House leader urges HHS to end settlements meant to cut Medicare backlog

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The Department of Health and Human Services may not have had the authority to offer providers special settlements to help clear a huge backlog of Medicare appeals, a leading Congressman said in a recent letter to the agency. Rep. Kevin Brady (R-TX) is urging HHS to halt the new settlement process.

Long-term care and other providers have seen their Medicare appeals come to a standstill due to a backlog at the administrative law judge level. In late August, HHS announced that certain hospitals could resolve pending appeals by entering an administrative agreement. The provider would receive 68% of the “net payable amount” of the contested claim and would agree to end the appeals process.

Brady demanded to know what statutory authority permitted HHS to create this type of settlement, and he criticized the plan as a hasty and uneconomical effort to manage a crisis. He requested that the agency immediately explain why the 68% payment level is appropriate.

“While the backlog of Medicare appeals is at an unacceptable high, settling all appeals without reviewing the merits of the appeals or coming up with any plan to address the backlog is just throwing money at a problem to make it go away,” he wrote in the Sept. 15 letter to HHS Secretary Sylvia Mathews Burwell.

Brady claims the agency developed and launched the administrative agreement program without Congressional collaboration, and that he and his colleagues were “shocked” to learn of it through the media. HHS demonstrated  “lack of engagement” with Congress, and this needs to be remedied in order to solve the appeals backlog, he wrote.

Brady sent the letter in his role as chairman of the House Committee on Ways and Means Subcommittee on Health. Click here to access the complete document.