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As you recall, CGI Federal asked for and received an injunction from the Court of Federal Claims to prevent award of the new Recovery Audit Contracts while they appealed to the U.S. Court of Appeals for the Federal District. 

That appeal was filed about 10 days ago. Recall that the issue is a pretty technical one. CGI Federal takes exception to the payment terms of the new contract. CMS had established those terms—as part of the procurement, back around the first of the year—to include a provision that RACs will not get paid until after the claim has exited the second level of appeal. This provision in the procurement was basically a compromise between the provider community that feels the RACs shouldn’t be paid until after the third level of appeal, and the current process that allows payment after the first level of appeal.

Thus far, CGI appears to be doing its best to speed up the appeal proceedings as much as possible. It has met all filing requirements prior to deadline. The government, however, is not matching that eagerness. Initial briefs are due in early November. Meanwhile, CMS has restarted automated auditing and some complex reviews. I remain of the opinion that CMS may open that auditing door a little wider while it scraps the procurement and tries again.

Meanwhile, Rep. Kevin Brady, Chairman of the House Energy and Commerce Subcommittee on Health, wrote to HHS Secretary Sylvia Mathews Burwell, urging her to reconsider the 68 percent appeal settlement with acute care providers. 

The upshot of Brady’s letter—in addition to well-deserved criticism of releasing the appeals settlement proposal on Friday evening of a holiday weekend—is that he wants greater cooperation between HHS and Congress on the knotty issue of appeals. Brady also questioned how CMS would handle beneficiary co-payments for settled claims.

It remains to be seen if HHS will take Congress up on the issue. Secretary Burwell seems inclined to address some of the criticism directed to HHS of late. We will have to wait until after the November elections to find out.

About the Author

Emily Evans is a partner with the Obsidian Research Group.

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