Medicare reform update

Tuesday, September 30, 2003

WASHINGTON - Administrative law judges and trial lawyers have raised a stink over a Medicare reform proposal that would move the ALJs from the Social Security Administration (SSA) to the Department of Health and Human Services (HHS), which includes CMS.

Like the HME industry, the ALJs and trial lawyers contend that moving the ALJs to HHS would erode their independence and make them susceptible to CMS’s influence. If that happens, the chance of an HME victory during an ALJ hearing would decrease, say industry watchers.

Senate and House negotiators have signed off on the move as part of their efforts to craft a compromise Medicare reform bill. CMS Administrator Tom Scully very much supports the move, too.

“They feel they can gain some control over (the ALJs) if they bring them in-house,” said David Williams, Invacare’s director of government relations. “The argument they are making is that they can keep them better trained and up to date on the ever changing regulatory environment of Medicare. It’s a specious argument at best.”

By some estimates, 80% of all HME recoupment decisions are overturned when appealed through the ALJ process.

Legislative language that would move the ALJs to HHS, states the ALJs would remain independent, but it remains to be seen how that would be interpreted, said Cara Bachenheimer, a healthcare attorney with Epstein Becker & Green in Alexandria, Va.

On the surface, the rationale for housing the ALJs in HHS makes sense, provided they remain truly independent from CMS, Bachenheimer said.

“Right now they primarily work with folks contesting their Social Security benefits,” she said. “So when they deal with a Medicare claim, it is a foreign issue and it is a minority of their case load. This would create a team of ALJs dedicated to Medicare issues.”
Related story: Independent thinkers: ALJs balk at getting cozy with CMS