A program that’s out of control (besides competitive bidding)


Audits are as big an issue—if not bigger, for some providers—as competitive bidding.

So the latest news from the Office of Medicare Hearings and Appeals (OMHA) that it will defer assignments for ALJ hearings possibly up to 28 months has put some providers right over the edge.

And I don’t blame them.

For a story that will appear in our December issue, AAHomecare’s Kim Brummett told Managing Editor Theresa Flaherty: “If CMS wants to continue this ferocious cycle of audits, they need more ALJs.”

It’s unlikely that no one provider has felt the ferocious cycle of those audits more than Gordian Medical d/b/a American Medical Technologies. Michael Watson, vice president of government affairs and corporate compliance officer, wrote in HME News a year ago about how the company’s payments were suspended for 180 days based on a review of five of 14,000 beneficiaries being serviced. As a result, the company had to lay off 10% of its work force and it landed in bankruptcy court.

After reading in HME News about the significant delays in hearings at the ALJ level, Watson emailed me. He told me that the company has 46,000 claims pending at the OMHA, and it adds 5,000 per month to the pile.

“If this 28-month delay in assigning appeals is allowed to stand, it will be disastrous to many, many providers,” he wrote. “Give the timeline of each level of the appeals process (and including this 28-month delay) and the time it takes most ALJs to publish their decisions, it will be more than four years between the date of service and the receipt of the ALJ’s decision.”

That’s worst-case scenario, but still.

And all of this when, as we reported about a year ago, 56% of the time, the ALJ reverses the decisions made by the qualified independent contractor (QIC), the previous level of appeal.

We’ve made the delays at the ALJ the subject of the Newspoll for our December issue. Chime in here. I’m sure many of you will!



I read this and have to ask where were ALL these concerns two years ago when I emphtically informed everyone this was coming.  This is an impossible hole from which to climb.  The legal and administrative cost to unravel something of this magnitude will far exceede the net result of all, IF successful, efforts.  You can't overcome an Appeal challenge without compensatory damages attached to the results.  The Third Circuit certainly stopped any chances of that happening!! 

It is currently an impossible mountain to climb!!

I was discussing this with a Provider only last week and it seems most Providers aren't aware or haven't considered that not only are these Appeals gridlocking Medicare dollars but they also impact secondary payments as well.  Not all but most secondary & Medicaid insurances pay based on what Medicare pays NOT LLOWS.  If you have money offset or held up in any way then the 20% payments are held in that gridlock.  If you appeal proves successful years later most secondary insurance statute of limitations in those cases are exhausted becuase they usually start the clock from the DOS NOT from when Medicare pays.  This means out of the gate you are 20% in the hole before paying admin & legal expenses. 

The secondary lost payments in The Nichole Medical case were a factor in the the judgement we wanted!!