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On January 29, 2015, a federal judge ruled that Medicare beneficiaries who filed suit about the lengthy and illegal delays in Administrative Law Judge appeals may proceed with the case. The Center for Medicare Advocacy, which represents the plaintiffs, brought the case (Lessler et al. v. Burwell, 3:14-CV-1230, D. Conn.) to help fix a broken Medicare appeals system.  ALJ hearings are critical to beneficiaries who appeal for coverage of denied medical claims.  The first two levels of appeal are paper reviews only, and virtually all cases are denied.  But once beneficiaries reach an ALJ at the third level of appeal, they can present their case at an oral hearing with a judge.  It is the only opportunity for truly meaningful review, and beneficiaries have a much better chance of gaining coverage at the ALJ level. 

The six named plaintiffs, from Connecticut, New York, and Ohio, were appealing for coverage of services such as ambulance trips, acute inpatient rehabilitation, and skilled nursing facility care, when their appeals stalled at the ALJ level.  By law, the decisions must be issued within 90 days of the request for a hearing.  But the plaintiffs, many of whom have serious, ongoing health conditions, waited anywhere from six months to over 1 ½ years. One of the named plaintiffs died just before receiving his ALJ decision, which was favorable and issued a refund for the money he had spent on nursing facility care. The judge found this was a “sobering reminder” of the consequences of delay.

The government had filed a motion to dismiss the case, claiming that the court lacked subject matter jurisdiction and that the Medicare appeals agency has already addressed the issue.  In a ruling from the bench, Judge Jeffrey A. Meyer rejected the notion that the litigation could be resolved at this early stage, before plaintiffs have had an opportunity to conduct discovery. He said that dismissing the case of beneficiaries who had made plausible allegations about delays and the harm they caused would be “foreign” to what federal courts should be doing.  Judge Meyer found that he had jurisdiction, and also indicated that he will soon rule on plaintiffs’ pending motion to certify a nationwide class of Medicare beneficiaries who have waited more than 90 days for an ALJ decision.

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