The First Level of the Medicare Appeals Process, 2008-2012: Volume, Outcomes, and Timeliness

WHY WE DID THIS STUDY

The Medicare appeals process serves as an important protection for beneficiaries and providers. This study represents OIG's first examination of redetermination, i.e., the first level of the appeals process for Medicare Parts A and B. Medicare refers to the process for the first level of appeals as redetermination. This study contributes to OIG's body of work concerning the Medicare appeals system.

HOW WE DID THIS STUDY

This study focused on redeterminations processed for Medicare Parts A and B during 2008-2012. We obtained and analyzed data on redeterminations and claims processed from CMS's Contractor Reporting of Operational and Workload Data system for calendar years 2008-2012. We surveyed 18 contractors that process redeterminations for Medicare Parts A and B and interviewed 5 of them to learn more about how they process redeterminations.

WHAT WE FOUND

In 2012, contractors processed 2.9 million redeterminations, which involved 3.7 million claims, an increase of 33 percent since 2008. Although 80 percent of all redeterminations in 2012 involved Part B services, redeterminations involving Part A services have risen more rapidly. By 2012, appeals involving recovery audit contractors accounted for 39 percent of all appealed Part A claims. Contractors decided in favor of Part A appellants at a lower rate than that for Part B appellants. Also, contractors largely met required timeframes for processing redeterminations and paying appeals decided in favor of appellants, but they fell short of meeting timeframes for transferring case files for second-level appeals. In addition, contractors use information from redeterminations in a variety of ways to improve their operations and to educate providers. Finally, CMS employs multiple methods to improve contractors' processing of redeterminations, including fostering communication among contractors and implementing the Medicare Appeals System (MAS) for first-level appeals.

WHAT WE RECOMMEND

We recommend that CMS (1) use the MAS to monitor contractor performance, (2) continue to foster information sharing among Medicare contractors, and (3) monitor the quality of redeterminations data in MAS. CMS concurred with all three recommendations.