On June 3, 2015, the Senate Finance Committee approved by voice vote abipartisan proposal to reform the Medicare audit and appeals process in an attempt to help ease the backlog of Medicare appeals and promote efficiency and transparency. The draft proposal, the “Audit & Appeal Fairness, Integrity, and Reforms in Medicare Act of 2015,” would, among other things:

  • Provide increased funding for the Office of Medicare Hearings and Appeals (OMHA) and the Departmental Appeals Board (DAB);
  • Raise the amount in controversy threshold for review by an Administrative Law Judge (ALJ) and establish a new Medicare Magistrates program within OMHA to review cases with lower costs.
  • Require Qualified Independent Contractors (QICs), Medicare Magistrates, ALJs, or the DAB to remand an appeal to the Medicare Administrative Contractor (MAC) for a redetermination when the appellant introduces new evidence into the administrative record at a subsequent level of appeal (with certain exceptions).
  • Require the Secretary to establish process whereby ALJs and Medicare Magistrates could issue decisions based on the evidence of record without holding a hearing when there are no material issues of fact in dispute and the ALJ or the Medicare Magistrate determines that there is a binding authority that controls the decision in the matter under review.
  • Establish a voluntary alternative dispute resolution process to allow multiple pending claims with similar issues of law or fact to be settled as a unit, rather than as individual appeals, in certain circumstances.
  • Allow for the use of sampling and extrapolation, with the appellant’s consent, to expedite the appeals process.
  • Require the Secretary to implement a process by which OMHA and the DAB would refer credible suspicion of fraudulent activity to appropriate law enforcement entities and CMS.
  • Require OMHA to conduct annual training for all ALJs and Medicare Magistrates on Medicare policies. HHS would be required to ensure that review entity contractors consistently apply Medicare payment and coverage policies, and that conflicting local and national coverage determinations and program instructions are appropriately modified.
  • Increase the transparency of the appeal process by publishing data regarding the number of determinations appealed, outcomes, and aggregate appeal statistics for each contractor and provider type.
  • Require HHS to develop a comprehensive strategy for claims review determinations made on a prepayment, post-payment, or prior-authorization basis, focusing on identifying and reducing high-impact claim errors.
  • Require the Secretary to establish a CMS Ombudsman for Medicare Reviews and Appeals.
  • Prohibit recovery audit contractors from conducting patient status reviews (i.e., inpatient versus outpatient status) more than 6 months after the date of service if the claim was submitted within 3 months of the date of service, and direct the Secretary to study the impact of shortening the look-back period for other RA audits.
  • Limit medical record review requests applicable to providers and suppliers with low error rates.