Issue 2006-04, April 2006

MMA - Changes to Chapter 29 – Appeals of Claims Decisions: Administrative Law Judge; Departmental Appeals Board; U.S. District Court Review

Provider Types Affected
Physicians, providers, and suppliers who submit Part A or Part B Fee-for-Service claims to Medicare for services

Background
The Medicare claim appeals process was amended by the Medicare, Medicaid, and SCHIP Benefits Improvement and Protection Act of 2000 (BIPA). Section 1869(c) of the Social Security Act (the Act), as amended by BIPA, requires a new second level in the administrative appeals process called a reconsideration. It is different from the previous first level of appeal for Part A claims performed by fiscal intermediaries (FIs). Reconsiderations will be processed by Qualified Independent Contractors (QICs).

The purpose of this article is to notify you about changes to the manual provisions that address Administrative Law Judge, Departmental Appeals Board, and U.S. District Court review levels of appeal.

Key Points

Administrative Law Judge (ALJ) - The Third Level of Appeal
Parties to an appeal who are not satisfied with decisions made by the QIC at the second level of appeal (reconsideration) have the right to request an ALJ hearing as long as all of the ALJ hearing request requirements are met (see Medicare Claims Processing Manual, Chapter 29, Section 330 for details). Outlined below is some pertinent information about the ALJ level of the appeal process.

ALJ Hearing Amount in Controversy
Parties requesting an ALJ Hearing must meet the Amount in Controversy requirements:

• The amount remaining in controversy requirement for requests made before January 1, 2006 is $100.
• The amount remaining in controversy will increase to $110 for requests made on or after January 1, 2006.
• Beginning in 2005, for requests made for an ALJ hearing or judicial court review, the dollar amount in controversy requirement will increase by the percentage increase in the medical care component of the consumer price index for all urban consumers (U.S. city average) for July 2003 to the July preceding the year involved. Any amount that is not a multiple of $10 will be rounded to the nearest multiple of $10.

Time Limits and Responsibilities

Decisions: The official ALJ decision is a signed copy of the ALJ decision. When issuing decisions, the ALJ will either:

• Issue a decision based on the request for ALJ hearing; or
• Issue an order of dismissal of the appellant’s request for ALJ hearing.

Effectuation (No Agency Referral): Often, the ALJ’s decision will require an effectuation action (payment of the claim) on the Medicare contractor’s part. Contractors will effectuate ALJ decisions within 30 days of the receipt of the official ALJ decision if:

• The decision is partially or wholly favorable;
• The decision gives a specific amount to be paid; and
• There is no agency referral to the DAB.

Computation of the Amount (No Agency Referral): If the amount must be computed by the Medicare contractor, the decision must be effectuated within 30 days after the contractor computes the amount to be paid to the appellant. The computation should be done as soon as possible, but no later than 30 calendar days of the date of receipt of the official ALJ decision or effectuation notice.

Clarification (No Agency Referral): If clarification from the ALJ is necessary, then the date of the clarification is considered to be the final determination for purposes of effectuation.

If clarification is needed from the physician/supplier (e.g., splitting charges), this clarification should be requested as soon as possible and the amount payable should be computed within 30 calendar days after the receipt of the necessary clarification. The date of receipt of the clarification is considered to be the final determination for purposes of effectuation.

Departmental Appeals Board (DAB) - The Fourth Level of Appeal
The DAB evaluates requests for review, and makes final decisions whether to review, or to decline to review, decisions of ALJs as well as orders of dismissal by ALJs.

DAB Effectuation Time Limits: DAB decisions requiring contractor effectuation must be initiated within 30 days of receipt of a DAB decision. Effectuation must be completed within 60 days.

U.S. District Court: The Fifth Level of Appeal
A party may request court review of the DAB’s decision. Medicare contractors are not responsible for reviewing ALJ decisions issued by the Department of Health and Human Services (HHS) ALJs to determine if an agency referral is appropriate, and will not accept a request for U.S. District Court review by a party.

Relevant Links
The official instruction issued to your FI including Regional Home Health Intermediaries (RHHIs), or carrier including DMERCs, regarding this change may be found by going to http://www.cms.hhs.gov/Transmittals/downloads/R862CP.pdf on the CMS Web site. The new sections of Chapter 29 of the Medicare Claims Processing Manual are attached to CR4152.

Please refer to your local FI/RHHI or carrier/DMERC if you have questions about this issue. To find the toll-free phone number, go to http://www.cms.hhs.gov/apps/contacts/ on the CMS Web site.

Disclaimer
This article was prepared as a service to the public and is not intended to grant rights or impose obligations. This article may contain references or links to statutes, regulations, or other policy materials. The information provided is only intended to be a general summary. It is not intended to take the place of either the written law or regulations. We encourage readers to review the specific statutes, regulations and other interpretive materials for a full and accurate statement of their contents.

Medlearn Matters Number: MM4152
Related Change Request (CR) #: 4152
Related CR Release Date: February 17, 2006
Effective Date: May 1, 2005
Related CR Transmittal #: R862CP
Implementation Date: March 17, 2006