House leader questions CMS plan for appeal settlements

The chairman of the U.S. House Subcommittee on Health voiced concerns about the Centers for Medicare & Medicaid Services' settlement plan for short-stay appeals in a letter to Health and Human Services Secretary Sylvia Mathews Burwell.

Rep. Kevin Brady (R-Texas), chairman of the House Committee on Ways and Means, Subcommittee on Health, noted that committee members did not learn about the settlement policy until reading it in the press, criticizing HHS for posting the notice the Friday afternoon before the Labor Day holiday weekend. "Our staff has inquired about the development and authority for a settlement process on several occasions and did not receive satisfactory responses," Brady wrote.

Brady also questioned HHS' authority to implement the process and voiced several other reservations, including what he called CMS' "all or nothing" approach. "Each discharge is unique and the circumstances that apply pertaining to medical necessity in one case do not necessarily transfer to all cases," Brady wrote, speculating CMS had prioritized how easy the process would be to implement over the due process rights of Medicare providers, which could set an "improper precedent."   

Moreover, Brady wrote, a recent MedPAC analysis found that beneficiary liabilities for inpatient stays were nearly $1,000 more than for outpatient stays. Brady questioned how HHS would address beneficiary overpayments for short stays if hospitals implement the HHS settlement process.

HHS, Brady wrote, hesitated to collaborate with the Committee on establishing the settlement process, which complicates Congress' ability to address current appeals problems. He concluded by urging Burwell to retract the settlement process posted in August in favor of working with Congress to develop a more transparent, conclusive settlement process.

CMS updated the administrative agreement offer last week, encouraging hospitals with inpatient status claims in the appeals process to accept partial payments. Hospitals have until Oct. 21 to file a settlement agreement request, FierceHealthcare previously reported.

To learn more:
- read the letter (.pdf)
- here's the MedPAC analysis (.pdf)