In re LCD Complaint: Noncovered Services, DAB CR5598 (2020)

DECISION DISMISSING COMPLAINT

I dismiss the complaint filed against Local Coverage Determination (LCD) No. L34555 because Palmetto GBA, Inc. (Palmetto) filed notice that it retired the LCD, effective March 23, 2020.  42 C.F.R. § 426.420(e)(1).

I. Background

On March 17, 2020, the aggrieved party (AP) filed a complaint with the Civil Remedies Division seeking review of the validity of the LCD regarding Noncovered Services, LCD L34555.  Specifically, the AP challenged the provisions of the LCD that pertain to the use of a continuous glucose monitor device.

On March 20, 2020, I acknowledged receipt of the AP’s acceptable complaint and issued a prehearing order establishing a schedule for the submission of the LCD record, and the parties’ arguments as to whether the LCD record was complete and adequate to support the validity of L34555 under the reasonableness standard.  42 U.S.C. § 1395ff(f)(2)(A)(i)(I); 42 C.F.R. §§ 426.403, 426.405(b), 426.425, 426.431.

Instead of filing the LCD record, on April 20, 2020, Palmetto filed a letter advising that it had retired L34555 as of March 23, 2020, along with copies of the retired LCD and retired Article A56480.  The letter included links to the Centers for Medicare & Medicaid Services’ (CMS) website where the retired LCD and article are posted.

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II. Analysis

An LCD is “a determination by a fiscal intermediary or a carrier . . . respecting whether or not a particular item or service is covered [under the Medicare program] on an intermediary- or carrier-wide basis . . . .”  42 U.S.C. § 1395ff(f)(2)(B).  At least 45 days before an LCD becomes effective, each Medicare administrative contractor must make the following available on its internet website and on the Medicare website:  where and when the proposed LCD was made public; hyperlinks to the proposed determination and a response to comments submitted to the contractor concerning the proposed determination; the entire LCD; a summary of the evidence that was considered by the contractor and a list of the sources of such evidence; and an explanation of the rationale that supports the LCD.  42 U.S.C. § 1395y(l)(5)(D).  The Secretary of the Department of Health and Human Services coordinates the LCDs issued by the various fiscal intermediaries and carriers and determines when LCDs should be adopted nationally.  42 U.S.C. § 1395y(l)(5)(A)-(C).

When a fiscal intermediary or carrier issues an initial determination denying coverage of an item or service, the determination must state whether an LCD was used in making that determination.  42 U.S.C. § 1395ff(a)(4)(A)(i).  If a qualified independent contractor considers a claim on reconsideration, the LCD “shall not be binding on the qualified independent contractor in making a decision with respect to a reconsideration” but “the qualified independent contractor shall consider the local coverage determination in making such decision.”  42 U.S.C. § 1395ff(c)(3)(B)(ii)(II).  If a case is further appealed to an administrative law judge (ALJ) at the Office of Medicare Hearings and Appeals or to the Medicare Appeals Council at the Departmental Appeals Board, the ALJ and the Council are not bound by the LCD, but must give the reasons for not following an LCD.  42 C.F.R. § 405.1062.

Outside of the Medicare claims appeal process, a beneficiary entitled to Medicare Parts A and/or B may seek review of an LCD by an ALJ, who will only defer to reasonable findings of fact, reasonable interpretations of law, and reasonable applications of fact to law.  42 U.S.C. § 1395ff(f)(2)(A)(i)(III); see also 42 C.F.R. § 426.431.  The ALJ may uphold or invalidate the challenged LCD provision.  42 C.F.R. § 426.460.  The LCD review process is distinct from the claims appeal process.  42 C.F.R. § 426.310.

A CMS contractor may retire an LCD under review at any time before an ALJ issues a decision.  42 C.F.R. § 426.420(a).  When this happens, the CMS contractor must notify the ALJ that it has retired the LCD.  42 C.F.R. § 426.420(c).  Upon receiving such notice, an ALJ must dismiss the complaint concerning the retired LCD so that the AP can receive individual claim review without the retired LCD.  42 C.F.R. §§ 426.420(e)(1), 426.444(b)(6).  Significantly, when an LCD is retired during the LCD complaint process, that retirement has the same effect as an ALJ decision finding that the challenged LCD provision is invalid.  42 C.F.R. §§ 426.420(a), 426.460(b).  For claims that have already

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been denied, this means that “the contractor, an M + C organization or another Medicare managed care organization must reopen the claim of the party who challenged the LCD and adjudicate the claim without using the provision(s) of the LCD that the ALJ found invalid.”  42 C.F.R. § 426.460(b)(1)(i); see also LCD Appeal of Non-Coverage of Transfer Factor, DAB No. 2050 at 18 (2006) (explaining that § 426.460(b)(1) applies when a challenged LCD provision is retired or withdrawn).  If a claim had not yet been submitted to a CMS contractor, then once a claim is filed, “the contractor adjudicates the claim without using the provision(s) of the LCD that the ALJ found invalid.”  42 C.F.R. § 426.460(b)(1)(iii).  Further, “the claim and any subsequent claims for the services provided under the same circumstances is adjudicated without using the LCD provision(s) found invalid.”  42 C.F.R. § 426.460(b)(1)(iv).

In the present case, I have received notice from Palmetto that it retired L34555 three days after the AP filed the complaint in this case.  The retirement of that LCD appears on CMS’s website.  Because there is no doubt that L34555 has been retired, my jurisdiction to review L34555 has ended.  42 C.F.R. § 426.405(d)(4).  Therefore, I dismiss the AP’s complaint so that the AP can receive an individual claim review following the retirement of the challenged LCD.  42 C.F.R. § 426.420(e)(1).1

III. Conclusion

For the reasons explained above, I must dismiss the AP’s complaint.