National Health-Policy Q&A

Q:  Does the Single-Payer Medicare Program Deny Payment for Health-Care Services?

A:  Yes.  In fiscal year 2004 Medicare denied over 158 million claims; approximately 5 million of those denied claims were appealed to the first level in the process; and about 113,000 denied claims were appealed to the third level of the process where administrative law judges (ALJs) hear and decide appeals, according the Government Accountability Office (GAO).  “An appeal may consist of more than one denied claim,” notes GAO. 

The Office of Medicare Hearings and Appeals (OMHA) reports that Medicare contractors process about 1 billion claims for payment annually, of which 10 percent are denied each year.  OMHA was appropriated $59 million for fiscal year 2007 to handle denied-payment issues and appeals.  Its budget will increase to $70 million in 2008.

Sources:

• Government Accountability Office, “Medicare: Concerns Regarding Plans to Transfer the Appeals Workload from SSA to HHS Remain”, Report # GAO-05-703R, June 30, 2005: http://www.gao.gov/new.items/d05703r.pdf
• U.S. Office of Management and Budget and federal agencies, “Detailed Information on the Office of Medicare Hearings and Appeals Assessment”:  http://www.whitehouse.gov/omb/expectmore/summary/10003554.2006.html and http://www.whitehouse.gov/omb/expectmore/detail/10003554.2006.html