What You Should Know About Appealing Medicare Claims

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A Closer Look At Overpayment Regulations

Here is the evolution of the law that controls the conduct of the national recovery audit contractors and the claim processing contractors such as Palmetto GBA.

• In 2003, Congress passed the Medicare Prescription Drug, Improvement, and Modernization Act (MMA) (Pub. L. 108-173).

• Section 935 of the MMA amended Title XVIII of the Social Security Act to add a new paragraph (f) to section 1893 of the act.

• The Department of Health & Human Services (DHHS) expanded upon the rules in Section 1893(f) of the Social Security Act.

• The DHHS codified their expanded §1893(f) rules in the CMS Manual System as Pub 100-06 Medicare Financial Management, for the Centers for Medicare & Medicaid Services (CMS), Transmittal 141. This became effective on September 12, 2008.

• The DHHS refers to the Pub 100-06 rules regarding overpayments as Change Request 6183 (CR 6183).

• The rules in CR 6183 govern the conduct of the RACs (and the claim processing contractors) as the RACs’ attempt to recoup overpayments from providers.

Author(s): 
David Mullens, DPM, Esq.

   Third, you will get back every dollar recouped by Medicare along the way. This includes interest on that money and any additional interest taken by Medicare during the recoupment process.

   The CR 6183 protects the providers by stating the RACs and the carriers are not allowed to violate your civil “due process” rights. Due process can be divided into procedural due process and substantive due process. Procedural due process refers to how Medicare takes the overpayment money from you. Substantive due process refers to why Medicare takes the overpayment money from you.

   There are a number of procedural due process rights under CR 6183. These rights are as follows.

1.    For each and every claim deemed to be an “overpayment,” the RACs and the carriers must tell the providers: the name of the patient, the date of service and the procedure code(s) at issue.
2.    When a provider files a valid (first level) and timely redetermination appeal, the carrier must stop recoupment. In addition, the carrier must send an acknowledgement of the receipt of the redetermination appeal request.
3.    When a provider files a valid (second level) and timely reconsideration appeal, the carrier must stop recoupment. The carrier must also acknowledge receipt of the reconsideration appeal request.
4.    When a provider wins (e.g. the entire amount of the overpayment claim) at the ALJ hearing level, the carrier must pay the provider the principal amount recouped by the carrier as well as interest.

   There are substantive due process rights under CR 6183. For each and every claim deemed to be an “overpayment,” the RACs and the carriers must tell the providers:

   • why the provider should not receive payment for the submitted item or procedure code, which is now considered to be an overpayment;

   • why the provider should have known the services would not be covered; and

   • why the provider was not found to be without fault in causing the overpayment.

   What happens when the RACs and/or the claim processing contractors violate the CR 6183 rules?

   In an e-mail exchange, Connie Leonard, the Director of the Division of Recovery Audit Operations for CMS, stated CR 6183 is only a “guide” for the RACs and the claim processing contractors. She thinks there are no “teeth” to enforce the rules of CR 6183 (against the RACs and the claim processing contractors).

   I strongly disagree with Ms. Leonard. Since Congress took the time to add paragraph (f) to section 1893 of the Social Security Act and because CR 6183 addresses the due process rights of the providers, I am willing to bet the ALJs will look very, very unfavorably at CR 6183 due process violations committed by the RACs and the claim processing contractors.

   In fact, if the CR 6183 due process violations committed by the RACs and the claim processing contractors are egregious enough, the provider should ask the ALJ to dismiss the entire overpayment demand. This is the exact point in the process where you get to create the “evidence” that will make the ALJ outright angry with the behavior of the RAC and the claim processing contractor.

A Step-By-Step Guide To Responding To An Appeal

   In order to best understand how you should apply the CR 6183 rules apply, let us follow what happens during a hypothetical appeal of a $10,000 repayment of overpayment demand your office has just received. Hypothetically, you receive a letter from the RAC requesting copies of progress notes on a limited number of patients.

   Staple the RAC envelope to the RAC letter and put them into a separate file. Send the RAC the exact copies of the progress notes requested and do this without adding to or altering the notes in any way.

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