OIG Issues Report on Medicare Appeals and Administrative Law Judges
Monday, January 28, 2013
by: VNAA Policy Team

Section: Public Policy and Advocacy

The Department of Health and Human Services Office of Inspector General (OIG) issued a report in late November on administrative law judges (ALJ) within the Medicare hearings and appeals process. Based on an analysis of all the ALJ appeals decided in FY 2010 and structured interviews with ALJs, their staff and Qualified Independent Contractors (QIC) the OIG found that in 56 percent of appeals the ALJ reversed the decisions of QICs and decided in favor of appellants.

Providers filed the about 85 percent of all ALJ appeals in 2010, with a small number of providers accounting for almost one-third of all appeals. Beneficiaries filed roughly 11 percent of appeals and state Medicaid agencies filed 3 percent. State Medicaid agencies were more likely than any other group to file Part A appeals on home health, hospice and skilled nursing facilities. Of the appeals in which ALJs overturned previous decisions, 62 percent were in Medicare Part A and more specifically 62 percent were in home health and hospice agencies.

The favorable rate for appellants varied widely from one ALJ to another and ALJ staff handled cases with suspicions of fraud inconsistently. When the Centers for Medicare and Medicaid Services (CMS) participated in the appeals process, ALJ decisions were less likely to favor the appellants.

Differences in interpretations of Medicare polices and other factors lead to the large differences between ALJ and QIC decisions. In interviews with ALJ and QIC staff, most agreed that QICs tend to interpret Medicare policies more strictly than ALJs. Unlike QICs, ALJs decide appeals involving all Medicare program areas because appeals are often randomly assigned.

The OIG recommended that the Office of Medicare Hearings and Appeals (OMHA) and CMS:
  • Develop and provide coordinated training on Medicare policies to ALJs and QIC
  • Identify and clarify Medicare policies that are unclear and interpreted differently,
  • Standardize case files and make them electronic
  • Revise regulations to provide more guidance to ALJs regarding the acceptance of new evidence
  • Improve the handling of appeals from appellants who are also under fraud investigation and seek statutory authority to postpone these appeals when necessary
  • Seek statutory authority to establish a filing fee
  • Implement a quality assurance process to review ALJ decisions
  • Determine whether specialization among ALJs would improve consistency and efficiency
  • Develop policies to handle suspicions of fraud appropriately and consistently and train staff accordingly
  • Continue to increase CMS participation in ALJ appeals
To read the full report, please visit the OIG Website. 
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