Study: Medicare audit, appeals process exceeded 4.5 years due to backlog

A Medicare backlog significantly holds up the audits and appeals process, according to a study published in the Journal of Hospital Medicine.

Researchers examined complex Medicare Part A audits and appeals for services before Oct. 1, 2013, that reached level three of the appeals process as of May 1, 2016. Study authors included data from Baltimore-based Johns Hopkins Hospital, University of Wisconsin Hospitals and Clinics in Madison and University of Utah in Salt Lake City.

The study analyzed 135 cases concluding at level three of the five-level appeals process. A vast majority (71.1 percent) of those cases were decided in favor of the hospital.

Researchers found an average of 1,663.3 days passed, or more than four and a half years, between the date of service and the conclusion of the Medicare reimbursement audit and appeals process. This includes an average 560.4 days between date of service and audit and 891.3 days in appeals, according to the study. Researchers said hospitals and government contractors were responsible for 70.7 percent and 29.3 percent of that time, respectively.

According to the study, government contractors and judges met legislative timeliness deadlines only 47.7 percent of the time. Researchers said more than 95 percent of level one and level two decision letters cited time-based (24-hour) criteria for determining inpatient status, "despite 70.3 percent of denied appeals meeting the 24-hour benchmark."

"CMS's current and proposed reforms may not be enough to eliminate the appeals backlog and restore a timely and fair appeals process," the study's authors concluded. "As CMS explores bundled payments and other reimbursement reforms, perhaps the need to distinguish observation hospital care will be eliminated. Short of that, additional actions must be taken so a just and efficient Medicare appeals system can be realized for observation hospitalizations."

 

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