[Federal Register Volume 79, Number 214 (Wednesday, November 5, 2014)]
[Notices]
[Pages 65660-65663]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-26214]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

[OMHA-1401-NC]


Medicare Program; Administrative Law Judge Hearing Program for 
Medicare Claim Appeals

AGENCY: Office of Medicare Hearings and Appeals (OMHA), HHS.

ACTION: Request for information.

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SUMMARY: This request for information solicits suggestions for 
addressing the substantial growth in the number of requests for hearing 
being filed with the

[[Page 65661]]

Office of Medicare Hearings and Appeals, and backlog of pending cases.

DATES: The information solicited in this notice must be received at the 
address provided below, no later than 5:00 p.m., eastern standard time 
(e.s.t.) December 5, 2014.

ADDRESSES: In commenting, refer to ``OMHA-1401-NC'' at the top of your 
comments. Because of staff and resource limitations, we cannot accept 
comments by facsimile (FAX) transmission. We will not accept comments 
submitted after the comment period.
    You may submit comments in one of two ways (to ensure that we do 
not receive duplicate copies, please choose only one of the ways 
listed):
    1. Electronically. You may submit electronic comments to 
www.regulations.gov. For new users, you can find instructions on how to 
submit comments by selecting ``Are you new to this site?'' at 
www.regulations.gov, then selecting ``How do I submit a comment?'' For 
those familiar with www.regulations.gov, you can search ``OMHA-1401-
NC'' and select ``Comment Now!''
    If you are submitting comments electronically, we strongly 
encourage you to submit any comments or attachments in Microsoft Word 
format. If you must submit a comment in Portable Document Format (PDF), 
we strongly encourage you to convert the PDF to print-to-PDF format or 
to use some other commonly used searchable text format. Please do not 
submit the PDF in a scanned or read-only format. Using a print-to-PDF 
format allows us to electronically search and copy certain portions of 
your submissions.
    2. U.S. Mail or commercial delivery. You may send written comments 
to the following address only: Office of Medicare Hearings and Appeals, 
Department of Health and Human Services, Attention: OMHA-1401-NC, 1700 
N. Moore St., Suite 1800, Arlington, VA 22209.
    Please allow sufficient time for mailed comments to be received 
before the close of the comment period.
    Viewing comments: Comments received from members of the public 
(including comments submitted by mail or commercial delivery) will be 
made available for public viewing in their entirety on the Federal 
eRulemaking portal at www.regulations.gov. Information on using 
www.regulations.gov, including instructions for accessing agency 
documents, submitting comments, and viewing the docket, is available on 
the site under ``Are you new to the site?''

    Privacy Note: Because comments will be made available for public 
viewing in their entirety on the Federal eRulemaking portal, 
commenters should exercise caution and only include in their 
comments information that they wish to make publicly available.


FOR FURTHER INFORMATION CONTACT: Jason Green, by telephone at 1-703-
235-0124, or by email at <a href="/cdn-cgi/l/email-protection#4f252e3c202161283d2a2a210f27273c61282039"><span class="__cf_email__" data-cfemail="3953584a5657175e4b5c5c577951514a175e564f">[email protected]</span></a> (comments will not be 
accepted at this email address). If you use a telecommunications device 
for the deaf (TDD) or a text telephone (TTY), call the Federal Relay 
Service (FRS), toll free, at 1-800-877- 8339.

SUPPLEMENTARY INFORMATION:

I. Background

    The Office of Medicare Hearings and Appeals (OMHA), a staff 
division within the Office of the Secretary of the U.S. Department of 
Health and Human Services (HHS), administers the nationwide 
Administrative Law Judge hearing program for Medicare claim, 
organization and coverage determination, and entitlement appeals under 
sections 1869, 1155, 1876(c)(5)(B), 1852(g)(5), and 1860D-4(h) of the 
Social Security Act. OMHA ensures that Medicare beneficiaries and the 
providers and suppliers that furnish items or services to Medicare 
beneficiaries, as well as Medicare Advantage Organizations (MAOs) and 
Medicaid State Agencies, have a fair and impartial forum to address 
disagreements with Medicare coverage and payment determinations made by 
Medicare contractors, MAOs, or Part D Plan Sponsors (PDPSs), and 
determinations related to Medicare eligibility and entitlement, and 
income-related premium surcharges made by the Social Security 
Administration (SSA).
    The Medicare claim, and organization and coverage determination 
appeals process consists of four levels of administrative review within 
HHS, and a fifth level of review with the Federal courts after 
administrative remedies within HHS have been exhausted. The first two 
levels of review are administered by the Centers for Medicare & 
Medicaid Services (CMS) and conducted by Medicare contractors for claim 
appeals, by MAOs and an independent review entity for Part C 
organization determination appeals, or by PDPSs and an independent 
review entity for Part D coverage determination appeals. The third 
level of review is administered by OMHA and conducted by Administrative 
Law Judges. The fourth level of review is administered by the HHS 
Departmental Appeals Board (DAB) and conducted by the Medicare Appeals 
Council. In addition, OMHA and the DAB administer the second and third 
levels of appeal, respectively, for Medicare eligibility, entitlement 
and premium surcharge reconsiderations made by SSA; a fourth level of 
review with the Federal courts is available after administrative 
remedies within HHS have been exhausted.
    The Medicare, Medicaid, and SCHIP Benefits Improvement and 
Protection Act of 2000 (Pub. L. 106-554), which added section 
1869(d)(1)(A) of the Social Security Act, provides for an 
Administrative Law Judge to conduct and conclude a hearing and render a 
decision on such hearing within 90 days of the date a request for 
hearing has been timely filed. Section 1869(d)(3) of the Social 
Security Act states that, if an ALJ does not render a decision by the 
end of the specified timeframe, the appellant may request review by the 
Departmental Appeals Board. Likewise, if the Departmental Appeals Board 
does not render a decision by the end of the specified timeframe, the 
appellant may seek judicial review. OMHA was established in July 2005 
pursuant to section 931 of the Medicare Prescription Drug, Improvement, 
and Modernization Act of 2003 (Pub. L. 108-173), which required the 
transfer of responsibility for the Administrative Law Judge hearing 
level of the Medicare claim and entitlement appeals process from SSA to 
HHS. OMHA was expected to improve service to appellants and reduce the 
average 368-day waiting time for a hearing decision that appellants 
experienced with SSA.
    OMHA serves a broad sector of the public, including Medicare 
providers, suppliers, and MAOs, and Medicare beneficiaries, who are 
often elderly or disabled and among the nation's most vulnerable 
populations. OMHA currently administers its program in five field 
offices, including those located in Miami, Florida; Cleveland, Ohio; 
Irvine, California; Arlington, Virginia; and the recently established 
field office in Kansas City, Missouri. OMHA uses video-teleconferencing 
(VTC), telephone conferencing, and in-person formats to provide 
appellants with hearings.
    At the time OMHA was established, it was envisioned that OMHA would 
receive the claim and entitlement appeals workload from the Medicare 
Part A and Part B programs, and organization determination appeals from 
the Medicare Advantage (Part C) program, as well as coverage 
determination appeals from the Medicare Prescription Drug (Part D) 
program and appeals of Income Related Monthly Adjustment Amount (IRMAA) 
premium surcharges assessed by SSA. With this mix of work at the 
expected

[[Page 65662]]

levels, OMHA was able to meet the 90-day adjudication time frame.
    However, in recent years, OMHA has experienced a significant and 
sustained increase in appeals workload that has compromised its ability 
to meet the 90-day adjudication time frame. In addition to the 
expanding Medicare beneficiary population and utilization of services 
across that population, the increase in appeals workload has resulted 
from a number of changes in the Medicare claim review and appeals 
processes in recent years, including:
    <bullet> Medicaid State Agency (MSA) appeals of Medicare coverage 
denials for beneficiaries dually enrolled in both Medicare and 
Medicaid. These appeals were previously addressed through a 
demonstration project that employed an alternative dispute resolution 
process to determine whether the Medicare or Medicaid program would pay 
for care furnished to the dually enrolled beneficiaries. The 
demonstration project ended in 2010, and the MSA appeals entered the 
standard administrative appeals process, increasing appeals workloads 
throughout the Medicare claim appeal process, including at OMHA.
    <bullet> The fee-for-service Recovery Audit (RA) program (also 
known as the Recovery Audit Contractor program), which was made 
permanent by section 302 of the Tax Relief and Health Care Act of 2006 
(Pub. L. 109-432). Appeals from the RA program began to enter the 
administrative appeals process at the CMS contractor levels in fiscal 
year 2011. In fiscal year 2012, OMHA began receiving hearing requests 
related to the RA program that exceeded projections.
    <bullet> CMS has implemented a number of changes to enhance its 
monitoring of payment accuracy in the Medicare Part A and Part B 
programs, which have increased denial rates and likely contributed to 
increased appeals. For example, based on recommendations from the HHS 
Office of Inspector General (OIG), in 2009, CMS tightened its 
methodologies related to how it calculates the Medicare payment error 
rate, with a view towards improving provider claims documentation and 
compliance with Medicare's billing, coverage, and medical necessity 
requirements. In addition, Medicare Administrative Contractors (MACs) 
initiated a series of focused medical review initiatives, which 
increased the overall number of denied claims. CMS also initiated 
efforts to eliminate payment error and fraud based on Executive Order 
13520 and the Improper Payments Elimination and Recovery Act of 2010 
(Pub. L. 111-204), resulting in additional denied claims and the 
identification of overpayments.
    With the increase in overall claim denials, the administrative 
appeals process has experienced an overall increase in appeal requests. 
At OMHA, the more than anticipated workload increase in appealed claims 
resulted in a backlog of appeals (that is, appeals that cannot be heard 
and decided within the adjudication time frame) starting in fiscal year 
2012, with a 42% increase from fiscal year 2011 in the number of claims 
appealed to OMHA. In fiscal year 2013, the number of claims appealed to 
OMHA more than doubled from fiscal year 2012, with a 123% increase, 
further contributing to the backlog of cases and resulting in a 
substantial increase in the adjudication time frame. The increase in 
appealed claims from the RA program was particularly high in fiscal 
year 2013, with a 506% increase in appealed RA program claims compared 
to fiscal year 2012 appealed claims from the RA program, versus a 77% 
increase in appealed claims not related to the RA program during that 
same period of time.
    In 2013, CMS issued an Administrator Ruling (published on March 18, 
2013, 78 FR 16614) and finalized new rules (published on August 19, 
2013, 78 FR 50495) designed to clarify criteria for new (fiscal year 
2014) Medicare Part A inpatient hospital admissions, which comprised 
the disputed issues in a majority of RA program appeals, and to clarify 
policies at issue in appeals of inpatient claim denials under the 
existing rules. In addition, CMS expanded the scope of alternative Part 
B services that could be billed if a Part A inpatient admission was 
denied and, as part of the ruling, for a limited time allowed hospitals 
to submit Part B claims for those services beyond the one-year claim 
filing deadline. Separately, CMS also suspended most RA program audits 
of Part A inpatient hospital admissions under the new inpatient 
admission criteria (commonly referred to as the two-midnight rule), 
which was effective for inpatient claims with admission dates on and 
after October 1, 2013, in order to offer providers time to become 
educated on the two-midnight rule. The suspension of audits for new 
admissions was extended for claims with dates of admission through 
March 31, 2015, pursuant to section 111 of the Protecting Access to 
Medicare Act of 2014 (Pub. L. 113-93). CMS is also making improvements 
to the RA program that are designed to increase the accuracy of RA 
determinations and to reduce the burden on providers as well as the 
number of payment denials that providers and suppliers appeal.
    OMHA also took measures to mitigate the effects of the workload 
increase at the Administrative Law Judge level. One of the immediate 
measures taken was to ensure that processing of the relatively small 
numbers of beneficiary-initiated appeals was prioritized. For the 
remaining cases, OMHA has deferred assignments of new requests for 
hearing until an adjudicator becomes available, which will allow 
appeals to be assigned more efficiently on a first in/first out basis 
as an Administrative Law Judge's case docket is able to accommodate 
additional workload.
    On February 12, 2014, OMHA hosted a Medicare Appellant Forum (see 
OMHA's Notice of Meeting, published on January 3, 2014, 79 FR 393). The 
Medicare Appellant Forum was conducted to provide the appellant 
community with an update on the status of OMHA operations; relay 
information on a number of OMHA initiatives designed to mitigate the 
backlog in processing Medicare appeals at the Administrative Law Judge 
level of the administrative appeals process; and provide information on 
measures that appellants could take to make the administrative appeals 
process work more efficiently at the Administrative Law Judge level. In 
addition, CMS and the DAB participated in the forum and shared 
information on operations at their respective appeals levels. A second 
OMHA Medicare Appellant Forum was held on October 29, 2014 (see OMHA's 
Notice of Meeting, published on October 23, 2014, 79 FR 63398). As 
conveyed at the forums, HHS is committed to addressing the challenges 
facing the Medicare claim and entitlement appeals process, and has 
implemented initiatives and continues to explore additional measures to 
address the workload increase and reduce the backlog of appeals.
    Since the February Medicare Appellant Forum, OMHA has implemented 
two pilot programs to provide appellants with meaningful options to 
address claims at the Administrative Law Judge level of appeal, in 
addition to the existing right to escalate a request for appeal when 
the adjudication time frame is not met. OMHA is providing appellants 
with an option to use statistical sampling during the Administrative 
Law Judge hearing process, which will enable appellants to obtain a 
decision on large numbers of appealed claims based on a sampling of 
those claims. OMHA is also providing appellants with an option for 
settlement conference facilitation, which will provide appellants with 
an independent

[[Page 65663]]

OMHA facilitator to discuss potential settlement of claims with 
authorized settlement officials. Additional information on these two 
pilots can be found on OMHA's Web site, http://www.hhs.gov/omha.
    In addition to these initiatives, OMHA continues to pursue new case 
processing efficiencies and an electronic case adjudication processing 
environment (ECAPE) to bring further efficiencies to the appeals 
process.

II. Request for Information

    OMHA is seeking input from the public on the current initiatives 
being undertaken at the Administrative Law Judge level, as well as 
suggestions for additional initiatives which could be undertaken at 
OMHA to address the Medicare claim and entitlement appeals workload and 
backlog at the Administrative Law Judge level. Input is sought on the 
following topics and questions:
    <bullet> Are there suggestions related to the current initiatives 
for addressing the increased workload and/or backlog of appeals at the 
Administrative Law Judge level that comply with current statutory 
authorities and requirements?
    <bullet> Are there other suggestions for addressing the increased 
workload and/or backlog of appeals at the Administrative Law Judge 
level that comply with current statutory authorities and requirements?
    <bullet> Are there any current regulations that apply to the 
Administrative Law Judge level of the Medicare claim and entitlement 
appeals process that could be revised to streamline the adjudication 
process while ensuring that parties to the appeals, as defined at 42 
CFR 405.902 and 405.906, are afforded opportunities to participate in 
the process and are kept apprised of appeals related to claims 
submitted by them or on their behalf?

(Catalog of Federal Domestic Assistance Program No. 93.770, 
Medicare--Prescription Drug Coverage; Program No. 93.773, Medicare--
Hospital Insurance; and Program No. 93.774, Medicare--Supplementary 
Medical Insurance Program)

    Dated: October 30, 2014.
Nancy J. Griswold,
Chief Administrative Law Judge, Office of Medicare Hearings and 
Appeals.
[FR Doc. 2014-26214 Filed 11-4-14; 8:45 am]
BILLING CODE 4150-46-P


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