Medicare Update

CMS Extends Timeline for Publishing Claim Appeal Procedures Final Rule

The Centers for Medicare & Medicaid Services (CMS) recently published a Notice in the Federal Register extending the time line for publishing the final rule for Medicare claims appeal procedures until March 1, 2009.  According to the Notice, the extended time line for publishing the final rule means that the March 8, 2005 interim final rule will remain in effect through March 1, 2009 (unless the final rule is published and becomes effective before March 1, 2009).

Medicare beneficiaries and, under certain circumstances, Medicare providers and suppliers, can appeal adverse determinations regarding claims for benefits under Medicare Parts A and B.  Section 521 of the Medicare, Medicaid and SCHIP Benefits Improvement and Protection Act of 2000 (BIPA) revised the Medicare claims appeal procedures and resulted in a November 15, 2002 proposed rule.  According to CMS, the March 8, 2005 interim final rule implements the BIPA provisions and other changes to the Medicare claim appeals procedures following the enactment of the Medicare Prescription Drug, Improvement and Modernization Act of 2003.

HHS Issues Proposed Rule to Revise Departmental Appeals Board Procedures

On December 28, 2007, the Department of Health and Human Services published a Proposed Rule in the Federal Register, which would revise the procedures for the Departmental Appeals Board (DAB).

Generally, the Proposed Rule would require that the DAB not only follow Federal statutes and regulations in hearings and appeals procedures, but also follow published guidance issued by the Secretary of the Department of Health and Human Services (Secretary) to the extent such guidance is not inconsistent with applicable statutes or regulations.  The Proposed Rule would also provide the Secretary with the authority to review DAB decisions for errors in the application of statutes, regulations and interpretative policy. According to the Secretary, the Proposed Rule is needed to ensure consistency in decision making and to ensure that the Secretary's policies are being correctly implemented.

In its current form, the Proposed Rule does not include a process for either party to request the Secretary's review or address briefing procedures. Instead, the Proposed Rule seeks to "maintain flexibility" so that the Secretary can tailor the review process to the needs of a particular case.  However, the Proposed Rule does solicit comments on whether the regulations should specify procedures for the Secretary's review.

The changes contemplated by the Proposed Rule would impact various appeals procedures, including: (i) the review of certain determinations under 42 C.F.R. Part 498 and impacting certain provider's participation in the Medicare program; (ii) disputes governed by 42 C.F.R. Part 1005 and concerning the imposition of exclusions, civil monetary penalties and assessments related to health care fraud and abuse; and (iii) appeals governed by 42 C.F.R. Parts 422 and 423 and involving civil monetary penalties imposed on Medicare Advantage organizations and Medicare prescription drug sponsors.

The deadline for submitting comments on the Proposed Rule is January 28, 2008. 

CMS Adjusts Amount in Controversy Thresholds for Medicare Appeals

Today, the Centers for Medicare & Medicaid Services published a Notice in the Federal Register announcing the annual adjustment to the amount in controversy (AIC) threshold amounts for administrative law judge (ALJ) hearings and judicial review under the Medicare appeals process.

The Medicare Prescription Drug, Improvement and Modernization Act of 2003 (MMA) requires that the AIC threshold amounts for ALJ hearings and judicial review be adjusted annually.  In brief, the MMA requires that the AIC threshold amounts be adjusted by the percentage increase in the medical care component of the consumer price index (CPI) for all urban consumers for July 2003 to the July of the preceding year involved, and rounded to the nearest multiple of $10.

According to the Notice, the AIC threshold amount for ALJ hearings will increase to $120, and the AIC threshold amount for judicial review will increase to $1,180, for calendar year 2008.  These new amounts are based on the 18.2 percent increase in the medical care component of the CPI from July 2003 to July 2007. The adjustment to the AIC threshold amounts for calendar year 2008 will be effective for requests for ALJ hearings and judicial review filed on or after January 1, 2008.

CMS Extends Timeline for Publishing Final Rule on PRRB Procedures

On June 22, 2007, the Centers for Medicare & Medicaid Services (CMS) published a Notice in the Federal Register, which extended the timeline for publishing the final rule updating the guidelines and procedures for Provider Reimbursement Review Board (PRRB) appeals until June 25, 2008.

On June 25, 2004, CMS published a Proposed Rule in the Federal Register that would update the guidelines and procedures for PRRB appeals.  On December 11, 2006, the Department of Health and Human Services published its Semiannual Regulatory Agenda indicating that a final rule would be published in June 2007.  However, the Notice indicates that the timeline is being extended because of the public comments received, the complex policy and legal issue raised in those comments, and the need for extensive consultation and analysis.

Currently, the PRRB's guidelines and procedures are found in the PRRB's March 1, 2002 Instructions, Section 1878 of the Social Security Act, and 42 C.F.R. 405-1835-1873.

CMS Ruling Addresses Own Motion Review of Medicare Part D Cases by Medicare Appeals Council

On March 23, 2007, the Centers for Medicare & Medicaid Services (CMS) published a Notice in the Federal Register announcing a CMS Ruling that establishes a process for own motion review of Medicare Part D prescription drug cases by the Medicare Appeals Council (MAC).

According to the Notice, the CMS Ruling permits CMS or a Medicare Part D independent review entity (IRE) to refer a Medicare Part D case to the MAC, and for the MAC to accept review, if an administrative law judge's (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.

However, the CMS Ruling does not allow a Medicare Part D plan sponsor to refer a Medicare Part D case to the MAC for own motion review.  Nevertheless, the Notice states that Medicare Part D plan sponsors will "continue to have the opportunity to communicate with the Part D IRE about cases that may warrant such referral."

Further, the CMS Ruling applies many of the provisions in 42 C.F.R. 405.1110 to Medicare Part D cases.  For instance, the CMS Ruling indicates that a 60-day time frame for filing a written referral, and for providing notice to other interested parties, is appropriate for Part D cases.  In the Notice, CMS also cites other existing appeal provisions that would be applicable to the Part D cases.

According to the Notice, the CMS Ruling became effective on March 15, 2007, and after being signed by Acting CMS Administrator, Leslie V. Norwalk.

CMS to Issue Final Rule Updating PRRB Guidelines and Procedures

On December 11, 2006, the Department of Health & Human Services (HHS) published its Semiannual Regulatory Agenda (Agenda) in the Federal Register.  The Agenda identifies rules that HHS intends to propose or finalize over the next year.

In the Agenda, HHS reveals that it intends to publish a final rule in June 2007, which redefines, clarifies and updates the guidelines and procedures for Provider Reimbursement Review Board (PRRB) appeals based on recent court decisions.  This final rule will follow a Proposed Rule that HHS published in the Federal Register in June 2004. 

Currently, the PRRB's guidelines and procedures are found in the PRRB's March 1, 2002 Instructions, and at Section 1878 of the Social Security Act and 42 C.F.R. 405.1835-1873.

HHS Adjusts Medicare's Amount in Controversy Thresholds for CY 2007

On December 14, 2006, the Department of Health & Human Services published a Notice in the Federal Register announcing the annual adjustment to the amount in controversy (AIC) threshold amounts for administrative law judge (ALJ) hearings and judicial review under the Medicare appeals process.

The Medicare Prescription Drug, Improvement and Modernization Act of 2006 (MMA) requires that the AIC threshold amounts for ALJ hearings and judicial review be adjusted annually.  In brief, the MMA requires that the AIC threshold amounts be adjusted by the percentage increase in the medical care component of the consumer price index for all urban consumers for July 2003 to the July of the preceding year involved, and rounded to the nearest multiple of $10.

According to the Notice, the AIC threshold amount for ALJ hearings will remain at $110, and the AIC threshold amount for judicial review will rise to $1,130, for calendar year 2007.  For calendar year 2006, the AIC threshold amount for judicial review is $1,090.   The adjustment to the AIC threshold amounts for calendar year 2007 will be effective for requests for ALJ hearings and judicial review filed on or after January 1, 2007.