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Regulation and Compliance > State Regulation

HHS Publishes Medicare Appeal Rule

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NU Online News Service, April 7, 2003, 12:45 p.m. EDT – The Center for Medicare & Medicaid Services, an arm of the U.S. Department of Health and Human Services, has published the final version of a regulation that will govern some appeal procedures for Medicare managed care plan members.

The final version of the regulation, 42 CFR Parts 422 and 489, is based on a preliminary version published in January 2001. The regulation states that managed care plans must give Medicare beneficiaries formal, written notices when terminating coverage for home health care, outpatient rehabilitation services and skilled nursing home services. Health care facilities must also provide formal notices when they terminate services to Medicare managed care beneficiaries.

The final version says providers can deliver the notices just two days before terminating services. The proposed rule required providers to notify patients at least four days in advance.

But the final version also creates a “fast-track appeal” system. Some beneficiaries could end up having to pay for a day of services from their own pockets if their appeals fail, but beneficiaries can end up having to pay for as many as four days of services under the current rules, according to an analysis accompanying the text of the final rule.

The officials who wrote the analysis estimate that 12,000 Medicare beneficiaries will file appeals using the regulation each year, and that complying with the regulation will cost managed care companies at least 12,600 hours of work per year.

The analysis identifies Chris Gayhead and Rhonda Greene Bruce as the Centers for Medicare & Medicaid Services officials who can answer questions about the regulation.

The American Association of Health Plans, Washington, has put out a statement praising the final version of the regulation.

“This regulation will help strengthen the coverage that beneficiaries receive ? by helping improve access to a timely and fair appeals process,” AAHP President Karen Ignagni says in the statement. “We support this important goal, and we are pleased that the rule minimizes the administrative complexity associated with implementing these new protections.”

The full text of the final rule is available at


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