Washington

Already buried under a backlog of pending cases, Medicare's administrative appeals system is not prepared to handle changes slated to take effect in October 2002, according to a recent report from the U.S. Health and Human Services Department's Office of Inspector General.

But even if Medicare were ready to implement the appeals reforms — which are mandated by Section 521 of the Benefit Improvement and Protection Act of 2000 — President Bush's 2003 budget does not include funding for the changes.

Nonetheless, U.S. lawmakers say HHS is not off the legislative hook.

In a Feb. 12 letter to HHS Secretary Tommy Thompson, the House Ways and Means committee urged HHS not to forget the department's responsibility to follow Congressional orders that require appeals reforms to take effect by Oct. 1, 2002.

“We do not support extensions to the statutory deadlines, because we have not lost sight of why these changes were made to the Medicare program,” the committee members said. “Nor do we believe that implementation should await improvements in the administrative processes.”

The letter came in response to OIG's report, which stated that Medicare's appeals system is in no way ready for imminent change. “The current Medicare appeals system is backlogged, overwhelmed and untimely, and the problems could be exacerbated by BIPA provisions,” the report explained.

Despite these arguments, HHS is bound by law to establish a uniform appeals process for handling all Part A and Part B Medicare claims, and to shorten the appeals process significantly within the next nine months, lawmakers said.

“These provisions are law because, according to CMS, if an appeal goes through the Departmental Appeals Board level, the process takes, on average, 1,214 days,” the letter said. “It seems no exaggeration, as beneficiary advocates state, that some beneficiaries are dead before their appeals are decided.”

A CMS spokesman would not respond directly to the letter, but he said that the agency is writing a response.

In recent years, health care providers' cases have dominated Medicare's appeals system, OIG said. Now, BIPA reforms could make matters worse for beneficiaries — hampering individuals' access to the appeals process, while at the same time improving access for providers, OIG warned.

Before implementing BIPA's provisions, OIG concluded, HHS should revamp its current appeals system and should delay BIPA implementation by seeking legislation to revise the statute's effective date.

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