4-27-15; Appeal Rights Coming to Some Medicare Issues by Shawn Biery, JD, MSCC, IME Docs--Never Send an Examinee Away Due to Language Barriers: Lindsay Vanderford, JD on Municipal Settlement Battle...

Synopsis: Appeal Rights Coming to Medicare Second Payer Issues Tomorrow!—Will It Work as Well as All Other Federal Programs!!  Analysis by Shawn R. Biery, J.D., MSCC.


Editor’s comment: The Centers for Medicare & Medicaid Services (CMS) issued a final rule implementing certain provisions of the Strengthening Medicare and Repaying Taxpayers Act of 2012 (the SMART ACT). With this final rule, a formal appeals process is established for applicable plans (liability insurance—including self-insurance, no-fault insurance, and workers’ compensation laws or plans) in situations where Medicare Secondary Payer (MSP) recovery is sought directly from an applicable plan. It is important to note—the rule is effective tomorrow April 28, 2015, and applies to demand letters issued on or after April 28, 2015. See below for a link to register for tomorrow’s CMS webinar if you want to learn more.


By way of recap, you may recall Medicare is a secondary payer to liability insurance (including self-insurance), no-fault insurance, and workers’ compensation laws or plans for injuries claims which may be the responsibility of one of those types of "first" payers. Medicare might make "conditional" payments, if they lack knowledge of the first payer or if payment for items or services has not been made promptly or may not be expected to be made promptly by the applicable plan. The payment creates the expectation these payments will be reimbursed to the appropriate Medicare Trust Fund if there is a settlement, judgment, award, or other payment (hereafter referred to as "settlement"). This includes situations where Ongoing Responsibility for Medicals (ORM) exists and once there has been a settlement, Medicare pursues recovery of its conditional payments.


If an MSP recovery demand is issued to the beneficiary as the identified debtor after April 28, 2015, then the beneficiary has formal administrative appeal and judicial review rights. There was no formal administrative appeal rights or judicial review previously and CMS' recovery contractor addressed any dispute raised by the applicable plan, so prior to this final rule there was no multilevel formal appeal process for applicable plans.


The appeals process established in the final rule parallels the existing process for claims-based beneficiary and other appeals for both non-MSP and MSP, and will be used for appeals involving both pre-payment denials as well as overpayments.



The formal appeals process applies to MSP recovery demand letters issued directly to applicable plans as the identified debtor on or after April 28, 2015. Receipt of a courtesy copy (“cc”) of a MSP recovery demand letter by an applicable plan does not necessarily mean the applicable plan has the ability to file an appeal.


There will be a formal multilevel appeal process for applicable plans where MSP recovery is pursued directly from the applicable plan. The MSP recovery demand letter and any subsequent appeal determination will specify any timeframe or other requirement to proceed to the next level of appeal. The process then moves forward as such:


Ø  An “initial determination” (the MSP recovery demand letter),

Ø  A “redetermination” by the contractor issuing the recovery demand,

Ø  A “reconsideration” by a Qualified Independent Contractor,

Ø  A hearing by an administrative law judge (ALJ),

Ø  A review by the Departmental Appeals Board's Medicare Appeals Council, and

Ø  Judicial review.


It is important to note the applicable plan is the only entity with appeal rights/party status when Medicare pursues recovery directly from the applicable plan. The beneficiary is not a party to applicable plan appeals. However, CMS is required to provide notice to the beneficiary of the applicable plan’s intent to appeal and will provide such notice if the applicable plan files a request for a redetermination.


Proper proof of representation must also be submitted in writing prior to or with a request for appeal in order for an attorney, agent or other entity to file an appeal on behalf of an applicable plan or act on behalf of an applicable plan with respect to an appeal that has been requested. Appeal requests without proper proof of representation will be dismissed. Proper proof of representation may be submitted with a request to vacate the dismissal, however the strongest course of action is to make sure proper proof of representation has been submitted when requesting a redetermination. It is also important to note separate proof of representation is required even where an applicable plan may have identified an agent for recovery correspondence as part of the Medicare, Medicaid & SCHIP Extension Act of 2007 Section 111 reporting process.


The applicable plan may appeal:


Ø  the amount of the debt and/or 

Ø  the existence of the debt. 


The regulation does not permit applicable plans to appeal the issue of who is the responsible party/correct debtor. Requests for appeal on the basis the applicable plan is not the correct debtor will therefore be dismissed. Medicare’s decision regarding who or what entity it is pursuing recovery from is not subject to appeal.


Tomorrow, CMS will be presenting a webinar on “Applicable Plan” Appeals which will include: an introduction to the appeals process (as the process is new to applicable plans), information on the appeals process specific to applicable plans, and tips/suggestions to applicable plans regarding the recovery process, including appeals. Anyone interested can take part:


Ø  Date: April 28, 2015

Ø  Start time: 1:00 PM Eastern time.

Ø  URL: https://webinar.cms.hhs.gov/r2g9kffqc46/


They ask you begin logging in approximately 15 minutes before the start time, due to the large number of participants anticipated.


It is still to be determined how well the appeals process will work, however we will follow the process closely and identify those cases in our office in which an appeal may be appropriate and test the process aggressively. If you have any cases which may have the potential, KCB&A has several MSCC certified attorneys to consult with. This article was researched and written by Shawn R. Biery JD, MSCC who can be reached at sbiery@keefe-law.com with any comment or question.




Synopsis: Note to IME Docs—Never Send Examinees Away Because They Need an Interpreter—Just Call and Get One!!


Editor’s comment: We had an IME doctor send away an examinee last week because the worker didn’t speak conversational English and the IME doc was not comfortable with having a family member interpret. The doctor didn’t call our office and wanted a “no show” fee due to the problem. We feel IME’s cost a lot of money and no show fees are also expensive—let’s not waste money and time when this issue can be so easily corrected.


Please note the defense team at KCB&A sets around 150-250 IMEs every year. Due to that volume of IME’s that we are handling, we are not strongly aware of the language abilities of the claimants who will be attending examinations. We don’t meet the claimants and we cannot talk to them unless we have prior consent from their attorneys. We also note it is very rare for a Petitioner attorney to contact us prior to an IME and let us know the language abilities of claimants.


What this IME doc and many of our readers were unaware of are the online and “real-time” available services to get telephonic interpretation of hundreds of languages almost instantaneously. If you contact:


·         Transcend Services has qualified and great interpreters waiting for your call and can handle over 200 languages. Take a look at Transcend’s website online at http://www.transcendservice.com/Translation-Interpretation-Services.cfm or on a 24/7/365 basis, call 877-838-3032;


·         AccessOnTime has an established national network of credentialed linguistic specialists, AccessOnTime provides clear, fast and accurate translation and interpretation services. You can find out more at: http://www.accessontime.com/language-services.shtml or call 888-745-7575.


So, as an IME doc that isn’t comfortable about your discussions with an examinee or at any other time anyone in our industry needs rapid and accurate translation, give us or the adjuster a phone call to discuss and then contact one of these great companies.



Synopsis: Are We Settled Yet? In an important ruling as it relates to municipality settlements, the Illinois Second District Appellate Court held a settlement was not final and binding since the City Council did not approve it. Thoughts and Analysis by Lindsay R. Vanderford, JD.

Editor’s comment: In a recent opinion, the Illinois Second District Appellate Court in essence affirmed the Circuit Court of Winnebago County’s denial of a motion to enforce a settlement agreement with the City of Rockford. The Appellate Court took the matter pursuant to Illinois Supreme Court Rule 308 on certified questions from the Circuit Court. The certified questions center around the Illinois Municipal Code and the local ordinances of Rockford related to settlement of pending litigation with the approval of the City Council. 

On the eve of trial, Plaintiff Meade, and Rockford reached a settlement agreement at a pre-trial conference, and consequently, the trial date was stricken. Subsequently, Plaintiff signed a written settlement agreement drafted by Rockford. However, when the settlement was presented to the City Council a few weeks later, that body (including some of the council members whom had been present at the settlement conference and had approved the settlement offer at that time) voted to reject the settlement agreement. Plaintiff moved to enforce the settlement agreement, and the Circuit Court of Winnebago County denied the motion but certified certain questions for the Appellate Court to answer. The Appellate Court answered all the certified questions in the negative. Pursuant to Rockford’s Ordinance, settling with Rockford for over $12,500 requires City Council approval, and signing a settlement document agreed to by all parties does not constitute a promise that approval will be consistent when the votes needed to approve the settlement before the City Council are taken.

Plaintiff alleged she was injured on May 10, 2009, when she was standing on the parkway near a street in her Rockford neighborhood, and the ground gave way, causing her to fall into a sinkhole. She filed suit against Rockford in 2010 seeking damages stemming from her injuries. Trial was set to begin on January 27, 2014. After numerous attempts at negotiation, $600,000 was offered by Rockford’s attorney and accepted by Plaintiff. Accordingly, the Circuit Court docketed the case as settled and struck the trial date. The settlement agreement did not state it was subject to approval by the City Council. When the settlement was presented to the City Council for approval, two of the council members who had previously approved the settlement changed their votes. The vote of the City Council was  seven (7) to five (5) against approving the settlement. It is undisputed that, if all City Council members had been present at the meeting and had voted consistently with their earlier positions, the settlement would have passed.

Although the Appellate Court opinion appeared to disapprove of the result of the proper application of legal precedent to determine the settlement agreement could not be enforced, it reiterated the Circuit Court had tools for dealing with parties disregard for its time and the time of all parties involved. In that same vein, the Appellate Court discussed using sanctions pursuant to Illinois Supreme Court Rule 219 for conduct demonstrating a willful disregard for the orders and deadlines set by the trial court or that unnecessarily and vexatiously multiplies the cost of litigation borne by the other party. The Appellate Court went on to describe the circumstances presented in the Circuit Court as ripe for a possible finding of Rockford’s conduct as sanctionable. It is obvious the Appellate Court disapproved of the City Council’s tactic in approving and subsequently disapproving of the settlement.

The analysis and writing of this article was performed by  Lindsay R. Vanderford, JD.  Lindsay can be reached with any questions regarding general liability, municipal defense, and workers’ compensation at lvanderford@keefe-law.com.