If your health care business or medical practice is facing recoupments and other penalties as a result of a Zone Program Integrity Contractor (ZPIC) audit, you need to quickly assess your options for filing an appeal. Flawed audit determinations are common; and, if you have been falsely accused of overbilling the government, appealing the ZPIC’s determination is your next step. An appeal is the only way to prevent the substantial consequences that can flow from an unfavorable Medicaid or Medicare audit.
Appealing a ZPIC audit determination is not a simple process. There are multiple stages of appeal, each with its own standards and procedures. Therefore, filing a successful appeal requires a comprehensive understanding of the pertinent legal and factual issues, as well as the numerous practical considerations involved. If you need to consider an appeal, here is a brief introduction to some key things you need to know. To learn more, you can contact the ZPIC appeal attorneys at The Criminal Defense Firm for a free and confidential consultation.
1. If You Think the ZPIC Made a Mistake, You are Not Alone
If you believe that the ZPIC’s determination of liability is unjustified, you are not alone. Mistakes during ZPIC audits are common, with errors ranging from selective review of billing records to application of outdated Medicare regulations routinely leading to flawed demands for recoupment. At this point, you need to trust your better judgment. If you suspect that the audit process was flawed, it probably was.
2. There are Two Deadlines You Need to Know About
After receiving an unfavorable ZPIC audit determination, there are two deadlines you need to know about. First, if you are going to appeal the determination, you need to do so within 120 days. If you miss the deadline for filing an appeal, you can lose your right to challenge the ZPIC’s conclusions entirely.
Second, while you have 120 days to file your appeal, you only have 30 days to file if you wish to avoid immediate recoupment liability. If you file your appeal after 30 days, you will be liable for recoupments while your appeal is pending; and, if you don’t pay, you can face interest and additional penalties.
3. Recoupment is Just One of the Consequences of an Unfavorable ZPIC Audit
Even if you are facing substantial recoupment liability, the reality is that this could be among the least of your concerns. The consequences of an unfavorable ZPIC audit can also include:
- Indefinite prepayment review of future Medicaid and Medicare claims, which can delay payments by as much as six months and which offers extremely limited remedies for improper denials of reimbursement claims
- Revocation of assignment privileges and loss of hospital privileges
- Referral to a state licensing board for regulatory action, including possible license suspension or revocation
- Referral to the U.S. Department of Justice (DOJ), the Office of Inspector General (OIG), the Centers for Medicare and Medicaid Services (CMS), or another federal agency for civil investigation and prosecution under the False Claims Act
- Loss of Medicaid and Medicare program eligibility (federal health care benefit program exclusion)
4. There are Multiple Grounds for Challenging a ZPIC Audit Determination
Numerous errors can lead to flawed ZPIC audit determinations; and, when assessing your options for filing an appeal, it is critical to examine all of the issues that may justify a reversal. Based upon our experience as defense attorneys and as former federal prosecutors working closely with ZPIC auditors, these are all common errors during ZPIC audits:
- Applying current Medicare and Medicaid regulations to reimbursement requests submitted under prior versions of the regulations
- Applying outdated billing regulations to recent requests for reimbursement
- Failing to provide required information to health care providers
- Misinterpreting the applicable Medicare and Medicaid billing regulations and key provisions of federal laws such as the Anti-Kickback Statute, Stark Law, and False Claims Act
- Relying on flawed methodologies and legal interpretations, and failing to seek guidance from independent experts when necessary
- Seeking recoupment for alleged deficiencies that fall outside of the ZPICs’ scope of authority
- Selectively reviewing a provider’s Medicare and Medicaid billing records in order to identify “trends” that don’t actually exist
5. The First Stage of ZPIC Appeal is a “Request for Redetermination”
There are five stages of appeal for ZPIC audits, the first two of which involve reviews by fee-for-service contractors similar to ZPICs. In fact, the first stage of appeal known as a request for redetermination must be filed with the Medicare Administrative Contractor (MAC) that sent your demand letter following your ZPIC audit. As noted above, while you technically have 120 days to file a request for redetermination, you must file within 30 days in order to avoid recoupment liability.
Once you file a request for redetermination, the MAC has 60 days to issue a decision (though this can be extended by 14 days if you submit additional information with your request).
6. The Second Stage of ZPIC Appeal is a “Request for Reconsideration”
If your request for redetermination is unsuccessful (as is frequently the case), the next step is to file a request for reconsideration. This request must be filed within 180 days of the MAC’s decision, and within 60 days in order to continue to avoid recoupment liability.
Requests for reconsideration are heard by Qualified Independent Contractors (QICs), which, like ZPICs and MACs, work with CMS to recover payments based on false and fraudulent reimbursement claims. Providers can, and must, submit any and all supporting documentation at this stage, and the QIC will independently evaluate the ZPIC’s conclusions based upon the evidence presented. However, QICs do not conduct hearings. QICs issue their decisions within 60 days, or within 74 days if the provider makes a supplemental filing.
7. The Third Stage of ZPIC Appeal is an Administrative Appeal with the Office of Medicare Hearings and Appeals (OMHA)
If the QIC denies your request for reconsideration, the third stage of appeal will involve presenting your case to an administrative law judge (ALJ) at the Office of Medicare Hearings and Appeals (OMHA). You must file with the OHMA within 60 days, and you will have the opportunity to present your case at a contested hearing before the ALJ. The process leading up to your OHMA hearing may take several months; and following the conclusion of the proceedings, the ALJ has 90 days to render a decision.
8. The Fourth Stage of ZPIC Appeal is an Administrative Appeal with the Medicare Appeals Council
At this point, you will likely be well over a year into your ZPIC appeal. If you lose your appeal at the OHMA, the fourth stage involves filing with the Medicare Appeals Council. The Medicare Appeals Council is a division of the U.S. Department of Health and Human Services (DHHS); and, like the OMHA, it employs ALJs who preside over health care providers’ ZPIC audit appeals.
Once you receive a decision from the OHMA, you have 60 days to file with the Medicare Appeals Council. However, unlike the earlier stages of appeal, your case before the Medicare Appeals Council will not focus on errors during the audit process. Instead, in order to prevail, you must be able to prove that the OMHA’s ALJ either (i) made an error of law, or (ii) failed to give due consideration to the weight of the evidence. This shift in focus makes the prior stage the OMHA appeal one of the most critical stages in the entire appeals process.
9. The Fifth Stage of ZPIC Appeal Is a Filing in Federal District Court
The fifth and final stage of the ZPIC appeals process is a filing in federal district court. Once the Medicare Appeals Council issues its decision, you will have 60 days to file a complaint in your local federal jurisdiction. You will have the opportunity to present your case in court, and a federal judge will decide whether any of the lower appellate decisions should be overturned. Similar to the ALJ at the Medicare Appeals Council, the federal judge presiding over your case will not review the substantive issues involved in your ZPIC audit, but rather will assess whether any of the lower rulings was “against the substantial weight of the evidence” or “arbitrary and capricious.”
10. You Need to Work with an Experienced Legal Team
At all stages of the ZPIC audit appeals process, it is critical to have experienced legal representation. You need to work with lawyers who understand your business, who know the constraints that apply to ZPICs, and who have a proven track record of successful representation in audits and appeals. At The Criminal Defense Firm, our defense team includes experienced health care law attorneys and former federal prosecutors who have decades of experience on both sides of ZPIC audits and appeals. We can help you, and your case starts with a free and confidential consultation.
Contact the ZPIC Audit Appeal Attorneys at The Criminal Defense Firm
For more information about appealing your ZPIC audit determination, we encourage you to schedule an appointment with our health care fraud defense team. To discuss your case in confidence, call (888) 452-2503 nationwide or inquire online today.
Dr. Nick Oberheiden is a national litigation and trial criminal defense attorney who practices exclusively in the area of federal law.