United States Senate Finance Committee Chairman Orrin Hatch (R-UT) and Ranking Member Ron Wyden (D-OR) introduced the Audit & Appeals Fairness, Integrity, and Reforms in Medicare (AFIRM) Act of 2015 (S. 2368) on December 9th. This legislation is designed to improve the Medicare audit and appeals process and reduce the backlog of hearings and appeals.
The backlog of appeals is having an adverse effect on beneficiaries and providers. Under Medicare law a decision must be issued by a Medicare Administrative Law Judge (ALJ) within 90 days following the filing of an appeal by the Medicare beneficiary or provider. However, the appeal system is backlogged with nearly 900,000 appeals pending review before a handful of ALJs. With stepped up claims reviews in all provider sectors in Medicare, the number of appeals has increased exponentially. Despite efforts by the Office of Medicare Hearings and Appeals (OMHA) to expand the number of ALJs and achieve greater efficiencies in processing appeals, with 14,000 new appeals filed every week, a decision on any current ALJ appeal is over a year away.
In addition to strengthening the appeals process, the legislation also includes reforms to address the high number of audits, including reforms to how MACs are incentivized, and creating a Medicare Supplier and Provider Ombudsman for Reviews and Appeals.
It is estimated that over 30,000 appeals involving hospice or home health services are pending in the backlog. It is believed that the majority involve claim denials based on the now-eliminated narrative requirement in the home health face-to-face physician encounter rules. The settlement authority in the Senate legislation provides the means by which these claims can be resolved without waiting the years that it will take to clear out the appeals backlog. However, if the legislation is enacted, it leaves it to CMS’ discretion whether it would consider a settlement approach to these appeals. As such, NAHC continues to pursue alternative legislative and judicial solutions that more directly address the home health and hospice backlogs.