Research · 7 min read
The Appeal Levels Above a Medicare Plan
Once a plan and an independent review entity have both said no, two more federal levels exist — an administrative law judge and the Medicare Appeals Council — and each has its own deadline, its own dollar threshold, and its own kind of review.
Key takeaways
- Above the plan and the independent review entity there are three stages: an ALJ or attorney adjudicator, the Medicare Appeals Council, and a federal district court.
- The request for an ALJ hearing is due within 60 calendar days of receipt of the reconsideration notice, with receipt presumed five calendar days after the notice date.
- The amount in controversy is an indexed figure — a $100 base for an ALJ hearing and a $1,000 base for judicial review under the Part D rule — computed net of cost sharing and inclusive of prescribed refills for the plan year.
- Part D appeals may be aggregated to meet the threshold under stated conditions, and only an ALJ may rule that appeals a party sought to aggregate do not qualify.
- Council review is de novo, with a 90 calendar day decision deadline and a 10 calendar day deadline on expedited review.
- In court, factual findings supported by substantial evidence are conclusive, the Secretary of HHS is the proper defendant, and venue lies in the district where the enrollee resides.
Answer first: the ladder above the plan has three rungs
The Part D appeals subpart states its own scope, and the list is the map. It sets out requirements relating to reopenings; to hearings and decisions by an administrative law judge, or decisions by an attorney adjudicator where no hearing is conducted; to Council review of Part D appeals; and to enrollees' rights with respect to reopenings, ALJ hearings and reviews, Council reviews, "and judicial review by a Federal District Court."
So above the plan and the independent review entity sit three further stages: an ALJ, the Medicare Appeals Council, and a federal district court. The Medicare Advantage side is structured the same way, with parallel sections on the right to a hearing, requesting an ALJ hearing, Council review and judicial review.
Each rung has an entry condition, and each entry condition is written as a rule rather than a discretion. Missing a deadline or falling below a dollar threshold ends the appeal at that level regardless of the merits.
What starts the whole sequence on the Medicare Advantage side is an organization determination, which the regulation defines broadly — including a refusal to provide or pay for services in whole or in part, a reduction or premature discontinuation of a previously authorized ongoing course of treatment, and a failure to act in a timely manner such that the delay would adversely affect the enrollee's health.
The administrative law judge: sixty days, and a dollar threshold
For Part D, the right to an ALJ hearing has two conditions and no others. The enrollee must file a written request "within 60 calendar days after receipt of the written notice of the IRE's reconsideration," and must meet the amount in controversy requirement.
Two timing mechanics attach to that. The date of receipt is presumed to be five calendar days after the date of the written reconsideration "unless there is evidence to the contrary," and the request is considered filed on the date it is received by the office specified in the reconsideration notice — not the date it was sent.
An expedited hearing may be requested where the appeal involves the specified categories and does not consist solely of a request for payment for drugs already furnished, where the request is submitted within the same 60 days and only after the written reconsideration notice has been received, and where the amount in controversy is met. The regulation says the request "should also explain why applying the standard timeframe may seriously jeopardize the life or health of the enrollee," and requires oral requests to be documented in writing and kept in the case file.
The Medicare Advantage side runs on the same clock. A party must file a written request for a hearing with the entity specified in the independent review entity's reconsideration notice, within 60 calendar days of receipt of the notice of a reconsidered determination, with the same five-day presumption of receipt.
How the amount in controversy is computed
The Part D regulation states the threshold as an indexed figure rather than a fixed one. For ALJ hearing requests, "the required amount remaining in controversy must be $100, increased by the percentage increase in the medical care component of the Consumer Price Index for All Urban Consumers (U.S. city average) as measured from July 2003 to the July preceding the current year involved," rounded to the nearest multiple of $10 where it is not already one. The Secretary publishes changes in the Federal Register when necessary. For judicial review the base figure is $1,000, adjusted the same way.
The computation is specific about what goes into it. The amount remaining in controversy is the projected value of the disputed benefits, "reduced by any cost sharing amounts, including deductible, coinsurance, or copayment amounts that may be collected from the enrollee." Where the appeal is about a refusal to provide drug benefits, the projected value "must include any costs the enrollee could incur based on the number of refills prescribed for the drug(s) in dispute during the plan year." Where the appeal concerns an at-risk determination under a drug management program, the projected value of the drugs subject to that program is used, again including refills.
Appeals can be aggregated to reach the threshold, under conditions. A single enrollee may aggregate two or more appeals if each has already been reconsidered by an independent review entity, if aggregation is requested at the same time the hearing requests are filed and within the 60-day window for each, and if the appeals involve the delivery of prescription drugs to a single enrollee. Multiple enrollees may aggregate on the same terms if the appeals involve the same prescription drugs. The regulation reserves to an ALJ — not an attorney adjudicator — the determination that appeals a party sought to aggregate do not qualify.
On the Medicare Advantage side the threshold is "the threshold requirement established annually by the Secretary," the amount remaining in controversy "can include any combination of Part A and Part B services," and where the appeal is about a refusal to provide services, CMS uses the projected value of those services. If a hearing request clearly shows the amount is below the requirement, the ALJ dismisses it; if the shortfall emerges after a hearing has begun, the ALJ discontinues the hearing and does not rule on the substantive issues.
The Medicare Appeals Council: de novo, with a clock
An enrollee dissatisfied with an ALJ's or attorney adjudicator's decision or dismissal may request Council review. The standard of review is stated in one sentence: "When the Council reviews an ALJ's or attorney adjudicator's written decision, it undertakes a de novo review." That means the Council is not confined to asking whether the ALJ made an identifiable error.
The Council operates under a decision deadline. It "issues a final decision, dismissal order, or remands a case to the ALJ or attorney adjudicator no later than the end of the 90 calendar day period beginning on the date the request for review is received," unless that period is extended as the subpart provides or the enrollee requested expedited review. On expedited review the Council acts as expeditiously as the enrollee's health condition requires, and no later than the end of a 10 calendar day period, subject to the same extension provisions.
Remand is one of the Council's three outcomes, and the regulation spells out how it works. The Council may remand where additional evidence is needed or additional action by the ALJ or attorney adjudicator is required, and it designates in its order whether a decision or a recommended decision should follow. Where a recommended decision comes back, the enrollee is notified at their last known address, given a copy, and may file briefs or other written statements within 20 calendar days of the date on the recommended decision, with extensions available for good cause.
There is also a mandatory remand. The Council "will remand a case to the appropriate Part D IRE if the Council determines that the enrollee wishes evidence on his or her change in condition after the coverage determination or at-risk determination to be considered in the appeal." New evidence about a changed condition goes back down, rather than being weighed at the top.
On the Medicare Advantage side, Council review is available to any party to the ALJ's or attorney adjudicator's decision or dismissal — expressly including the MA organization itself — and the part 405 rules on Council review apply to the extent appropriate.
Court, and the limits on what a court reviews
Judicial review is available in two situations under the Part D rule: review of a Council decision that is a final decision of the Secretary and meets the amount in controversy threshold, or review of an ALJ's or attorney adjudicator's decision where the Council denied the request for review and the threshold is met.
The venue rule is fixed. Any such civil action "must be filed in the District Court of the United States for the judicial district in which the enrollee resides," or, if the enrollee does not reside within any judicial district, in the District Court for the District of Columbia. The date of receipt of the Council's notice is presumed to be five calendar days after the date of the notice absent a reasonable showing to the contrary. Where a case is certified for expedited access to judicial review, the civil action must be filed within 60 calendar days after receipt of the certification, subject to extension for good cause.
The proper defendant is the Secretary of Health and Human Services in an official capacity, and the action survives a change in who holds the office. If the complaint names the United States or another federal agency, officer or employee instead, the plaintiff is notified and granted 60 calendar days from receipt of that notice to commence the action against the Secretary.
The standard of review is deferential on the facts. Under the incorporated Social Security Act provision, "the findings of the Secretary of HHS as to any fact, if supported by substantial evidence, are conclusive." And where the adverse decision rests on an enrollee's failure to submit proof conforming to a proof regulation, the court reviews only whether the proof conformed and whether the regulation is valid.
The Medicare Advantage judicial review section is parallel: any party, including the MA organization, may request judicial review of an ALJ or attorney adjudicator decision where the Council denied review and the threshold is met, or of a Council decision that is CMS's final decision and meets the threshold, by filing a civil action in a United States district court.
Sources
- 42 CFR § 423.1968 — ScopeThe list of stages the subpart governs — reopenings, ALJ hearings and attorney adjudicator decisions, Council review, and judicial review by a Federal District Court.
- 42 CFR § 423.2002 — Right to an ALJ hearingThe two conditions for an ALJ hearing; the 60 calendar day deadline; the conditions for an expedited hearing including the exclusion of requests solely for payment of drugs already furnished; the five-day presumption of receipt; the rule that a request is filed on the date received by the specified office; and the requirement to document oral expedited requests in writing.
- 42 CFR § 423.2006 — Amount in controversy required for an ALJ hearing and judicial reviewThe $100 and $1,000 base amounts, the medical care CPI indexing from July 2003, the $10 rounding rule and Federal Register publication; the computation of the amount remaining in controversy net of cost sharing; the inclusion of refill costs and of drugs subject to a drug management program; and the aggregation rules for one enrollee and for multiple enrollees, including the reservation of the disqualification determination to an ALJ.
- 42 CFR § 423.2100 — Medicare Appeals Council review: generalThe right to request Council review of a decision or dismissal; the statement that the Council undertakes a de novo review; and the 90 calendar day and 10 calendar day decision deadlines with their extension provisions.
- 42 CFR § 423.2126 — Case remanded by the CouncilWhen the Council may remand and its designation of a decision or recommended decision; the notice sent to the enrollee when a recommended decision is returned; the 20 calendar day briefing period with good-cause extensions; and the mandatory remand to the Part D independent review entity where the enrollee wishes evidence of a change in condition to be considered.
- 42 CFR § 423.2136 — Judicial reviewThe two routes to judicial review; the venue rule and the District of Columbia fallback; the five-day presumption of receipt of the Council's notice; the 60 calendar day deadline after an expedited-access certification; the identification of the Secretary of HHS as the proper defendant and the 60-day cure period for naming the wrong defendant; and the substantial evidence standard and the narrow review where a decision rests on nonconforming proof.
- 42 CFR § 422.566 — Organization determinationsThe requirement that an MA organization have standard and expedited procedures for timely organization determinations, and the enumerated actions that constitute an organization determination, including refusals to provide or pay for services, reductions or premature discontinuation of a previously authorized ongoing course of treatment, and untimely action that would adversely affect the enrollee's health.
- 42 CFR § 422.600 — Right to a hearingThat the amount remaining in controversy must meet the threshold established annually by the Secretary, that it can include any combination of Part A and Part B services, and that CMS uses the projected value of refused services to compute it.
- 42 CFR § 422.602 — Request for an ALJ hearingThe requirement to file with the entity specified in the reconsideration notice within 60 calendar days of receipt, the five-day presumption of receipt, the identification of the parties, and the dismissal and discontinuation rules where the amount in controversy is insufficient.
- 42 CFR § 422.608 — Medicare Appeals Council (Council) reviewThat any party to the decision or dismissal, including the MA organization, may request Council review, and that the part 405 Council review regulations apply to the extent appropriate.
- 42 CFR § 422.612 — Judicial reviewThat any party, including the MA organization, may request judicial review where the Council denied review or where the Council decision is CMS's final decision, in each case subject to the annual threshold, by filing a civil action in a United States district court.
Frequently asked questions
What levels exist above the plan and the independent review entity?
The Part D appeals subpart lists a hearing before an administrative law judge (or a decision by an attorney adjudicator where no hearing is conducted), review by the Medicare Appeals Council, and judicial review by a federal district court. The Medicare Advantage regulations set out the same three stages in parallel sections.
How long is there to request an ALJ hearing?
Sixty calendar days after receipt of the written notice of the independent review entity's reconsideration, for both Part D and Medicare Advantage. Receipt is presumed to be five calendar days after the date of the written reconsideration unless there is evidence to the contrary, and a Part D request is considered filed on the date it is received by the office named in the reconsideration notice.
How much has to be at stake?
For Part D, the required amount remaining in controversy is $100 indexed by the medical care component of the Consumer Price Index from July 2003 to the July preceding the year involved, rounded to the nearest $10, with $1,000 similarly indexed for judicial review. For Medicare Advantage, it is the threshold the Secretary establishes annually. No current-year figure is stated here because no Federal Register notice announcing one was read for this article.
Can several denials be added together to reach the threshold?
Under the Part D rule, yes, subject to conditions. A single enrollee may aggregate appeals that have each been reconsidered by an independent review entity, where aggregation is requested at the same time the hearing requests are filed and within the 60-day window for each, and where the appeals involve delivery of prescription drugs to a single enrollee. Multiple enrollees may aggregate where the appeals involve the same prescription drugs.
What kind of review does the Medicare Appeals Council conduct?
De novo, when it reviews an ALJ's or attorney adjudicator's written decision. It must issue a final decision, dismissal order or remand within 90 calendar days of receiving the request, or within 10 calendar days on expedited review, unless those periods are extended as the subpart provides.
What happens if a condition changes after the original decision?
The Part D regulation requires the Council to remand the case to the appropriate independent review entity if it determines that the enrollee wishes evidence about a change in condition after the coverage determination or at-risk determination to be considered in the appeal.