Any Claim is Fair Game for an Audit, Appeals Court Rules
A recent appeals court ruling upholds Medicare regulations that give recovery auditors the right to reopen claims paid one to four years previous. Auditors need only good cause to reopen such claims and, per Medicare regulations, a good-cause determination cannot be challenged, the court said. The implications of this ruling have industry experts worried.
The 9th U.S. Circuit Court of Appeals ruling on Aug. 22 comes after three years of administrative appeals brought forth by Escondido, Calif.-based Palomar Medical Center. In the original 2009 lawsuit, Palomar challenged auditors’ reopening and overpayment determination of a claim paid 20 months previous, according to American Medical News.
An administrative law judge (ALJ) found that Palomar was overpaid for the medical services, but the recovery auditor had not demonstrated good cause to examine the claim. The ALJ decision was overturned by a Centers for Medicare & Medicaid Services (CMS) administrator, however, based on Medicare regulations that stipulate the reopening of a claim deemed to have good cause was not subject to appeal. Further, Medicare regulations prevent medical professionals from challenging an audit’s good-cause determination, CMS said.
The ruling is harmful to physicians, who must accept audits without being afforded the opportunity to question the reasoning behind reopening old claims, said Long X. Do, legal counsel for the California Medical Association (CMA).
“Any audit is going to be very disruptive to a physician’s practice,” Do said. “The longer the audit goes back, the more burdensome it is on physicians. … The court has upheld the ability of the auditor to [reopen claims] without being subject to physicians’ challenges.”