Female caregiver greets older couple at door

CHICAGO — Skilled nursing providers would get a new, improved appeals process for Medicare Advantage denials under a proposal issued late Monday by the Centers for Medicare & Medicaid Services.

The change would address one of the most significant challenges faced by nursing homes and their patients in the shift to managed care: insurers who have been able to decide single-handedly whether their own denials of care or shortened stays were appropriate.

The CMS proposal comes as MA plans find themselves under increasing scrutiny for allowing artificial intelligence and other technology to influence, and possibly dictate, coverage and the length of patient stays.

Under contract year 2025 Medicare Advantage plan changes, beneficiaries would be able to use the same appeal process provided under traditional Medicare. Staff from the nation’s 53 CMS-affiliated Quality Improvement Organizations would review untimely, fast-track appeals of any MA plan’s decision to terminate services in a skilled nursing facility, outpatient rehabilitation facility or home health agency.

The rule would also eliminate a requirement that makes beneficiaries forfeit their right to appeal a termination of services decision when they leave the facility. 

The proposal helps to address a glaring difference in how patients in traditional, Fee For Service Medicare are treated compared to the 51% of Medicare patients now enrolled in MA plans, said Nicole Fallon, vice president of Integrated Services and Managed Care for LeadingAge.

“My takeaway is that they’re hearing us that the appeals process is pretty complex,” Fallon told McKnight’s Long-Term Care News at the LeadingAge annual meeting here. “In theory, Medicare Advantage is supposed to offer the same benefits that Fee For Service does. And what we’re seeing in practice is that that really hasn’t been the case with coverage denials and some other things. I think if this takes us a step in that direction, it seems like it’s going to be a positive.”

Fallon said one key detail is the apparent removal of an existing requirement that patients who appeal a denial agree to take on financial liability for additional care if the denial is upheld. That provision has sometimes discouraged Medicare Advantage patients, 52% of whom have annual incomes below $25,000, from fighting denials.

A KFF report earlier this year found just 11% of partial or complete Medicare Advantage denials are appealed. Of those, however, 82% were overturned with results favorable to patients. 

Maureen McCarthy, president and CEO of Celtic Consulting, helps facilities deal with medical billing and MA denials. She called the proposal “long-awaited” and “fantastic news” for providers.

“When Medicare advantage organizations deny care currently, the providers must go back to the insurer directly to appeal the denied coverage. There are two levels of appeal and a third called a ‘peer review’. All levels of reviews are performed by the insurer’s staff, who they have trained to interpret coverage regulations inappropriately, to increase profit margins,” she told McKnight’s Monday.

“Access to the QIO appeal process would allow providers and beneficiaries to have an independent review of the care delivered or intended per the care plan. The third level of appeal, with an Administrative Law Judge, poses the best opportunity for review decisions to be overturned because there is a dialogue exchanged between the provider,  resident, insurer and the judge,” she added. “Having the opportunity to state your case in front of a judge will allow providers to give the ‘real picture’ and give testimony as to the coverage that would have applied, had traditional Medicare been the primary payer.” 

McCarthy said other MA regulations finalized in April for Managed Care Organizations would help providers in advocating for their residents and how coverage of care is determined. 

“Having the treating physician deciding whether care is medically necessary will help keep the focus on the resident and their care, rather than on filing multiple appeals,” she said.

In early 2022, the Health and Human Services Office of the Inspector General found that peer reviewers (doctors trained and hired by the insurers) were “missing” key information when reviewing whether a denial was appropriate.

Fallon encouraged CMS to go a step further in its regulation of MA denials and require all plans to use a standardized set of forms or documentation when making coverage determinations. Currently, information is sent to various insurers by mail, or fax or electronic portal, with hundreds of pages of patient information sometimes required.

Having those reviewed by insurance plan employees, with reviewers often pressured to process or deny claims quickly, has made the process fast. But it’s often at the sake of patients whose healthcare providers believe they still need in-patient care, Fallon said.

“We want them to have the right to get these [denials] overturned where we believe they’re not appropriate, where that individual beneficiary doesn’t feel safe or ready to go home,” she said.

Many of the provisions in the rule proposed Monday were sluiced off a previous proposed rule. Their reintroduction means CMS is likely committed to pressing forward, and there could be a silver lining for insurers to accept the new appeals process.

“It takes these particular appeals off the plate of the MA plan. One could argue there’s reduced administrative burden on the plans, so there could be a little bit of a win-win in there.”

It’s unclear just how much the MA plans might push back against the proposal.

The proposal also sets out potential new rules for the Medicare Prescription Drug Benefit Program, Medicare Cost Plan Program, and Programs of All-Inclusive Care for the Elderly, and Health Information Technology Standards. Comments will be due in early January.