[House Hearing, 113 Congress]
[From the U.S. Government Publishing Office]
MEDICARE MISMANAGEMENT PART II: EXPLORING MEDICARE APPEALS REFORM
=======================================================================
HEARING
before the
SUBCOMMITTEE ON ENERGY POLICY,
HEALTH CARE AND ENTITLEMENTS
of the
COMMITTEE ON OVERSIGHT
AND GOVERNMENT REFORM
HOUSE OF REPRESENTATIVES
ONE HUNDRED THIRTEENTH CONGRESS
SECOND SESSION
__________
JULY 10, 2014
__________
Serial No. 113-148
__________
Printed for the use of the Committee on Oversight and Government Reform
Available via the World Wide Web: http://www.fdsys.gov
http://www.house.gov/reform
______
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COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM
DARRELL E. ISSA, California, Chairman
JOHN L. MICA, Florida ELIJAH E. CUMMINGS, Maryland,
MICHAEL R. TURNER, Ohio Ranking Minority Member
JOHN J. DUNCAN, JR., Tennessee CAROLYN B. MALONEY, New York
PATRICK T. McHENRY, North Carolina ELEANOR HOLMES NORTON, District of
JIM JORDAN, Ohio Columbia
JASON CHAFFETZ, Utah JOHN F. TIERNEY, Massachusetts
TIM WALBERG, Michigan WM. LACY CLAY, Missouri
JAMES LANKFORD, Oklahoma STEPHEN F. LYNCH, Massachusetts
JUSTIN AMASH, Michigan JIM COOPER, Tennessee
PAUL A. GOSAR, Arizona GERALD E. CONNOLLY, Virginia
PATRICK MEEHAN, Pennsylvania JACKIE SPEIER, California
SCOTT DesJARLAIS, Tennessee MATTHEW A. CARTWRIGHT,
TREY GOWDY, South Carolina Pennsylvania
BLAKE FARENTHOLD, Texas TAMMY DUCKWORTH, Illinois
DOC HASTINGS, Washington ROBIN L. KELLY, Illinois
CYNTHIA M. LUMMIS, Wyoming DANNY K. DAVIS, Illinois
ROB WOODALL, Georgia PETER WELCH, Vermont
THOMAS MASSIE, Kentucky TONY CARDENAS, California
DOUG COLLINS, Georgia STEVEN A. HORSFORD, Nevada
MARK MEADOWS, North Carolina MICHELLE LUJAN GRISHAM, New Mexico
KERRY L. BENTIVOLIO, Michigan Vacancy
RON DeSANTIS, Florida
Lawrence J. Brady, Staff Director
John D. Cuaderes, Deputy Staff Director
Stephen Castor, General Counsel
Linda A. Good, Chief Clerk
David Rapallo, Minority Staff Director
Subcommittee on Energy Policy, Health Care and Entitlements
JAMES LANKFORD, Oklahoma, Chairman
PATRICK T. McHENRY, North Carolina JACKIE SPEIER, California, Ranking
PAUL GOSAR, Arizona Minority Member
JIM JORDAN, Ohio ELEANOR HOLMES NORTON, District of
JASON CHAFFETZ, Utah Columbia
TIM WALBERG, Michigan JIM COOPER, Tennessee
PATRICK MEEHAN, Pennsylvania MATTHEW CARTWRIGHT, Pennsylvania
SCOTT DesJARLAIS, Tennessee TAMMY DUCKWORTH, Illinois
BLAKE FARENTHOLD, Texas DANNY K. DAVIS, Illinois
DOC HASTINGS, Washington TONY CARDENAS, California
ROB WOODALL, Georgia STEVEN A. HORSFORD, Nevada
THOMAS MASSIE, Kentucky MICHELLE LUJAN GRISHAM, New Mexico
C O N T E N T S
----------
Page
Hearing held on July 10, 2014.................................... 1
WITNESSES
Ms. Nancy J. Griswold, Chief Administrative Law Judge, Office of
Medicare Hearings and Appeals, U.S. Department of Health and
Human Services
Oral Statement............................................... 4
Written Statement............................................ 7
APPENDIX
Office of Medicare hearings and appeals chart, submitted by
Chairman Lankford.............................................. 38
Questions for the record answered by Judge Griswold.............. 40
Oct. 28, 2014 letter to Rep. Maloney from Judge Griswold......... 41
July 9, 2014 letter to Rep. Lankford from Proper Payments........ 42
Statement for the record by OIG of HHS........................... 45
MEDICARE MISMANAGEMENT PART II: EXPLORING MEDICARE APPEALS REFORM
----------
Thursday, July 10, 2014
House of Representatives,
Subcommittee on Energy Policy, Health Care, and
Entitlements,
Committee on Oversight and Government Reform,
Washington, D.C.
The subcommittee met, pursuant to call, at 2:13 p.m., in
Room 2154, Rayburn House Office Building, Hon. James Lankford
[chairman of the subcommittee] presiding.
Present: Representatives Lankford, Gosar, Woodall, Massie,
Meadows, Speier, Norton, Duckworth and Lujan Grisham.
Staff Present: Molly Boyl, Deputy General Counsel and
Parliamentarian; Katelyn E. Christ, Professional Staff Member;
Linda Good, Chief Clerk; Meinan Goto, Professional Staff
Member; Mark D. Marin, Deputy Staff Director for Oversight;
Emily Martin, Counsel; Laura L. Rush, Deputy Chief Clerk;
Andrew Shult, Deputy Digital Director; Sarah Vance, Assistant
Clerk; Jaron Bourke, Minority Director of Administration;
Aryele Bradford, Minority Press Secretary; Una Lee, Minority
Counsel; and Michael Wilkins, Minority Staff Assistant.
Mr. Lankford. Good afternoon. We apologize for a little bit
of delay. We'll have additional delays in the moments ahead.
Ms. Speier and I both were on the floor doing some debate on
the current bill that's on the floor, appropriations bill. The
votes, we understand, will be called for that in the next 15 to
20 minutes. So what I'm going to try to accomplish is an
opportunity for us to be able to go through some of our opening
statements, get us established. When votes are called, we'll
recess for a short period of time, then we'll come back and
finish up with questions.
This is the Energy Policy, Health Care and Entitlements
hearing on Medicare and Mismanagement Part II: Exploring
Medicare Appeals Reform. The chair is authorized to declare a
recess of the committee at any time.
I'd like to begin this hearing by stating the Oversight
Committee mission statement. We exist to secure two fundamental
principles: First, that Americans have the right to know that
the money Washington takes from them is well spent; second,
Americans deserve an efficient, effective government that works
for them. Our duty on the Oversight and Government Reform
Committee is to protect these rights.
Our solemn responsibility is to hold government accountable
to taxpayers, because taxpayers have the right to know what
they get from their government. We will work tirelessly in
partnership with citizen watchdogs to deliver the facts to the
American people and bring genuine reform to the Federal
bureaucracy. This is the mission of the Oversight and
Government Reform Committee.
This conversation is, as I mentioned already, the second
part of a two-part conversation about how things are going. We
have multiple different entities that have a significant
backup. They're waiting through the appeals process, some of
them for years in the appeals process, healthcare providers,
hospitals, individuals that do not have a large cash flow and
individuals and businesses that do.
So the issue today is why does that exist, how do we
actually resolve this, what are the fixes that are needed
legislatively, and what can we take care of right now?
I'd like to yield additional time to Mr. Meadows from North
Carolina, who has been very, very involved in this process as
well.
Mr. Meadows. Thank you, Mr. Chairman, and thank you for
your leadership on this particular issue. And really this comes
down and boils down to people, and what we have to do is make
sure that as government agencies that we do the very best we
can to go after waste, fraud and abuse, which the chairman has
so eloquently articulated, yet at the same time make sure that
the rule of law, in fairness to everyone, is upheld.
And right now I think that there is great question--and not
singling you out, Ms. Griswold, because I've had some great
conversations with really folks within the ALJ. There seems to
be a very compassionate desire to fix the problem, and so
that's what we're looking for here today.
My other concern, though, and I think the concern of the
American people, is this whole process in terms of when we go
after waste, fraud and abuse, if we cast such a wide net, then
we're taking the decisionmaking away from doctors, healthcare
providers, hospitals, many people who make their decisions who
are trained, who go to years of training to do that, and we're
transferring that decisionmaking capability because of
reimbursements to--actually to a bureaucrat.
For me, I have a lot more trust in the nurse or the doctor
that cares for me than I do somebody that works here in
Washington, D.C. I think that polls would show that to be the
fact as well. So what I'm looking for specifically, and it will
be difficult, I know, because you're all part of an agency, but
there's this wall of separation that somehow goes up that the
American people don't understand, that they all see you part of
HHS or part of CMS, and yet you have a wall, CMS has a wall.
What I need to do is have as much finger pointing as
possible to say this is what will solve it, knowing that I'm
not asking you to throw anybody under the bus. As the chairman
pointed out, we're looking for legislative fix, for
appropriations that need to be done so that we can help this to
quit being a problem, and so we can obey the law the way that
it is written.
And so I thank the chairman, and I yield back.
Mr. Lankford. Thank you, Mr. Meadows.
I would like to ask unanimous consent to conserve for the
record a chart giving disposition outcome rates that was given
to us by the Office of Medicare Hearings and Appeals just last
night. I'd like to be able to add this to the record and be
able to share with all individuals that are here as well.
I'd like to now recognize the distinguished ranking member,
the gentlelady from California Ms. Speier, for her opening
statement.
Ms. Speier. Mr. Chairman, thank you for holding the
hearing, and I want to thank the Chief Judge Griswold for
appearing before us today on this important issue.
You know, I think we can all agree that Medicare providers
are entitled to have their claims administered fairly,
efficiently and without undue delay so that they can focus on
their core mission of providing care to our Nation's seniors.
If they are billing incorrectly, they deserve to know sooner
than later. Unfortunately, that is not the situation facing
providers today.
Medicare providers appealing payment decisions made by
contractors are waiting on average 387 days to have their
claims adjudicated by the Office of Medicare Hearings and
Appeals. For providers submitting new claims, the wait could be
as long as 28 months just to have an appeal assigned to an ALJ.
The current claims backlog at OMHA is unacceptable and
unsustainable. OMHA must make significant changes in how it
does business. I look forward to hearing from the chief judge
about the initiatives that OMHA is implementing to approve
efficiency and alleviate the backlog.
But I also want to remind my colleagues that the claims
backlog is a problem that Congress created. Congress has
required CMS appropriately to be increasingly vigilant in
detecting and reducing the amount of waste, fraud and abuse in
the $600 billion Medicare program that covers 51 million
beneficiaries. This emphasis on program integrity is critical
both to the health of our Nation's seniors and to the
protection of our taxpayer dollars, but this increased scrutiny
has not been coupled with additional funds to address the
influx of claims and appeals that have resulted.
With the Medicare Prescription Drug Act, Congress created
the Medicare Administrative Contractors, the Zone Program
Integrity Contractors, and the Recovery Auditor Contractors
pilot program. In 2010, the RAC program was made permanent and
expanded nationwide. All of these contractors conduct audits of
Medicare providers. Each of these contractors have increased
the number of claims being audited for payment accuracy in
recent years. According to a 2013 GAO study, the volume of
contractor postpayment claims reviews increased by 55 percent
between 2011 and 2012.
More audits means, obviously, more appeals. That is an
inevitable result of the additional program integrity functions
that we here in Congress have asked CMS to implement. Yet
Congress has not provided OMHA with more funding for more
judges to adjudicate claims, so when we wring our hands about
the number of days that these providers have to wait, we have
to wring our hands and look directly at ourselves.
Despite the sixfold increase in the number of appeals since
2006, the number of ALJs at OMHA has remained relatively
constant. In 2007, OMHA received 20,000 RAC claims. In 2013,
OMHA received 192,000 RAC claims, yet received no additional
funding to handle this workload. I joined a number of my
colleagues on both sides of the aisle in sending a letter to
the Secretary of HHS citing concerns about the RAC program and
expressing the need for reform.
But it's also important to note that RACs have led to the
exposure of many questionable billing practices, such as
billing for hospital readmissions on the same day with the same
diagnosis; durable medical equipment items delivered, but never
ordered by a physician; hospital claims coded with illness a
patient did not possess; and excessive units of medication
ordered, especially where the billed dose would be harmful or
lethal to the patient who received it.
We may need to consider reforms to the RAC program that
reduces the administrative burden of RAC audits on providers,
but we must also ensure that we preserve the central program
integrity functions of the RACs who performed the critically
important, congressionally mandated function of reducing
improper payments in the Medicare program.
Finally, an important part of reducing the burden on
providers is ensuring that appeals from adverse RAC
determinations are adjudicated in a timely manner. Congress
must do its part by ensuring that OMHA's budget request is
fully funded. We have to give OMHA the resources commensurate
with the workload that we have asked them to perform.
And with that, I yield back.
Mr. Lankford. Members will have a requisite 7 days to
submit additional statements if they choose to add statements
for the record.
Ms. Griswold, you are the sole individual in this hearing
today, and we are grateful that you are here. Pursuant to all
committee rules, all witnesses are sworn in before they
testify. If you'd please stand, raise your right hand.
Do you solemnly swear or affirm the testimony you are about
to give will be the truth, the whole truth and nothing but the
truth, so help you God?
Ms. Griswold. I do.
Mr. Lankford. Thank you.
Let the record reflect the witness answered in the
affirmative.
You, of course, may be seated.
Ms. Griswold is the Chief Administrative Judge at the
Department of Health and Human Services Office of Medicare
Hearings and Appeals, and we are very grateful that you are
here to be able to have this conversation. To allow time for
discussion, we'd ask you to limit your oral testimony to 5
minutes. Of course, your written testimony we've already
received will be a part of the permanent record as well. We
have not called votes yet, so we're not in a hurry at this
point, so I'm grateful to be able to receive your testimony.
You may begin.
STATEMENT OF NANCY J. GRISWOLD, CHIEF ADMINISTRATIVE LAW JUDGE,
OFFICE OF MEDICARE HEARINGS AND APPEALS, U.S. DEPARTMENT OF
HEALTH AND HUMAN SERVICES
Ms. Griswold. Chairman Lankford, Ranking Member Speier and
members of the subcommittee, I want to thank you for the
invitation to discuss the workloads of the Office of Medicare
Hearings and Appeals, or what we call OMHA. OMHA administers
the nationwide Medicare administrative law judge hearing
program and is responsible for conducting the third level of
review of Medicare appeals. In order to ensure that OMHA's
adjudicators have decisional independence from CMS, OMHA was
established as a separate agency within the Department of
Health and Human Services and reports directly to the
Secretary. Accordingly, we operate under a separate
appropriation, and we are both functionally and physically
separate from CMS.
Between fiscal years '11 and '13, what had previously been
a gradual upward trend in appeal receipt levels took an
unexpectedly sharp turn, and OMHA experienced an overall 545
percent increase in our appeals. The rise in the number of
appeals resulted both from increases in the number of
beneficiaries utilizing covered services, and also from the
expansion of OMHA's responsibility to include the adjudication
of appeals resulting from new audit workloads undertaken by
CMS, including the nationwide implementation of the Recovery
Audit Program. There have also been increases in Medicaid State
agency appeals.
We are pleased that OMHA's 2014 enacted funding level has
allowed for the hiring of 7 additional teams, bringing OMHA's
adjudication capacity to 72,000 appeals per year; however, this
capacity pales in comparison to the adjudication workload. In
fiscal year '13 alone, OMHA received 384,151 appeals; and in
fiscal year '14, receipt levels through July 1 are
approximately 509,124 appeals.
As a result, OMHA had over 800,000 appeals pending on July
1 of 2014. Although ALJ team productivity has more than doubled
from fiscal year '09 through '13, OMHA has been receiving
approximately 1 year's worth of appeals every 4 to 6 weeks,
driving adjudication time frames to their current high of 387
days.
OMHA recognizes the need to adjudicate appeals with greater
efficiency. By the end of the fiscal year, we will release a
manual which utilizes best practices to standardize our
business process. We are using information technology to
convert our process from paper to electronic, an effort which
will culminate in its first release in the summer of 2015.
We have also developed a template system which simplifies
the work of our staff by providing standardized fillable
formats for routine word processing. OMHA also proposed and
former Secretary Sebelius established a departmental
interagency work group, which conducted a thorough review of
the appeals process and developed additional initiatives that
both OMHA and CMS are currently implementing.
On June 30, OMHA posted on its Web site two new options for
appellants. The first allows appellants to have their claims
adjudicated using statistical sampling and extrapolation
methods. The second option for appellants uses alternative
dispute resolution techniques during a facilitated settlement
conference.
Finally, OMHA has redirected the efforts of its senior
attorneys to assist in the prioritization of beneficiary
appeals. Any beneficiary who believes their case is not
receiving priority consideration at OMHA may contact us
directly at [email protected] or at our toll-free
number, 855-556-8475.
Although OMHA is functionally and organizationally
separate, I can provide a general outline of initiatives that
are being undertaken at CMS. These include beginning global
settlement discussions involving similarly situated appellants,
requiring the new recovery auditors to offer providers and
suppliers a 30-day discussion period, allowing for recovery
audit payment only after a qualified independent contractor has
determined that an overpayment exists, issuing a proposed rule
requiring prior authorization for certain durable medical
equipment, and requiring prior authorization for two particular
Part B services under CMS' demonstration authority.
Although the Department is working to address the backlog
and the number of prospective appeals within current resources
and authorities, the initiatives that I've discussed today will
be insufficient to close the gap between workload and resources
at OMHA. Although all workloads at OMHA have experienced rapid
growth, a significant portion of the increase is a consequence
of the Department's effort to implement legislation designed to
combat Medicare fraud and to reduce improper payments.
The Department is committed to crafting solutions which
will bring these efforts and the resulting appeal workload into
balance. We look forward to working with this committee and
with our stakeholders to develop and implement these solutions.
I thank you for your time and concern.
[Prepared statement of Ms. Griswold follows:]
[GRAPHIC] [TIFF OMITTED]
Mr. Lankford. The chair recognizes Dr. Gosar for
questioning.
Mr. Gosar. Thank you, Mr. Chairman.
Ms. Griswold, can you walk us through the five levels of
Medicare appeals process?
Ms. Griswold. Yes. The first two levels are conducted at
CMS. They are administered by CMS and CMS' contractors. The
third level is at the Office of Medicare Hearings and Appeals
and is conducted by administrative law judges. The fourth level
is at the Medicare Appeals Council, which is part of the
Departmental Appeals Board and is also a separate agency within
Health and Human Services. And the final level is with the
Federal district courts.
Mr. Gosar. Gotcha.
Can you describe the different types of appeals heard by
the ALJs?
Ms. Griswold. Yes. We hear both Part A and Part B appeals
under Medicare, and we also hear the Part D appeals. This was
part of our original charge, the prescription drug appeals. We
hear IRMAA appeals. We hear appeals on entitlements. We also
hear the Part C Medicare Advantage appeals.
Mr. Gosar. In percentages of those, what do you hear more
often, most often in those appeals for ALJs?
Ms. Griswold. Well, it varies. In recent years we have
heard a significant number of appeals under Part A, which are
the acute care hospital--the acute hospital appeals.
Mr. Gosar. And does that happen, would you say, 30, 40, 50
percent of the time in the ALJ workload?
Ms. Griswold. I can get you that number. Hold on just 1
minute.
Mr. Gosar. I mean, trends really help you out trying to
figure out what the problem--you know, being a healthcare
provider, I mean, you always look at trends about what's
happening, so that gives you kind of a workload basis of which
to delegate resources to.
Ms. Griswold. Most of our recovery audit appeals have been
Part A, and so you can kind of use that as a gauge. In 2014,
41.2 percent--oh, I'm sorry. I have the wrong number there;
54.2 percent to date were recovery audit appeals, and those are
predominantly those Part A appeals.
Mr. Gosar. Part A.
So according to HHS Office of Inspector General, in 2010,
56 percent of the appeals were decided as fully favorable to
the appellants, a reverse previous lower-level decision. What
is the current rate?
Ms. Griswold. All right. And are you asking about the RAC
decisions, the RAC appeals, or just overall----
Mr. Gosar. Just overall.
Ms. Griswold. --overall OTRs? All right.
In 2014, the fully-favorable OTR rate for the fiscal year
to date is 19.3 percent.
Mr. Gosar. Gotcha.
Now, has OMHA conducted an analysis on what factors are
really driving this backlog? I mean, you made mentions of three
of them, but I'd like to be a little bit more specific.
Ms. Griswold. Yeah. There are a number of things. All of
our workloads are going up. We attract what we call our
traditional workload, which is, you know, the Part A/B
workload. We also have been tracking the RAC workload, and
we've tracked the dual-eligible or Medicaid and Medicare
beneficiary workload. All three of those have been going up.
The traditional workload has been driven largely partly by
demographics. I mean, there are just more beneficiaries on the
rolls who are utilizing more services.
It has also been driven by increases in CMS' audit efforts,
Zone Program Integrity Contractors' identification of improper
payments. Anything that results in more denials at lower levels
is going to result in more appeals at the ALJ level.
Of course, the Recovery Audit Program is the one that gets
a lot of attention. It was a new program in 2010, so it was a
startup, and the increase in receipts in that program was, of
course, dramatic. That occurred primarily at our level between
2011 and 2013 is when we saw the largest spikes in that
workload. We've also seen increases in this dual-eligible
workload, beneficiaries that are eligible for both Medicare and
Medicaid, and those workloads have gone up as well.
Mr. Gosar. I thank you.
I yield back, Mr. Chairman.
Mr. Lankford. Ms. Speier and I are going to reserve our
questions until after the voting time, so the chair would like
to recognize Mr. Meadows for his questioning.
Mr. Meadows. Thank you, Mr. Chairman.
Ms. Griswold, is it not true that the efficiency of your
adjudicators has actually increased? You're handling more cases
per adjudicator on an annual basis; is that not true?
Ms. Griswold. It is true, yes. We're very proud of our----
Mr. Meadows. All right. So you're actually more efficient
by 20 percent if you really look at the real numbers, that
you're adjudicators are actually being a lot more efficient
than they've ever been before?
Ms. Griswold. Well, and since 2009, our adjudicators have
actually doubled their productivity.
Mr. Meadows. Right. And so if we look at that, this is not
a problem of an administrative law judge just sitting back
eating bonbons?
Ms. Griswold. No.
Mr. Meadows. Okay. All right.
Ms. Griswold. We have a very dedicated workforce.
Mr. Meadows. I think we can both agree on that.
At this particular point, and you've done your homework,
you've looked at the previous hearings, would you say an
estimate under our current rates right now based on the
estimates of potential backlog of 1 million cases, I guess, was
in the budget assessment that we got, that that is an 8- to 10-
year backlog to adjudicate them based on current staffing and
workload efficiency?
Ms. Griswold. I think if you do the simple math, which is,
you know----
Mr. Meadows. I'm a simple guy, so simple math, you know.
Ms. Griswold. --workforce divided by adjudicators, you
know, of course that is the number you come up with. It does
not, however, take into account the efficiencies that we are
putting in place, the initiatives both at CMS and within our
pilot programs.
Mr. Meadows. So granted, you've got the--I saw the guy
smiling, so he's part of your efficiency thing there. And I see
that, and so I'm encouraged by that.
You are familiar with the fact that the law says that
you're required to have a 90-day turnaround. That's the law.
That is the law.
Ms. Griswold. Yes, that is--the statute envisions a 90-day
processing time.
Mr. Meadows. Yeah. And you're also familiar with the fact
that the intent of Congress was to have that 90-day turnaround?
Ms. Griswold. Yes. I----
Mr. Meadows. Okay. Because--go ahead.
Ms. Griswold. No, I was just going to say, I think that's
part of why OMHA--if you look back at the legislative history,
that's part of why we were established in the first place was
to deal with processing delays in Medicare cases that existed
at Social Security.
Mr. Meadows. And you are familiar with the fact that you--
because the intent of Congress is that, that there is a law out
there that authorizes you to take moneys from other trust funds
to do three things: hire additional administrative law judges,
provide additional training, and increase the staff of the
Department Appeals Board, those three things. You are familiar
with that?
Ms. Griswold. I think you're talking about the
reprogramming authority.
Mr. Meadows. Well, it's Public Law 108-173, subtitle D, if
your counsel would like to look at it. I mean, I've got a copy
of it. But with that, even the budget requirement or request
that you guys have made, I guess, require for additional seven
units; is that correct?
Ms. Griswold. Our fiscal year '14 enacted level allows for
seven additional ALJs.
Mr. Meadows. So what are we doing on 2015?
Ms. Griswold. The President's budget----
Mr. Meadows. Yeah.
Ms. Griswold. --for 2015 would give us an additional 17
teams.
Mr. Meadows. Right. So I've done the simple math based on
the President's budget and based on where we are, and does that
get you to 90 days?
Ms. Griswold. No.
Mr. Meadows. Okay. Does it get you to less than 3 years?
The answer is no.
Ms. Griswold. Well, the initiatives--I want to qualify
that. If we're talking about given current authorities and
current funding, then the answer is no.
Mr. Meadows. Well, your request. It's the President's
request. So your request, at this particular point how many
years would somebody have to wait for justice?
Ms. Griswold. I think it is----
Mr. Meadows. 5.3 years?
Ms. Griswold. I think it is impossible at this point to
really pin down how long they will have to wait.
Mr. Meadows. Okay.
Ms. Griswold. We are--you know, we do the math as, I think,
an outside limit.
Mr. Meadows. All right. Well, let me close with this, then:
How many businesses have to go out of business before we start
abiding by the law?
Ms. Griswold. The 90-day timeframe that's envisioned by
Congress----
Mr. Meadows. Ninety-day law. It is law. I can give you a
copy. Ninety-day law.
Ms. Griswold. I also have to point out, and it is in the
statute, we recognize that, there is, however, a safety valve
in that statute as well, which I need to point out, which is
the right to escalate claims. And I think that also
envisioned----
Mr. Meadows. So we just moved the 10-year backlog up to
number four or number five? That won't work either. I mean,
I've looked at their budgets.
Ms. Griswold. That is what the statute envisions.
Mr. Meadows. Okay.
Ms. Griswold. The interesting thing in this, though, is
that people have chosen not to escalate. This year we had 152
requests to date, which I believe indicates that providers and
suppliers are still finding value in our ALJ hearing process
and choose to remain in the queue.
Mr. Meadows. So your recommendation is for all those that
are watching here today to escalate their claims if they're in
this 10-year backlog? I can't imagine you would say that.
Ms. Griswold. No, it is an option for them.
Mr. Meadows. Okay. All right.
I yield back. I thank the patience of the chair.
Mr. Lankford. Ms. Griswold, we're going to take a recess.
The votes have been called, and so we're headed that direction,
and we will recess until the conclusion of the votes. The
votes, I would estimate, are going to take somewhere around 30
minutes, maybe a little bit longer to be able to go through,
and then we will reconvene at that time.
Ms. Griswold. Great.
[recess]
Mr. Lankford. I apologize for the delay there with the
votes. We do not expect votes to interrupt us. Since we're
voting about--9 o'clock is our next vote series. If we're still
meeting in our hearing at that time, this would be not a good
sign. So we don't anticipate that as well. But I do apologize,
that 30-minute delay ended up being about an hour and 20 or so
before it was all said and done.
We will go back and forth here to be able to process
through questions. Ms. Speier, if you're okay with the number
that's here, I'm okay if we just start opening up questions,
and we'll just start to formally go through this.
Ms. Duckworth, is that all right with you?
So we'll kind of turn clocks off. We'll start addressing
questions, and I have no particular order on that. That way, if
you want to be able to interrupt during the questioning time,
you're free to be able to do that to be able to get a follow-up
question to any statement that's made.
Ms. Griswold, what that will do is that changes our format
some. It won't change yours. We typically do a very structured
5-minute time during our first round; our second round of
questioning, it's a more open process where any Member can ask
a question at any time. Just so if you make a statement, the
Member that asked you the question is not limited to the one
that does the follow-up. Is that fair enough?
Ms. Griswold. Absolutely.
Mr. Lankford. And so we'll just open this up to more
conversational style.
Ms. Griswold. I'm just answering questions, so----
Mr. Lankford. Great. It doesn't change, I guess, what's
happening on your side of the dais very much at all. It just
changed a little bit on our process.
I do have a question on the numbers that you submitted to
us on the recovery audit appeals work, percent increase in the
nonrecovery, I should say. I want to be able to go through a
couple of these with you.
You list out on the disposition outcome rates fully
favorable, partially favorable, unfavorable, remanded, dismiss
and other. Can you give us a quick definition on what that
means to the provider for each of those in the process that
happens?
Fully favorable, obviously they've overturned the previous
two, it comes back to them; partially favorable, there's a
little bit of a change, and I'd like some definition there;
unfavorable, basically they lost entirely the previous two.
They're going to appeal, then, to the fourth level at that
point.
Ms. Griswold. Right.
Mr. Lankford. Give us partially favorable, what that means,
remanded, dismiss and other.
Ms. Griswold. Yeah. Partially favorable, our appeals
consist generally of a number of claims that will be submitted
with each appeal, and so a partially favorable decision would
say that some of these claims are payable, and some of these
claims are not payable. And so that would be what that is.
Mr. Lankford. So fully favorable, if a provider comes in,
and they've got 10 different cases in front of you, they want
all 10 of those. It may be another one that's another provider
comes in, they bring in 10 cases, they want 7 of them or 2 of
them or whatever it may be. So we don't know if they want 1 of
those or 10 of those in that case, correct?
Ms. Griswold. Exactly.
Mr. Lankford. Okay. So unfavorable, they lost all of them?
Ms. Griswold. Right.
Mr. Lankford. And tell us about remanded and dismissed.
Ms. Griswold. The remanded, we do have some authority to
send cases back to the lower level or to the QIC if there is
information that we need from them and that information is only
available to--you know, from CMS and its contractors. And so we
can do some limited remands.
Mr. Lankford. Okay. With Part A, that seems to be a very
high percentage that's actually being remanded and coming back.
Do we know what happens then? Once they go back down to the
second level, what occurs?
Ms. Griswold. Well, actually, with most of these, they have
come back to us, and this large number was related to the Part
A/B policy issue, which was resolved by CMS through rulemaking,
and so those are coming back to us.
Mr. Lankford. Okay. So help us understand the order there.
When you're talking about it's coming back to us, that meant it
went to the fourth level, it came back to you?
Ms. Griswold. Yes.
Mr. Lankford. What does that mean? So talk us through how
that happens.
Ms. Griswold. Well----
Mr. Lankford. Because this is a very high number here.
You're talking about as many are remanded as are found fully
favorable, partially favorable and unfavorable combined.
Ms. Griswold. Yes. And in these cases, many of the judges
decided to remand them. You know, they're basically questions
about whether or not claims would be paid as inpatient claims
under Part A, or whether they would be paid as outpatient
claims under Part B. That was, you know, the basic issue. And
so in order to get--many of the judges felt they needed
additional information in order to make that decision, and they
sent these claims back to the lower level to get that
information.
What has happened as a result of CMS' rulemaking and--these
cases are actually going to be coming back to us. And I think
they have come back to us.
Mr. Lankford. Okay. So they're remanded, you got the
additional detail, it's now coming back to you. How does that
show up in our statistics here of what we're trying to see?
What we're trying to evaluate is what's really happening in
these cases. When a very high percentage of remand and dismiss,
it's hard to be able to tell what's really going on.
Ms. Griswold. Well, and we don't double count them. I think
that's the important thing. They don't recount into our receipt
levels when they do come back to us, you know, because they're
not fully disposed of. The cases are still--still need an
adjudication at our level. And so when they come back to us, we
adjudicate them within the process, and then we would send them
on. They either get paid, or, you know, they don't get paid,
and many of them will get appealed.
Mr. Lankford. Okay. So I'm still trying to track this.
They've gone through the first two levels with CMS.
Ms. Griswold. Yes.
Mr. Lankford. They come to you?
Ms. Griswold. Yes.
Mr. Lankford. There's not the information you need to deal
with inpatient, outpatient, whatever that may be. You're
remanding it back to CMS?
Ms. Griswold. Yes.
Mr. Lankford. They're getting additional information, and
then it comes back to you again?
Ms. Griswold. Yes, that's right.
Mr. Lankford. Okay. So there's now, one, two, three, four,
five levels so far. Excuse me, five different events within the
first three levels.
Ms. Griswold. Five hand-offs.
Mr. Lankford. Right. They're come back to you again?
Ms. Griswold. Yes.
Mr. Lankford. And then I should look at this remand that is
sent back, it would be basically this same percentage between
fully favorable, partially favorable and unfavorable, then? You
would expect that, because you're saying it's not double
counted.
Ms. Griswold. No, it's not a double count.
Mr. Lankford. Right. That's what I'm saying. But when it
comes back to you again, I should expect it to be something
similar to this percentage that's coming back? I'm trying to
find out what happens when it's remanded. Are they more likely
to be found favorable or unfavorable when it comes back after
being remanded?
Ms. Griswold. I don't think that--the remand doesn't
predispose it to any sort of disposition when it comes back.
When it comes back to us, we adjudicate it as all other claims,
and, you know, we'll have a hearing on it and make a decision.
Mr. Lankford. So this is somewhere around 60 percent--just
Part A--around 60 percent, 65 percent being found fully
favorable when they're coming to you. I should expect if
they're remanded, it's about the same percentage coming back
again.
Ms. Griswold. Yeah.
Mr. Lankford. That once they're remanded, and they get
through that--so basically if they are very, very persistent in
Part A at least, pretty good chance they're going to be found
fully favorable.
Ms. Griswold. I think if the percentages hold true, then
you can use those percentages to say what will happen with the
remands when they come back.
Mr. Lankford. Okay. And that's approximately how long?
Because, again, getting to you the first time, they have
consumed 3 years in the process. Then it gets remanded, it goes
back to CMS, they handle it in 3 months, whatever it may be,
and then they're waiting back in line again. That may be
another 3 or 4 years to get back in line to get to you. So a
remand is an incredible amount of time.
Ms. Griswold. It's my understanding that these cases are
really already back with us, that they were sent back in bulk,
and so these are already back in the hearing queue. So, but as
far as how long that took, that's a number I'll need to get
back with you on.
Mr. Lankford. That's what we're trying to figure out,
because the remand is a new number that we're trying to track
based on what we got last night on this. I'm trying to figure
out if it's 3 years to get to you and get a decision; it gets
remanded, goes back, and they're back in the queue again, so
now we're up to 6 years minimum to get fully through all five
of those steps.
Ms. Griswold. I believe--I will check on this for you and
clarify it, but I believe that they retain their spot in the
hearing queue when they are remanded.
Mr. Lankford. Okay. So once CMS makes the decision, they're
right back to you again quickly?
Ms. Griswold. And they're right back into the queue where
they were when they left us, because we haven't given up
jurisdiction of the claim, you know. We've sent it back for
some more information, but it's still with us. And generally it
would come back to the same judge who had it when it was sent,
when it was remanded.
Mr. Lankford. Okay.
Ms. Griswold. This was--this year was an aberration. You
can--you know, it was a very, very high number.
Mr. Lankford. Right.
Ms. Griswold. And we're not seeing that in subsequent
years, and we didn't see it in previous years.
Mr. Lankford. Okay. And you feel that's because of the
whole issue about inpatient, what's inpatient, what's
outpatient, that was unique to this year?
Ms. Griswold. Correct. Correct.
Mr. Lankford. Is it still with the two-midnights rule and
all of that?
Ms. Griswold. Yes. Yes.
Mr. Lankford. What a fun rule. That's gone really, really
well. The hospitals love it.
Ms. Griswold. Well, we're waiting to see what impact it
will have at our level. We have not seen the impacts of that
rule at our level yet.
Mr. Lankford. I have yet to find a fan of that rule, by the
way, anywhere. And that seems to be one of those issues that
doctors in hospitals raise consistently saying, this affects
our decisionmaking. That wasn't your decision. I'm not blaming
you. But I would expect there would be quite a bit coming at
you because there's a tremendous amount of frustration around
that particular rule, and----
Ms. Griswold. Well, and I think this is something that we
are watching and need to watch. We need to continue to see what
the appeal rates are in this Part A and Part B inpatient/
outpatient arena.
Mr. Lankford. Let me ask two more quick questions on this,
then I want to be able to share this time, as well. The
``dismissed'' and ``other.''
Ms. Griswold. Yeah, the dismissals are cases where, for one
reason or another, usually it's because the appellant hasn't
properly filed their request for hearing, or perhaps they have
abandoned their request for hearing in the process by not
showing up for hearing and that sort of thing, and so the cases
are dismissed at our level. That is a final disposition of
those unless they appeal that dismissal to the Medicare Appeals
Council.
Mr. Lankford. So that is an unfavorable sitting out there,
but it's basically an unfavorable based on the individual
didn't show up, didn't file, didn't complete their process.
They started the process, but didn't complete it.
Ms. Griswold. Correct.
Mr. Lankford. But the previous decision would still stand,
which was unfavorable?
Ms. Griswold. That's correct. The QIC decision becomes the
final decision.
Mr. Lankford. Okay. What is an ``other''? This sounds like
``present'' on our dais.
Ms. Griswold. The other, I will actually--oh, okay.
Escalations. It would include escalations to the Medicare
Appeals Council. As I mentioned, we have about 152 of those.
Occasionally we have an expedited access to judicial review,
but those are very, very rare.
Mr. Lankford. Okay. Thank you.
Ms. Speier. Thank you.
I'm still a little flummoxed by this remanded number. I
just added up the fully favorable, the partially favorable and
the unfavorable and came up with the number 21,846, which is 9
from this 21,855. So this remanded number that you say get back
in the queue, are they getting back in the queue in FY '13, or
are they getting back in the queue in FY '14?
Ms. Griswold. I believe that they came back in FY '13 or
early fiscal year '14 right about the time that CMS
Administrator Tavenner issued, you know, her rulings on this.
Ms. Speier. But since the number is so close, and maybe
that's just part of the aberration, that would mean that
virtually every one of these cases was remanded because there
was inadequate information?
Ms. Griswold. No, these are not--it's not a cumulative
number. I understand that they are close to the same amount,
but the remands are exclusive of this fully favorable,
partially favorable and unfavorable. It's a separate category.
Ms. Speier. Okay. So it's a separate category, which would
mean that we're not talking--we're talking about close to
50,000 just in Part A if you take all of these numbers and add
them together, give or take?
Ms. Griswold. Yes.
Ms. Speier. Okay. All right. Let me ask you this: ALJs
don't have medical training, correct?
Ms. Griswold. No, as a general rule, they don't. I don't
know whether there are any who actually have dual
certifications, medical and legal, but they are attorneys who
have been selected off an OPM register.
Ms. Speier. Now, because they don't have medical training,
they are somehow trying to determine whether or not a procedure
was appropriate or not appropriate, correct?
Ms. Griswold. Reasonably--medically reasonable and
necessary, yes.
Ms. Speier. So is that system flawed just at the outset?
Ms. Griswold. Well, we have some extensive training for
them that is conducted. When they come onboard, we do a
training session for them that goes over very much of this, but
lawyers are involved in medical/legal issues in many, many
areas.
Ms. Speier. But they're advocating typically for one side
or another and not judging whether something is appropriate
medical procedure or not, whether someone really needed this
procedure. It's more of a philosophical question. I don't--I
mean, we obviously have engaged in this for a long period of
time. I just find it somewhat odd that in the end there are
attorneys like you and me who have been trained a certain way,
but don't know whether this was an appropriate urology
procedure or not.
Ms. Griswold. Well, but in essence, what they're doing is
making a judicial decision that is based on the evidence that's
presented to them. And, you know, in our setting, that includes
the written record, the documentary evidence, and generally
during the course of a hearing also some explanation of medical
necessity from either a provider or supplier of the services.
And so that is--you know, that's kind of the way this system is
set up for us to be able to rely on the opinions of----
Ms. Speier. I'll let you read your note so you can respond.
Ms. Griswold. Yeah. Essentially it's the same thing that
I've been saying, you know, that we look at the record to
determine whether the standards for coverage have been met.
Ms. Speier. So I think we're all troubled by the fact that
54 percent, at least that's the record that we have heard, of
the appeals in Part A are sustained. Now, you said earlier that
the figure for the first part of this year is less than half
that that are fully favorable, but fully and partially, to me,
need to be lumped together. What is the figure for 2014 for
fully and partially favorable?
Ms. Griswold. I don't have a percentage for that.
Ms. Speier. Could you get that for us, though?
Ms. Griswold. I certainly can.
Ms. Speier. Okay. So here is the dilemma I see. Fifty-four
percent of the appeals are sustained. So in the medical
profession, if you've got a better than 50/50 chance of being
sustained, you're going to appeal. So your volume is going to
continue to increase as more and more providers recognize that,
hey, this is a pretty good--your odds are really good here. And
when you have an ALJ who is looking at a set of circumstances,
is not a physician, but is trained, and is looking at, well,
you know, from my perspective as someone who is, you know, not
in the profession, it could be a close call. The procedure has
been performed. It's not like there hasn't been a service that
has been actually provided in most of these circumstances. So
you're going to err in favor of saying, okay, we're going to
sustain this appeal.
Ms. Griswold. Yes.
Ms. Speier. So at some point I wonder whether we're going
to have diminishing returns here. That's more of a provocative
question, rhetorical question at this point. But I do think
that the construct probably should urge us to think about
whether it's the way we should be doing these appeals.
Ms. Griswold. Uh-huh.
I would like to clarify one thing here, which is that the
percentages you're looking at are on the recovery audit
appeals. And the reversal rates on those appeals have been
higher than the general reversal rate for the agency, which--
you know, if it includes all appeals. So for 2014, and, again,
the numbers I have are fully favorable decisions, but it was
just 19.3 percent.
The numbers have been--I'm sorry, that was fully favorable
OTRs, and I keep going to that number. I will get you a number
on the reversal.
Ms. Speier. Now, the other thing I've been told is that
when CMS actually is present at these hearings, that the
decisions are not sustained, but the CMS representative is
oftentimes not present. So that suggests to me, again, that we
have a system that isn't properly--isn't operating properly,
because we want fairness across the entire spectrum.
So if one provider shows up, has their appeal, and the CMS
person shows up and it's not sustained, but another provider
shows up, same sort of circumstance, but the CMS person is not
there and it is sustained, we're not providing equal protection
under the laws.
Ms. Griswold. Uh-huh. Let me--the CMS, what we have found,
and there is very limited data on this, and it does come from
CMS, but when there is CMS participation at the hearing, the
reversal rate does go down. And----
Ms. Speier. By how much; do we know?
Ms. Griswold. I think it was about 6 percent, if I remember
correctly. It was from about 46 percent. It was only over a few
months of data that we have. I'll get you the exact numbers,
but from about 46 percent down to 40 percent. Yeah, 40 percent.
And as far as the reversal rates go, if I could, I've got
that number now which is on the dispositions, the overall
favorable rate in '14 is 35.2 percent. We have been doing a
number of things which have been designed to bring our policy
interpretations in line across all levels and to develop some
consistency in adjudication. Part of that is training, and we
have had--approximately 20 training sessions have been
delivered by CMS, their doctors and their policy experts to the
administrative law judges since 2010.
And so what you will see if you look at the historical data
is that the reversal rates have actually been going down. They
were at a high in 2010, 55.5 percent fully favorable, and that
is now down to 35.2 percent.
Mr. Lankford. Why?
Ms. Griswold. I think that the training efforts have--you
know, have a lot to do with that.
Mr. Lankford. So you have a better quality of decision?
Because they're dealing with every case in front of them having
to make a decision.
Ms. Griswold. Yes.
Mr. Lankford. So the question is the cases coming to you,
they either made better decisions at a lower level, or there's
something that's happened at the ALJ level with better training
that you're making better decisions, and the decisions earlier
you were finding people fully favorable more often than what
would be consistent with policy.
Ms. Griswold. Or that joint training leads to better
consistency among adjudication levels.
Mr. Lankford. Well, that still would mean that at some
point you've got some people making fully favorable decisions
that should have been partially or unfavorable. If you're
saying better training has fixed that, that would say there was
an issue at some point that we were doing too many fully
favorable or partially favorable.
Ms. Griswold. I don't think I would go so far as to say it
has fixed it, you know, but I would say that it has improved
it.
Mr. Lankford. Has changed.
Ms. Griswold. And I think the goal is, you know, as
Congresswoman Speier points out, the goal is to have the case
paid; if it is a validly payable claim----
Mr. Lankford. Yes.
Ms. Griswold. --to have it paid at early as possible and
keep them from reaching the ALJ level.
Ms. Duckworth. Mr. Chairman, may I add a little to this?
Mr. Lankford. Sure you can.
Ms. Duckworth. I just want to touch on this. Is there
training coming from you, the ALJ, back down to CMS, feedback
back to CMS? And is CMS accepting that at the RAC audit? And
I'm going to use an example that's happening in the orthotics
and prosthetics industry where after an artificial limb is made
and delivered to the patient, the claim is being denied by RAC
audits because the actual words ``patient is an amputee'' does
not appear in the physician's notes. But the words ``patient
requires artificial limb or prosthesis'' appear, and the
Medicare history includes payment for the surgeon to conduct a
limb amputation.
Ms. Griswold. Uh-huh.
Ms. Duckworth. And so many of these denials could be
eliminated if when they get to--and then these are, you know,
getting reversed at ALJ.
Is there feedback going back down to the CMS saying, look,
just because the exact words does not appear in the surgeon's
note that the patient is an amputee doesn't mean that you deny
these, because if you look, it says that the physician is
saying they need a prosthetic, and we paid them to amputate a
limb.
And so are you in CMS and the RAC audits looking at
different records? Are you--because, you know--I----
Ms. Griswold. No. I mean, as a general--as a general rule,
we review the same record. Now, there are some exceptions to
that. There's a good cause exception which allows additional
evidence to be presented at the ALJ level. But we are supposed
to be deciding things on the same record.
What does change significantly is the fact that we do have
a hearing. And so at our level we are able to, you know,
question the provider/supplier, receive some explanation, and
then make a decision. That becomes part of the evidence that's
in front of us.
Ms. Duckworth. But my understanding is that the auditors
are not allowed to consider the O&P professional's notes, but
those notes are considered part of the physician's record, and
they show up under the physician's record. So the O&P, the
person who makes the artificial leg, his notes--the RAC
auditors are not allowed to look at his notes. They only look
at the physician's note. But when you look at the physician's
note, you look at the entirety, which includes the person--the
prosthetist's notes.
Is there feedback coming from you to CMS to allow their RAC
auditors and the lower levels to say you need to look at the
prosthetist's notes, because you're pushing these people into
the system? And it's ridiculous when someone is being--you
know, something as simple as ``patient is an amputee'' is
missing from a record from a guy that we paid already to have
his leg amputated.
Ms. Griswold. Yes. And we do have regular meetings with CMS
and with their appeals group within CMS. I think those happen
on a weekly basis? Weekly basis. And when we identify a trend,
we would bring that up at those meetings, or if it was
significant trend, I would bring it up with Marilyn Tavenner.
I'm not aware of the specific instance that you are describing.
Ms. Duckworth. Oh, it's more than one. We have 100
orthotists and prosthetists in this country who have gone out
of business waiting to be reimbursed and have gone out of
business, and so it's more than one. And I am sure that we can
get you a lot of those examples.
Mr. Meadows. Yes.
Ms. Griswold. You know, as we become aware of them, I think
that's part of the, you know, part of the issue. Our judges are
individual adjudicators, and so we have to become aware that
there is a trend. And when we do, we have those feedback loops
in place, and we have--we are able to do that.
Ms. Duckworth. How do you spot a trend? Do you have a
system in place at the ALJ level to figure out, to find those
trends? And I think Mr. Meadows, my colleague from----
Mr. Meadows. Well, I just want to reiterate what the
gentlewoman from Illinois was talking about. She's exactly
right, and this is not just unique to her particular group that
is--told her. I mean, we've got physicians--we've got
physicians who literally go through step one and step two that
have complete records.
And it has to go to you before you look and say, oh, gosh,
it's a complete record, and they've waited how many months or
years to find it. And it's crazy stuff, Ms. Griswold. I mean,
you know, she's given that. I got examples. I mean, after this
last hearing, we started hearing from all over the country from
claims that were denied because the date instead of being at
the top was at the bottom. Or the physician, you know, had
signed his name in this spot, and they weren't taking--I know
we can't fix stupid, but it seems like that that's what we've
got to do here, because it's just, I mean, a reasonable person
would do this.
And you talk about trends. I don't know how you define
trends, because you've got adjudicators that are adjudicating
across the OMHA system. So what one adjudicator is seeing as a
trend in his or her jurisdiction, it doesn't work. And so I
just--I appreciate the gentlewoman yielding. I'll yield back.
Mr. Lankford. Go ahead.
Ms. Duckworth. I just have one final thing, and that is as
you go to meet with the newly confirmed Secretary Burwell, I
was hoping that you would consider having a conversation with
her about granting the same kind of relief from RAC audits that
was being granted to hospitals under Part A, through the work
under the two-midnight rule, to Part B providers like those in
orthotics and prosthetics. If we're going to grant it to
hospitals under Part A, I think that we need to consider
granting it under Part B, especially since there is a halt to
the hearings at this point.
Thank you, Mr. Chairman.
Ms. Griswold. I'll certainly convey that.
Mr. Lankford. Ms. Lujan Grisham, would you want to jump in?
Go ahead.
Ms. Lujan Grisham. Thank you, Mr. Chairman.
And at the risk of piling on now in the last couple of
comments and statements, I have the same concern. I applaud
that you've introduced new initiatives so that your
productivity is better, but now we're minimizing; my
information says that, you know, the average hearing is now 2
hours, and given the complexities--although we haven't talked
about the complexities, we've talked about the easy stuff--I'm
not sure gets addressed. And while I know that given that we
now have an incredible backlog, and we are struggling with
this, it's time to do more than just sort of figure out the
steps, how we're touching these cases, how we're cross-
communicating, what the training looks like. We have to maybe
do something up front, and the up front is nobody on this
committee, and I daresay no one in Congress, is willing to
tolerate waste, abuse and fraud. We want you, everyone in the
system, to do everything you can not just to minimize it;
eradicate it.
But these are clearly administrative issues. And while I
do, I expect providers to be as administratively competent as
they can, I can't with consistency, and I'm a lawyer, even read
a Medicare EOB. Given that, the likelihood that you make
mistakes, simple; the form says put the date at the bottom, but
that form was updated this year, I've got 200,000 forms from
last year, and instead of throwing those away, we're just going
to--and no one pays attention to that.
And the fact that we are doing this under a waste, fraud
and abuse context, and I think that's important, but we're
closing these businesses who aren't getting paid, and there's a
lot of small providers. And again, I know that you've heard all
this, and we appreciate it, and I agree with my colleagues, I
want fairness. I--just because you're a big provider, I don't
think that a big hospital system should have to wait and be
penalized in this fashion.
But what's critical in a rural and frontier State like mine
in New Mexico, that means that an entire community in a place
like Gallup, where in one of--in my district in Torrance
County, there aren't any providers, there aren't any durable
medical equipment providers, there aren't any small oncology
providers. There are none. You have zero access. And we don't
even have the right tools or strategies to recreate these
practices.
So I'm really interested as a result of understanding now
the situation between how they're adjudicated, what your
initiatives are, how you're trying to manage these cases, I
feel--I appreciate the weekly meetings, but I would encourage
you to go back to Ms. Tavenner and the Secretary and be really
clear, at least some of these comments--and I think it seems to
me like we're all on the same page on the subcommittee--that
we've got a problem on the front end.
So we do want updates, I do, I want information about what
you're doing on the back end. And I want to be careful that
people feel like because it's cumbersome, that they can win on
an appeal even when there might be a material problem. But I
think the bulk of these cases and the reason that you now have
half a million cases coming to you on appeal is because they
are administrative issues that don't come anywhere close to
fraud, waste and abuse, and we need to deal with that issue
sooner than later.
And I don't know that you--is a comment to make back except
that my expectation is that you'll take this urgency back,
because we are--with all the work we've done to maximize
access, this effort is minimizing it to the highest degree, and
it has a chilling effect on our patient populations.
Ms. Griswold. I would certainly take that back. And, you
know, if there is a positive that is coming out of this
situation, I think it is that the Department is viewing this
workload more holistically. Although there are three separate
agencies, CMS, OMHA, and the Departmental Appeals Board and
Medicare Appeals Council, that work with these workloads, the
Department is taking an active role in trying to resolve
things. And so I will take your concerns back. I certainly
share them.
I would also say I was very pleased when I came here to
OMHA to be part of an agency that had for the most part met its
90-day time frames. You know, as an administrator myself, I
find the delays very troubling and unacceptable. You basically
have here, though, a workload and capacity problem at our----
Ms. Speier. And can we get to that for a moment, because, I
mean, we can sit here and complain for hours, and nothing's
going to change, because the addition of 17 new ALJs, talk
about the simple math that my good friend Mr. Meadows had
referenced. There's 500,000 appeals that will be backlogged by
the end of this year. You divide that by 1,220, and you're
working at optimal levels, and I don't know that you can do any
more than that, and, frankly, I don't know that we would want
you to do more than that, because giving less than 2 hours to
every case is probably unfair and would be slipshod. That would
suggest that we would need 410 new ALJs if we wanted to get rid
of that backlog in a year, 410, and you have asked for 17, or
you have been given 17.
So we're basically saying to all the providers out there,
suck it up. Excuse my language, but that's basically what we're
saying to them. We're saying that we don't--we're not willing
to deal with this backlog in the reality that it--we're putting
blinders on, we're going to add a few more, and cross our
fingers and hope that with a few new reforms that you put in
place, that it's going to--but it's not going to reduce it to
the extent that we're not going to be back here next year with
the same discussion.
So how would you comment to that?
Ms. Griswold. Well, there are several things. One----
Mr. Lankford. Ms. Griswold, I'm sorry to interrupt. Can you
pull your microphone a little bit closer to you?
Ms. Griswold. Sure.
Mr. Lankford. Thank you.
Ms. Griswold. You know, there are several funding issues
here, and, in my mind, one of the primary ones has to do with
the Recovery Audit Program and the recovery audit legislation.
I think when Congress passed the legislation for the program,
it was envisioned that that program would be self-funding out
of recoveries, but the legislation actually provides that the
administrative costs of CMS will be covered. That does not
include the administrative costs or the--of OMHA or the
administrative costs of the Departmental Appeals Board. So what
we have basically had in that regard is a workload that came in
on us that was basically unfunded.
So I think that's part of the problem, and it's a part of
the problem that I think does have a solution. And so if I were
queen for a day----
Ms. Speier. Yes. What would you----
Ms. Griswold. --you know, that would be one of the simple
fixes that I think would be possible.
Ms. Speier. Meaning what? Fix the----
Ms. Griswold. To in some way be able to----
Ms. Speier. Properly fund.
Ms. Griswold. --properly fund the--fund OMHA, and I'll put
in a plug for my sister agency, the Departmental Appeals Board,
so that the recovery audit appeals that come to the last two
levels are funded at--the administrative costs are funded out
of the program as they are at the lower two levels.
Ms. Speier. So is there enough money that is recovered by
the RACs to pay for all of the levels of appeal?
Ms. Griswold. Yes. I think that there is, yes. And, you
know, this is based on CMS' reports on the recoveries that are
coming from that program. So that is one part, I think, of the
solution.
There's some other things as well. We're doing these two
pilots. One involves alternative adjudication models, you know,
using a settlement conference facilitation. If that pilot is
successful, I think we need to look at some things like that as
well.
Mr. Lankford. Is that being piloted in a geographic
location or with a certain type of file?
Ms. Griswold. It's being piloted at the Office of Medicare
Hearings and Appeals. There's no geographic location. It's
being done with Part B, I believe--yeah, Part B claims right
now. And there's a certain time period where we are offering
these facilitated settlement conferences. CMS has agreed----
Mr. Lankford. Give us an example of what that means.
Ms. Griswold. Well----
Mr. Lankford. Real-life terms.
Ms. Griswold. Well, real-life terms, it is just--it was put
on our Web site on June 30th, so it's a very new program, and
we're waiting to see how appellants respond to it. But the
theory is that an appellant will be able to come in and ask for
a settlement conference with an attorney who is at OMHA. CMS
would provide someone there with settlement authority who would
be able to discuss the merits of the claim and possibly resolve
them short of them having to stay in the queue and go to
hearing. That is the theory.
While that is going on, they do not lose their place in the
hearing queue, so they would still remain there, but we're
hopeful that this will allow us to resolve some of the pending
claims.
You know, this is a two-part problem. There are the pending
claims that we have; there are also the receipts that are
coming in. This piece of the solution is designed to deal with
the pending cases that are already with us.
Mr. Lankford. So is it your assumption it's the slam-dunk
cases that are going to come at that settlement process? Go
back to Mr. Meadows' statement about a signature's in the wrong
spot, and they walk in and say, it's not at the top, it's at
the bottom, it's right here. Is it your assumption it's going
to be that kind of stuff coming at you, or what is your
assumption coming at you with the settlements? And are the
settlements for a lesser amount than fully paid, or is it fully
paid so they're at a faster process to full payment?
Ms. Griswold. Well, you know, I think it depends. Like most
settlement conferences, it's going to be probably a little bit
of give and take. That would be my anticipation. But if it's
something that we can, in that--the course of what's really a
prehearing conference with an attorney, point out a simple
error, a technical error or something like that in these
claims, then, you know, it is potential, it is possible that
they would be fully paid. We just--we have to wait and see how
that would work.
Ms. Speier. So this alternative dispute resolution would be
valuable to providers in particular if it was a decision that
was going to be made swiftly.
Ms. Griswold. Yes. We are----
Ms. Speier. So that becomes the appeal.
Ms. Griswold. We're trying to find ways----
Ms. Speier. No pun intended.
Ms. Griswold. --of resolving claims within our pending
workload more quickly than we can get them to an ALJ. And we're
trying to do that given our current authorities.
Right now the way the statutory scheme is structured, an
appeal cannot get out of step three, it cannot leave OMHA
without action by an ALJ. So what this would do, there would be
this agreed-upon settlement, both parties would sign, and the
judge would then dismiss the appeal. So the agreement becomes
the resolution of the claims.
Mr. Lankford. So is that listed in the chart that you gave
us as a dismissal, long term----
Ms. Griswold. It would end up being----
Mr. Lankford. --or is that--it ends up being favorable or
fully favorable or----
Ms. Griswold. It would be a--it would probably be a
dismissal, but right now we're just tracking them separately as
a settlement resolution.
Mr. Lankford. Okay.
Ms. Speier. How about the other alternative is this global
settlement discussion concept, which claimants that have very
similar kinds of cases would all be invited to come in and
participate in a global settlement, but they could choose not
to, I gather; is that correct?
Ms. Griswold. This is an initiative that is one of CMS'
initiatives, and I have to admit that my knowledge on this is
limited, but, you know, it's my understanding that it would be
a global settlement.
Ms. Speier. So that would happen before it even got to you?
Ms. Griswold. I think it also contemplates--they're also
looking at claims that are pending at all levels of the
process.
Ms. Speier. So we really haven't seen it operational yet?
Ms. Griswold. No, we have not. It's an initiative that is
still pending.
Ms. Speier. Okay.
Mr. Lankford. Okay. So I know you're communicating back and
forth with CMS, and CMS is part of the issue, and I get that,
that's not you, that you're in these regular conversations.
When we're getting to an attorney, helping them to try to do a
type of presettlement, what you're talking about, before it
gets to an ALJ, that's really something that they would have
rather had with CMS and to get this done a long time ago, to
face-to-face with someone there, resolve this, or to be able to
get on the phone and everybody looks at the same document and
tries to resolve this. If they're simple, straightforward
cases, they just want this resolved. If they are a physical
therapist that is trying to take care of his practice as well
as trying to do all the paperwork, he does not need one more
thing to do to try to chase all this stuff down. Just to be
able to leave and go do a hearing and to be in that process, or
to hire outside counsel is well beyond what they want to be
able to do. They just want resolution of simple things.
How could a process like what you're experimenting with
work in a CMS so it never gets to you? We're still trying to
figure out how do we prevent the backlog.
Ms. Griswold. Right. And I think among CMS' initiatives,
you will see mention of a discussion period, particularly with
regard to recovery audit, and I think that that could be
helpful in resolving these claims at the lower level.
Mr. Lankford. But that's not something----
Ms. Griswold. I don't know----
Mr. Lankford. --you're aware that they do? That's something
they're discussing, but that's not something that they do
currently?
Ms. Griswold. I really can't speak to that. I don't know to
what extent they have a discussion period right now.
Okay. I am informed that it's optional right now in the RAC
cases, recovery audit cases.
Mr. Lankford. But at the CMS level, they can do some sort
of discussion as well?
Ms. Griswold. I think so, but I'll have to check on that.
I'd rather get back or have CMS get back to you on that.
Mr. Lankford. I understand. I understand. I don't want to
push you outside and try to answer for them. We're just trying
to do some fact gathering as well.
Ms. Griswold. I understand.
Mr. Lankford. Because, again, we come down to the issue of
they just want resolution.
Ms. Griswold. Absolutely.
Mr. Lankford. And once the RAC contractor grabs it, files
it, lays it out there, they lose contact with them, and now
they're fighting with someone else. And really their fight is
first with the RAC folks they can't get to anymore because it's
too late. They've made their decision, and they've filed it.
And then the RAC auditor is trying to figure out--playing the
percentages, literally, that if they grab 10 or 15, they know
they're going to get 3 or 4 of these at least get paid, and
they get paid a percentage of each of them. So it's a whole
different game for them.
But for the provider, our issue all along is if it's fraud,
it's fraud, and we ought to bust them. If it's a good provider,
this should not be harder. These are the folks we need on our
team and that the American people need rather than hurt.
Ms. Griswold. I fully agree, and I think that identifying
not just Medicare fraud, but also improper payments is an
important piece of this puzzle. But what we have done, I guess,
in the zealous efforts to implement Congress' intent in that
regard, it's gotten out of balance, and what we need to do is
restore that balance at this point between the fraud efforts
and the appeal rights. And so I'm--you know, I have spoken with
the Secretary on these issues, and I know she's committed to
restoring that balance.
Ms. Speier. You know, I had a RAC in my district that was
creating a great deal of discomfort for one of the hospital
providers in my district, and it was also a hospital that was
under a lot of financial pressure to just keep its doors open.
And my experience with that particular situation suggests that
more than anything else, the provider wants to know what's
going to be approved.
Now, they could have, in fact, have been unbundling
services that, you know, would allow for more reimbursement. I
don't remember the elements of it. Sometimes, you know, the
providers are in a bind and are looking for ways to upcode or
to unbundle services. So we need to be smart about this and not
appear to be taking one side or another. Everyone should be
treated the same. But it's so important for there to be some
certainty, and some finality, and some timeliness to these
decisions.
And this backlog, I keep coming back to this backlog,
because we're not getting anywhere near addressing that even
with all of these new proposals that haven't even been tested
really. So I still think that we've got to do--whether we hire
temporary ALJs for a period of 1 year and deal with this
backlog, otherwise we haven't really accomplished much.
Ms. Griswold. And just to address that, there are very,
very limited authorities for hiring temporary ALJs, and this is
statutory under the Administrative Procedures Act. Really,
there are two ways. You can try and get a loan--a judge on loan
from another agency. Most agencies have their own backlogs.
Ms. Speier. It's true.
Ms. Griswold. And when we went forward requesting loaner
judges in April, we did not get any. So the other way is to
hire judges who have retired, and they're called rehired
annuitants, senior ALJs. Those individuals are also on a list
that's maintained by OPM. They can be hired for a couple of
years and then let go. Beyond that, an ALJ appointment is, you
know, essentially a life appointment except for removal for
good cause after a hearing before the MSPB.
Ms. Speier. So how large is this list of retired ALJs?
Ms. Griswold. How many were there? Nine--it's probably
around 100. It's not a tremendously long list, you know, but we
do have that. We requested it in April, because we do think
that temporary capacity is a part of this solution to deal with
the backlog.
Now, when you get to--when you're talking about projected
receipt levels, I do think we need to be appropriately staffed
for what we anticipate to be coming in, you know. So I don't
know if that's helpful, but ALJs are nonprobationary. When you
hire them under the APA, there's no probationary period, there
are no performance reviews, and they can't receive awards. So
those are kind of the things that make them different from
other government employees.
Mr. Meadows. If the gentlewoman would yield, I want to
follow up, because they're hitting on precisely the point and
why it's so incredibly important that you're here today, but it
really is about what's coming to you and how do we address
that.
The bigger concern that I have is is even if you hired your
hundred, it would still be shy, based on my simple math, of
what's going to happen, because this doesn't stop today. It's
growing exponentially every day. I think it's 1,500 appeals, at
least, a week. Is that correct?
Ms. Griswold. It has been as high as 16,000 appeals a week.
Mr. Meadows. A week, yeah.
Ms. Griswold. But it has been down slightly at the
beginning of this year to 11,000. We're trying to figure out
where the plateau is going to be.
Mr. Meadows. Well, I guess--I was told by Jonathan Blum
before he left that there was a policy change within CMS that
was initiated--and maybe numerous policy changes--but there was
a policy change between 2011 and 2012 that dealt with the way
that they start to refer these to you. Part of it's RAC, but
part of it was--and that he needed a legislative fix. Now, my
question to him was, if it was a policy change, why do you need
a legislative fix?
But what I'm concerned about is is what changed in 2011 or
2012 to make this number grow that you're getting when we're
not seeing payments, miss--the payments, improper payments,
actually go down? So we've seen no progress in terms of
improper payments, and yet we've got this huge problem on our
hands, and we're not saving any money.
Ms. Griswold. Uh-huh.
Mr. Meadows. So what changed in 2011 or 2012? And I'll
yield back to the chairman, let you answer.
Ms. Griswold. Okay. Well, the big thing was the recovery
audit, of course. You know, we've talked about that. That was
initially a pilot program in 2009-ish. You know, we saw I think
it was four States. And that----
Mr. Meadows. But that was an act of Congress. He indicated
it was a policy within their agency that--I don't know if----
Ms. Griswold. It's probably--I mean, there was--and it was
probably around that time period where there was a focus on
identifying improper payments. That's not tracked as part of
our--you know, we track the recovery audit separately.
Mr. Meadows. Right.
Ms. Griswold. But CMS' efforts to identify improper
payments, the ZPICs, Zone Program Integrity Contractors, and
the others, you know, Zone Program, who are really looking at
fraud issues, and there was also a coding initiative and some
other things like that, but any time there are efforts at CMS'
level that result in a denial of more claims, then at our level
there is going to be an increase in appeals.
Mr. Meadows. But that's my point. It didn't change the
improper payments. I mean, they may have done that, and it may
have been well intentioned, but we are still--actually, they
increased, if you look at the numbers. You can go on there. We
had a hearing yesterday, and so that's fresh in my mind.
But I'll yield back. I want to thank the ranking member and
the chair for their leadership on this and their graciousness
to allow me to be included.
Ms. Griswold. And if I could----
Mr. Lankford. Right.
Ms. Griswold. Could I go back to one issue that you raised
earlier, which I think I have finally kind of grasped what the
question may have been, and that has to do with our
appropriation and how that is handled? And, of course, as you
pointed out, the Medicare Modernization Act did contain
language which would authorize to be appropriated funds that
would, you know, cover an increase in adjudicators as needed.
Having said that, though, that appropriation still has to
be approved, and it does have to go through our Department's
appropriation process. So I just wanted to point that out.
I would also say with regard to our general appropriation
that, you know, we do know we've been living in challenging
budgetary times. And in the past 5 years, the President's
budget has actually only been approved for us in 1 of the 5
years. So requests that we have gone forward with, even though
they'd be somewhat modest, have really only been approved this
year, and so we appreciate that, and we're trying to do what we
can with the money that's been appropriated to us.
Ms. Speier. So--and that was approved because it was part
of the omnibus bill?
Ms. Griswold. Oh, was it part of the omnibus bill?
Ms. Speier. Why was it approved this year and----
Ms. Griswold. I don't know whether it was part of an
omnibus bill or what it was part of, but I do know that we
received President's budget this year. I'm sorry.
Ms. Speier. So is there any other statutory authority you
think you need or could use?
Mr. Lankford. Or solutions that you would propose?
Ms. Griswold. Yeah. You know, I think that there are a
number of things that are going to be coming through the
appropriate legislative process that we're looking at. I think
the two that I've highlighted from our perspective will provide
us with the greatest ability to handle our workloads and to
expand the way that we adjudicate claims at OMHA.
There are some additional things that are being considered
that--you know, through the Departmental Work Group that I know
will be coming up through the proper legislative channels.
Mr. Lankford. When will you evaluate the settlement
process? It obviously just started June the 30th, so it's just
starting. When is the target date for your initial evaluation?
Is it a year? Is it 6 months?
Ms. Griswold. No. We're looking at a 6-month evaluation.
Mr. Lankford. Okay. Can you put us on a calendar reminder
and 6 months from now send it to this committee as well----
Ms. Griswold. Certainly.
Mr. Lankford. --so we get a feel for that also?
Ms. Griswold. And we're tracking a number of metrics with
that from which we'll judge the success of the program. We'd be
happy to include you in that.
Mr. Lankford. Okay. Please do. This committee is obviously
very interested in that.
Ms. Speier. Mr. Chairman, I don't have any further
questions. I just want to thank Ms. Griswold for being so
attentive to our questions and for sitting around for an hour
and a half while we went and voted. And thank you for your
service to----
Ms. Griswold. Thank you.
Ms. Speier. --our country.
Ms. Griswold. I thank you for your interest in this issue.
It's certainly one near and dear to our hearts as well.
Mr. Lankford. Well, it's near and dear to a lot of people
in our district that not only want to deal with the fraud and
waste, and the loss, and the improper payments, which is
important to everyone, including everyone on this dais, but
also to providers that absolutely firmly, intensely hate the
RAC audit process. And when they go through it, and there is a
signature in the wrong place or a date in the wrong spot, and
they just want to get it resolved, it now takes 3 years to get
it resolved at times. So it goes from their frustration about
RAC to the frustration about getting an obvious solution that
doesn't help any of us. So finding alternative solutions like
what you're proposing on the settlement process, that they
could go through that process, if they don't like it--is what
it sounds like to me, if they don't like what happens in the
settlement, they still are in the queue to be able to resolve.
Is that correct, or do they leave?
Ms. Griswold. No. They are absolutely in the queue.
Mr. Lankford. Okay.
Ms. Griswold. And there's nothing mandatory about that----
Mr. Lankford. Right.
Ms. Griswold. --settlement process. You know, at any point,
they can exit the process.
Mr. Lankford. They just want an answer. So that's very
important----
Ms. Griswold. And they're entitled to an answer.
Mr. Lankford. They are.
Ms. Griswold. I realize that.
Mr. Lankford. They are. So that's a key thing, so if you're
working on processes to do that, thank you. Continue to press,
and if there are ways that we can help in the process, because,
as Mrs. Speier has mentioned, bringing on more ALJs is not
going to solve this. There's no way you're going to get 400
more ALJs, so there has to be another solution into this to be
able to determine how do they get answers.
Part of this, we understand well, is on CMS. You should not
have the number get to you that is getting to you. So if you
have a--and I'm looking at these percentages, and I know we've
kicked around numbers on it, but let me just mention this one
other number on it. When I look at the percentages, I pull out
the remanded, because those are coming back; that's a different
number. I pull out dismissed, because they're not even getting
to you, that's not there. And the other I can pull out.
When I look at that fully favorable and partially favorable
just for Part A, and I'm aware of the other numbers, that's
showing a 65 percent either a fully favorable or partially
favorable resolution for them if they get to you. That's
telling me the job is not getting done on the CMS side.
You should not have that high of a percentage of overturn
getting to you. There's something being missed. So part of the
issue is we've got to press on CMS to get some of these things
resolved before they ever get to you so you don't have a
backlog this high. Just statistically you shouldn't have a 65
percent overturn rate to be able to get to you. So that's not
on you, but I'm just saying publicly there are issues on the
previous two that we've got to get resolved in the days ahead.
Any other comments?
Thank you as well for spending the day, and we apologize
for the long delay in the middle of a recess.
With that, we are dismissed.
Ms. Griswold. Thank you.
[Whereupon, at 5:05 p.m., the subcommittee was adjourned.]
APPENDIX
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Material Submitted for the Hearing Record
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