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By Sandra Gauron, Appeals Coordinator

In an effort to provide ALJ backlog relief, CMS launched the Settlement Conference Facilitation (SCF) pilot program in July 2014.  SCF is an alternative dispute resolution process designed to bring the appellant and the Centers for Medicare & Medicaid Services (CMS) together to discuss the potential of a mutually agreeable resolution for Medicare Part A and Part B claims appealed to the Office of Medicare Hearings and Appeals (OMHA) level or the Medicare Appeals Council (Council) level of the Medicare claims appeals process[. On the outset, the requirements set forth were very specific; giving only a limited number of providers the ability to participate.  Based on success with this program, and in order to make a dent in the existing ALJ backlog, the SCF program has been expanded yet again.  Following are the eligibility requirements to participate in a SCF as outlined.   

SCF Eligibility

SCF Appellant Eligibility Criteria includes the following:

• The appellant must be a Medicare provider or supplier that has been assigned a National Provider Identifier (NPI) and Provider Transaction Access Number (PTAN);
• The appellant cannot have filed for bankruptcy and/or expect to file for bankruptcy; and
• The appellant may be excluded from participation if he or she has or has had False Claims Act litigation or investigations pending against them, or other program integrity concerns, including pending civil, criminal, or administrative investigations. 

SCF Appeals Eligibility Criteria includes the following:

• The appeals must involve request(s) for Administrative Law Judge (ALJ) hearing or Council review filed on or before March 31, 2019;
• 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;
• All jurisdictional requirements for OMHA or Council review must be met for the eligible appeals;
• All SCF eligible OMHA and Council appeals associated with a single NPI and corresponding Provider Transaction Access Number (PTAN) must be included in SCF;
• Appeals must not be scheduled for an ALJ hearing or an ALJ hearing must not have been conducted;
• Appeals must not be involved in OMHA's Statistical Sampling Initiative;
• Appeals must not be actively engaged in another CMS Medicare appeals initiative, including the QIC Demonstration Project and the CMS Serial Claims Initiative;
• The beneficiary must not have been found liable for the amount in controversy after the initial determination or participated in the reconsideration;
• Appeals must not involve items, services, drugs, or biologicals billed under unlisted, unspecified, unclassified, or miscellaneous healthcare codes (e.g., CPT Code 38999 Unlisted procedure, hemic or lymphatic system; K0108 Wheelchair component or accessory, not otherwise specified);
• Appeals must not involve payment disputes (e.g., the appellant was paid as billed, in full, by the contractor, but the appellant believes the fee schedule or contractor price amount is insufficient payment);
  • Appeals arising from down coding of claims are eligible for SCF; however, please see the Settlement Agreement Template regarding the special payment rate of Diagnosis Related Group (DRG) down coded appeals.
• Appeals must not arise from a QIC or ALJ dismissal order; and
• 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). 

Please note that providers and/or suppliers whose appeals have a total billed amount less than $10,000 may only participate in SCF Express and do not have the option of a settlement conference (see SCF Process section below).  Additionally, settlement agreements with any individual claims, or extrapolated overpayments, in excess of $100,000 will be subject to U.S. Department of Justice (DOJ) approval prior to full execution by CMS and the appellant.

SCF Process

The process for SCF will proceed as follows:

1. An appellant will submit a Request for SCF to [email protected] for all pending OMHA and Council appeals associated with an NPI/PTAN.
   1. The request is an OMHA document available in the Downloads section of this website.
2. CMS will be informed the appellant has requested SCF.  CMS will have 15 calendar days to determine whether CMS will participate in SCF with the appellant.    

Please note:  Any party may decline to participate at any time during the settlement conference process.   Participation is not mandatory for any party.

• After CMS indicates it will participate, an SCF Spreadsheet (Spreadsheet) of the appeals eligible for SCF will be created.  The spreadsheet will contain all OMHA and Council appeals believed to be eligible for SCF.
• The appellant will receive a Preliminary Notification Package.  The Preliminary Notification Package will include the SCF Spreadsheet for appellant review.
• The appellant must respond to the Preliminary Notification by submitting the SCF Agreement of Participation Package within 20 calendar days of the date printed on the Preliminary Notification.  The SCF Agreement of Participation Package must include a completed and signed SCF Agreement of Participation and the completed and reviewed SCF Spreadsheet.
  • The SCF Agreement of Participation must be e-mailed and only handwritten signatures will be accepted (e-signatures using Adobe Acrobat are unacceptable).
  • The appellant is responsible for ensuring only SCF eligible appeals appear on the SCF Spreadsheet.  Failure to object to SCF ineligible appeals appearing on the spreadsheet, as directed in the Preliminary Notification, will lead to those appeals being dismissed by operation of the settlement agreement, if an agreement is later reached.
• Once the appellant’s complete SCF Agreement of Participation Package is received, an SCF Confirmation Notice will be issued.
  • The SCF Confirmation Notice includes the following information:
    • The Confirmation Notice
    • The final Spreadsheet
• SCF Express:  CMS provides a settlement offer to the appellant based on preliminary data available to CMS (e.g., ALJ overturn rates, type of claim or service, etc.).  Only appellants with appealed claims that have billed amount(s) of $100,000 or less or appeal(s) of an extrapolated overpayment that is $100,000 or less are eligible for SCF Express.  If an appellant has any appealed claims or extrapolated overpayment appeal(s) in excess of $100,000, the appellant is ineligible for SCF Express.
  • SCF Express Eligible Appellants whose appeal(s) have at least $10,000 total in billed charges:  The appellant can choose to take the SCF Express offer or proceed to the actual settlement conference process.
    • Within 30 calendar days of the date of the SCF Confirmation Notice, an SCF Express Offer Package will be issued to the appellant. 
    • The appellant must respond (within 7 calendar days of the date on the SCF Express Offer Package) by signing and emailing the proposed  settlement agreement or stating that it declines CMS’s offer and wishes to proceed to a settlement conference.
    • The proposed settlement agreement signed by the appellant will be forwarded directly to the CMS representative for signature and effectuation.
  • SCF Express Eligible Appellants whose appeal(s) do not have at least $10,000 total in billed charges: The appellant may only participate in SCF Express.
    • Within 30 calendar days of the date of the SCF Confirmation Notice, an SCF Express Offer Package will be issued to the appellant. 
    • The appellant must respond (within 7 calendar days of the date on the SCF Express Offer Package) by signing and emailing the proposed  settlement agreement or stating that it declines CMS’s offer and wishes for its appeals to return to OMHA and/or the Council.
    • The proposed settlement agreement signed by the appellant will be forwarded directly to the CMS representative for signature and effectuation.
• For those appellants who decline SCF Express and are eligible to proceed to a settlement conference (or those appellants who do not qualify for SCF Express because they have individual claims, or extrapolated overpayment appeals, in excess of $100,000), OMHA will begin the Pre-Settlement Conference scheduling process:
  • OMHA will send an email to all parties and assigned facilitators providing potential pre-settlement conference dates.  OMHA will select a pre-settlement conference date that accommodates both parties.
  • OMHA will randomly select a few appeals that will be the focus of CMS and the appellant’s review.  These selected appeals ensure that both parties are considering similar material when determining negotiation posture. This is not a statistical sample.
• Pre-Settlement Conference
  • The settlement conference and position paper submission, if applicable, will be discussed and finalized at the pre-settlement conference.
• Settlement Conference (where all appealed claims subject to the conference have billed amount(s) of $100,000 or less or the appeal(s) of an extrapolated overpayment is $100,000 or less):
  • If an agreement is reached, both parties will sign the agreement the day of the conference.
  • If the settlement conference session concludes after 2:00pm Eastern Time, or the appellant returns its signed portion of the agreement after 2:00pm Eastern Time, the agreement will be fully executed the next business day.
    • Settlement discussions will not continue the next business day.
  • If an agreement is not reached, the appeals subject to the conference will return to the previously assigned adjudicator, if applicable, or to the OMHA and Council docket for future assignment in the order in which the appeal was received.
• Settlement Conference (where an appealed claim(s) subject to the conference has a billed amount in excess of $100,000 or an appeal of an extrapolated overpayment in excess of $100,000):
  • If an agreement is reached, both parties state firmly to the facilitators their agreed percentage.  The facilitators will end the settlement conference.  There will be no further negotiations once the settlement conference has ended.  The facilitators will draft the proposed settlement agreement; however, the parties will not sign the agreement at this time.
  • The DOJ will be informed of the proposed agreement.  If the DOJ approves the proposed agreement, the facilitators will notify the appellant and send the draft agreement to the appellant.
  • The appellant will have one business day to return their portion of the proposed agreement to the facilitators.  If the appellant does not return the proposed agreement within one business day, the appellant’s SCF request will be cancelled and the appeals will be returned to OMHA and/or Council docket (if the appeal(s) were previously assigned to an adjudicator, the appeals will return to that adjudicator’s docket). 
  • The facilitators will forward the appellant signed, proposed settlement agreement to CMS.  CMS will have one business day to return its signed portion of the settlement agreement. 
  • The settlement agreement will be fully executed only after all of the actions above have occurred.

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