Other types of denials that should be monitored closely and should perhaps be on the “Medicare Denial” team’s agenda are the denials from a Medicare Advantage plan (MA).
Why do I say this? Here’s why:
• Current beneficiary enrollment in Medicare Advantage plans is significant
• Medicare Advantage plan denials may increase
• The appeal process is a bit tricky
Current Beneficiary Enrollment in Medicare Advantage Plans is Significant
Created in its modern form by the Medicare Prescription Drug Improvement and Modernization Act of 2003, Medicare Advantage is a government program that subsidizes private health insurance companies for offering supposedly more extensive health care coverage at lower premiums than traditional Medicare.
Penetration is currently significant for many Providers as 23 percent of all Medicare beneficiaries are enrolled in MA. (10.25 million beneficiaries were enrolled in 2009, which was more than twice the enrollment of 2003.)
Interestingly, MA enrollment varies widely from state-to-state, ranging from 41 percent in Oregon to 1 percent in Alaska. However, the future of MA remains unclear as policymakers grapple with its value and cost, and regulatory adjustments to the MA program are made.
MedPac reported in March 2009 that payments to MA plans cost 14 percent more per beneficiary on average than the government pays for beneficiaries in traditional Medicare. Republicans have, however, blocked planned cuts to the subsidies that private insurers receive under the MA program. Meanwhile, new regulations such as the requirement for MA private fee-for-service plans to have formal networks of providers in place starting in 2011 has caused some insurance companies to withdraw from the MA market. Yet, according to a November 2009 Kaiser Family Foundation report:
In 2010, the average Medicare beneficiary will have the option to choose from among 33 Medicare Advantage plans in addition to the traditional Medicare program, and some can choose from as many as 73 Medicare Advantage plans.
Accordingly, it behooves providers to recognize that now, the number of patients who are covered through MA plans can be substantial in your state, so denial practices of MA plans should be tracked along with other types of Medicare denials as the financial impact could be significant.
Medicare Advantage Plan Denials May Increase
It is this writer’s opinion that MA denials will increase simply because denials have traditionally been a source of revenue opportunity for payers, and because I have personally observed an increase in MA denials among Washington & West clients. Indeed, providers have observed many insurers stepping up their audit and denial activity utilizing data mining and RAC- like private contractors to handle the volume. [TIP! – We have seen audits performed on non-MA contracted providers by RAC-like independent contractors. If you disagree with the denial, do not accept the decision of the RAC-like contractor and proceed with the Medicare appeals process if necessary.]
The RAC demonstration project was apparently a source of inspiration for all types of payers. Other signs appear in the course offerings of organizations that provide educational opportunities to the insurance industry; programs on how to survive future cutbacks and new skills to succeed are becoming popular.
Perhaps most telling in lieu of reliable statistics on MA denial trends is the October 2007 American Medical Association survey of 2,202 physicians about their experience with MA. Interestingly, the surveyed physicians reported that contrary to the widely reported claim that MA plans provide more benefits to beneficiaries, one half experienced denial of services typically covered in the traditional Medicare plan.
Whether your facility receives one MA denial or many, it is important to understand the appeal process in order to fight all inappropriate denials.
The Appeal Process is a Bit Tricky
A provider’s appeal rights and appeal timeframes depend upon whether the provider is contracted with the MA plan. This is tricky for all because the rules are easy to confuse. For instance, the MA plan’s denial letters to the provider often contain erroneous information; apparently, even the MA plan can confuse the rights of contracted vs. non-contracted providers. Further, the rights of enrollees vs. providers can be confused, and there is a separate process for expedited appeals versus standard appeals.
I recommend that everyone involved with preventing and/or appealing Medicare Advantage denials review the program information housed at the CMS website at http://www.cms.hhs.gov/MMCAG/01_Overview.asp#TopOfPage. A flow chart of the appeal process is contained on the website for easy reference.
Most significantly, contracted providers have no appeal rights under the Medicare appeals process as set forth in Chapter 13 of The Medicare Managed Care Manual. Contracted providers are therefore limited to the appeal rights as described in their negotiated contract with the MA plan.
Be certain your Appeals staff is up-to-date with the appeal timeframes and procedures under the contract. Be aware that we have seen contracted provider’s appeals denied as untimely because the MA plan cites the 60 day limit for non-contracted providers, when the applicable contract may allow much more time for an appeal.
Hopefully, your MA contract is fair to both parties and does not contain terms that give the payer the ability to make the final judgment on whether a claim should be paid. In my view, all disputed claims (particularly with respect to subjective matters such as medical necessity) should be ultimately determined by a neutral party such as an Administrative Law Judge or an independent review organization.
If the Medicare health plan denies a request for payment from a non-contracted provider that is appealing on its own behalf, the Medicare health plan must notify the non-contracted provider of the specific reason for the denial and provide a description of the appeals process. The Medicare health plan must also explain that in the event the non-contracted provider wishes to appeal, the non-contracted provider must sign a waiver of liability statement which provides that the provider will not bill the enrollee regardless of the outcome of the appeal. Indeed, a provider cannot pursue an appeal unless the waiver of liability statement is signed and filed.
Except in the case of an extension of the filing time frame for “good cause”, a provider must file the request for reconsideration within 60 calendar days from the date of the notice of the MA determination. This is one of the tricky parts! The steps and time frames are different from the regular Medicare “5-step” appeals process. (The appeal timeframe under the regular Medicare appeal process is 120 days.)
If the reconsideration decision is unfavorable, in whole or in part, the MA plan must automatically submit the case file and its decision for automatic review by the Part C Independent Review Entity (IRE). Currently, MAXIMUS Federal Services is the Medicare Advantage IRE.
Reported data from 2007 shows only 19.2 percent of 28,315 cases were overturned by Maximus. So be prepared to go to the next level, a Request for Administrative Law Judge Hearing. The ALJ Hearing request must be filed within 60 calendar days from the date of the notice of Maximus’ reconsideration decision.
Understand that one of the most significant distinctions between an MA Administrative Law Judge Hearing and an ALJ Hearing with a regular Medicare Appeal is that the MA plan will more than likely have an attorney representing the plan in the Hearing. Additionally, the MA plan will likely provide a medical expert to testify on matters of medical necessity. Accordingly, it is wise for providers to have an attorney or representative who is skilled with presenting cases to an ALJ under these circumstances.
Steps 4 & 5
Proceed to the Medicare Appeals Council and then to Federal District Court with 60 days to file each step.
In conclusion, it is worthwhile to fight all inappropriate denials by Medicare Advantage plans – particularly if they are generated through an audit by an independent contractor. However, the process is a bit confusing as the rights of Providers and beneficiaries are distinguishable, and the process differs depending upon whether or not the Provider is contracted with the MA plan. Therefore, please read the program information housed at the CMS website at http://www.cms.hhs.gov/MMCAG/01_Overview.asp#TopOfPage.
About the Author
Linda Fotheringill, Esq, is a founding member of Washington West, LLC, and is a nationally recognized expert on denial and appeals management. Ms. Fotheringill successfully assists hospitals across the country, overturning “hopeless” denials and generating millions of dollars in otherwise lost revenue.
Contact the Author: firstname.lastname@example.org