Bush Pushes Plan to Curb Medicare Appeals
 
By ROBERT PEAR
 
 
WASHINGTON, March 15 — The Bush administration says it is planning major changes
in the Medicare program that would make it more difficult for beneficiaries to
appeal the denial of benefits like home health care and skilled nursing home
care.
 
In thousands of recent cases, federal judges have ruled that frail elderly
people with severe illnesses were improperly denied coverage for such services.
 
In the last year, Medicare beneficiaries and the providers who treated them won
more than half the cases — 39,796 of the 77,388 Medicare cases decided by
administrative law judges. In the last five years, claimants prevailed in
186,300 cases, for a success rate of 53 percent.
 
Under federal law, the judges are independent, impartial adjudicators who hold
hearings and make decisions based on the facts. They must follow the Medicare
law and rules, but are insulated from political pressures and sudden shifts in
policy made by presidential appointees.
 
President Bush is proposing both legislation and rules that would limit the
judges' independence and could replace them in many cases.
 
The administration's draft legislation says, "The secretary of health and human
services may use alternate mechanisms in lieu of administrative law judge
review" to resolve disputes over Medicare coverage.
 
Under the legislative proposal, cases could be decided by arbitration or
mediation or by lawyers or hearing officers at the Department of Health and
Human Services. The department recently began testing the use of arbitration in
Connecticut under a law that permits demonstration projects. 
 
Tommy G. Thompson, the secretary of health and human services, said the proposed
legislative changes would give his agency "flexibility to reform the appeals
system" so the government could decide cases in a more "efficient and effective
manner."
 
The department said there was an "urgent need for improvements to the Medicare
claim appeal system," in part because the number of appeals was rising rapidly.
 
Consumer groups, administrative law judges and lawyers denounced the proposals.
Judith A. Stein, director of the Center for Medicare Advocacy in Willimantic,
Conn., said, "The president's proposals would compromise the independence of
administrative law judges, who have protected beneficiaries in case after case,
year after year."
 
Beneficiaries have a personal stake in the issue. When claims are denied, a
beneficiary often must pay tens of thousands of dollars for services already
received. 
 
In a typical case, an administrative law judge ordered Medicare to pay for 230
home care visits to a 67-year-old woman with breast cancer, heart disease and
arthritis. Medicare officials had said the woman should pay the cost. But the
judge ruled that because the woman was homebound, the services were "reasonable
and necessary." 
 
When federal agencies issue rules or decide cases, they generally must follow
the Administrative Procedure Act, a 1946 law intended to guarantee the fairness
of government proceedings.
 
Ronald G. Bernoski, president of the Association of Administrative Law Judges,
said: "We see President Bush's proposals as a serious assault on the
Administrative Procedure Act, a stealth attack on the rights of citizens to
fair, impartial hearings. These hearings guarantee due process of law, as
required by the Constitution."
 
The American Bar Association and the Federal Bar Association, which represents
lawyers who practice in federal courts and before federal agencies, have
expressed similar concerns.
 
Health care providers, which are involved in many of the appeals, share those
concerns.
 
Robert L. Roth, a Washington lawyer who has represented hospitals and suppliers
of medical equipment, said: "The interests of providers and beneficiaries are
aligned. Access to an independent decision maker, an administrative law judge,
is quite valuable because it's often your first opportunity to get a fair review
of government action."
 
Medicare officials could adopt the proposed rules, regardless of whether
Congress accepts Mr. Bush's recommendation for changes in the law.