# Rejections and Appeals

Contents

[9.1 Medicaid Appeal Process 9-2](#medicaid-appeal-process)

[9.1.1 Requesting a Hearing 9-3](#requesting-a-hearing)

[9.2 Private Insurance Appeal Process
9-4](#private-insurance-appeal-process)

[9.3 Collection Policies and Procedures for Submitted Claims
9-6](#collection-policies-and-procedures-for-submitted-claims)

[9.4 Verifying Eligibility 9-7](#verifying-eligibility)

[9.4.1 Steps to Verify Eligibility via Telephone
9-7](#steps-to-verify-eligibility-via-telephone)

[9.4.2 Steps to Verify Eligibility Online
9-7](#steps-to-verify-eligibility-online)

[9.4.3 Entering Updated Eligibility Information in RPMS
9-8](#entering-updated-eligibility-information-in-rpms)

[9.5 Medicare Appeals Process 9-8](#medicare-appeals-process)

[9.5.1 Background 9-8](#background)

[9.5.2 General Appeals Process in Initial Determinations\
(CMS CR 4019)
9-10](#general-appeals-process-in-initial-determinations-cms-cr-4019)

[9.6 The Revised Medicare Appeals Process
9-10](#the-revised-medicare-appeals-process)

[9.6.1 First Level of Appeal -- Redetermination
9-11](#first-level-of-appeal-redetermination)

[9.6.2 New Language for Redetermination Letters
9-13](#new-language-for-redetermination-letters)

[9.6.3 Second Level of Appeal - Reconsideration
9-14](#second-level-of-appeal---reconsideration)

[9.6.4 Third Level of Appeal -- Administrative Law Judge (ALJ)\
Hearing
9-14](#third-level-of-appeal-administrative-law-judge-alj-hearing)

[9.6.5 Fourth Level of Appeal -- Departmental Appeals Board (DAB)
9-15](#fourth-level-of-appeal-departmental-appeals-board-dab)

[9.6.6 Fifth Level of Appeal -- Federal District Court
9-15](#fifth-level-of-appeal-federal-district-court)

[9.7 Medicare Part B Appeals Process - Carriers
9-16](#medicare-part-b-appeals-process---carriers)

[9.7.1 Who Can Appeal 9-16](#who-can-appeal)

[9.7.2 Aggregation of Claims 9-18](#aggregation-of-claims)

[9.7.3 Good Cause 9-19](#good-cause)

[9.8 Medicare Part B Appeals Process
9-20](#medicare-part-b-appeals-process)

[9.8.1 First Level of Appeal -- Redetermination
9-20](#first-level-of-appeal-redetermination-1)

[9.8.2 Telephone Review Procedures 9-22](#telephone-review-procedures)

[9.8.3 Second Level of Appeal -- Hearing Office Hearing
9-22](#second-level-of-appeal-hearing-office-hearing)

[9.8.4 Hearing Office Hearing Types 9-24](#hearing-office-hearing-types)

[9.8.5 Third Level of Appeal -- Administrative Law Judge (ALJ)\
Hearing
9-25](#third-level-of-appeal-administrative-law-judge-alj-hearing-1)

[9.8.6 Fourth Level of Appeal -- Departmental Appeals Board Review
9-26](#fourth-level-of-appeal-departmental-appeals-board-review)

[9.8.7 Fifth Level of Appeal -- U.S. District Court (Court) Review
9-27](#fifth-level-of-appeal-u.s.-district-court-court-review)

[9.9 General Guidelines for Writing Appeals
9-27](#general-guidelines-for-writing-appeals)

[9.10 Quality Control 9-27](#quality-control)

[9.11 Additional Resources 9-28](#additional-resources)

## Medicaid Appeal Process

Reasons for resubmitting or appealing Medicaid claims include

-   Date of Service spans over the calendar year (payment and billed
    amount changes).

-   The patient was admitted on September 13 and discharged on September
    30, but Medicaid's eligibility was not effective until September 15.

-   Eligibility information states the patient was not eligible for
    coverage; however, other information provided states the patient was
    covered.

-   The initial claim was not received by Medicaid; however, the
    facility has proof of submission within the timely filing
    guidelines.

-   The Authorization number was not on file.

-   Medicaid has a record that the patient is covered by other
    insurance; however, research finds that the patient is not covered
    by other insurance.

-   The Consent form was not present with initial bill.

-   There was a coding discrepancy on the initial claim submission.

-   There was a name discrepancy on the original claim.

-   There were system errors.

Each state has its own appeal process. For guidance on the rejection and
appeal process, contact your state Medicaid program.

Sample of the appeal and rejection process:

-   Determine the validity of the denial or partial pay by reviewing the
    following items.

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-   Date of Service

-   Type of Service

-   Medicaid Identification Number

-   Effective Date of Coverage

-   Review of Medical Record and PCC, PCC+, or Electronic Health Record

-   Diagnosis

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-   If denial of partial payment is invalid,

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-   Resubmit a claim on the appropriate form.

-   Type a letter requesting reconsideration, stating a reason for the
    request.

-   Copy and attach one of the following documents:

    -   Remittance Advice

    -   Authorization Number

    -   Consent Form

    -   Proof of Medicaid Eligibility

    -   Private Insurance denial EOB

### Requesting a Hearing

A hearing process is available for any provider or facility who
disagrees with decisions from Medicaid that relate to participation or
termination from the plan, overpayment, or imposed sanctions. Most
Medicaid state plans have 30 calendar days from the date of an action to
request a hearing.

To be timely, the request must be received by Medicaid no later than the
close of business of the specified day. Hearings are conducted and a
written decision is issued to the provider within 120 calendar days from
the date Medicaid receives the request, unless the parties agree to an
extension.

For individual hearings, a pre-conference is usually scheduled to
clarify the issues, resolve some or all of the issues, exchange
documents and information, review audit findings, and discuss other
matters.

Besides the traditional hearing, most state Medicaid programs offer
either

-   An expedited hearing for cases related to health, safety, or service
    availability; or

-   A group hearing for cases where individual issues of fact are not
    disputed and where related issues of state and/or Federal law,
    regulation, or policy are the sole issues being raised.

Medicaid may deny or dismiss a request for a hearing when:

-   The request is not received in a timely manner or within the time
    period stated in the notice

-   The request is withdrawn, or canceled in writing by the provider

-   The sole issue presented concerns a Federal or state law which
    requires an adjustment of compensation for all or certain classes of
    providers of services

-   The provider fails to appear at a scheduled hearing without good
    cause

-   The same issue has already been appealed or decided upon as to this
    provider and fact situation

Beyond the hearing process, if the final decision is upheld, providers
still have the right to pursue judicial review of the decision. This
must be accomplished within 30 calendar days from the date of the
hearing decision

## Private Insurance Appeal Process

To substantiate any denied claims through an appeal process, it is
essential that you keep written records of all verbal and written
correspondence at all levels of the patient encounter. This is
especially critical in the issuing of prior approvals/authorizations by
third-party payers.

Oftentimes claims are denied months or even years after the original
submission. Because of this wide disparity in claims adjudication,
document your correspondence in the **RPMS Accounts Receivable**
messaging fields.

Documentation of conversations with payers should include at a minimum:

-   Date the conversation took place

-   Telephone number and extension of representative you called

-   Person you spoke to

-   Prior authorization or treatment numbers

-   The name of the IHS facility staff person

In addition, be sure to note any additional information from the
preauthorization telephone call or conversation. This can be found on
page 5 of the RPMS registration editor. This can include comments such
as "this individual was just added to the contract". Written
documentation of comments such as these can often be the deciding factor
between a successful appeal and a denial.

Immediately after you receive the claim denial, begin the appeal
process. If you believe you have a compelling rational for an appeal
resulting in the denial being reversed, proceed with that appeal.

Each appeal letter does not have to be customized. Craft a letter that
has worked in the past. Keep copies of prior letters in your computer
system and modify them for the current situation.

Appeal letters should include the following:

-   Date of your letter

-   Name of the particular individual to whom you are addressing your
    appeal. If you don't have a name, call the payer and obtain one.

-   Title of the individual to whom you are addressing the appeal

-   Complete address, including department to which you are sending the
    appeal

-   Reason for the letter

-   Subscriber name, patient name, date(s) of service, certificate
    number, precertification number, internal patient account number,
    and amount of claim being appealed

-   Include language from the contract or the billing manual, if
    relevant

-   If you have resubmitted the claim numerous times prior to the
    denial, be sure to tell the payer

-   Send the appeal letter certified mail

Familiarize yourself with the response time for an appeal as contained
in the payer's billing manual or contract. Always follow up on your
appeal at set timeframes

When appealing a denied claim,

-   Be respectful of the individual receiving your letter.

-   Involve your patient in the appeal process. The patient is paying
    the premiums and a satisfied patient will want the provider paid.

## Collection Policies and Procedures for Submitted Claims 

The collection of outstanding insurance claims requires a high level of
research and review:

-   All outstanding claims are examined for accuracy and adequacy of
    documentation in preparation for re-submission.

-   All claims require the same basic information, which is either
    collected or verified as correct from various components of the
    RPMS.

-   All private insurance (inpatient and outpatient) claims are filed in
    the respective patient financial folders, which are readily
    available for retrieval.

Outstanding claims are identified utilizing the

-   Explanation of Benefits for private insurance claims.

-   Remittance Advice for Medicare and Medicaid claims.

Other sources in obtaining outstanding claims are the various reports
available from the RPMS Accounts Receivable menu, such as 30/60/90/120
Day Age report.

The Accounts Receivable (A/R) staff should be responsible for keeping
the batches in order by the remittance date. Uncompleted batch reports
should be prepared on a weekly basis for Medicaid and Medicare. These
reports allow the supervisor to monitor outstanding batches and/or
Remittance Advices.

The first step in the process is to review the Explanation of Benefits
or Remittance Advice to determine the status of the outstanding account.
Accounts Receivable staff need to

-   Log completed batches in the Tracking Log

-   File remittances by payer according to remit date.

All Remittance Advices should be batched, logged, and filed. Explanation
of benefits are logged and filed by received date. Follow-up of denied
and outstanding claims are done by the latest remittance date.

The second step is to confirm that the insurance eligibility information
listed in the RPMS Patient Registration application on Page 4 and Page 8
is accurate and current. If the eligibility has not been updated, the
respective insurance company or carrier needs to be contacted either by
a telephone call or on-line. Once verification is completed, updates
will be made in RPMS.

## Verifying Eligibility

### Steps to Verify Eligibility via Telephone

1\. Make contact with the appropriate insurance company or carrier and
follow prompts or ask for the eligibility department.

2\. Provide the patient's information for verification of coverage, such
as social security number, date of birth, and gender of patient.

3\. Ask for the effective date, any lapses in coverage, the termination
date, and type of coverage.

4\. Enter updated information in the RPMS Patient Registration
application, on Page 4 and Page 8.

### Steps to Verify Eligibility Online

1.  Various payers have on-line capabilities to verify eligibility which
    require setting up a user name and password.

1\. Log onto website, enter password, and enter with information that is
requested, such as Health Insurance Claim Number, social security
number, name, and date of birth, gender, and the identification number
for the recipients.

2\. Enter date range for payers that require that information

3\. Enter updated information in the RPMS Patient Registration
application, on Page 4 and Page 8.

### Entering Updated Eligibility Information in RPMS

1\. Select the RPMS Patient Registration menu.

2\. Select PAG or edit one of the patient pages.

3\. Select P4.

4\. Select PATIENT NAME and enter the patient's name, social security
number, date of birth, and/or health record number.

5\. Select upper case E to edit eligibility.

6\. Enter the insurer number you want to edit.

7\. Type "E" to edit or "A: to add an insurer.

8\. Make necessary corrections or updates

## Medicare Appeals Process

### Background

The Medicare claim appeals process was amended by the Medicare, Medicaid
and SCHIP Benefits Improvement and Protection Act of 2000 (BIPA), and
again by the Medicare Prescription Drug, Improvement, and Modernization
Act of 2003 (MMA). The Medicare appeals process is undergoing revision
as a result of these amendments, and currently, new appeals process
requirements are being phased-in.

By the completion of the phase-in process, and in addition to other
changes, there will be a uniform claim appeals procedure for Part A and
Part B claims. A table comparing the Medicare Appeals process is
available in Part 5, Appendix C.

There will be a new stage (second level) in the appeals process, named
**reconsideration**, which is different from the previous first level of
appeal for Part A claims performed by Medicare Fiscal Intermediaries
(FIs).

These new reconsiderations will be processed by Qualified Independent
Contractors (QICs). For clarification, see Table 1: Appeal Rights for
Redetermination Requests.

2.  As of October 1, 2004, reconsiderations are called redeterminations.

Table 1: Appeal Rights for Redetermination Requests

  ----------- ------------------ ------------------------ -------------------
  Medicare    Medicare           Date Redetermination     Appeal Rights\
  Claims      Contractor Issuing Issued and Mailed        for
              Redetermination                             Redetermination\*

  Part A/Part FI                 On or after May 1, 2005  QIC
  B                                                       

  Part B      Carrier            On or after January 1,   QIC
                                 2006                     

  Part A      FI                 Before May 1, 2005       ALJ

  Part B      FI                 Before May 1, 2005       HO

  Part A      Carrier            Before January 1, 2006   ALJ

  Part B      Carrier            Before January 1, 2006   HO
  ----------- ------------------ ------------------------ -------------------

**\***Qualified Independent Contractor (QIC); Administrative Law Judge
(ALJ);\
Hearing Officer (HO)

  -------------------- --------------------------------------------------
  **For requests       **The date received is defined as**
  filed**              

     in writing        the date received by the Medicare contractor in
                       the corporate mailroom

     in person         the date of the office's date stamp on the request
  -------------------- --------------------------------------------------

3.  For Part A and Part B redeterminations issued *before* May 1, 2005,
    contractors will be responsible for accepting ALJ hearing requests
    and for preparing case files for the hearing. Contractors will
    continue to follow instructions in the Medicare Claims Processing
    Manual, Chapter 29, sections 50 and 60, in preparing case files.

CMS has developed and published *Understanding the Remittance Advice: A
Guide for Medicare Providers, Physician, Suppliers, and Billers*. This
Medlearn guide is designed to be used as a self-help tool, and is
available at this website:

<http://www.cms.hhs.gov/MedlearnProducts/>

Additional information about this guide can be found in the 2005
Medlearn Matters article SE0540, *CMS Releases New Educational Guide on
Remittance Advice (RA) Notices*, which is available at this website:

<http://www.cms.hhs.gov/MedlearnMattersArticles/>

### General Appeals Process in Initial Determinations (CMS CR 4019)

4.  The Centers for Medicare & Medicaid Services (CMS) revised the
    Medlearn Matters article on Nov. 18, 2005.

CMS has released an article that discusses the general appeals process
in initial determinations and references pertinent information in
Sections 200 to 260 in Chapter 29 of the *Medicare Claims Processing
Manual*.

The article, titled "MMA - Changes to Chapter 29 -- General Appeals
Process in Initial Determinations," (MM4019, October 7, 2005) is
available at this website:

<http://www.cms.hhs.gov/MedlearnMattersArticles/>

Providers may reference CR 4019, Pub. 100-04, Transmittal 695, dated
Oct. 7, 2005, for this information. The CMS transmittal is available in
its entirety at this website:

<http://www.cms.hhs.gov/Transmittals/downloads/R695CP.pdf>

## The Revised Medicare Appeals Process 

(For Medicare Part A Fee-for-Service Appeals for Redeterminations issued
by FIs on or after May 1, 2005, and Medicare Part B Fee-for-Service
Appeals for Redeterminations issued by Carriers on or after January 1,
2006)

Effective for all initial determinations made on or after May 1, 2005,
are new appeal rights for Medicare providers. Providers who submit
claims to FIs will have the same right to appeal claims as
beneficiaries. Accordingly, FIs will no longer use RA remark code MA44
for initial determinations made on or after May 1, 2005.

This means that FIs will not have to determine whether a provider
submitting as appeal has the right to appeal, nor will they have to
evaluate appointment of representative forms submitted by providers
representing beneficiaries. In the past, non-participating suppliers
accessed the appeals process by acting as the beneficiary's appointed
representative in situations where they might not otherwise have had
appeal rights.

Section 1869(b)(1)(C) permits a beneficiary to assign his or her appeal
rights with respect to an item or service to a provider or supplier.
This assignment of appeal must be made using the CMS standard form, CMS
20031, *Transfer (Assignment) of Appeal Rights*, which is available at
this website:

<http://www.cms.hhs.gov/CMSForms/>

### First Level of Appeal -- Redetermination

Parties who are not satisfied with the initial determination of their
claim have the right to appeal that decision. For requirements for
written redetermination requests made on or after May 1, 2005, s the
*Medicare Claims Processing Manual* (pub# 100-4), Chapter 29, Section:

-   40.2.1(B) and 50.3.1(A) for beneficiary requests

-   40.2.1(C) and 50.2.1(B) for provider and State appeal requests.

The manual is available at this website:

<http://www.cms.hhs.gov/manuals/>

Unlike appeal requests filed before this date, provider and State
appellants do not need to specify the date of initial determination in
their requests.

Most Part A appeal requests will be made using the prescribed form,
CMS 20027, *Medicare Redetermination Request Form*, available at this
website:

<http://www.cms.hhs.gov/CMSForms/>

If a fully completed Form CMS-20027 is not used to express disagreement
with the initial determination, the appeal request must contain the
following information:

-   Date of initial determination;

-   Beneficiary name;

-   Medicare Health insurance Claim Number;

-   Name and address of provider of service;

-   Date(s) of service for which the initial determination was issued
    (dates must be reported in a manner that complies with the Medicare
    claims filing instructions. Ranges of dates are acceptable only if a
    range of dates is properly reportable on the Medicare claim form);

-   Which item(s), if any and/or service(s) are at issue in the appeal;
    and

-   The signature of the appellant.

During the transition period, requests for redeterminations of appeal
decisions (determinations) effective for all initial determinations made
on or after May 1, 2005 should go either to the QIC, the Administrative
Law Judge (ALJ), or the Hearing Officer (HO), depending on whether the
claim is a Part A or Part B claim; whether the Medicare contractor who
issued the initial claim decision is an FI or a carrier; and the date of
the claim. (see Table 2.)

A request for redetermination must be filed *in writing* within 120 days
of the date of receipt of the notice of initial determination (either
the Medicare Summary Notice (MSN) supplied to the beneficiary, or the
Remittance Advice (RA) supplied to the provider. Provider and State
appellants no longer have to specify the date of the initial
determination in their requests. Medicare contractors may consider as
good cause for late filing written redetermination requests that are
mailed or personally delivered to CMS, SSA, Railroad Review Board (RRB)
office or another Government agency, mailed in good faith and within the
time limit, but do not reach the appropriate Medicare contractor until
after the time period to file a request expired.

FIs are not required to send the appellant a letter acknowledging the
receipt of a redetermination request, however, an Automated
Correspondence System (ACS) will be created to house redetermination
request information. This information will be accessible to providers
within the Direct Data Entry (DDE) system for 90 days after receipt of
the redetermination request and will allow providers to view which
appeals were received by the FI and which appeals need to be
resubmitted.

The redetermination is an independent examination of the claim file made
by FI personnel who were not involved in the original determination
decision. This person examines each aspect of each service in the claim.
If there is doubt that the request is specific or general, a general
redetermination is performed. For appeals initiated by the State, the FI
will request that the State, or the parties who are authorized to act on
behalf of the Medicaid State Agency will obtain and submit the necessary
documentation.

Once the written redetermination appeal has been filed, Medicare
providers and beneficiaries will receive a Medicare Redetermination
Notice (MRN) from the FI for any partially favorable or unfavorable
decision made on a redetermination request that was made on or after
October 1, 2004. This written notification of the redetermination
decision will provide complete, accurate and understandable information
about the redetermination decision. All redeterminations will be
completed and mailed within 60 days of the receipt of the request for
redetermination.

CR3530, *Appeals Transition -- BIPA 521 Appeals* (MM3530), discuses the
revisions to the Medicare appeals process for FIs. A copy of the new
Medicare Appeal Decision letter is attached to CR3530 (exhibit 2), and
is available at this website:

<http://new.cms.hhs.gov/MedlearnMattersArticles/>

5.  The revisions discussed in CR3530 do not apply to claims submitted
    to Medicare carriers and/or redeterminations processed by carriers.

### New Language for Redetermination Letters 

6.  This does not apply to carriers and/or redeterminations processed by
    carriers.

FIs will change the Medicare Redetermination Notice (MRN) for
redetermination decisions issued on or after May 1, 2005. There is no
longer a minimum amount in controversy (AIC) requirement to move to the
next level of appeal (QIC).

The MRN will show that providers who disagree with the redetermination
decision will have 180 days to appeal to a QIC. The MRN will include a
form to use for requesting a reconsideration from the QIC. If this form
is not used to request an appeal, providers must include the required
information in the letter requesting the appeal, and must include the
name of the contractor that made the redetermination.

Providers should, in particular, note the instructions on the MRN
related to the submission of evidence to support their appeal. All
evidence must be presented before the reconsideration is issued.
Providers will not be able to submit any new evidence in subsequent
appeal levels, unless they show good cause for not presenting evidence
to the QIC.

The request for a reconsideration form will be included with the MRN and
it will include the address of the QIC. If you send your request to the
wrong QIC or to the FI in error, the error will be corrected and the
request for appeal will be honored.

### Second Level of Appeal - Reconsideration 

Only the QIC has the authority to dismiss a request for reconsideration.
This applies even when it appears that the request does not meet the
requirements for requesting a reconsideration.

A provider or State request for a reconsideration must be made either on
the CMS 20033 *Medicare Reconsideration Request Form*, available at this
website:

<http://www.cms.hhs.gov/CMSForms/>

or as shown in the attachments to CR3530; or the request must contain
the following information:

-   Beneficiary's name

-   Medicare health insurance number

-   Specific service(s) and item(s) for which the reconsideration is
    requested and the specific date(s) of service

-   Name and signature of the party or representative of the party
    making the request; and

-   Name of the FI that made the redetermination

In many cases, the QIC's decision will be effectuated (payments issued)
by the FI; however, the FI will not effectuate a decision based on
correspondence from any party of the reconsideration. The FI will take
action only in response to a formal decision from the QIC.

If the decision is favorable and the amount to be paid is specified, the
FI will effectuate the decision within 30 calendar days of the date of
the QIC's decision or from the date written assurance from the provider
is received. If the amount to be paid must be computed, the decision
must be effectuated within 30 days of the time the amount was computed.

### Third Level of Appeal -- Administrative Law Judge (ALJ) Hearing 

For Part A and Part B redeterminations issued before May 1, 2005, FIs
will continue to be responsible for accepting ALJ hearing requests and
for preparing case files for the hearing. For redeterminations issued on
or after May 1, 2005, the QIC will be responsible for accepting ALJ
hearing requests and for preparing case files for the hearing.

Often the FI will be responsible for effectuating the ALJ's decisions.
The FI will take effectuation action only in response to a formal
decision by the ALJ.

If the decision is favorable and the amount to be paid is specified, the
FI will effectuate the decision with 30 calendar days of the date of the
ALJ's decision or from the date the written assurance from the provider
is received. If the amount to be paid must be computed, the decision
must be effectuated within 30 days of the time the amount was computed.

### Fourth Level of Appeal -- Departmental Appeals Board (DAB) 

Appeals should be made to the DAB or the ALJ Hearing Office. Appeals
must be filed within 60 days of the date of receipt of the ALJ hearing
or dismissal notice. The DAB may review an ALJ decision on its own, or
may decline review of an appeal.

### Fifth Level of Appeal -- Federal District Court 

Appeals must be filed within 60 days of the date of receipt of DAB
decision or declination of review, and the amount in contention (AIC)
must be at least \$1000 and for requests made or after January 1, 2005,
the AIC must be at least \$1050. A request filed with the contractor is
considered to have been filed as of the date the contractor received it.

Agency referrals

The AdQIC will be responsible for reviewing ALJ decisions and deciding
whether an agency referral is appropriate for decisions issued after May
1, 2005. For all ALJ decisions issued by SSA ALJs, the FI remains
responsible for this activity. The FI will no longer be responsible for
reviewing ALJ decisions issued by HHS ALJs.

Additional Information

Among other topics, Medlearn Matters article MM3530, and the related
CR3530 *Appeals Transition -- BIPA Section 521 Appeals* contain appeals
related information about

-   Redetermination letters for fully favorable decisions, decision
    making time frames and extensions to the 60 day decision-making time
    frame;

-   Requirements for written redetermination requests effective with
    initial determinations made on or after May 1, 2005;

-   Consolidating requests for multiple parties on redetermination
    requests received on or after May 1, 2005;

-   Filing reconsideration requests on redeterminations issued on or
    after May 1, 2005 (QIC jurisdictions);

-   Requirements for reconsideration requests

-   Overpayments and reopenings

-   QIC decisions

-   Appealing and vacating dismissals, and dismissal letters

-   Incomplete requests

-   Dismissal appeals and dismissal letters

-   ALJ hearings

-   Incomplete requests

-   Preparing case files for ALJ hearings

The article is available at this website:

<http://new.cms.hhs.gov/MedlearnMattersArticles/>

## Medicare Part B Appeals Process - Carriers

For Part B appeals, the Medicare regulation **42 CFR 405.807** states
that a party who is dissatisfied with an initial determination may
request that the contractor make a redetermination.

### Who Can Appeal

-   Providers (including physicians), as defined in **42 CFR 400.202**,
    who have appeal rights (**42 CFR 405.710(b)**).

-   Physicians and Suppliers with appeal rights as specified in
    regulations at 42 **CFR 405.801(b)**, accepting assignment on the
    claim at issue, and suppliers with refund requirements under section
    **1842(1)(1)**, **1834(a)(18)**, or **1834(j)(4)** of the Act.

-   Beneficiaries and their authorized representatives

-   After December 7, 2000, the Medicaid State agency or the party
    authorized to act on behalf of the Medicaid State agency.

Reviews are based on the following criteria:

-   If the services and charges you provided were reasonable and
    necessary. Medicare will conduct a new, independent, and critical
    reexamination of the facts regarding denial or reduction in payment.

-   If the services were covered and arbitrarily denied.

-   You did not know and could not reasonably have been expected to know
    that Medicare would not pay for the service.

-   You notified the beneficiary that Medicare would likely deny payment
    before you furnished the service.

There are two specific instances that are not initial determinations
regarding claims for benefits under Medicare Part B:

-   Any determination that CMS or SSA has sole responsibility for
    making, such as whether an independent laboratory meets the
    conditions for coverage of services or whether a Medicare
    overpayment claim should be compromised or a collection action
    terminated or suspended; and

-   Any issue or factor that relates to hospital insurance benefits
    under Medicare Part A.

Further, a party may not appeal your use of the Physician Fee Schedule.

The initial determination is binding unless a party to the initial
determination, such as the beneficiary, physician, supplier, or facility
requests an appeal. The Medicare Part B administrative appeals process
is available to resolve each party's questions or concerns about payment
and coverage decisions. In instances where appeal rights have been
exhausted or lapsed, you may have the authority to reopen your
determination.

The Part B appeals process consists of five levels. Each level must be
completed for each claim at issue prior to proceeding to the next level
of appeal, except for two specific situations:

1\) Claims for payment not acted upon with reasonable promptness

2\) Reopened determinations

Table 3 Medicare Part B Fee-for-Service Appeals Process - Carriers

+-----------------------+-----------------------+----------------------+
| Appeal Level          | Time to File (TTF)    | Notes                |
|                       | Limit                 |                      |
+-----------------------+-----------------------+----------------------+
| **1 -                 | **TTF** = 120 days    | Minimum amount in    |
| Redetermination**     | from date of the      | controversy          |
|                       | notice of initial     | (**AIC**) = None     |
| (Beginning October 1, | determination (the    |                      |
| 2004, reviews will be | carrier allows 5 days | **TLP** = Complete   |
| called                | beyond the date of    | 95% within 45 days   |
| "redeterminations.")  | notice for mail       | of receipt of        |
|                       | delivery)             | request, and all     |
|                       |                       | within 60 days of    |
|                       |                       | receipt of request.  |
+-----------------------+-----------------------+----------------------+
| **2 - Hearing Officer | **TTF** = 6 months    | **AIC** = At least   |
| (HO) hearing**        | from date of          | \$100 remains in     |
|                       | redetermination       | controversy          |
|                       | (allow an additional  |                      |
|                       | 5 days for mail       |                      |
|                       | delivery)             |                      |
+-----------------------+-----------------------+----------------------+
| **3 - Administrative  | **TTF** = Filed with  | **AIC** = At least   |
| Law Judge Hearing     | 60 days of receipt of | \$100 remains in     |
| (ALJ)**               | HO hearing decision   | controversy          |
+-----------------------+-----------------------+----------------------+
| **4 - Departmental    | **TTF** = Filed       | **AIC** = None       |
| Appeals Board (DAB)   | within 60 days of     |                      |
| Review**              | receipt of ALJ        |                      |
|                       | hearing               |                      |
|                       | decision/dismissal    |                      |
+-----------------------+-----------------------+----------------------+
| **5 - Federal Court   | **TTF** = Filed       | ^1^At least \$1,050  |
| Review**              | within 60 days of     | remains in           |
|                       | receipt of DAB        | controversy          |
|                       | decision or           |                      |
|                       | declination of review | Must be filed with   |
|                       | by DAB                | the district court   |
|                       |                       | and not the          |
|                       |                       | contractor.          |
+-----------------------+-----------------------+----------------------+

1\. In 2005, the Amount in Contention (AIC) requirement for an
Administrative Law Judge (ALJ) hearing and Federal District Court will
be adjusted in accordance with the medical care component of the
consumer price index for all urban consumers (U.S. city average) for
July 2003 to the July preceding the year involved, rounded to the
nearest \$10.

### Aggregation of Claims 

Under **42 CFR 405.815**, claims with an amount in controversy (AIC)
greater than \$0 may be combined to meet the amount in controversy (or
contention) requirements. The decision about whether the AIC requirement
has been met is made by the Hearing Officer (HO) at the HO level, and by
the Administrative Law Judge (ALJ) at the ALJ level.

For further information, see the *Medicare Claims Processing Manual*
(100-4), Chapter 29, Section 60.6.5, which is available at this website:

<http://www.cms.hhs.gov/manuals/>

### Good Cause 

When a request for redetermination or Hearing Office hearing is not
filed within the time-to-file limit and where there is sufficient
evidence or other documentation supporting a finding of good cause, the
time limit (120 days for redetermination or within 6 months for Hearing
Office dismissal) can be extended.

Good cause may be found when the record clearly shows, or the
beneficiary alleges and the record does not negate, that the delay in
filing was due to one of the following:

-   Circumstances beyond the beneficiary's control, including mental or
    physical impairment (such as disability or extended illness), or
    significant communication difficulties

-   Incorrect or incomplete information about the subject claim
    furnished by official sources (Social Security Administration (SSA),
    CMS or the contractor) to the individual, such as whenever a
    beneficiary is not notified of his appeal rights or the time limit
    for filing

-   Delay resulting from efforts by the beneficiary to secure supporting
    evidence, where the individual did not realize that such evidence
    could be submitted after filing an appeal

-   Unusual or unavoidable circumstances, the nature of which
    demonstrates that the beneficiary could not reasonably be expected
    to have been aware of the need for timely filing

-   Destruction by fire or other damage of the individual's records,
    when the destruction was responsible for the delay in filing

Good cause for providers, physicians, or other suppliers can be found
when the delay in filing was due to:

-   Incorrect or incomplete information about the subject claim and/or
    appeal was furnished by official sources (CMS, the contractor, or
    the Social Security Administration (SSA)) to the provider,
    physician, or supplier; **or**

-   Unavoidable circumstances that prevented the provider, physician, or
    other supplier from timely filing a request for review or Hearing
    Office hearing. These may include floods, fire, tornados or other
    natural disasters.

If good cause for late filing is not found by the Hearing Office, the
Hearing Office may refer the appeal to the contractor to consider
reopening. If the contractor does not find good cause for the late
filing of a request for redetermination, it may determine whether the
case has any basis for reopening and revising its determination.

## Medicare Part B Appeals Process

### First Level of Appeal -- Redetermination 

A facility or provider dissatisfied with the initial determination on a
Part B claim may request by telephone or in writing a redetermination of
their initial determination.

The redetermination appeal can be filed with the contractor by telephone
or in writing, and must be filed within 120 days of the date of the
notice of initial determination (MSN or RA) received in the corporate
mailroom by the contractor (minus 5 days to allow for normal mail
delivery).

A fully completed CMS 20027 *Medicare Redetermination Request Form*
constitutes a request for redetermination. The form is available at this
website:

<http://www.cms.hhs.gov/CMSForms/>

If the form is not used, a written redetermination request must include
the following information:

-   Beneficiary name;

-   Medicare health insurance claim (HIC) number;

-   Name and address of provider/physician/supplier or item/service;

-   Date of initial determination;

-   Date(s) of service for which the initial determination was issued
    (dates must be reported in a manner that complies with the Medicare
    claims filing instructions. Ranges of dates are acceptable only if a
    range of dates is properly reportable on the Medicare claim form);

-   Which item(s), if any and/or service(s) are at issue in the appeal;
    and

-   The signature of the appellant

If the Remittance Advice (RA) is attached to the redetermination request
and the dates of service are highlighted or emphasized on the attached
RA, but the redetermination request does not itself contain the dates of
service, it is still an acceptable redetermination request. If an
initial determination on a claim has not been made, there are no appeal
rights on that claim.

Some letters and calls are considered inquires and not requests for
redeterminations. These communications may include the following
characteristics:

-   It is clearly limited to a request for an explanation of how
    Medicare calculated payment.

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-   It is a status request.

-   It is a request for information.

-   It is a request for a second copy of a notice.

-   There is not an initial determination.

The carrier must complete 95% of requests within 45 days of receipt of
request, and all requests within 60 days of receipt of request. The date
of receipt is defined as the date the request for redetermination is
received in the corporate mailroom (written requests) or on the
telephone (telephone requests).

If the determination is a full reversal (fully favorable), the
contractor will send an adjusted MSN or RA to all parties of the appeal.
This will provide the beneficiary information about his or her financial
liability with regard to the claim(s) that are now payable. An example
of a redetermination letter can be found in the *Medicare Claims
Processing Manual*, Chapter 29, Section 60.11.6.

A party to an appeal may appoint a **representative** to handle the
appeal by completing Form CMS-1696, *Appointment of Representative* or
may submit the required information in writing. The form is available at
this website:

<http://www.cms.hhs.gov/CMSForms/>

To be valid,

-   The representative must be an individual, not an organization,
    **and**

-   Form CMS-1696 (or written request) must be signed by the
    representative within 30 calendar days of the date that the
    beneficiary or other party signs, and is valid for no more than one
    year from the date it was signed by the party making the appointment
    or the date of acceptance by the representative.

The reviewer making the redetermination must comply with, and must be
bound by, all applicable statutory and regulatory provisions. The
reviewer may not overrule the provisions of law or interpret them in a
way different than CMS does; nor may the reviewer comment upon legality,
constitutional or otherwise, of any provision of the Act, regulations or
CMS policy review determination.

The reviewer is also bound by all CMS-issued policies and procedures,
including CMS rulings, Medicare manual instructions, program memoranda,
national coverage determinations, and carrier-issued local medical
review policies.

### Telephone Review Procedures

A telephone review can be requested and performed on the phone. Both are
completed through a review determination letter or other notice.

Whether a request for review is made by telephone or is conducted and
completed as a telephone review depends on the issues at hand and the
complexity of the matters involved. Telephone reviews should be limited
to resolving minor issues and correcting errors, and should not involve
anyone other than the redetermination analyst.

The appellant has 120 days after the date of the notice of initial
determination to request a redetermination by telephone. If a more
in-depth review is not necessary, and information and documentation was
faxed during or prior to the telephone review, the reviewer may be able
to inform the appellant of his or her decision at the conclusion of the
call, or via a follow-up phone call.

### Second Level of Appeal -- Hearing Office Hearing

A party, who is dissatisfied with a review determination where at least
\$100 remains in controversy, may request a Hearing Office hearing.

The Hearing Office hearing is an independent review of the claim by a
hearing officer. The hearing process gives a dissatisfied provider or
facility the opportunity to present the reasons for his/her
dissatisfaction and to receive a new decision based on the evidence
developed at the hearing.

If a redetermination has not been issued, there is no right to a Hearing
Office hearing (except for claims not acted upon in a reasonable time by
the contractor, and for appeals of revised initial determinations where
\$100 or more remains in controversy).

The request for a Hearing Office hearing can be filed with any of the
following:

-   the contractor

-   CMS

-   an SSA office

-   the RRB for RRB beneficiaries

The request must be filed within 6 months of the date of the notice of
the redetermination or revised initial redetermination (plus 5 days for
mail delivery).

The request may be any clear expression, in writing, by a party (or
representative) that contains the necessary information to complete the
appeal and states that the appellant is not satisfied with the review
determination. Form CMS 1965, *Request for Hearing -- Part B Medicare
Claim*, can be used for this purpose, and is available at this website:

<http://www.cms.hhs.gov/CMSForms/>

The written inquiry must be stamped with the date of receipt in the
corporate mailroom and tracked until a final answer is provided.
Telephone and other inquiries (such as in-person or electronic) should
be logged and tracked until the final answer is provided.

Requests that are filed incorrectly to a contractor that did not make
the initial review decision/determination will be forwarded to the
correct contractor as soon as possible. A request for a Hearing Office
hearing that was filed prior to a redetermination should be handled as a
request for redetermination.

The contractor or Hearing Officer who is assigned the request must send
a letter to the appellant acknowledging receipt of the hearing request
within 21 calendar days of the receipt of the request. Carriers must
issue 90% of final determinations within 120 days of the date of receipt
of request of the Hearing Office hearing (FIs function as carriers when
processing Part B Hearing Office hearings.)

For telephone or in-person hearings, the Hearing Office must issue a
decision no later than 30 days after the date that the hearing was held
(unless the appellant has additional documentation to be considered
after the telephone or in-person hearing).

### Hearing Office Hearing Types

There are three kinds of Hearing Office hearings that can be requested
by the appellant:

-   In-person

-   Telephone

-   On-the record (OTR)

For the **in-person hearing**, the facility/provider/beneficiary can
present both oral testimony and written evidence and has the right to
refute or challenge the information.

A **telephone hearing** offers a convenient and less costly alternative
to an in-person hearing, but it is not suited to every person or every
case.

The major advantage of an **OTR hearing** is the speed with which the
hearing is held and the decision is rendered. The same format as the
in-person hearing is followed, except the decision is based on the facts
that are in the file and/or additional information.

7.  Where an appellant specifically requests an OTR hearing, the
    resulting OTR hearing decision is not a POTR decision, and the
    appellant does not have a further option of then requesting an
    in-person or telephone hearing.

Hearing Office Hearing Review Process

An appellant who requests either an in-person or telephone hearing must
be given adequate notice of the date, time, and place of the hearing and
the specific issues to be determined. The Hearing Office must provide a
written notice to the appellant and his/her representative before
conducting the in-person or telephone hearing.

The appellant must receive the notice before the hearing takes place,
allowing sufficient time to review it and to prepare for the meeting.
Meetings can be rescheduled or adjourned on the motion of the Hearing
Office for good and sufficient reasons (illness, certain scheduling
difficulties, abusive or violent actions during the hearing).

Effectuation (payment) of Hearing Office hearing decisions must be
initiated within 30 calendar days of the date of the decision, and 100%
of decisions must be effectuated within 60 calendar days of the date of
the decision.

Durable Medical Equipment (DME) Hearings

Durable Medical Equipment Regional Carriers (DMERCs) should accept
transfer of in-person hearing requests from other DMERCs, because the
determination of claims processing jurisdiction is based on the location
of the beneficiary. Thus, suppliers must request hearings from the DMERC
that processed the claim at issue.

### Third Level of Appeal -- Administrative Law Judge (ALJ) Hearing 

If the appellant is dissatisfied with the determination made by the
Hearing Office, and the amount in controversy is at least \$100, the
appellant may request an in-person hearing before an Administrative Law
Judge.

Requests for Part B ALJ hearings must be filed in writing with the
contractor, at an RRB office (for qualified RRB beneficiaries), or with
CMS, or at an SSA office within 60 days of the date of the receipt of
the Hearing Office decision. The request must be in writing and filed
within 60 days of the date of the carrier's fair hearing decision of
record.

**Aggregation**

You may combine this claim with other claims to meet the \$100 amount in
controversy requirement, as long as the appeal is timely filed for all
claims at issue, and all claims at issue are at the proper level of
appeal.

The contractor will acknowledge the request for a Part B ALJ hearing by
sending the ALJ letter to the appellant within 30 calendar days of its
receipt of the request in the corporate mailroom.

Supporting Documentation

For claims being submitted for an appeal, the responsibility for
gathering and submitting documentation that supports claims and appeals
rests with the provider and/or the facility. Documentation sources that
have been proven useful to providers/facilities include.

-   X-ray reports

-   Test results

-   Medical History

-   Documentation of severity or acute onset

-   Consultation Reports

-   Billing Forms

-   Referrals

-   Plan of Treatment

-   Nurse's Notes

-   Copies of communications between physician and/or beneficiary,
    hospital, laboratory or others.

ALJ Hearing Review Process

The ALJ will either issue a decision based on the request for a Part B
ALJ hearing or will issue an order of dismissal. If the decision of the
ALJ requires effectuation on the part of the contractor, the contractor
will wait to hear the ALJ's formal decision.

When effectuating the decision, the contractor will use the payment
policies that were in effect on the date the claim was first submitted
for processing, unless specifically directed otherwise.

The decision will be effectuated within 30 days of the receipt of the
ALJ decision, if

-   the decision is partially or wholly favorable,

-   gives a specific amount to be paid, and

-   is not referred to the DAB.

If the amount must be computed, then effectuation will occur no later
than 30 calendar days of the date of receipt of the official ALJ
decision. Duplicate ALJ decisions should be brought to the attention of
the RO and OHA immediately for resolution.

### Fourth Level of Appeal -- Departmental Appeals Board Review

The Department Appeals Board (DAB) may choose to review an ALJ's
decision or dismissal for any of the following reasons:

-   There was an error or law.

-   The ALJ decision/dismissal was not supported by substantial
    evidence.

-   The ALJ abused their discretion.

-   There is a broad policy or procedural issue that may affect the
    general public.

The DAB reviews requests for review and makes final decisions whether to
review or decline to review ALJ decisions, as well as ALJ orders of
dismissal.

The DAB will request all case files from the specialty contractor, who
has responsibility to receive and store the files sent by ALJs after
they make their decisions.

Effectuation of DAB decisions must be initiated within 30 days of the
contractor's receipt of the DAB decision, and completed within 60 days.

### Fifth Level of Appeal -- U.S. District Court (Court) Review

An appellant, who is not satisfied with the DAB decision, may request a
court review of the DAB decision. This appeal must be filed with the
District Court and not with the contractor. The Court may remand the
case back to the DAB or the ALJ.

In rare cases, the Court may require effectuation on the part of the
contractor. In this case, the contractor will contact its CMS regional
office (RO) appeals contact for instructions before taking any action.

## General Guidelines for Writing Appeals

The appeals correspondence should be written so that anyone can easily
understand the reason why any of the services were not covered or could
not be full reimbursed, as well as actions that can be taken if the
provider or facility disagrees with that decision. In addition, the
following guidelines should be followed to the extent possible:

-   Keep the language as simple as possible.

-   Do not use abbreviations or jargon.

-   Choose a positive rather than a negative tone, whenever possible.
    Avoid words or phrases which emphasize what you cannot do.

-   If possible, avoid one-sentence paragraphs, uneven spacing between
    paragraphs, or other formatting that makes the document difficult to
    read.

## Quality Control

Records must be kept of all inquiries. Appropriate management reports
and reports requested by CMS will be produced from these records to aid
in assuring that control standards for the inquiries and the quality of
responses to the inquiries are maintained.

The appraisal requirements need to include the following:

-   **Accuracy and Correctness**

The information in letters should be correct with regard to Medicare
policy and your data. Taken as a whole, the information will increase
the inquirer's overall understanding of the issues that prompted the
inquiry. Letters should have good grammatical construction, sentences of
varying length, and paragraphs generally containing no more than five
sentences.

-   **Responsiveness**

The response should address the inquirer's major concerns and state an
appropriate action to be taken.

-   **Tone/Clarity**

A clear statement of issues should be presented in the warmth and
genuineness of a letter. The tone of the communication should be
professional and customer friendly.

## Additional Resources 

If you have additional questions about the Medicare claims appeals
process, please refer to your local FI\... To find the toll free phone
number for your local FI or carrier, go to this website:

<http://www.cms.hhs.gov/medlearn/tollnums.asp>

For your convenience, the following list summarizes the references to
documents in this chapter.

-   *Medicare Claims Processing Manual* (100-4), Chapter 29: "Appeals of
    Claims Decisions," which is available at this website:

<http://www.cms.hhs.gov/manuals/>

-   *Understanding the Remittance Advice: A Guide for Medicare
    Providers, Physician, Suppliers, and Billers*, which is available at
    this website:

<http://www.cms.hhs.gov/MedlearnProducts/>

-   CR3530: *Appeals Transition -- BIPA 521 Appeals* (MM3530)

-   CR3942 *Changes to Chapter 29 -- Appeals of Claims Decisions:
    Redeterminations and Reconsiderations (Implementation date May 1,
    2005)* (MM3942)

-   CR4019 *Changes to Chapter 29 -- General Appeals Process in Initial
    Determinations* (MM4019)

-   SE0540 *CMS Releases New Educational Guide on Remittance Advice (RA)
    Notices*

To download copies of these documents (CR3530, 3942, 4019; SE0540), go
to the **2005 Medlearn Matters Articles** at this website:

<http://www.cms.hhs.gov/MedlearnMattersArticles/>

-   Form CMS 20031, Transfer (Assignment) of Appeal Rights,

-   Form CMS-1696, Appointment of Representative

-   Form CMS-1965, Request for Hearing -- Part B Medicare Claim

To download copies of these CMS forms (CMS 20031, 1696, 1965), go to
this website:

<http://www.cms.hhs.gov/CMSForms/>