Providers Filed 85% of Medicare Appeals in 2010

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A study from the HHS Office of Inspector General (pdf) found that hospitals and other Medicare providers filed 85 percent of payment appeals at the administrative law judge level, 56 percent of which went in favor of providers, and the OIG concluded that serious improvements are needed to clarify Medicare policies.

Medicare providers and beneficiaries may appeal certain decisions regarding claims for healthcare services. For example, hospitals may appeal payment recoupments from Recovery Auditors, or RACs, if they believe their actions were consistent with Medicare law and standards.

There are four general levels of appeal: Level One goes to CMS Medicare Administrative Contractors, Level Two goes to CMS Qualified Independent Contractors, Level Three goes to ALJs and Level Four goes to the Medicare Appeals Council. The ALJ level is the most common platform of the four.

The OIG looked at the 40,682 Medicare appeals filed to ALJs in fiscal year 2010. It found that hospitals, physicians and other providers filed 34,542 of those appeals, or roughly 85 percent. In addition, a small number of providers accounted for nearly one-third of all appeals. The OIG tagged 96 providers as “frequent filers,” meaning they filed at least 50 appeals each. One provider filed 1,046 appeals alone.

For 56 percent of appeals that made it to level three, ALJs also reversed 56 percent in favor of appellants, indicating a “number of inconsistencies and inefficiencies in the Medicare appeals process,” according to the OIG’s report.

The OIG had 10 recommendations for CMS and the Office of Medicare Hearings and Appeals, including more coordinated training on Medicare policies to ALJs and QICs, better identification and clarification of Medicare policies that are unclear, and digitization of appeal case files. CMS and OMHA concurred fully or in part with all of the OIG’s recommendations.

More Articles on Hospitals and Medicare Appeals:

AHA Sues HHS Over Medicare Audits, Payment Denials

Providers Can't Challenge Year-Old RAC Audits, Court Rules

Hospital RAC Activity Up More Than 20% From 1Q to 2Q

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