[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[S. 3078 Introduced in Senate (IS)]
<DOC>
116th CONGRESS
1st Session
S. 3078
To amend title XVIII of the Social Security Act to improve the
efficiency of the Medicare appeals process, and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
December 17, 2019
Mr. Grassley (for himself and Mr. Wyden) introduced the following bill;
which was read twice and referred to the Committee on Finance
_______________________________________________________________________
A BILL
To amend title XVIII of the Social Security Act to improve the
efficiency of the Medicare appeals process, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Audit & Appeals
Fairness, Integrity, and Reforms in Medicare Act of 2019'' or the
``AFIRM Act''.
(b) Table of Contents.--The table of contents for this Act is as
follows:
Sec. 1. Short title; table of contents.
Sec. 2. Authority to establish a process to review low value claims;
revision of amount in controversy
thresholds.
Sec. 3. Remanding appeals to the redetermination level with the
introduction of new evidence.
Sec. 4. Expedited access to appeals.
Sec. 5. Authority to use sampling and extrapolation methodologies and
to consolidate appeals for administrative
efficiency.
Sec. 6. Identification and referral of fraud.
Sec. 7. Study to assess hearing participation.
Sec. 8. Improvements to the Office of Medicare Hearings and Appeals.
Sec. 9. Review program improvements.
Sec. 10. Creation of Medicare Provider and Supplier Ombudsman for
Reviews and Appeals.
Sec. 11. Limiting the audit and recovery period for patient status
reviews.
Sec. 12. Incentives and disincentives for Medicare contractors,
providers, and suppliers.
SEC. 2. AUTHORITY TO ESTABLISH A PROCESS TO REVIEW LOW VALUE CLAIMS;
REVISION OF AMOUNT IN CONTROVERSY THRESHOLDS.
(a) Authority To Establish a Process To Review Low Value Claims.--
(1) In general.--Section 1869(b) of the Social Security Act
(42 U.S.C. 1395ff(b)) is amended by adding at the end the
following new paragraph:
``(4) Conduct of reviews by medicare magistrates.--
``(A) In general.--The Secretary shall establish,
through regulations, a process under which appealed
claims may be reviewed by officials within the Office
of Medicare Hearings and Appeals to be known as
Medicare magistrates.
``(B) Medicare magistrate defined.--For purposes of
this section, the term `Medicare magistrate' means an
attorney who is licensed by a State, has expertise in
this title (including regulations and policies
promulgated thereunder), meets such other
qualifications as the Secretary shall require, and who
performs reviews and renders decisions in appeals
described in paragraph (1)(E)(i)(II).
``(C) Requirements for reviews conducted by
magistrates.--The provisions of this subsection and
subsection (d) that govern hearings and decisions by
administrative law judges (including provisions related
to reviews of decisions by administrative law judges by
the Departmental Appeals Board of the Department of
Health and Human Services) shall apply to reviews and
decisions by Medicare magistrates in the same manner
and to the same extent as such provisions apply to
hearings and decisions by an administrative law judge.
The Secretary may establish by regulation such other
requirements and procedures as may be necessary so that
reviews by Medicare magistrates are resolved fairly,
efficiently, and expeditiously.''.
(2) Conforming amendment.--Section 1869(b)(1)(A) of the
Social Security Act (42 U.S.C. 1395ff(b)(1)(A)), as amended by
section 4(b)(3), is amended by inserting ``and paragraph (4)''
after ``subject to subparagraphs (D), (E), and (H)''.
(b) Amount in Controversy Thresholds.--
(1) In general.--Section 1869(b)(1)(E) of the Social
Security Act (42 U.S.C. 1395ff(b)(1)(E)) is amended--
(A) by striking clause (i) and inserting the
following:
``(i) In general.--Except as otherwise
provided in this section, subject to clause
(iii)--
``(I) a review by a Medicare
magistrate under paragraph (4), or a
hearing by an administrative law judge
under this subsection or subsection
(d), shall not be available to an
individual if the amount in controversy
is less than $160;
``(II) a review by a Medicare
magistrate under paragraph (4) shall be
available to an individual if the
amount in controversy is equal to or
greater than the amount specified in
subclause (I) but less than the amount
specified in subclause (III); and
``(III) a hearing by an
administrative law judge shall be
available to an individual under this
subsection or subsection (d) if the
amount in controversy is equal to or
greater than $1,630.'';
(B) in clause (iii)--
(i) by striking ``For requests for
hearings'' and inserting ``For requests for
Medicare magistrate reviews, hearings,'';
(ii) by striking ``2004'' and inserting
``2021''; and
(iii) by striking ``2003'' and inserting
``2020''; and
(C) by adding at the end the following new clause:
``(iv) Judicial review.--Judicial review
shall not be available to an individual under
this section if the amount in controversy is
less than the amount specified in clause
(i)(III) (as adjusted under clause (iii)).''.
(2) Conforming amendments.--
(A) Section 1155 of the Social Security Act (42
U.S.C. 1320c-4), as amended by section 4(b)(1), is
amended--
(i) in the second sentence, by striking
``$200 or more'' and inserting ``equal to or
greater than the amount specified in section
1869(b)(1)(E)(i)(III)'';
(ii) in the fourth sentence, by striking
``$2,000 or more'' and inserting ``equal to or
greater than the amount specified in section
1869(b)(1)(E)(i)(III)''; and
(iii) by inserting after the fourth
sentence the following new sentences: ``Where
the amount in controversy is equal to or
greater than the amount specified in subclause
(I) of section 1869(b)(1)(E)(i) but less than
the amount specified in subclause (III) of such
section, such beneficiary shall be entitled to
a review by a Medicare magistrate in accordance
with procedures established by the Secretary
pursuant to section 1869. The provisions of
section 1869(b)(1)(E)(iii) shall apply with
respect to the dollar amounts referred to in
this section in the same manner as they apply
to the dollar amounts specified in section
1869(b)(1)(E)(i).''.
(B) Section 1852(g)(5) of the Social Security Act
(42 U.S.C. 1395w-22(g)(5)), as amended by section
4(b)(2), is amended--
(i) in the first sentence, by striking
``$100 or more'' and inserting ``equal to or
greater than the amount specified in section
1869(b)(1)(E)(i)(III)'';
(ii) in the second sentence, by striking
``$1,000 or more'' and inserting ``equal to or
greater than the amount specified in section
1869(b)(1)(E)(i)(III)'';
(iii) by inserting after the second
sentence the following new sentence: ``If the
amount in controversy is equal to or greater
than the amount specified in subclause (I) of
section 1869(b)(1)(E)(i) but less than the
amount specified in subclause (III) of such
section, such enrollee shall be entitled to
review by a Medicare magistrate in accordance
with procedures established by the Secretary
pursuant to section 1869.''; and
(iv) in the last sentence, by striking
``the first 2 sentences of''.
(C) Section 1876(c)(5)(B) of the Social Security
Act (42 U.S.C. 1395mm(c)(5)(B)), as amended by section
4(b)(4), is amended--
(i) in the first sentence, by striking
``$100 or more'' and inserting ``equal to or
greater than the amount specified in section
1869(b)(1)(E)(i)(III)'';
(ii) in the second sentence, by striking
``$1,000 or more'' and inserting ``equal to or
greater than the amount specified in section
1869(b)(1)(E)(i)(III)'';
(iii) by inserting after the second
sentence the following new sentence: ``If the
amount in controversy is equal to or greater
than the amount specified in subclause (I) of
section 1869(b)(1)(E)(i) but less than the
amount specified in subclause (III) of such
section, such member shall be entitled to
review by a Medicare magistrate in accordance
with procedures established by the Secretary
pursuant to section 1869.''; and
(iv) in the fourth sentence, by striking
``the first 2 sentences of''.
(c) Calculation of Amount in Controversy for the Aggregation of
Claims.--Section 1869(b)(1)(E)(ii) of the Social Security Act (42
U.S.C. 1395ff(b)(1)(E)(ii)) is amended--
(1) by redesignating subclauses (I) and (II) as items (aa)
and (bb), respectively, and indenting appropriately;
(2) in the matter preceding item (aa), as so redesignated,
by striking ``if the appeals involve'' and inserting the
following: ``if--
``(I) the appeals involve--'';
(3) in item (bb), as so redesignated, by striking the
period at the end and inserting ``; and''; and
(4) by adding at the end the following new subclause:
``(II) all claims that an
individual seeks to aggregate are
included in the same request for an
aggregated appeal.''.
(d) Effective Date.--The amendments made by this section shall take
effect on January 1, 2021.
SEC. 3. REMANDING APPEALS TO THE REDETERMINATION LEVEL WITH THE
INTRODUCTION OF NEW EVIDENCE.
(a) In General.--Section 1869(b)(3) of the Social Security Act (42
U.S.C. 1395ff(b)(3)) is amended by striking ``A provider of services''
and all that follows through the period and inserting the following new
subparagraphs:
``(A) Remand upon submission of new evidence.--
``(i) In general.--Except as provided in
subparagraph (B), when a party to an appeal,
other than an individual entitled to benefits
under part A or enrolled under part B, or both,
or the Centers for Medicare & Medicaid Services
or its contractors, introduces new evidence
into the administrative record at a
reconsideration conducted by a qualified
independent contractor under subsection (c) or
at any subsequent, higher level of appeal, the
appeal shall be remanded for a new
redetermination under subsection (a)(3), and
any prior decisions (other than the initial
determination made by the Secretary pursuant to
subsection (a)(1)) on this appeal shall be
vacated.
``(ii) Requirements.--For purposes of
clause (i), except to the extent otherwise
provided by the Secretary in regulations, the
provisions that apply to redeterminations under
subsection (a) and this subsection shall apply
to redeterminations of appeals that are
remanded.
``(B) Exceptions.--The provisions of subparagraph
(A) shall not apply in instances where an adjudicator
determines that introduction of new evidence is
justified due to--
``(i) a lower-level adjudicator's
inadvertent omission or erroneous decision to
omit such evidence from the administrative
record when that evidence was timely submitted
to the lower-level adjudicator by a party to
the appeal;
``(ii) a decision by a lower-level
adjudicator to issue an unfavorable decision
based on new or different grounds than were the
basis of a previous adjudication; or
``(iii) such other circumstances for good
cause as the Secretary may establish.
``(C) No appeal.--A decision to remand an appeal
under this paragraph shall not be subject to appeal.''.
(b) Effective Date.--The amendments made by this section shall take
effect on January 1, 2020, and shall apply to new appeals filed on or
after such date.
SEC. 4. EXPEDITED ACCESS TO APPEALS.
(a) In General.--Section 1869(b)(1) of the Social Security Act (42
U.S.C. 1395ff(b)(1)) is amended by adding at the end the following new
subparagraph:
``(H) Expedited access to appeals for decisions on
the record.--
``(i) Decision on the record.--Not later
than 1 year after the date of the enactment of
this subparagraph, the Secretary shall
establish by regulation and implement a process
authorizing an administrative law judge
reviewing a decision pursuant to this
subsection or subsection (d) to issue a
decision on the record in cases where, based on
the evidence of record, there are no material
issues of fact in dispute and the
administrative law judge determines that there
is a binding authority that controls the
decision in the matter under review.
``(ii) Application of hearing rules to
decisions on the record.--The provisions of
subsection (d) that govern hearings by
administrative law judges shall apply to a
decision issued by an administrative law judge
without a hearing pursuant to clause (i) in the
same manner and to the same extent as such
provisions apply to a hearing by an
administrative law judge.''.
(b) Conforming Amendments.--
(1) Section 1155 of the Social Security Act (42 U.S.C.
1320c-4) is amended--
(A) in the second sentence, by striking ``Where''
and inserting ``Subject to the succeeding sentences of
this section, where''; and
(B) by adding at the end the following new
sentence: ``The provisions of subparagraph (H) of
section 1869(b)(1) shall apply with respect to
decisions by an administrative law judge under this
section in the same manner as they apply to decisions
by an administrative law judge under such subparagraph
(H).''.
(2) Section 1852(g)(5) of the Social Security Act (42
U.S.C. 1395w-22(g)(5)) is amended--
(A) in the first sentence, by striking ``An
enrollee'' and inserting ``Subject to the succeeding
sentences of this paragraph, an enrollee''; and
(B) by adding at the end the following new
sentence: ``The provisions of subparagraph (H) of
section 1869(b)(1) shall apply with respect to
decisions by an administrative law judge under this
paragraph in the same manner as they apply to decisions
by an administrative law judge under such subparagraph
(H).''.
(3) Section 1869(b)(1)(A) of the Social Security Act (42
U.S.C. 1395ff(b)(1)(A)) is amended by striking ``subparagraphs
(D) and (E)'' and inserting ``subparagraphs (D), (E), and
(H)''.
(4) Section 1876(c)(5)(B) of the Social Security Act (42
U.S.C. 1395mm(c)(5)(B)) is amended--
(A) in the first sentence, by striking ``A member''
and inserting ``Subject to the succeeding sentences of
this subparagraph, a member''; and
(B) by adding at the end the following new
sentence: ``The provisions of subparagraph (H) of
section 1869(b)(1) shall apply with respect to
decisions by an administrative law judge under this
subparagraph in the same manner as they apply to
decisions by an administrative law judge under such
subparagraph (H).''.
(c) Effective Date.--Unless otherwise specified, the amendments
made by subsections (a) and (b) shall take effect on the date of the
enactment of this Act and shall apply to cases that are pending as of
such date.
SEC. 5. AUTHORITY TO USE SAMPLING AND EXTRAPOLATION METHODOLOGIES AND
TO CONSOLIDATE APPEALS FOR ADMINISTRATIVE EFFICIENCY.
(a) In General.--Section 1869 of the Social Security Act (42 U.S.C.
1395ff) is amended by adding at the end the following new subsection:
``(j) Authorities To Promote Administrative Efficiencies.--
``(1) Authority to consolidate appeals.--
``(A) In general.--Any individual or entity
conducting redeterminations, reconsiderations, reviews,
or hearings under subsection (a)(3), (b), (c), or (d)
(in this section, referred to as an `adjudicator') may
consolidate pending requests for review into a single
action, and may issue a single decision, or separate
decisions, with respect to such review requests--
``(i) if such requests involve one or more
common questions of fact or law for similar
claims submitted by the same appellant;
``(ii) if such requests involve claims that
were included within a statistical sample
during the initial determination or any
previous level of appeal;
``(iii) if the appellant requests
aggregation of two or more claims under
subsection (b)(1)(E)(ii); or
``(iv) in any other case in which the
adjudicator determines that consolidation would
promote administrative efficiency, consistent
with such standards as the Secretary may
establish by regulation.
``(B) Deadlines.--The Secretary may establish
applicable timeframes for appellants to request
consolidations and for adjudicators to issue decisions
on appeals that have been consolidated.
``(2) Requirements for claims that were included in an
extrapolated overpayment or previously consolidated.--An
individual or entity requesting a redetermination,
reconsideration, review or hearing under subsection (a)(3),
(b), (c), or (d) with respect to two or more claims that were
included in an extrapolated overpayment, or claims that were
consolidated into a single appeal at a lower-level adjudication
under this section, must submit a single request for review or
hearing with respect to such claims in order to be entitled to
a review or hearing.
``(3) Authority to use statistical sampling and
extrapolation methodologies in adjudications.--With the consent
of the appellant, an adjudicator may use statistical sampling
and extrapolation methodologies in reaching a decision with
respect to a claim or claims for benefits for items or services
furnished under part A or B. When an appeal involves a decision
that was based on a statistical sample at the lower level, the
adjudicator's decision shall be based on the same statistical
sample.''.
(b) Effective Date.--
(1) In general.--Except as provided in paragraph (2), the
amendments made by this section shall apply to requests for
review that are filed after the date of the enactment of this
Act.
(2) Exception.--The requirements described in subsection
(j)(2) of section 1869 of the Social Security Act (42 U.S.C.
1395ff), as added by subsection (a), shall apply to requests
for review and requests for hearing that are pending at any
level of appeal as of the date of enactment of this Act and to
those filed after such date.
SEC. 6. IDENTIFICATION AND REFERRAL OF FRAUD.
Not later than 1 year after the date of enactment of this Act, the
Secretary of Health and Human Services, in consultation with the
Inspector General of the Department of Health and Human Services and
the Attorney General of the United States, shall establish and
implement a process under which the Office of Medicare Hearings and
Appeals and the Departmental Appeals Board of the Department of Health
and Human Services shall refer cases in which there is a credible
suspicion of fraudulent activity to appropriate law enforcement
agencies and to the Centers for Medicare & Medicaid Services.
SEC. 7. STUDY TO ASSESS HEARING PARTICIPATION.
(a) Study.--Not later than 1 year after the date of enactment of
this Act, the Secretary of Health and Human Services shall conduct a
study to determine whether it would be feasible to cost-effectively
increase the participation, with respect to hearings conducted by the
Office of Medicare Hearings and Appeals, of--
(1) the Centers for Medicare & Medicaid Services;
(2) entities serving as qualified independent contractors
under section 1869(c) of the Social Security Act (42 U.S.C.
1395ff(c));
(3) entities serving as medicare administrative contractors
under section 1874A of such Act (42 U.S.C. 1395kk-1);
(4) entities serving as recovery audit contractors under
section 1893(h) of such Act (42 U.S.C. 1395ddd(h)); and
(5) other Medicare claims review entities determined
appropriate by the Secretary.
(b) Report.--Not later than 2 years after the date of the enactment
of this Act, the Secretary of Health and Human Services shall publish a
report containing the results of the study required under subsection
(a) on the Internet website of the Department of Health and Human
Services.
SEC. 8. IMPROVEMENTS TO THE OFFICE OF MEDICARE HEARINGS AND APPEALS.
(a) Training for ALJs and Medicare Magistrates.--Section 1869(e)(3)
of the Social Security Act (42 U.S.C. 1395ff(e)(3)) is amended--
(1) in the paragraph heading, by striking ``and
administrative law judges'' and inserting ``, administrative
law judges, and medicare magistrates; annual training for
administrative law judges and medicare magistrates'';
(2) by striking ``The Secretary'' and inserting the
following:
``(A) Continuing education requirement.--The
Secretary'';
(3) by inserting ``and, beginning in 2020, to Medicare
magistrates'' after ``administrative law judges'' the first
place it appears;
(4) by striking ``and administrative law judges'' and
inserting ``, administrative law judges, and Medicare
magistrates''; and
(5) by adding at the end the following new subparagraph:
``(B) Annual training.--Beginning with calendar
year 2020, each calendar year the Secretary shall
provide to each administrative law judge and Medicare
magistrate within the Office of Medicare Hearings and
Appeals training on Medicare policies, including any
policies that were changed or instituted in the
previous year.''.
(b) Publication of Appeals Information.--Section 1869(e) of the
Social Security Act (42 U.S.C. 1395ff(e)) is amended by adding at the
end the following new paragraph:
``(5) Publication of appeals information.--Not later than
January 1, 2020, and annually thereafter, the Secretary of
Health and Human Services shall publish and maintain on the
Internet website of the Department of Health and Human Services
the following information regarding appeals heard by the Office
of Medicare Hearings and Appeals for each fiscal year:
``(A) The percentage of appeals that received fully
favorable, partially favorable, and unfavorable
decisions.
``(B) For each type of service, the percentage of
appeals that received fully favorable, partially
favorable, and unfavorable decisions.
``(C) The average length of time elapsed between
the initial request for review and a final decision.
``(D) Such other information as the Secretary
determines necessary to ensure greater transparency for
the Office of Medicare Hearings and Appeals.''.
SEC. 9. REVIEW PROGRAM IMPROVEMENTS.
(a) In General.--Section 1893 of the Social Security Act (42 U.S.C.
1395ddd) is amended--
(1) in subsection (b), by adding at the end the following
new paragraph:
``(7) The review program improvements described in
subsection (k).''; and
(2) by adding at the end the following new subsection:
``(k) Review Program Improvements.--
``(1) In general.--
``(A) Guidelines.--
``(i) In general.--To promote uniformity
and consistency in initial determinations and
appeals decisions relating to the
appropriateness of payment with respect to
items or services furnished under this title,
the Secretary shall establish claim review
guidelines for review contractors for reviewing
claims for payment submitted by providers of
services and suppliers.
``(ii) Requirements.--Prior to the
implementation of the claim review guidelines
described in subparagraph (A)(i), the Secretary
shall--
``(I) approve the claim review
guidelines;
``(II) make the claim review
guidelines publicly available as
described in subparagraph (B); and
``(III) ensure that review
contractors, Medicare magistrates,
administrative law judges, and
appropriate members of the Departmental
Appeals Board are trained in the
application of the claim review
guidelines.
``(iii) Transition period.--The Secretary
may provide for or establish one or more
transition periods, during which the use of
existing claim review guidelines for reviewing
claims submitted by providers of services and
suppliers shall be permitted to continue until
such time as the Secretary is able to review
and approve the claim review guidelines
established under this subparagraph.
``(B) Transparency.--
``(i) In general.--The Secretary shall
ensure that the information described in clause
(iii)--
``(I) is published on the Internet
website of the Department of Health and
Human Services for not less than 30
days prior to its implementation;
``(II) remains available on such
Internet website after such
publication; and
``(III) is updated at least
annually.
``(ii) Expedited process.--The Secretary of
Health and Human Services may expedite the
process described in clause (i) for claims
review guidelines that are expected to impact
the improper payment rate, frequency of denials
of payment, or costs to the Medicare program.
``(iii) Information described.--The
information described in this clause is the
following:
``(I) Subject to clause (ii) and
subparagraph (A), any new claim review
guideline approved for use under this
paragraph.
``(II) Any updates or revisions to
existing claim review guidelines.
``(C) Limitation.--Nothing in this section is
intended to--
``(i) delineate sample size or how claims
are to be selected for review;
``(ii) require the publication of
algorithms or methodologies used for claim
selection; or
``(iii) require the publication of
information that could promote fraud or
potential gaming.
``(D) Review contractor defined.--In this
subsection, the term `review contractor' means--
``(i) a medicare administrative contractor
(as defined in section 1874A(a)(3)(A)) with a
contract to conduct prepayment or post-payment
reviews of claims for payment by providers of
services or suppliers;
``(ii) a recovery audit contractor with a
contract under subsection (h); or
``(iii) any other contractor the Secretary
determines appropriate.
``(2) Program integrity initiatives.--To improve existing
and future Medicare program integrity initiatives, and to limit
unnecessary burdens on providers of services and suppliers, the
Secretary shall designate a point of contact to oversee and
undertake the following:
``(A) Develop a comprehensive strategy for claim
review determinations made on a prepayment, post-
payment, or prior-authorization basis that--
``(i) focuses on identifying and reducing
those claim errors that have the largest impact
on the improper payment rate, pose the greatest
risk to the Federal Hospital Insurance Trust
Fund under section 1817 or the Federal
Supplementary Medical Insurance Trust Fund
under section 1841, or are likely to negatively
affect quality of care;
``(ii) reduces unnecessary burden on
providers of services and suppliers and
minimizes any negative effects on Medicare
beneficiaries; and
``(iii) utilizes data and other sources,
including claims data, improper payment rate
data, and reports from the Office of the
Inspector General of the Department of Health
and Human Services, the General Accountability
Office, and the Medicare Payment Advisory
Commission.
``(B) Develop methods designed to minimize, using
available data, unnecessary duplicate reviews by review
contractors.
``(C) To the extent possible given the specific
mission of each entity that has contracted with the
Secretary, work with all review contractors to develop
a uniform, consistent, and transparent review process
to reduce the burden on providers of services and
suppliers, including a uniform approach for such
entities to notify parties of pending reviews and to
request medical documentation, improved communication
with providers of services and suppliers, better
refinement of audits to target claims that are at the
highest risk for improper payments or other errors, and
any other areas in which the Secretary determines that
the burden on providers of services and suppliers may
be decreased.
``(D) To the extent practicable, identify local
coverage determinations, national coverage
determinations, regulations, and program instructions
issued by the Centers for Medicare & Medicaid Services
for the Medicare program that need updating or that
inappropriately conflict with other Medicare policies
and make modifications where appropriate, and, if
necessary, establish new policies or claim review
guidelines with input from stakeholders as appropriate.
``(E) Publish on the Internet website of the
Department of Health and Human Services the volume and
type of prepayment and post-payment claim reviews
performed by medicare administrative contractors under
section 1874A and recovery audit contractors under
subsection (h).
``(F) Coordinate with the Office of Medicare
Hearings and Appeals and the Departmental Appeals Board
of the Department of Health and Human Services in the
implementation of the improved claim review guidelines
and evidentiary standards established by the provisions
of, and the amendments made by, the Audit & Appeals
Fairness, Integrity, and Reforms in Medicare Act of
2019, such as the decision to remand an appeal.
``(G) Ensure that providers of services and
suppliers subject to post-payment review by a medicare
administrative contractor are granted a discussion
period with the contractor of at least 30 days from the
letter from the contractor regarding the result of the
review.
``(H) Develop qualification standards for review
contractors that require prepayment and post-payment
reviews of claims for payment submitted by providers of
services or suppliers be overseen by a medical director
of the review contractor who has knowledge of relevant
Medicare laws, regulations, and program instruction, as
appropriate.
``(I) Undertake verification methods, such as
sampling, to determine whether decisions by review
contractors are consistent with Medicare laws,
regulations, and program instruction (taking into
account geographical variations that are a result of
local coverage determinations).
``(J) Determine whether punitive actions against
ineffective review contractors could be taken and what,
if any, financial incentives or disincentives could be
used to promote the accuracy of a review contractor's
reviews.''.
(b) Annual RAC Report.--Section 1893(h)(8) of the Social Security
Act (42 U.S.C. 1395ddd(h)(8)) is amended by inserting ``, and, with
respect to reports submitted after the date of the enactment of the
Audit & Appeals Fairness, Integrity, and Reforms in Medicare Act of
2019, the number of claims corrected in the discussion period, the
percentage of appeals of determinations by recovery audit contractors
that were ultimately successful, a careful description of the
denominator of total audits and appeals (given the likelihood that many
appeals in a given year will not have a decision in that year), and
separate reports on complex Medicare part A, complex Medicare part B,
semiautomated, and automated reviews'' before the period at the end.
(c) Independence of Adjudicators.--Nothing in this section or the
amendments made thereby shall be construed as authorizing the Secretary
of Health and Human Services to limit the authority or decisional
independence of Medicare magistrates, administrative law judges, or the
Departmental Appeals Board of the Department of Health and Human
Services.
SEC. 10. CREATION OF MEDICARE PROVIDER AND SUPPLIER OMBUDSMAN FOR
REVIEWS AND APPEALS.
Section 1808 of the Social Security Act (42 U.S.C. 1395b-9) is
amended by adding at the end the following new subsection:
``(e) Medicare Reviews and Appeals Ombudsman.--
``(1) In general.--Not later than 1 year after the date of
the enactment of this subsection, the Secretary shall appoint
within the Centers for Medicare & Medicaid Services a Medicare
Reviews and Appeals Ombudsman.
``(2) Duties.--The Medicare Reviews and Appeals Ombudsman
shall--
``(A) identify, investigate, and assist in the
resolution of complaints and inquiries related to the
Medicare audits and appeals process from providers of
services or suppliers with respect to benefits under
part A or B;
``(B) identify trends in complaints and inquiries
regarding the current Medicare review and appeals
systems to provide recommendations for improvements to
the Secretary that would improve the efficacy and
efficiency of claim review and appeals systems, as well
as communication to beneficiaries, providers of
services, and suppliers;
``(C) design a system by which to objectively
measure and evaluate reviewer responsiveness to
addressing inquiries from providers of services and
suppliers and inquiries from the Ombudsman;
``(D) provide assistance to appellants and those
considering an appeal;
``(E) publish data regarding the number of review
determinations appealed, each appeal's outcome, and
aggregate appeal statistics--
``(i) for each medicare administrative
contractor conducting redeterminations under
section 1869(a)(3);
``(ii) for each qualified independent
contractor conducting reconsiderations under
section 1869(c);
``(iii) for each recovery audit contractor
conducting reviews under section 1893(h);
``(iv) by type of provider of services; and
``(v) by type of supplier;
``(F) assist in education and training efforts for
providers of services, suppliers, and review
contractors (as defined in section 1893(k)(1)(D));
``(G) communicate with the Medicare Beneficiary
Ombudsman to assist with the identification,
investigation, and resolution of beneficiary-related
complaints, including those that overlap with requests
for review and appeals submitted by providers of
services or suppliers; and
``(H) perform such other duties as determined
appropriate by the Secretary.''.
SEC. 11. LIMITING THE AUDIT AND RECOVERY PERIOD FOR PATIENT STATUS
REVIEWS.
(a) In General.--Section 1893(h)(4) of the Social Security Act (42
U.S.C. 1395ddd(h)(4)) is amended--
(1) by redesignating subparagraphs (A) and (B) as clauses
(i) and (ii), respectively, and moving such clauses 2 ems to
the right;
(2) by striking ``Each such'' and inserting the following:
``(A) In general.--Except as provided in
subparagraph (B), each such''; and
(3) by adding at the end the following new subparagraph:
``(B) Limitation.--
``(i) In general.--With respect to the
classification of an individual entitled to
benefits under part A or enrolled under part B,
or both, as an inpatient or an outpatient for
purposes of hospital claims for payment for
items or services furnished to such individual
under this title, such contracts shall provide
that a recovery audit contractor shall only
send additional documentation requests related
to the appropriateness of such classification
in the first 6 months after the date on which
such items or services were furnished.
``(ii) Exception.--The limitation described
in clause (i) shall not apply where a claim for
payment is submitted more than 3 months after
the date on which such items or services were
furnished.''.
(b) Study on Shortening the Audit and Recovery Period for Other
Reviews.--
(1) Study.--The Secretary of Health and Human Services
shall conduct a study to assess--
(A) the potential burden on providers of services
(as defined in subsection (u) of section 1861 of the
Social Security Act (42 U.S.C. 1395x)) and suppliers
(as defined in subsection (d) of such section) under
the Medicare program of the audit and recovery period
applicable to audit and recovery activities conducted
by recovery audit contractors under section 1893(h)(4)
of such Act (42 U.S.C. 1395ddd(h)(4)); and
(B) the impact of shortening such period with
respect to different types of reviews.
(2) Report.--Not later than 1 year after the date of the
enactment of this Act, the Secretary of Health and Human
Services shall publish a report containing the results of the
study required under paragraph (1) on the Internet website of
the Department of Health and Human Services.
(c) Authority To Implement Shorter Audit and Recovery Period.--
Section 1893(h)(4) of the Social Security Act (42 U.S.C.
1395ddd(h)(4)), as amended by subsection (a), is further amended--
(1) in subparagraph (A), by striking ``subparagraph (B)''
and inserting ``subparagraphs (B) and (C)''; and
(2) by adding at the end the following new subparagraph:
``(C) Authority to implement shorter audit and
recovery period.--Notwithstanding subparagraph (A)(ii),
with respect to payments made under this title for
specific categories of services, the Secretary may
enter into contracts under paragraph (1) that provide
for a retrospective period during which audit and
recovery activities may be conducted of not more than 3
years.''.
(d) Report on RAC Payment Structure.--Not later than 6 months after
the date of the enactment of this Act, the Secretary of Health and
Human Services shall submit to Congress a report on ways to change, in
a budget neutral manner, the payment structure for recovery audit
contractors under section 1893(h)(1) of the Social Security Act (42
U.S.C. 1395ddd(h)(1)) from an incentive-based model to a non-incentive
based approach that does not impose additional financial burdens on
providers.
SEC. 12. INCENTIVES AND DISINCENTIVES FOR MEDICARE CONTRACTORS,
PROVIDERS, AND SUPPLIERS.
Section 1893 of the Social Security Act (42 U.S.C. 1395ddd), as
amended by section 10, is further amended by adding at the end the
following new subsection:
``(l) Compliance Incentive Program.--
``(1) In general.--Not later than 1 year after the date of
enactment of this subsection, the Secretary shall establish a
compliance incentive program, consisting of the components
described in paragraphs (2) and (3), to encourage--
``(A) providers of services and suppliers to submit
accurate claims that comply with this title and the
policies, regulations, and program instructions
promulgated thereunder, as well as any applicable
national or local coverage determinations; and
``(B) entities that have entered into contracts
with the Secretary under subsection (h) (referred to in
this subsection as `review contractors') to conduct
reviews under this section in a manner that is
consistent with the provisions of this title and the
claim review guidelines, regulations, and program
instructions promulgated thereunder, as well as any
applicable national or local coverage determinations.
``(2) Compliance with claim procedures by providers of
services and suppliers.--
``(A) In general.--Not later than 6 months after
the date of enactment of this subsection, the Secretary
shall establish a system through which a provider of
services or supplier that has achieved a low rate of
denials of claims for payment subject to additional
documentation requests over a 2-year period, as
determined by the Secretary, shall be exempt for a
period of 1 year from any post-payment review of claims
for payment conducted by review contractors.
``(B) Limitation.--The Secretary shall not exempt
or shall rescind an exemption granted to a provider of
services or supplier under subparagraph (A) if the
Secretary determines that there is a reasonable basis
to suspect gaming, fraud, abuse, or delay in the
provision of services or items by such provider or
services or supplier.
``(3) Compliance with review procedures by medicare
contractors.--
``(A) In general.--Not later than 6 months after
the date of enactment of this subsection, the Secretary
shall establish a process, which may include the use of
sampling, for determining the frequency with which the
decisions made by a review contractor with respect to
reviews conducted under this section are consistent
with the provisions of this title and the policies,
regulations, and program instructions promulgated
thereunder, as well as any applicable national or local
coverage determinations. The results of this process
shall be made available to the public on the Internet
website of the Department of Health and Human Services.
``(B) Access to medical records by review
contractors.--
``(i) Access to records based on
performance review.--Not later than 6 months
after the date of enactment of this Act, the
Secretary shall establish a system under which,
in addition to any other adjustments that the
Secretary may make to the number of medical
records that a review contractor may request,
for any incentive period--
``(I) the number of medical records
that a review contractor that was a
high-performing review contractor in
the performance review period
associated with such incentive period
may request from a provider of services
or supplier in carrying out activities
under this section may be increased (on
a sliding scale); and
``(II) the number of medical
records that a review contractor that
was a low-performing review contractor
in the performance review period
associated with such incentive period
may request from a provider of services
or supplier in carrying out activities
under this section may be decreased (on
a sliding scale).
``(ii) Definitions.--In this subparagraph:
``(I) High-performing review
contractor.--The term `high-performing
review contractor' means a review
contractor that, for a given
performance review period, makes
decisions with respect to reviews
conducted under this section of the
activities of providers of services and
suppliers that are consistent with the
provisions of this title and the
policies, regulations, and program
instructions promulgated thereunder, as
well as any applicable national or
local coverage determinations, at a
rate that is equal to or greater than
95 percent.
``(II) Incentive period.--The term
`incentive period' means, with respect
to a performance review period, a
period of time (to be determined by the
Secretary) following such performance
review period during which the number
of medical records that a review
contractor may request from a provider
of services or supplier may be
increased or decreased based on such
contractor's status as a high-
performing review contractor or a low-
performing review contractor for such
performance review period.
``(III) Low-performing review
contractor.--The term `low-performing
review contractor' means a review
contractor that, for a given
performance review period, is not
described in subclause (I).
``(IV) Performance review period.--
The term `performance review period'
means a period of time (to be
determined by the Secretary) during
which a review contractor's decisions
with respect to reviews conducted under
this section are evaluated to determine
if such review contractor is a high-
performing contractor or a low-
performing contractor for such
period.''.
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