ALJ Level Appeals – Will Things Change?

on Thursday, 02 May 2013. All News Items | Billing

ALJ Level Appeals – Will Things Change?

The Office of Inspector General (OIG) recently released a report on suggested improvements at the Administrative Law Judge (ALJ) level of Medicare appeals. As most hospitals are aware, there has been a high rate of reversals of denials in the Medicare appeal process, especially since reviews by Recovery Auditors have begun. A lot of the reversals occur at the ALJ level of appeal. This OIG report evaluates the ALJ appeals process after changes were made in 2005, provides some interesting statistical data, and makes several recommendations. Here is a brief summary of some of the information from the report. For more information, read the complete OIG report.

2005 Changes to ALJ Appeals

  • ALJs required to “give substantial deference” to Local Coverage Determinations (LCDs) and CMS program guidance
  • New evidence to be accepted at ALJ level only with “good cause”
  • CMS participation in ALJ hearing allowed

Statistics of 2010 ALJ Appeals

  • Two percent of providers filed almost one third of appeals
  • Fifty-six percent (56%) of appeals reversed as fully favorable to appellant
  • Highest favorable rate was for hospitals at 72%
  • Favorable rate varied widely between ALJs
  • ALJs tended to interpret Medicare policies less strictly than QICs (Quality Independent Contractors – handle 2nd level of Medicare appeals)
  • QICs are more specialized in Medicare program areas and use more clinical experts than ALJs
  • ALJ more likely to uphold denials when CMS participated
  • CMS only participated in 10% of ALJ hearings in 2010

OIG Recommendations

  • Coordinated training on Medicare policies for ALJs and QICs
  • Clarify unclear Medicare policies
  • Better guidance on accepting new evidence
  • Establish a filing fee
  • Increase CMS participation in ALJ hearings
  • Consider specialization for ALJs
  • Implement a QA process to review ALJ decisions

There may already be some changes under way – at the July 2012 Alabama Hospital Association Revenue Integrity Committee meeting, Cahaba GBA discussed plans for their increased participation in ALJ hearings.

Article by Debbie Rubio

Debbie Rubio, BS, MT (ASCP), is the Manager of Regulatory Affairs and Compliance at Medical Management Plus, Inc. Debbie has over twenty-seven years of experience in healthcare including nine years as the Clinical Compliance Coordinator at a large multi-facility health system. In her current position, Debbie monitors, interprets and communicates current and upcoming regulatory and compliance issues as they relate to specific entities concerning Medicare and other payers. You may contact Debbie at This email address is being protected from spambots. You need JavaScript enabled to view it.This email address is being protected from spambots. You need JavaScript enabled to view it. .

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