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If you have appeals pending at the Administrative Law Judge level awaiting a hearing, then you have probably heard a lot of buzz around CMS settlement processes. One option is the Settlement Conference Facilitation (SCF), an alternative dispute resolution process designed to bring the appellant and CMS together to discuss the potential of a mutually agreeable resolution for claims appealed to OMHA and the Council. Another option is the Low Volume Appeals (LVA) initiative, an administrative settlement process for appellants to settle pending appeals for timely partial payment of 62% of the net Medicare approved amount. The questions I receive most often are:

1. Do I qualify for one of these settlements?
2. Should I do it?

Let's tackle the first question, regarding a supplier's eligibility for one of these settlements. Each have unique requirements. Appellants are eligible for the LVA process if they have fewer than 500 appeals pending at OMHA and the Council, combined, as of November 3, 2017, with total billed amounts of $9,000 or less per appeal. The complete list of qualifying criterion for LVA is as follows:

1. The appeal was pending before the OMHA/Council level of appeal as of November 3, 2017;
2. The appeal has a total billed amount of $9,000 or less;
3. The appeal was properly and timely filed as of November 3, 2017;
4. The claims included in the appeal were denied by a Medicare contractor and remain in a fully denied status in the Medicare system;
5. The claims included in the appeal were submitted for payment under Medicare Part A or Part B;
6. The claims included in the appeal were not part of an extrapolation; and,
7. As of the date this Agreement is fully executed, the appeal was still pending at the OMHA or Council level of review.

If a supplier's pending appeals meet the above criteria, they can submit an expression of interest to OMHA to participate in this process. Deadline to submit was extended to June 8, 2018. Appellants are eligible for the SCF if they have a total of 25 or more appeals pending at OMHA and the Council combined; or less than 25 appeals pending and at least one appeal has more than $9,000 in billed charges. The complete list of qualifying criterion for SCF is as follows: 

1. The appeals must involve request(s) for Administrative Law Judge (ALJ) hearing or Council review filed on or before November 3, 2017;
   • With a total of 25 or more appeals pending at OMHA and the Council combined; or
   • With any number of appeals pending at OMHA and the Council and at least one appeal that has more than $9,000 in billed charges;
2. The request(s) for ALJ hearing and/or Council review must arise from a Medicare Part A or Part B Qualified Independent Contractor (QIC) reconsideration decision;
3. All jurisdictional requirements for OMHA or Council review must be met for the eligible appeals;
4. All pending OMHA and Council appeals associated with a single NPI and corresponding Provider Transaction Access Number (PTAN) must be included in SCF;
5. Appeals must not be scheduled for an ALJ hearing or an ALJ hearing must not have been conducted;
6. The amount of each individual claim must be $100,000 or less (for the purposes of an extrapolated statistical sample, the overpayment amount extrapolated from the universe of claims must be $100,000 or less);
7. Appeals must not be involved in OMHA's Statistical Sampling Initiative;
8. The beneficiary must not have been found liable for the amount in controversy after the initial determination or participated in the reconsideration;
9. Appeals must not involve items, services, drugs, or biologicals billed under unlisted, unspecified, unclassified, or miscellaneous healthcare codes;
10. Appeals must not involve payment disputes;
11. Appeals must not arise from a QIC or ALJ dismissal order; and
12. Appeals must not be beneficiary-initiated appeals of QIC reconsiderations or any appeals arising from Medicare Part C, Medicare Part D, or appeals of Social Security Administration decisions regarding entitlement, Part B late enrollment penalties, and Part B and Part D income related monthly adjustment amounts (IRMAAs);
13. Appeals must not be actively engaged in a CMS Medicare appeals initiative that was available on or after November 3, 2017;
14. The appellant cannot have filed for bankruptcy and/or expect to file for bankruptcy; and
15. The provider or supplier must not have or have had a False Claims Act litigation  or investigations pending against them, or other program integrity concerns, including pending civil, criminal, or admiinstrative investigations.

If a supplier's pending appeals meet the above criteria, they can submit an expression of interest to OMHA to participate in this process. Please note, an updated expression of interest form will be available on the OMHA website in early June. If you determine that you qualify for LVA or SCF, the next question is, should I do it? While I have advised several clients on this, the decision is ultimately yours, as it is a business decision only you can make. Let me give you a few items to consider, however, if you are 'on the fence'.

• For both the LVA and SCF, all appeals eligible for settlement must be included. Appellants may not select some appeals for settlement and others for ALJ Hearing.
• LVA and SCF are settlement processes. LVA has a predetermined payment amount - 62% of the net Medicare approved amount. SCF is a payment negotiation process, in which you are negotiating with CMS on a settlement amount. This is also a percentage of net Medicare approved amount. (Net approved equals the “bottom line” of the claim paid by Medicare after deductible and co-insurance.)
• If you desire to discuss application of law and policy or to evalute each appeal on its merits, SCF or LVA is not the appropriate forum. Your appeals should remain pending at the OMHA for a hearing with an ALJ.
• Claims resolved through LVA or SCF will not be excluded from future audits. Claims that have already been reviewed are excluded from future review by a MAC and RAC. However, CERT reviews and reviews of potentially fraudulent claims will continue as appropriate.
• Claims included in LVA or SCF will remain denied and the appeals will be dismissed. This means that future supply claims could be affected with a denied initial/parent claim. For dual-eligible beneficiaries, the claims will remain denied and the state Medicaid agency may recover any payment made, up to the amount paid for a claim resolved through this settlement.
• Interest will not be paid for the claims under appeal if you choose to participate in a settlement agreement.

If you initiate the settlement process and do not agree with the outcome, you may abandon the process at any time prior to submitting the signed administrative agreement. Once the signed agreement is returned to CMS, appellants will no longer have an opportunity to appeal or otherwise dispute the inclusion or exclusion of appeals and their associated claims. Appellants who abandon the process at any time prior to submitting the signed administrative agreement will remain in the traditional appeals process. Something new for phase 3 of SCF is 'SCF Express'. After appeals have been qualified for SCF, CMS may provide a settlement offer to the appellant based on preliminary data. The appellant can choose to take this Express offer or proceed to the actual settlment process. If presented with this offer, the appellant must respond within 7 calendar days with a signed agreement or decline. Non-response will remove the appellant from the settlement process. Benefits to SCF Express include no CMS medical review of appeals and a faster resolution, since there are no conferences. CMS was quick to point out that if you decline the SCF Express option, the offer percentage also expires. Additionally, they conveyed that there is no guarantee that you will receive the same settlement percentages associated with LVA (62%). The goal of these settlements is to remove appeals from the pending backlog at OMHA, thus reducing the current processing time of 1205.8 days. With DMEPOS claims accounting for 51% of the current backlog these settlement options may seem like an attractive solution for suppliers. And I don't necessarily disagree. The ALJs are much more stringent on their reviews than in years past. If you believe your pending appeals have merit and have a good chance of being overturned, my advice is to wait it out. Chances are you have already waited three or more years for a hearing date, so what is a few more months to receive full reimbursement plus interest? However, if your appeals were submitted on the old principle of "Get it to the ALJ and they will pay it, they pay everything" then a settlement may be a more sound option. You can read more about LVA or SCF in the links provided below. If you have questions or would like to talk with someone at The van Halem Group we are here to help. Resources: Low Volume Appeals Initiative  Settlement Conference Facilitation