On June 28, 2016, the U.S. Department of Health and Human Services (HHS) released a series of regulatory changes in the Notice of Proposed Rule Making (NPRM) designed to curtail the massive backlog of Medicare claim appeals. Specifically, the proposed changes would revise the appeal procedures at the Administrative Law Judge (ALJ) level as well as alter procedures at the Centers for Medicare and Medicaid Services (CMS) and Medicare Appeals Council (Council) levels for certain matters affecting the ALJ level. HHS contends that these reforms will help defray the number of pending appeals by encouraging resolution of cases earlier in the appeals process.

HHS intends for this proposed rule to operate in conjunction with a series of legislative actions and funding requests outlined in the Fiscal Year (FY) President's Budget Request. Should this three-prong strategy gain traction, "[HHS] estimates that the backlog of appeals could be eliminated by FY 2021." These proposed changes follow a recent report published by the Government Accountability Office (GAO) stating the appeals backlog would likely persist despite HHS initiatives. The GAO report also recommended four actions to improve the completeness and consistency of the appeals data used by HHS and to promote the efficient resolution of repetitive claims. To be assured consideration, all comments must be received by the OMHA no later than 5:00 PM EST on August 29, 2016.

Key Takeaways:

• If implemented, the proposed changes would vest the Chair of the Department Appeals Board (DAB) with the power to designate certain Council decisions as precedential.

• The proposed changes would also expand the current decision-maker taxonomy. In addition to ALJs, new attorney adjudicators would absorb limited responsibilities at the third level of HHS appeals.

The following commentary examines some of the significant changes the proposed reforms would bring and considers how the appeals process would function if the proposed regulatory changes, legislative actions, and budgetary requests take effect.

• Precedential Decisions.

• Attorney Adjudicators.

• Revise the Amount-in-Controversy Calculation.

• CMS Involvement in Hearings.

• Create Process Efficiencies.

• Address Stakeholder Concerns and Regulations Clarifications.