On December 6, 2016, the US District Court for the District of Columbia issued an order in American Hospital Association v. Burwell giving CMS a four-year runway to clear the enormous backlog of appeals at the administrative law judge (ALJ) level. The Medicare Act requires ALJs to hold a hearing and to render a decision within 90 days of a party’s filing of its appeal with the Office of Medicare Hearings and Appeals. However, CMS has been unable to comply with this statutory deadline, with a backlog of almost 1 million appeals at the ALJ level.

In his decision, US District Court Judge James E. Boasberg granted summary judgment for the American Hospital Association and required CMS to meet the following deadlines and mandatory percentage reductions:

  • A 30% reduction from the current backlog of cases pending at the ALJ level by December 31, 2017
  • A 60% reduction from the current backlog of cases pending at the ALJ level by December 31, 2018
  • A 90% reduction from the current backlog of cases pending at the ALJ level by December 31, 2019
  • A 100% reduction from the current backlog of cases pending at the ALJ level by December 31, 2020

The court also noted that if CMS fails to meet the above deadlines, claimants at the ALJ level may move for default judgment.

The DC court’s decision may put an end to a long-running controversy and should start bringing long-overdue relief to providers. All eyes are on CMS now as it proceeds with implementing the court’s order and providing status reports every 90 days. The possible raft of appeals being rapidly decided presents many issues, not the least of which is whether any interest penalties will be due under the Medicare Act.