Archived Article: Coverage & Appeals - Notice Concerning Appeals Of Claims Under Medicare Parts A And B

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CMS ISSUES NOTICE CONCERNING APPEALS OF CLAIMS UNDER MEDICARE PARTS A AND B

INTRODUCTION

On October 7, 2002, the Centers for Medicare & Medicaid Services (CMS) published a notice in the Federal Register setting forth its policy on implementation of new Medicare Parts A and B appeals procedures that were supposed to go into effect on October 1, 2002. 67 Federal Register 62478 (Oct. 7, 2002). The Notice incorporates the text of Ruling CMSR-02-01, signed by CMS Administrator Tom Scully on September 12, 2002.

The new appeals procedure were enacted as part of the Beneficiaries Improvement and Protection Act of 2000 (BIPA), Pub. Law 106-554 (2000). The reforms to the appeals system establish a uniform process for claims under Medicare Parts A and B, set time frames for filing appeals and for contractors to act on appeals, establish a uniform amount in controversy for administrative law judge (ALJ) hearings, and create a new level of review by the qualified independent contractor (QIC). CMS has announced a delay in implementation of most of the changes.

CMS CRITERIA FOR DETERMINING WHETHER TO IMPLEMENT BIPA CHANGES

Ruling CMSR-02-01 lists five criteria used by CMS to determine whether BIPA reforms could be implemented for initial determinations made on or after October 1, 2002. The criteria are:

Does the provision fundamentally affect an individual’s right to appeal or does it primarily involve the applicable appeals procedure?
Are the provisions clear and self-explanatory?
Can the provision be implemented using existing CMS resources?
Can the provision be implemented within existing appeals structures and without the new QIC level of review?
Will implementing a provision by itself support and not undermine the goal of a more timely and accurate appeal?

Applying the criteria to each provision of BIPA, CMS determined the following:

NEW APPEALS PROVISIONS THAT TAKE EFFECT

The time frame for filing a request for a redetermination of a Part A claim has been increased to 120 days. The previous time frame was 60 days.
The time frame for filing a request for a review of a Part B claim has been reduced to 120 days. The previous time frame was 180 days. However, CMS states that carriers may extend the deadline 60 days if the patient, provider, or supplier requests additional time in order to gather necessary supporting medical records.
The amount in controversy for requesting an ALJ hearing is reduced to $100 for Part B claims and for initial determinations of hospital claims made by Quality Improvement Organizations (QIOs). Previously, the amount for ALJ review of Part B claims was $500, and the amount for ALJ review of QIO hospital claims was $200.

NEW APPEALS PROVISIONS THAT ARE DELAYED

CMS will not implement the BIPA requirement that fiscal intermediaries and carriers make decisions and issue notices 45 days after receipt of the claim. Providers under the old process have 45 days to submit additional medical information, and so CMS wants their comments on how to implement the new time frame.
CMS will not require contractors to issue redeterminations of initial determinations within 30 days. CMS states that implementation of the new time frame requires additional resources.
CMS will not implement the QIC level of review until such time as QICs are in place. CMS states that it cannot begin the formal contracting process until the agency can commit to the additional allocation of resources.
CMS will not establish time frames for filing appeals to ALJs and the Medicare Appeals Council (MAC) of the Departmental Appeals Board (DAB) until after the public, "especially the beneficiary population," comments on proposed rules.
CMS lists a number of issues that must be resolved before implementing the new requirement for expedited determinations of provider decisions to terminate care. Although QIOs currently provide this kind of review in the hospital setting, CMS believes the new process is broader and will require more resources. The issues to be decided before implementation include:
Who should conduct expedited determinations?
To whom should the provisions apply?
What are the financial liability and notice requirements?
CMS cannot implement the new 90-day deadline for decisions by ALJs and the DAB until QICs are fully operational. CMS expects QICs to reduce the number of ALJ appeals, making the shorter deadline more attainable.
CMS also cannot implement the provision giving an appellant the option of moving to the next level of review if the 90-day time frame is not met until QICs are in place. CMS raises the potential of cases moving to federal court before the record is fully developed. CMS notes that more than 10,000 cases are now heard annually by the MAC.

APPEALS PROCEDURES THAT REMAIN IN EFFECT

CMS instructs fiscal intermediaries, carriers, and QIOs to follow current appeals procedures with the exception of (1) the new time frame for seeking carrier review and fiscal intermediary reconsideration, and (2) the amount in controversy threshold for ALJ hearings. CMS specifically notes the following:

Current rules for aggregation of Part B claims for purpose of determining the ALJ amount in controversy remain in effect.
BIPA did not establish an amount in controversy for review of claims by the new review entity, the QIC. Therefore, the amount in controversy for a Part B carrier hearing remains $100.
Fiscal intermediaries must continue to issue 90% of redeterminations of claims within 90 days, and carriers must continue to issue 95% of review determinations within 45 days.
Fiscal intermediaries should treat a request for a QIC reconsideration as a request for an ALJ hearing.
Carriers should treat a request for a QIC reconsideration as a request for a Part B fair hearing.
A contractor which receives a request to escalate an appeal to an ALJ or to the MAC because a timely decision has not be issued should inform the appellant that BIPA implementation has been delayed and the appeal will be processed under existing appeals procedures.
A contractor which receives a request for a case file from an ALJ or from the MAC to escalate an appeal should explain that the case file is being used to process a review, reconsideration or fair hearing, and that the file will be sent when that level of review is complete.
QIOs should continue to follow current procedures concerning time frames and financial liability when reviewing hospital discharges.

CONCLUSION

CMS states both in CMSR-02-01 and in the October 2002 Quarterly Provider Update that it expects to issue a notice of proposed rulemaking to implement the BIPA changes in the fall of 2002. See www.cms.hhs.gov/providerupdate.main.asp. Proposed rules will generally be issued the fourth Friday of the month - October 25, November 22, and December 27, 2002 - though rules may be issued at other times if required by statute. Until final rules to implement BIPA are in place, beneficiary advocates should continue to follow existing appeals processes with the exception of the two items noted above.