AHA Urges Congress, CMS to Address Medicare RAC Appeals Suspension

The American Hospital Association has urged CMS to address a suspension in administrative law judge hearings concerning payment denials from Medicare recovery audit contractors.

In a letter to CMS Administrator Marilyn Tavenner, AHA Executive Vice President Rick Pollack wrote his organization is concerned about the Office of Medicare Hearings and Appeals' December 2013 announcement of a temporary suspension of most new requests for administrative law judge hearings for at least two years. Delays of at least two years in granting a hearing for an appealed claim violate a Medicare statute that requires ALJs to issue a decision within 90 days of receiving the request for a hearing, according to Mr. Pollack. Even before the temporary suspension, he wrote ALJs weren't adhering to the statutory deadline.

"Hospitals have been put in an untenable position in which the nearly unfettered ability of RACs to churn out erroneous denials forces them to pursue appeals in order to receive payment for medically necessary care, while the inability of OMHA to manage the appeals process within the timeframes required by the Social Security Act holds that payment hostage," Mr. Pollack wrote.

He asked CMS to work with OMHA (which is also part of HHS) to fix the situation immediately to mitigate detrimental effects for hospitals.

In a separate letter to Congress, also sent this week, Mr. Pollack asked lawmakers to encourage CMS to adopt policy reforms concerning RAC-related appeals that would prevent the federal government from recouping the disputed funds until after the hospital receives an ALJ determination. Additionally, he asked policymakers to urge CMS to adopt the RAC reforms included in the Medicare Audit Improvement Act of 2013, under which Medicare RACs would be limited to a hard cap of additional medical record requests. The bill would also impose financial penalties on RACs for auditing errors, improve RAC transparency and allow denied inpatient claims to be billed as outpatient claims when appropriate.

More Articles on Medicare RACs:
5 Big Mistakes Hospitals Make When Dealing With RAC Audits  
The Two-Midnight Rule: What Hospitals and Health Systems Need to Know About Compliance
3 Key Medicare RAC Issues for Hospitals 

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