Appeals Court Halts Timeline for Clearing Medicare Claims Backlog

Last year, a federal judge ordered the Department of Health and Human Services (HHS) to clear a growing Medicare appeals backlog by 2021. But an appellate judge last week overturned the order, claiming that the lower court didn’t fully consider whether such a project would even be possible under current law.

The U.S. Court of Appeals for the D.C. Circuit found merit in HHS secretary Tom Price’s assertion that his department couldn’t possibly meet such a speedy deadline unless it simply settled outstanding Medicare appeals en masse without a formal review — an action that would violate existing law.

“If only lawful reforms were implemented, the Secretary claimed, compliance with the timetable would be impossible,” Judge Robert Wilkins wrote in the majority opinion. “And just as a court may not require an agency to break the law, a court may not require an agency to render performance that is impossible.”

The original order came last December, largely in response to a ballooning backlog of Medicare claims. Health care providers that file fee-for-service claims can appeal all denials in a process that’s supposed to take about a year, with four distinct levels of review lasting 60 to 90 days each.

However, as Wilkins noted in his court’s ruling, the number of appeals spiked from 59,600 in fiscal 2011 to 384,000 in fiscal 2013. At this rate, the logjam at the third level is on pace to reach 950,520 by 2021, which could cause some claims to spend 10 years in the system before reaching a resolution.

“This is, of course, far outside the ninety-day timeframe set by statute,” Wilkins wrote.

The American Hospital Association and several providers joined forces to seek relief, filing a lawsuit that prompted the original order from the U.S. District Court for the District of Columbia.

But Price and HHS fought back, claiming that there were simply too many cases to clear out without simply approving or denying them in a single block, denying the government and providers their legal right to explore each case.

While Wilkins largely concurred with this argument, the ruling doesn’t necessarily mean a victory for Price and a return to indefinite backlogs. The circuit court merely kicked the case back to the lower U.S. District Court, which is now tasked with more carefully deciding whether or not Price and HHS can pull the project off.

“Difficult as it was, however, courts must ensure that it is indeed possible to perform the act being commanded,” Wilkins concluded. “Ought, after all, implies can.”

Written by Alex Spanko

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