September 19th saw the Washington D.C. District Court (the Court) pass down a decidedly pro-Medicare provider decision, ultimately holding that the Department for Health and Human Services (HHS) would not be granted a stay of proceedings as they had yet to make significant progress in reducing the Medicare appeals backlog. The case is American Hospital Association (AHA) v. Burwell (acting in her official capacity as HHS Secretary), and it was before the Court for the second time following an Order of Remand by the D.C. Circuit in February of 2016.
The Court’s September 19th decision came as a response to Secretary Burwell (the “Secretary”)’s motion to stay proceedings on remand. The motion was based on the Secretary’s claim that significant progress had been made toward reducing the Medicare appeals backlog. A decision in the Secretary’s favor would have suspended the case until the last day of September, 2017. However, the Court rejected the purported progress by HHS, finding that more extreme measures had to be taken, ultimately concluding the stay in proceedings was not warranted.
The Secretary’s motion for a stay was heavily supplemented with examples of the efforts the government has been taking to reduce the appeals backlog. The Secretary cited administrative actions such as efforts to promote settlements, changes to the administrative appeals process, front-end limitations on provider activity and changes to the Recovery Audit Contractor (“RAC”) Program. Two specific programs mentioned were CMS’ 68% settlement, which resolved 260,000 inpatient hospital claims; and the settlement conference facilitation program, which is projected to reduce the number of appeals pending by 27,000 by the end of the 2020 fiscal year.
The Secretary further discussed legislative efforts, including the 2017 fiscal year budget and the Audit & Appeal Fairness, Integrity, and Reforms in Medicare Act of 2015 (AFIRM Act). The Secretary argued that these would increase appropriations to Medicare appeals programs by $1.3 billion over ten years, and that these additional funds would be able to ramp up efforts to process the backlogged claims, both through traditional hearings and through newer methods such as settlements.
Detailed breakdowns of each process and their supposed successes were not met enthusiastically by the Court, however. The Court held that even though there was marginal progress being made, the net result was still a growing backlog—the government’s efforts did nothing to actually move the appeals process toward statutory compliance. The Court also cited the seven months since remand, and the 21 months since the AFIRM Act had been reported to the full Senate, and yet no debate or vote on the act had been scheduled. In short the Court found these efforts unsatisfactory, and noted the clear risk these delays put on the health and welfare of Medicare beneficiaries.
Nonetheless, in the end, the Court admitted that it possessed no “magic wand” to fully remedy the appeals process or force HHS to resolve all pending appeals within the statutory timeframe. Regardless, the Court’s decision recognizes that the appeals backlog is unruly and constitutes a real threat to the wellbeing of Medicare patients, especially as it disrupts providers’ financial ability to care for its patients. With pressure from the Court now mounting, in the coming months Medicare providers and beneficiaries alike may have a first-row seat to further attempts by HHS and CMS to tame the backlog of appeals.
For over 30 years, Wachler & Associates has represented healthcare providers and suppliers nationwide in a variety of health law matters, including Medicare audit compliance and appeals. If you or your healthcare entity have any questions about the AHA v. Burwell decision and its potential effect on Medicare appeals, or any other health care regulatory compliance questions, please contact an experienced healthcare attorney at (248) 544-0888, or via email at wapc@wachler.com. You may also subscribe to our health law blog by adding your email at the top right of this page.