Healthcare reform

Senate Finance Committee holds hearing on Medicare appeals system

On April 28, 2015, The Senate Finance Committee held a hearing about the Medicare appeal problems, focusing on the immense backlog at the ALJ level.  The committee members considered ways to fix problems at the center of the appeals backlog. However, the current proposals don’t work; they would further restrict access to meaningful reviews.

Current proposals include:

  • Establishing a refundable filing fee for providers, suppliers, and State Medicaid Agencies, including those acting as a subrogee to beneficiaries, at each level of Medicare appeal; appeals filed by beneficiaries or representatives other than providers, suppliers and State Medicaid Agencies would be exempt from the fee. 
  • Increasing the amount in controversy (AIC) for ALJ hearings(the 3rd stage in the appeals process) to equal the amount required for judicial review in federal court (the 5th and final stage in the appeals process). 
  • Establish a new review process, creating “Magistrates” (attorney adjudicators) who would hear claims below the new higher Amount in Controversy threshold.
  • Remand appeals to the redetermination level when new evidence is provided. 


The Center for Medicare Advocacy (CMA) has published some alternative proposals that they believe will help mitigate the current appeals problems, these include:

  • Eliminate one of the initial levels of appeal that simply deny coverage, at great expense to taxpayers.  Note that the Social Security Administration appeals system – a comparable agency – doesn’t have comparable levels of review
  • Handle hospital and Recovery Audit Contractor (RAC) cases in a separate manner
  • Review CMS policies such as Observation Status that incorrectly deny coverage in the first place.
  • Provide more funding for assisting beneficiaries with appeals, and for other assistance.