Providers who receive unfavorable overpayment determinations have up to five levels of appeal available to them. First, the provider may request a redetermination from the CMS claims processing contractor. Second, the provider may appeal to a CMS Qualified Independent Contractor (QIC). Third, the provider may appeal to a CMS Administrative Law Judge (ALJ). Fourth, the provider may appeal to the Medicare Appeals Counsel (MAC). Finally, the provider can request a judicial review in a federal district court.
For each level of appeal, Medicare is required to give the provider a specific rationale for denying its claims or determining that an overpayment was made. An adequate, specific and detailed explanation for denial of a claim or a finding of an overpayment is an essential procedural component of the appellate process. It provides the information to effectively dispute the determination and serves as evidence that a contractor properly conducted the review. If CMS did not require its contractors to provide an explanation for denying a claim, then it would be able to circumvent the appellate process by systematically denying claims and then changing its rationale for denial upon hearing the provider’s defense. If a determination decision does not include specific reasoning for denial of a claim, the appeals process fails to function properly and denies the healthcare provider a full and fair appeal.
This same logic applies to overpayment calculations performed through extrapolation from a statistical sample. Often, CMS or one of its contractors will audit a sample of patient medical records and extrapolate its findings to all claims submitted during the look-back period. To adequately defend against such an extrapolation, a provider needs to be fully informed of the extrapolation methodology, particularly the sample used. In The Case of Global Home Care Inc., the MAC declined to review the ALJ’s decision to not use the extrapolation conducted by CMS’s contractor. The ALJ found that because the contractor failed to produce its sampling documentation to the provider, the provider was unable to recreate the “statistically valid random sample,” thereby denying him a full and fair appeal. Thus, providers are entitled to see the Medicare contractor’s extrapolation methodology documentation.
If you have been audited or an overpayment determination has been made against you do not hesitate to call our firm and speak with one of our experienced healthcare attorneys. We will ensure that your rights are effectively protected!