As previously reported, the American Hospital Association (AHA) filed suit against HHS in 2014 in connection with the Medicare appeals backlog and requested that the court force HHS to meet its statutory deadline for administrative review of denials of claims for Medicare reimbursement.  As also reported, AHA recently filed a motion for summary judgment requesting that the court direct HHS to implement certain “practicable solutions” to address the appeals backlog or, in the alternative, direct HHS to comply with certain targets and deadlines that would eliminate the appeals backlog by the start of CY 2021.  On December 5, 2016, U.S. District Judge James Boasberg granted AHA’s motion for summary judgment and adopted AHA’s proposed deadlines for reducing the appeals backlog over the next four years.

Specifically, in October 2016, AHA filed a motion for summary judgment requesting that the court direct HHS to implement the following three “practicable solutions” to address the Medicare appeals backlog:

• Offer reasonable settlements to broad groups of Medicare providers and suppliers;
   
• Delay repayment of at least some subset of disputed Medicare claims, and toll the accrual of interest on those claims for waiting times beyond the statutory maximums; and
   
• Impose financial penalties on Recovery Auditors for poor outcomes at the administrative law judge level.

In the alternative, AHA proposed that the court should direct HHS to comply with certain targets and deadlines that would eliminate the appeals backlog by the start of CY 2021.  If HHS could not eliminate the backlog by January 1, 2021, AHA proposed that the court enter a default judgment in favor of all claimants whose appeals had been pending for more than a year.

On November 7, 2016, HHS filed its own motion for summary judgment along with its opposition to AHA’s motion for summary judgment.  HHS argued that court intervention was unnecessary to reduce the appeals backlog.  HHS informed the court that it had implemented multiple measures to combat the backlog and that it estimated the backlog would be eliminated by CY 2019 “with a combination of administrative and legislative” actions.

As noted, on December 5, 2016, U.S. District Judge James Boasberg granted AHA’s motion for summary judgment, observing that “[a]lthough the Court is glad to learn that the backlog-reduction projections are better than earlier reported, they are still unacceptably high.”  The court further noted that HHS did “not point to any categorically new administrative actions and, critically, continues to promise the elimination of the backlog only ‘with legislative action’ – a significant caveat.”

The court then adopted AHA’s proposed deadlines that would reduce the appeals backlog over the next four years.  Specifically, the court ordered HHS to:

• Reduce the appeals backlog by 30 percent by the end of 2017;
   
• Reduce the appeals backlog by 60 percent by the end of 2018;
   
• Reduce the appeals backlog by 90 percent by the end of 2019; and
   
• Completely eliminate the appeals backlog by December 31, 2020.

Should HHS be in default on January 1, 2021, AHA may move for a default judgment or enforce the writ of mandamus.  The court denied AHA’s request that the court automatically enter default judgment in favor of all claimants whose appeals have been pending at the ALJ level without a hearing for more than one calendar year.  Additionally, the court ordered HHS to file status reports with the court every 90 days. 

The court’s order is available here and its opinion is available here.