HHS FY 2018 Budget in Brief - OMHA

Office of the Secretary, Office of Medicare Hearings and Appeals (OMHA)

The Office of Medicare Hearings and Appeals provides an independent forum for the fair and efficient adjudication of Medicare appeals for beneficiaries and other parties. This mission is carried out by a cadre of knowledgeable Administrative Law Judges exercising decisional independence under the Administrative Procedures Act with the support of a professional, legal, and administrative staff.

OMHA Budget Overview

(Dollars in millions)

Funds 2016 2017 /1 2018 2018
+/- 2017
Budget Authority 107 107 117 +10
Proposed Mandatory Funding -- -- 125 +125
Total Program Level 107 107 242 +135
Full-Time Equivalents 557 671 980 +309

Table Footnotes

1/  Reflects the annualized level of the Continuing Resolution that ended April 28, 2017, including the across the board reduction, the 21st Century Cures Act, and directed transfers.

The Fiscal Year (FY) 2018 Budget requests $242 million in program level funding for the Office of Medicare Hearings and Appeals (OMHA), an increase of $135 million over the funding provided in the FY 2017 Continuing Resolution.  The increase outlined in the FY 2018 Budget request is composed of a $10 million increase in discretionary budget authority and a $125 million proposed mandatory funding increase.  The Budget request also includes a legislative package to address the Medicare appeals backlog.

OMHA administers hearings and appeals nation-wide for the Medicare program.  OMHA began processing cases on July 1, 2005; since then, it has received approximately 1.7 million appeals for Medicare Parts A, B, C, and D, as well as for Medicare entitlement and eligibility.  In FY 2011, OMHA began receiving additional appeals resulting from the permanent nation-wide expansion of the Recovery Audit program administered by the Centers for Medicare & Medicaid Services.  These appeals, in addition to the more traditional Part A and B appeals, have contributed to OMHA’s significant workload increase.  Despite efforts to mitigate the incoming workload, unsustainable appeal receipt volumes continued:  FY 2014—474,000; FY 2015—240,000; and FY 2016—184,000. The slight decline in FY 2016 receipts was due to a contract protest which slowed the rate of receipts.  Annual adjudication capacity in FYs 2014 and 2015 was 77,000 appeals.  In FY 2016, OMHA adjudicated 87,000 appeals.

Current law requires that Medicare appeals at the OMHA level be heard within 90 days after receipt of a request for a hearing from an appellant.  Due to the overwhelming growth in its workload, OMHA has not been able to meet the 90-day time frame for case adjudication in some cases.  It currently takes approximately 1,000 days for OMHA to adjudicate a
non-beneficiary appeal.


Improving the Medicare Appeals Process

The Department has a three-pronged approach to address the significant volume of new Medicare appeals and the current backlog of claims to be adjusted:

  1. Invest resources to increase adjudication capacity and implement new strategies to alleviate the current backlog;
  2. Take administrative actions to reduce the backlog of appeals and the number of new cases from entering the system or escalating to higher levels of appeal; and
  3. Propose legislative actions that provide additional funding and new authorities to address the backlog.

To address these challenges, OMHA has taken a number of administrative actions to reduce the pending appeals workload.  For example, OMHA is pursuing alternative dispute resolution as an alternative to an Administrative Law Judge hearing.  In addition, OMHA has made statistical sampling an option available to appellants, which has the potential to resolve large numbers of cases based on representative samples. While helpful, these initiatives alone are insufficient to keep up with the dramatic growth in Medicare appeals.

The Budget will increase OMHA adjudicatory capacity by adding up to 106 new Administrative Law Judge teams, which will result in 106,000 additional dispositions per year.  OMHA will continue to utilize technology, such as video telephone and teleconference hearings, to offer appellants access to multiple hearing venues and services.  The requested resources are critical for OMHA to respond to the backlog of unheard appeals while maintaining the quality and accuracy of its decisions.  These resources are also essential to provide timely hearings for Medicare appellants.

For more information about the Medicare appeals legislative proposals, please see the Medicare chapter.

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