News: AHA suggests ways to fix Medicare appeals backlog

Last week, the AHA submitted four, non-deadline related remedies to reduce the backlog of Medicare billing appeals awaiting adjudication at the Administrative Law Judge (ALJ) level in response to a federal judge’s request earlier this year, according to AHA News.

To stem the tide of appeals in the backlog (which Modern Healthcare estimates will reach 950,520 by the end of 2021), the AHA proposed the following changes.

First, the Department of Health and Human Services (HHS) should prevent a new wave of recovery audit contractor (RAC) denials and appeals, by

1. Imposing a financial penalty on RACs with high overturn rates at the ALJ level
2. Shifting hospital-related claims to quality improvement organizations (QIO) and away from RAC jurisdiction

The financial penalty “counteracts RACs’ incentive to deny debatable claims,” the AHA wrote. Likewise, QIOs are “paid on a flat-fee, rather than contingent-fee, basis, removing RACs’ incentive to deny debatable claims.”

Second, the AHA recommends HHS redouble its settlement efforts by

1. Bringing inpatient rehabilitation facility claims to a prompt, fair settlement
2. Making good-faith settlement offers to participants in its settlement conference facilitation program

Third, the AHA recommended the court order HHS to ameliorate the backlog’s harmful effect on providers. Specifically, the AHA recommended that HHS should

1. Reduce the interest charged on funds not recouped from providers while their appeals are part of the backlog
2. Allow providers and suppliers to “rebill” denied claims for up to six months
3. Toll the time to file Section 340B appeals (related to outpatient claims; currently, the time it takes to file an appeal counts towards the deadline, which can result in a negative payment adjustment due to late fees)

Finally, the AHA recommended the court orders HHS to maintain its current efforts to fight the backlog and direct the agency to supply status reports every 90 days.

Editor’s note: To read the AHA News coverage of this story and the AHA’s recommendations, click here. To read Modern Healthcare’s coverage of this story, click here. To read the complete recommendation submitted to the court by the AHA, click here. To read about the judge’s original request for suggestions from the AHA, click here.