January 14, 2003 Centers for Medicare and Medicaid Services Department of Health and Human Services Attention: CMS-4004-P P.O. Box 8017, Baltimore, MD 21244-8017 Comments on Proposed Rule: Medicare Program: Changes to the Medicare Claims Appeals Procedures (Federal Register/Vol.67, No. 221) The American Health Quality Association is the national association representing the nation’s Medicare Quality Improvement Organizations (QIOs). We have been working with CMS officials and Congress on the interpretation and implementation of the Medicare, Medicaid and SCHIP Benefits Improvement and Protection Act of 2000 (BIPA 2000) since its passage in December 2000. We have been particularly interested in section 521 of this law, which calls for major revisions to the Medicare appeals process. Since their inception, the QIOs have handled medical necessity reviews associated with Part A and B appeals as Fiscal Intermediaries (FIs) and Carriers may request them. Since 1987, the QIOs have handled the expedited process in which Medicare beneficiaries have the right to request a review of a Hospital Issued Notice of Non-coverage (HINN). The Social Security statute that created the QIOs requires that actively practicing physicians, in the specialty or subspecialty appropriate to the care being reviewed, perform these medical necessity reviews. The QIOs provide the most long-standing and highly qualified medical necessity reviews in the field. We offer these comments on behalf of the QIOs regarding what we consider the positive aspects of the changes called for by section 521, as well as our concerns about implementation of the law. We are pleased CMS has acknowledged in this proposed rule its plan to have the QIOs handle all of the new expedited initial determinations created by BIPA section 521 (in Skilled Nursing Facilities (SNFs), home health, hospice and Comprehensive Outpatient Rehabilitation Facilities (CORFs)) and continue to handle the HINN reviews [section 405.122(b)(2)]. BIPA 2000 did not speak to who should be handling these reviews, but CMS states in the summary of the proposed rule, "…the regulations assume the QIOs would likely conduct these determinations. We believe QIOs are the appropriate entity to conduct these expedited reviews of provider terminations, given that they already have the professional medical capabilities to review such medical necessity cases and they are located in every State" [FR page 69337]. We are also pleased that the review process set forth for these new expedited determinations is consistent with the deadlines and procedures with which the QIOs are currently and successfully complying [section 405.122(b)(2)]. This is exactly what AHQA has been proposing since BIPA 2000 was passed. The QIOs are already required to turn around the most pressing hospital inpatient cases within one business day from receiving the pertinent information required. The proposed rule allows 72 hours to complete the new non-hospital expedited reviews once the QIO receives the necessary information to complete a review. AHQA has heard from legal experts in the area of Medicare appeals and consumer rights that this longer timeframe is appropriate for reviews in non-hospital settings. The QIOs are ready to provide competent decisions within any timeframe all parties agree is sensible. We believe timeliness will be of particular importance with regard to these new expedited reviews because the BIPA law does not provide beneficiaries with the strong liability protection afforded to them during hospital inpatient expedited reviews. We believe this was a significant omission in the law and we support further corrective legislation. Without this protection, beneficiaries may not exercise their right to request a review of an Advanced Beneficiary Notice (ABN) as they may be too fearful of the potential financial consequences. Until Congress fixes this problem, the assurance that the reviews will be done as quickly as possible would at least limit their liability as they pursue proper care. In order to completely shield beneficiaries from liability, regardless of the QIOs decision, it would be necessary for ABNs to be issued at least five working days prior to the scheduled termination of services. This would provide the time necessary, as prescribed in the regulation, for the beneficiary to request a review, the provider to supply necessary information, and the QIO to make a determination before the initial stay in question has ended [section 405.1200(g)]. We understand that CMS could not change, in this rule, the timing of the delivery of the existing ABNs because it is not the intent of the BIPA statute [FR p.69337]. We are hopeful that the current required ABN timeframes will suffice until statutory liability protection can be provided. The HHS Inspector General and the consumer advocacy community have made public their concerns about the wisdom of creating Qualified Independent Contractors (QICs). They predict that inserting an additional level of appeal prior to reaching an Administrative Law Judge (ALJ) review will only exacerbate the burden already on the system. Further, they, and many other policy makers, view the limited qualifications required by BIPA for the QIC reviewers to be insufficient. The law merely states, "Members of the QIC panel who conduct reconsiderations must have sufficient training and expertise in medical science and/or legal matters." AHQA supports legislation that would increase the reviewer requirements, but with or without further legislation, we believe that CMS will go far in remedying both of these concerns about QICs by allowing QIOs to be eligible to compete for QIC contracts. The reasons for this are largely the same as the reasons CMS cites in identifying QIOs as the most appropriate entities to handle the new expedited initial determinations under BIPA. The QIOs do not require the creation of a new infrastructure and have a proven track record of timeliness. QIO reviewers are actively practicing physicians in the specialty or subspecialty appropriate to the case being reviewed; and are located in every state, therefore making it easier to fulfill what will be a geographic consideration when CMS is selecting QICs. The QIOs’ level of qualification and experience in this area also assures that beneficiaries across the nation will all have recourse to a uniform standard of review executed by highly qualified individuals. At the new QIC level of appeal, which beneficiaries will now have to complete before having access to an ALJ, it would be inappropriate for QIC reviewers to have lower requirements than QIO reviewers. The proposed rule needs revision to be consistently clear as to whether certain QIO initial determinations are subject to redeterminations. The summary overview of the statute [FR p. 693321] states, "Section 1869(a)(3) contains certain requirements for redeterminations that are specific to fiscal intermediaries and carriers, and do not apply to the initial determinations made by other entities such as SSA or QIOs." However, section 405.940 states, "A person or entity that is party to an initial determination made by a contractor as described under section 405.920 through section 405.928 and is dissatisfied with that determination may request a redetermination by a contractor in accordance with section 405.940 through section 405.958, regardless of the amount in controversy." Further, section 405.944 requires requests for redeterminations to be filed with the entity that issued the initial determination. Certain QIO determinations, including the new expedited determinations created by BIPA, are defined in section 405.924 (b)(11) and (c) as actions that are considered initial determinations and would appear to be subject to the redetermination rights established in section 405.940. While QIOs will not be performing reconsiderations, it would be beneficial if QIOs were included in the list of "parties" that should be notified when an initial determination is reversed by a higher level of review [section 450.976]. The QIOs should be able to use this information as part of their internal quality control and improvement systems. There are also two errors in the rule that we wish to point out. First, the proposed language for section 405.924 (b)(11) contains an incorrect reference to "Qualified Improvement Organization (QIO)." This reference should be corrected to read "Quality Improvement Organization (QIO)." Second, the summary [FR p. 69336] states that "provider" for the purposes of sections 405.1200 and 405.1202 applies to: "hospitals, critical access hospitals, home health agencies, skilled nursing facilities, and comprehensive rehabilitation facilities." There is no mention of "hospice." However, in the rule language [FR p. 69360], "provider of services" does include hospice. This should be clarified and made consistent. Finally, CMS is very clear in the proposed rule that the changes mandated by BIPA 2000 will entail "significant new costs" to the agency, SSA and DHHS [FR p.69340, Effects on the Medicare Program]. The agency is also candid about the fact that it tried to structure the regulation in such a way as to achieve the goals of BIPA while "keeping in mind the limited resources likely available for appeals system changes" and that the "volume of appeals could increase significantly with the implementation of BIPA" [FR p.69316, Overview]. The rule does not discuss, however, a lesser, but necessary, cost to the program: education of providers and beneficiaries. The QIOs have long engaged in these activities as they pertain to HINNs. They have found many hospitals would not be inclined to widely publicize a patient’s right to a HINN review and few beneficiaries would know their rights without the efforts of QIOs and consumer groups to educate them on this matter. Education of beneficiaries concerning ABNs as a new aspect of the Medicare appeals system must be improved in order to have an effective and equitable appeals system. AHQA understands the resource dilemma CMS faces. We are already working to ensure the QIOs receive enough funding in their Medicare contracts to succeed in their latest, greatly expanded new scope of work. In this rule, CMS rightly calls upon the QIOs’ to continue their current inpatient expedited reviews and to take on the additional expedited initial determinations in non-hospital settings. Beneficiaries will receive timely, accurate and consistent decisions from their QIOs in every State. Further, any QIOs selected by CMS to be QICs will certainly bring greater established efficiencies to the table than could contractors newly created for this purpose. However, it will cost the QIOs more money to do a greater volume of high quality medical necessity reviews and to provide the necessary provider and beneficiary education about these new reviews. CMS must recognize that the QIOs cannot be expected to absorb this new work under their current contracts. Additional funds must be apportioned for these contractors to not only do their job, but do it well. AHQA appreciates the opportunity to share these comments. We look forward to continued communication about this matter and wish to support CMS’ efforts in implementing this new law. Sincerely, David G. Schulke Executive Vice President American Health Quality Association