.donley@
lw.com.
COPYRIGHT 姝2016 BY THE BUREAU OF NATIONAL AFFAIRS, INC. ISSN 1049-7986
BNA’s
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