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RAC Facts: HHS: RACs Are Not Responsible for Appeals Backlog, Only 9.5% of Appeals

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HHS: RACs Are Not Responsible for Appeals Backlog, Only 9.5% of Appeals

Recently, the U.S. Department of Health and Human Services (HHS) issued a response to discussions about the Medicare appeals backlog, releasing new data on what is causing the backlog and what actions are being taken to reduce it.

  • HHS determined that the RAC “program simply was not, and is not, the primary source of the backlog”;
  • That RAC-related appeals made up only 9.5% of all appeals filed with the Office of Medicare Hearings and Appeals (OMHA) in FY2016 and only 14.15 in FY2015; and,
  • Appeals from State Medicaid agencies make up a significant portion of the backlog.

HHS has put in place several efforts to address the backlog, which has thus far retired nearly 200,000 cases since litigation began in late Winter 2015. HHS also offered providers two opportunities to settle their backlogged cases which has decreased the backlog by 288,726 appeals. The Settlement Conference Facilitation has also been expanded, adding 11 new facilitators. Most recently, HHS announced a third settlement for providers, which they estimate will remove another 95,000 appeals from the backlog. Because of these changes, the backlog is projected to be eliminated by the end of FY2019 – 2 years earlier than the original projection.  

In addition to the work of the HHS to clear the backlog, the Council for Medicare Integrity (CMI) supports Congress’ action to pass the Audit and Appeals Fairness, Integrity and Reforms in Medicare (AFIRM) Act. Passed by the Senate Finance Committee last year, AFIRM seeks to make urgently needed programmatic changes to further address the cases waiting for review in the OMHA process.

The AFIRM Act would ensure active steps are taken to address the backlog by sending claims back to the first level of appeal when new evidence is introduced later in the process. It would also create Medicare Magistrates to perform reviews and render decisions on certain types of cases, and ensure fairness by requiring that all parties involved be notified in advance of a hearing to allow for participation of all stakeholders.

While the AFIRM Act addresses several issues facing the struggling Medicare appeals process, CMI recommends some additional safeguards to further promote expediency and prevent future backlogs, specifically:

  • Inclusion of an appeals filing fee, refundable if a provider wins its appeal, as championed by the President’s Budget, the HHS Secretary and Chief ALJ;
  • Penalties for providers who fail to bill a claim within 3 months of the date of service;
  • Requirements recommended by Congress that ALJs make decisions consistently and in accordance with Medicare policy; and,
  • Expedition of claims where no facts are disputed.

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