Medicare Appeals:

Disparity between Requirements and Responsible Agencies' Capabilities

GAO-03-841: Published: Sep 29, 2003. Publicly Released: Oct 29, 2003.

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Appellants and others have been concerned about the length of time it takes for a decision on the appeal of a denied Medicare claim. In December 2000, the Medicare, Medicaid, and SCHIP Benefits Improvement and Protection Act of 2000 (BIPA), required, among other things, shorter decision time frames. BIPA's provisions related to Medicare appeals were to be applied to claims denied after October 1, 2002, but many of the changes have not yet been implemented. GAO was asked to evaluate whether the current Medicare appeals process is operating consistent with BIPA's requirements and to identify any barriers to meeting the law's requirements.

BIPA demands a level of performance, especially regarding timeliness, that the appeals bodies--the contract insurance carriers responsible for the first two levels of appeals, the Social Security Administration's (SSA) Office of Hearings and Appeals (OHA), and the Department of Health and Human Services (HHS) Medicare Appeals Council (MAC)--have not demonstrated they can meet. While the carriers have generally met their pre-BIPA time requirements, in fiscal year 2001, they completed only 43 percent of first level appeals within BIPA's 30-day time frame. In addition to average processing times more than four times longer than that required by BIPA, OHA and the MAC--the two highest levels of appeal--have accumulated sizable backlogs of unresolved cases. Delays in administrative processing due to inefficiencies and incompatibility of their data systems constitute 70 percent of the time spent processing appeals at the OHA and MAC levels. The appeals bodies are housed in two different agencies--HHS and SSA. The lack of a single entity to set priorities and address operational problems--such as incompatible data and administrative systems--at all four levels of the process has precluded successful management of the appeals system as a whole. Uncertainty about funding and a possible transfer of OHA's Medicare appeals workload from OHA to HHS has also complicated the appeals bodies' ability to adequately plan for the future.

Recommendations for Executive Action

  1. Status: Closed - Not Implemented

    Comments: The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 mandated that SSA transfer its responsibility for adjudicating Medicare appeals to HHS between July 1, 2005, and October 1, 2005, thus obviating the need for an interagency steering committee. Implementation of the transfer has begun, as scheduled. Consequently, there is no need for SSA to take action.

    Recommendation: The Secretary of Health and Human Services and the Commissioner of SSA should create an interagency steering committee with representatives from CMS, the carriers, OHA, and the MAC to serve as an advisory body to the Secretary of Health and Human Services and the Commissioner of SSA responsible for establishing requirements for reporting specific and comparable program and performance data to CMS, SSA, and HHS so that management can identify opportunities for improvement, and determine the resource requirements necessary to ensure that all appeals bodies will be able to meet BIPA's requirements.

    Agency Affected: Department of Health and Human Services

  2. Status: Closed - Not Implemented

    Comments: The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 mandated that SSA transfer its responsibility for adjudicating Medicare appeals to HHS no sooner than July 1, 2005, and no later than October 1, 2005, thus obviating the need for an interagency steering committee. Implementation of the transfer has begun, as scheduled. SSA has committed to completing all of its pending workload.

    Recommendation: The Secretary of Health and Human Services and the Commissioner of SSA should create an interagency steering committee with representatives from CMS, the carriers, OHA, and the MAC to serve as an advisory body to the Secretary of Health and Human Services and the Commissioner of SSA responsible for negotiating responsibilities and strategies for reducing the backlog of pending cases, especially at OHA and the MAC, and establish the priority for adjudicating pre-BIPA cases relative to BIPA-governed cases.

    Agency Affected: Department of Health and Human Services

  3. Status: Closed - Not Implemented

    Comments: The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 mandated that SSA transfer its responsibility for adjudicating Medicare appeals to HHS no sooner than July 1, 2005, and no later than October 1, 2005, thus obviating the need for an interagency steering committee. Implementation of the transfer has begun, as scheduled. SSA has committed to completing all of its pending workload.

    Recommendation: The Secretary of Health and Human Services and the Commissioner of SSA should create an interagency steering committee with representatives from CMS, the carriers, OHA, and the MAC to serve as an advisory body to the Secretary of Health and Human Services and the Commissioner of SSA responsible for negotiating responsibilities and strategies for reducing the backlog of pending cases, especially at OHA and the MAC, and establish the priority for adjudicating pre-BIPA cases relative to BIPA-governed cases.

    Agency Affected: Department of Health and Human Services

  4. Status: Closed - Not Implemented

    Comments: The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 mandated that SSA transfer its responsibility for adjudicating Medicare appeals to HHS no sooner than July 1, 2005, and no later than October 1, 2005, thus obviating the need for an interagency steering committee. Implementation of the transfer has begun, as scheduled.

    Recommendation: The Secretary of Health and Human Services and the Commissioner of SSA should create an interagency steering committee with representatives from CMS, the carriers, OHA, and the MAC to serve as an advisory body to the Secretary of Health and Human Services and the Commissioner of SSA responsible for making administrative processes, such as file tracking and transfer, compatible across all appeals bodies.

    Agency Affected: Social Security Administration

  5. Status: Closed - Not Implemented

    Comments: The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 mandated that SSA transfer its responsibility for adjudicating Medicare appeals to HHS no sooner than July 1, 2005, and no later than October 1, 2005, thus obviating the need for an interagency steering committee. Implementation of the transfer has begun, as scheduled.

    Recommendation: The Secretary of Health and Human Services and the Commissioner of SSA should create an interagency steering committee with representatives from CMS, the carriers, OHA, and the MAC to serve as an advisory body to the Secretary of Health and Human Services and the Commissioner of SSA responsible for making administrative processes, such as file tracking and transfer, compatible across all appeals bodies.

    Agency Affected: Social Security Administration

  6. Status: Closed - Not Implemented

    Comments: The Medicare Prescription Drug, Improvement, and Modernization Act of 2003, mandated that SSA transfer its responsibility for adjudicating Medicare appeals to HHS between July 1, 2005, and October 1, 2005, thus obviating the need for an interagency steering committee.

    Recommendation: The Secretary of Health and Human Services and the Commissioner of SSA should create an interagency steering committee with representatives from CMS, the carriers, OHA, and the MAC to serve as an advisory body to the Secretary of Health and Human Services and the Commissioner of SSA responsible for establishing requirements for reporting specific and comparable program and performance data to CMS, SSA, and HHS so that management can identify opportunities for improvement, and determine the resource requirements necessary to ensure that all appeals bodies will be able to meet BIPA's requirements.

    Agency Affected: Social Security Administration

 

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