The Fifth Circuit has recently held that its courts have jurisdiction to hear a lawsuit seeking to enjoin Medicare from recouping funds until after a hearing because (1) the provider’s claim is collateral to the underlying recoupment and (2) the recoupment may result in the provider’s bankruptcy and in a disruption to its patients.

In 2016, a Zone Program Integrity Contractor (ZPIC) concluded that Medicare had overpaid Family Rehab (a home health provider) nearly $7.9 million.  Family Rehab asked for a redetermination from its Medicare Administrative Contractor (MAC); the MAC affirmed the ZPIC’s conclusion.  The provider then asked a Qualified Independent Contractor (QIC) to reconsider the decision.  The QIC slightly reduced the demand to over $7.6 million.  The MAC then noticed its intention to begin recouping the overpayment.  (The MAC can begin recouping overpayments after the QIC issues its decision.)  Family Rehab then requested an ALJ hearing.

Despite the statutory requirement for an ALJ to issue a decision within 90 days of a request for a hearing, the hearing is not projected to occur until at least 3 to 5 years from now.  Since the recoupments will continue during the delay, the provider faces the possibility of going bankrupt and terminating operations before it could even conclude the 4-part Medicare appeal process (which has been described by the court as Byzantine).  The recoupments would cut off nearly all of the provider’s revenue stream.  Faced with these issues, Family Rehab sued the Secretary of Health and Human Services (HHS) in federal court and sought a temporary restraining order and an injunction to prevent the recoupment of any overpayments until the conclusion of the administrative appeals process. Continue reading…

The recent Medicare Payment Advisory Commission (“MedPAC” or “Commission”) report should serve as a shot across the bow to telehealth advocates seeking broader Medicare coverage of telehealth. In reading the telehealth chapter, it is clear to me that the MedPAC commissioners are not fully sold on telehealth because, among other reasons, they recommend that the Medicare program proceed cautiously before any expansion of the telehealth benefit. The report also makes certain conclusions that are sure to vex many in the telehealth community.

For those not familiar with MedPAC, it is an independent congressional agency that advises Congress on Medicare-related issues, and it is influential in lawmakers’ consideration of Medicare issues.  By way of quick background, the 21st Century Cures Act of 2016 required the Commission to provide information regarding: 1) the extent to which Medicare covers telehealth; 2) the extent to which commercial insurers cover telehealth; and 3) ways in which the telehealth coverage policies of commercial insurance plans may be incorporated into the Medicare program. This required the Commission to do a broad-reaching examination of the telehealth sector beyond Medicare.

As a preliminary matter, the Commission notes that in 2016, 108,000 beneficiaries accounted for approximately 300,000 telehealth visits totaling $27 million in reimbursement under the Medicare physician fee schedule. Most of the services were basic physician office and mental health services.  More interesting was the Commission’s observation that Medicare beneficiaries using telehealth tended to be under the age of 65, Medicare/Medicaid dual eligibles, and “to disproportionately have chronic mental health conditions.”

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