CMS Report Reveals 77% of Appealed RAC Denials Are Improper

Figures Show 55% of RAC Denials Are Improper

Who will get the blame for all the mess? Democrats? Republicans? Violent Video Games?

Who is to blame for all this mess? Providers? ALJs? Violent Video Games?

If you read my previous article and then read the CMS Report to Congress for the RAC Program in FY2013, you can find figures that tell the story in the title of this article. Read the rest of this article, and you’ll find the logic and figures to show the truth of the subtitle, above.

I’ve heard that some people read the CMS Report and see CMS reluctantly admitting to problems. I disagree, entirely. In my opinion, the report is rife with cry-baby whining and an entitlement mentality, blaming everyone else (providers and even the ALJs) for any problems and delays, never accepting responsibility for the horrors unleashed on the healthcare system by a program that violated the Fifth Amendment before it even started, and should have been declared blatantly illegal, long ago.

There are cases where the RACs withdrew denials... where do those get counted?

There are cases where the RACs withdrew denials… where do those get counted?

But just to be fair, let’s reword this article’s title, to be more… what shall we call it… genuine (a concept that CMS report writers seem to be unfamiliar with). It comes out too long for a title, but here it is:  the figures in the CMS report reveal that a total of 77% of RAC Denials decided at the 3rd level of appeal are found to be improper, since they are either overturned outright, or sent back down to the QIC to be reassessed because the ALJ found the decision by the QIC to be flawed, in some way.

I don’t care how you say it… if nothing else, there is an inescapable conclusion from those figures that the RACs are wrong, and make improper decisions, a great majority of the time.

But of course, CMS doesn’t tell it that way, in their report. And of course, why would they?

Choose Your Weapon Numbers

CMS wants to only count the claims that have been decided, as of the end of FY2013, and lump them all together, so they can claim credit for every denial, as if it were a victory for truth, justice, and the American Way.

I can understand why they want to count everything at once. After all, they want to appear to be active, fair and effective, catching those devious little providers, who keep trying to obstruct their sacred mission to save the trust fund. So, they need to find ways to BURY the fact that they have only decided 38,732 appeals at the ALJ level, and have LOST there 77% of the time (52.7% sent down + 24.5% overturned).

Also, they kind of leave OUT how many appeals have actually reached that level. How many is that? Just 38,732? I found it hard to accept that number, and upon further research, using reports by the Office of Medicare Hearings and Appeals (OMHA), I have found some very different figures from what CMS has reported.

Here Come The Judge…

Notice the HUGE jump in appeals filed in FY2013. Why doesn't the CMS report included these in their figures?

Notice the HUGE jump in appeals filed in FY2013. Why doesn’t the CMS report included these in their figures? Source: 8th National RAC Summit presentation by Judge Moore

A presentation made by the Honorable C.F. “Spike” Moore, Deputy Chief Administrative Law Judge for OMHA, at the 8th Annual National RAC Summit on December 6, 2013, gave clear and unimpeachable evidence that OMHA received  a total of 215,562 appeals, through the first three quarters alone. That’s a pretty big difference from the 38,732 reported by CMS, yes? Hmmm.

Also, testimony by the Honorable Nancy J. Griswold, Chief Administrative Law Judge for OMHA, before the U.S. House Committee on Oversight & Government Reform on July 10, 2014, related that OMHA received a total of 384,151 appeals in FY2013. (Judge Griswold also related that another 509,124 appeals were received at OMHA by July 1, 2014, resulting in over 800,000 appeals pending.) Judge Griswold stated that OMHA could only adjudicate about 72,000 cases per year, given existing resources, and that OMHA was now “receiving one year’s worth of appeals every four to six weeks.” I can’t wait to see the CY2014 report to Congress, can you?

Meanwhile, where are the other 345,419 appeals (384,151 – 38,732) received by OMHA in FY2013 shown in the CMS report? Missing? I don’t see them. Now, this leads me to ask, as well, are there other appeals filed by providers that are not accounted for by CMS in this report? Is there anything coming out of CMS these days that can be trusted?

Time to Recalculate

CMS Math - or - How to Count Overturned Denials for Congressional Reports

CMS Math – or – How to Count Overturned Denials for Congressional Reports

The figures that we do have in the FY2013 report from CMS indicate that a total of 836,849 appeals were filed in FY2013, counting all levels – and admittedly, a claim filed at each level gets counted as an appeal, each time it is filed. So, some appeals are counted multiple times – as are the subsequent denials, I might add.

Evidently, the 836,849 figure includes the total number of appeals decided at each level – let’s add them up with our own calculators, just to be sure, shall we?

Level 1 Appeals Decided = 500,629
Level 2 Appeals Decided = 296,963
Level 3 Appeals Decided =   38,732
Level 4 Appeals Decided =        525
Total Appeals Decided  = 836,849

But as we have seen above, CMS has omitted or misplaced or ignored a large number of appeals filed at Level 3, so let’s add those in ourselves and see the number:

    Total Appeals Decided  = 836,849

+ ALJ Appeals “Missing” = 345,419
Total Appeals (maybe) = 1,182,268

Before we move on, here’s another question:  how can an additional 345,419 appeals be filed at level 3, if only 296,963 were “decided” at level 2?

Are the balance, 48,456 appeals, “stuck” at level 2? Did they “skip” level 2 and go right to level 3?  I know that’s actually possible (if the QIC takes too long, the provider can request to move on to level 3), but is it this prevalent? Really?

I don't know anyone at CMS anymore. Perhaps these folks went to work there?

I don’t know anyone at CMS anymore – they all quit. Perhaps these folks went to work there?

I’m not clear how there could be another explanation, besides CMS simply not counting correctly – which is pretty disturbing in itself. Is this from the same calculator that will be used to calculate the Global Settlement offers? Let’s hope not!

Now that we have a new total for appeals filed, let’s compare it to the number of denials and get a better view of how often providers filed appeals:

Total Appeals (that we know of)       = 1,182,268

Total Denials (that CMS reported)  = 1,632,658

Percentage Appealed  = 72.4%

This is a far different number from CMS’s report of just 30.7% of “Determinations Appealed” (see Appendix K1, pg 48 of the report).

Finally, we get a useful number, but one that CMS will never present to Congress:

IF      72% of RAC Denials are appealed,

 AND    77% of those are improper,

THEN  55.8% of all RAC denials are improper.

Looking Forward to Next Year’s Report

Can CMS overcome 800,000 appeals?

Can CMS overcome 800,000 appeals?

Finally, let’s keep in mind that there now must be well over 800,000 appeals now sitting at the ALJ.

No wonder CMS changed the rules, so ALJs can’t decide for Part B.

No wonder CMS has now offered a settlement, for 800,000 appeals.

No wonder they want to do the settlement and still count them as DENIALS.

If CMS gets their way, we can now imagine the CMS Report to Congress for FY2014:

Level 3 Appeals Decided = 800,000

Percent Level 3 Overturns = 0%

Now THAT’s a heroic figure, eh?

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3 Responses to CMS Report Reveals 77% of Appealed RAC Denials Are Improper

  1. Pingback: False Claims Act: an Expanding Reach in 2015 | Appeal Academy

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