AHA Sues HHS over Review of Medicare Denials/ ALJ timelines

On May 22, 2014, the American Medical Association (AMA) and 3 hospitals filed a lawsuit to compel the Department of Health and Human Services to meet statutory deadlines for timely review of Medicare claims denials.

· Medicare law requires an administrative law judge to hold a hearing and render a decision within 90 days.

· Hospitals have the first opportunity to obtain a hearing and review by an independent adjudicator at this third-level of the appeals process, where many payment denials are reversed.

· HHS’s Office of Medicare Hearings and Appeals imposed a moratorium on ALJ appeals in December, leaving 480,000 appeals awaiting assignment to an ALJ as of Feb. 12.

· Wait times for an ALJ hearing could exceed three years when the moratorium is lifted, delaying billions of dollars in Medicare reimbursements to hospitals, many of which are already strapped for cash, the complaint states. “These are funds that otherwise could be dedicated to patient care or to sustaining the hospital infrastructure necessary to provide patient care,” the organizations add.

· Joining in the lawsuit with AHA are Baxter Regional Medical Center (Mountain Home, AR), Covenant Health (Knoxville, TN) and Rutland (VT) Regional Medical Center.

HHS has not made an attempt to resolve the backlog: (History of events)

· Delay announced in December 2012

· Public outcry from the public, HHS did not take action to remedy.

· January 14, 2014 – Plaintiff AHA sent a letter to CMS

· February 12, 2014 – 98 organizations sent a letter to the Chief ALJ Griswold urging OMHA to develop a solution to the problem.

· March 27th, 2014, the Advanced Medical Technology Association (“AdvaMed”) wrote to Defendant Sebelius and to the administrator of CMS to express its concerns about the moratorium.