In January 2018, Centers for Medicare & Medicaid Services (CMS) announced additional information regarding a new Low Volume Appeals (LVA) settlement option and an expanded Settlement Conference Facilitation (SCF) as part of its efforts to reduce the significant backlog of appeals pending before Administrative Law Judges (ALJs) at the Office of Medicare Hearings and Appeals (OMHA) and the Medicare Appeals Council (Council). A large percentage of the Part A and Part B appeals pending at the OMHA and Council levels of appeal are likely covered by the broad eligibility requirements for either the LVA settlement option or the expanded SCF. Providers and suppliers with appeals pending at OMHA or the Council should consider the pros and cons of these settlement options and be aware of eligibility requirements and deadlines for participation.

LVA Settlement Option

On February 5, 2018, the LVA settlement option became available for Medicare Part A and Part B providers, physicians and suppliers with less than 500 properly and timely-filed appeals pending as of November 3, 2017, at both OMHA and the Council collectively across all National Provider Identifiers (NPIs) that belong to an appellant. The appeals must have total billed amounts of $9,000 or less per appeal and have been fully denied by a Medicare contractor. The LVA settlement option allows for settlement at 62% of the net Medicare claim approved amount. There is no restriction on dates of service eligible for settlement. Appeals of extrapolated overpayments are not eligible for the LVA settlement option. To receive payment under the LVA settlement option, appellants must settle all claims eligible for each NPI submitted. As explained in a February 13, 2018, outreach call, CMS will only review for eligible appeals connected with submitted NPIs and will not search for additional NPIs linked with the provider.

On March 29, 2018, CMS extended the deadline for appellants with NPIs ending in even or odd numbers to submit Expressions of Interest (EOIs) for the LVA settlement option to June 8, 2018. Under the LVA settlement option, appellants must submit a separate EOI in PDF format for each NPI they choose to submit to with the subject line listing the appellant’s name, appellant’s NPI, and “Expression of Interest.” Appellants with multiple NPIs should submit EOIs for the NPIs most likely associated with eligible appeals or may consider submitting EOIs for every potentially eligible NPI. CMS will then provide a spreadsheet of potentially eligible appeals and the associated claims to the appellant along with an administrative agreement for signature.

The appellant will review and validate the spreadsheet of potentially eligible appeals and associated claims. If the appellant agrees with the details of the spreadsheet, it can sign the administrative agreement. If the appellant disagrees with the appeals or associated claims included on the spreadsheet and would like to add or remove appeals, it can submit one Eligibility Request Determination (EDR) in excel format for appellant and appeals eligibility for each NPI to CMS within 15 business days of receipt of the spreadsheet. CMS and the appellant will have 30 business days after CMS’ receipt of the EDR to resolve any discrepancies in the spreadsheet. If the spreadsheet is resolved, agreed upon and signed by the appellant, CMS will countersign the agreement and the eligible appeals will be stayed. CMS’ Medicare Administrative Contractors (MACs) will then calculate the value of the associated claims for settlement included in the signed agreement. CMS will issue one payment per agreement within 180 days of CMS’ signature on the agreement and the settled appeals will be dismissed. Appellants may withdraw from the LVA settlement option at any time prior to signing the administrative agreement and the relevant appeals will return to the appeals process.

Additional information regarding the LVA settlement option can be found here.

Expanded Settlement Conference Facilitation

Beginning in April 2018, CMS will implement the expanded SCF program for appellants with requests for an ALJ hearing or Council review filed on or before November 3, 2017, with a total of 500 or more Medicare Part A or Part B appeals pending at OMHA and the Council combined or any number of appeals pending at OMHA and Council that each have more than $9,000 in billed charges.

The requests for hearing or review must result from Medicare Part A or Part B reconsideration decisions and the requests must satisfy all jurisdictional requirements for ALJ or Council review to be eligible for the SCF program. The total for each individual claim on appeal must be $100,000 or less, including the total for extrapolated overpayments. Appeals eligible for settlement under another CMS settlement option available on or after November 3, 2017—such as the LVA settlement option, and appeals that have been scheduled for an ALJ hearing or where an ALJ hearing has already been conducted, among other things—are not eligible for the SCF program. Additional information regarding the expanded SCF may be found here.

Certain appellants may be excluded from the LVA program and the expanded SCF program based on, among other things, False Claims Act litigation or investigations; other program integrity concerns, including pending civil, criminal or administrative investigations; or bankruptcy.

What This Means for Providers

Providers with a significant number of appeals pending at the ALJ may find the settlement options are an efficient way to resolve these appeals and receive some payment for these claims. The settlement amount is a set amount that cannot be negotiated, and providers will waive its appeal rights for the settled claims. Providers should carefully analyze their pending appeals and prior success rates at the ALJ level to determine whether the settlement option is more advantageous than waiting for an ALJ hearing.

If you have questions regarding the qualifications for claims settlement options or the request process, please contact the authors.