Priority Health Parts C & D Appeals Policy Update | OpenPayer
Currentpriority healthPolicy N/A
Parts C & D Enrollee Grievances, Organization/Coverage Determinations, and Appeals Guidance
Guidance governing grievances, coverage/organization determinations, and appeals processes for enrollees in Medicare Advantage (Part C), Medicare cost plans/HCPPs, and stand-alone Part D plans; clarifies regulatory requirements under 42 CFR Parts 422 and 423 and affects plan sponsors, delegated entities, providers, representatives, and enrollees.
Policy Summary
Payerpriority health
PolicyParts C & D Enrollee Grievances, Organization/Coverage Determinations, and Appeals Guidance
Policy CodePolicy N/A
Change TypeNo material changes
Effective DateNov 18, 2024
Next Review DateN/A
Key ActionSubmit coverage and exception requests with required prescriber supporting statements and respond to plan outreach so determinations and any expedited processing timelines can proceed.
No material clinical or coverage changes in this revision.
115+pages / sections
42 CFR 422 & 423regulatory authority
Glossarydefined terms
24 hrsexpedited info deadline
14 days
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standard MA org determ.
Immediateuntimely = adverse
Coverage, Grievances, and Appeals Criteria
Coverage determinations and appeals overview
Guidance establishes processes and timeframes for coverage/organization determinations, requests (including expedited), who may request determinations and appeals, and notification requirements for Part C and Part D.
This guidance covers grievances, coverage/organization determinations, and appeals for enrollees in Medicare Advantage (Part C), Medicare cost plans/HCPPs, and stand‑alone Part D plans and interprets 42 CFR Parts 422 and 423.
A coverage/organization determination (initial determination) is any decision by the plan or delegated entity concerning payment or provision of an item, service, or drug; such determinations are subject to the appeal processes described in this guidance.
Requests for coverage or organization determinations may be submitted by enrollees, enrollee representatives, or providers acting on behalf of enrollees (rules differ by Part C/Part D and request type); plans must accept and process requests per applicable Part C/Part D requirements.
Scope and claims processing
Applicability and claims handling for Part C, Part D, and cost plans/HCPPs.
Part C procedures apply to all benefits offered under an MA plan, including optional supplemental benefits, except certain employer‑purchased benefits which are outside this guidance's scope.
Part D appeal procedures apply to all Part D benefits, including EGWPs; where employer‑provided coverage is intertwined with Part D drugs the sponsor must follow Part D procedures.
For Medicare cost plans and HCPPs, MACs may process certain claims as regular Part A/B claims; appeals concerning services received through the cost plan's network or at the plan's direction follow the cost plan appeal rules (42 CFR Part 422 Subpart M) and related provisions.
Grievance and request classification and handling criteria
Guidance on how to categorize and handle communications from enrollees regarding coverage, grievances, inquiries, and appeals.
Plans must review each enrollee communication case‑by‑case to determine whether it is a grievance, inquiry, coverage request, appeal, or combination; the plan must inform the enrollee (verbally or in writing) how the matter is categorized.
If multiple issues are raised simultaneously, each issue should be processed separately and, to the extent possible, concurrently under the appropriate procedure.
Grievances include items such as involuntary disenrollment, premium/cost‑sharing changes, quality of care concerns, plan benefit design, access or contact problems, interpersonal aspects of care, appeals process complaints, and general formulary dissatisfaction.
Coverage requests include requests for drugs/services/items, continuation of previously authorized services, requests to continue care with an out‑of‑network provider, pharmacy rejections where the drug is needed, and disputes about Part D exclusions for an indication.
Grievance and Coverage Criteria
Procedural criteria for grievances, quality-of-care grievances, organization and coverage determinations, PA processing, exceptions, tiering and formulary exceptions.
Standard written grievance responses must be understandable, address all issues, and be delivered within 30 days (14‑day extension allowed where applicable); expedited grievances must be decided within 24 hours with written confirmation within 3 days if verbal initially provided.
Quality‑of‑care grievances must be submitted no later than 60 days after the incident (plans may accept late filings), investigated, and responded to in writing within 30 days or as expeditious as the enrollee's health requires; a 14‑day extension may be taken with written notice.
An initial determination (organization/coverage determination) is any plan decision about payment/provision of an item/service/drug and is appealable; Part C organization determinations include questions whether the plan will cover an item or service and may be requested by enrollee, representative, or provider.
Part D coverage determinations include decisions about non‑formulary drugs, medical necessity, out‑of‑network pharmacy coverage, cost‑sharing, prior authorization status, tiering and formulary exceptions; pharmacy point‑of‑sale transactions are not automatically coverage determinations unless treated by the plan as such.
Tiering exception criteria
Clinical criteria required in the prescriber's supporting statement to justify exceptions:
Tiering exception supporting statement must indicate that applicable lower cost‑sharing tier alternatives would (1) not be as effective as the requested drug and/or (2) would have adverse effects; plan must obtain additional information if needed.
Formulary exception criteria
Formulary exception clinical criteria:
Prescriber's supporting statement must indicate that the requested drug is medically necessary because: (1) covered formulary drugs would not be as effective or would have adverse effects; and/or (2) dose restrictions have been or would be ineffective; and/or (3) formulary alternatives have been ineffective or likely to cause adverse reaction based on sound clinical evidence; plan must obtain additional information if needed.
Approval and cost-sharing rules
Requirements upon approval of exceptions:
A plan must grant an exception when it determines applicable criteria are met and must continue coverage for the approved exception for the remainder of the plan year (while enrollee remains enrolled and prescriber continues to prescribe) without requiring resubmission; plans may choose whether to extend into the next plan year but must provide written notice at least 60 days prior to plan year end if not continued unless prior communications specified an end date.
For tiering exceptions, cost‑sharing must be set at the most favorable applicable lower tier; for formulary exceptions, the plan selects a single existing formulary tier's cost‑sharing (may apply a second lower level for generic exceptions) and may not assign exceptions to a cost‑sharing level not present on its formulary.
Denial notice and redetermination
Requirements for denial notices and redetermination materials
Part D adverse coverage decisions must use the standardized Notice of Denial of Medicare Prescription Drug Coverage (Form CMS‑10146) and the notice must state the specific reason for denial, applicable coverage or formulary rule, instructions for obtaining a prescriber supporting statement for exceptions, representative appointment information, and appeals/redetermination processes and timeframes.
Plan sponsors must include completed sections of the model Request for Redetermination form with each adverse coverage determination notice (unless the notice was untimely and the case is forwarded to the IRE).
Timeliness procedures
Timeliness and untimely decisions handling
Verbal notice may be provided initially, but written notice must be mailed within 3 calendar days of verbal notification for approvals, denials, or expedited denial verbal notices; when a request to expedite is denied the plan must promptly provide verbal notice and written notice within 3 days explaining transfer to standard processing and rights to expedited grievance and resubmission with prescriber support.
If a decision is not provided within the required timeframe (untimely), the plan should notify the enrollee that the decision was not made timely and that the case has been forwarded to the IRE; the notice must advise the enrollee of the right to submit additional evidence and provide IRE contact information.
Pharmacy notification procedures
Pharmacy notification responsibilities (network, mail-order, home infusion, LTC, I/T/U)
Network pharmacies must provide the standardized pharmacy notice (Form CMS‑10147) when a claim is not covered and the designated NCPDP response code is returned; plan sponsors must arrange with pharmacies to distribute the notice and have controls to ensure compliance.
Designated NCPDP response code need not be returned for certain rejects (e.g., missing adjudication data, OTC not covered, manufacturer/NDC list issues, refill‑too‑soon edits, DMP edits); where returned, pharmacies must deliver the notice.
Mail‑order and home infusion pharmacies must deliver the notice no later than 72 hours from receipt of the transaction response indicating the claim is not covered; LTC pharmacies must attempt to resolve with prescriber/facility and, if unresolved, deliver the notice to the enrollee/representative/prescriber/staff within 72 hours; I/T/U pharmacies that dispense at no cost are exempt from the notice requirement.
Withdrawals and dismissals
Withdrawals, dismissals, and appeals of dismissals
An initial determination request may be withdrawn at any time before the decision is issued by the requesting party; plan will dismiss the request and issue a dismissal notice as required.
Plans must dismiss requests only for specified regulatory reasons (improper party, invalid request lacking sufficient identification/contact info, death with no financial interest, timely withdrawal, or other reasons listed in regs); the list is exhaustive.
When dismissing, the plan must transmit a written dismissal notice by the end of the adjudication timeframe stating the reason, the right to request vacatur, and the right to request review; a request for review of a dismissal must be filed within 65 calendar days (effective Jan 1, 2025).
A dismissal is binding unless modified, reversed on appeal, or vacated; upon appeal reversal the plan must process the coverage request and the initial determination timeframe begins on the date/time of reversal.
Dismissal and vacatur rules
Dismissal and vacatur criteria and outcomes
A dismissal of an initial determination is binding unless modified, reversed on appeal, or vacated for good cause; upon a request to review a dismissal, the plan conducts the appeal per level‑1 timeframes.
If the plan reverses a dismissal on appeal it must process the coverage request and the initial determination timeframe begins on the date/time of the reversal; plans may vacate their own dismissal within 6 months for good cause and, if vacated, must conduct an initial determination per applicable timeframes.
If the plan does not find good cause to vacate a dismissal, it must issue a letter explaining why vacatur was not granted.
Level 1 appeal filing & expedited processing
Level 1 appeal filing and processing rules (reconsiderations/redeterminations) including expedited procedures
A party to an adverse initial determination has the right to a reconsideration (Part C) or redetermination (Part D) which reviews the adverse decision and evidence submitted or obtained by the plan.
Level 1 appeals must be filed within 65 calendar days from the date of the notice of initial determination (effective Jan 1, 2025); plans must accept verbal expedited requests and may accept verbal standard requests; required request content includes enrollee name, identification of the denial, and contact information; representatives must provide proof of appointment.
Processing start
For standard requests the processing timeframe begins when the plan, any unit in the plan, or a delegated entity receives the request.
For expedited requests the processing timeframe begins when the appropriate department receives the request.
Non-contracted provider appeals
Non-contracted provider appeal participation and requirements (Part C)
A non‑contracted provider may request reconsideration for a denied claim only if a Waiver of Liability (WOL) is filed with the appeal; the plan may delay review until the WOL is received and the adjudication timeframe begins upon receipt of the WOL; if WOL is not received within the adjudication timeframe the plan may dismiss per dismissal procedures.
Non‑contracted providers who execute a WOL are parties to organization determinations and may pursue the Subpart M appeals process for payment disputes (examples include DRG/diagnosis denials, downcoding, bundling disputes, and rate‑of‑payment denials).
Electronic signatures on WOLs are acceptable when submitted through the plan's secure portal that meets regulatory/CMS requirements; authorized billing agents may submit appeals on behalf of providers with evidence of authority but may not sign the WOL for the provider.
Appeals procedures and criteria
Timeframes and extension rules
Standard timeframes
Part C standard requests for items/services: 30 days (may extend to 44 days where permitted).
Part D standard adjudication timeframe for drug benefit requests: 7 days (extensions not permitted).
Part C standard Part B drug timeframe: 7 days.
Expedited Part C and Part D decisions must be made as expeditiously as the enrollee's health requires but no later than 72 hours; Part C expedited timeframes for items/services may be extended up to 14 days in limited circumstances (enrollee request, need for non‑contract provider evidence in enrollee's interest, or extraordinary circumstances); Part B drug timeframes cannot be extended; Part D adjudication timeframes are not extendable.
Appeals processing and IRE forwarding criteria
Procedural requirements and criteria related to appeals processing, dismissal, notice content, and forwarding to IRE.
If the plan affirms an adverse level 1 decision (in whole or part) or fails to provide notice within required timeframes, the plan must gather and forward the complete case file and a written explanation to the IRE within specified forwarding timeframes; plans must make reasonable and diligent efforts to include pertinent documentation including medical records and required transmittal forms.
Plans must dismiss level 1 appeal requests only for specified regulatory reasons (improper party, missing WOL for non‑contract provider, invalid/late filing absent good cause, death with no financial interest, timely withdrawal); dismissal notices must be transmitted by the end of the adjudication timeframe and must state reason, right to vacatur, and right to IRE review (65 days to request review effective Jan 1, 2025).
If a plan vacates its dismissal for good cause within 6 months it must process the appeal per level‑1 timeframes; if vacatur is denied, the plan must issue a letter explaining why vacatur was not granted.
Adverse decision notices (Part D) must state specific reasons reflecting the enrollee's medical condition, include enrollee identifiers and plan IDs, describe applicable coverage/formulary criteria, and explain rights to reconsideration/level‑2 review; favorable notices must explain conditions of approval including duration and limitations.
IRE forwarding, contents, timeframes, dismissal, and effect
Timeframes and processing requirements for forwarding case files and IRE reconsiderations.
Part C forwarding timeframes: expedited files no later than 24 hours of the decision (or expiration of extension); standard items and services: forward no later than 30 days of receipt of request; Part B drugs: forward no later than 7 days; payment: 60 days.
Part D forwarding timeframes: expedited forward no later than 24 hours of receipt of IRE's request; standard forward no later than 48 hours of receipt of IRE's request; untimely decisions forward no later than 24 hours of expiration of adjudication timeframe.
IRE reconsiderations have processing timeframes that vary by request type (e.g., Part C items and services 30 days standard; Part C payment 60 days; Part D benefit 7 days; expedited 72 hours); the IRE must notify parties of its decision and provide written reasons.
Required case file contents include transmittal/cover sheet, Appeal Case File Transmittal form, case narrative, copies of initial determination and level‑1 notices, supporting documentation including medical records, representation documentation, and any specified forms or electronic references per IRE guidance.
LEP and IRE reconsideration criteria
Process and criteria for LEP reconsideration and evidence submission
Enrollee has 60 calendar days from the LEP letter date to request LEP reconsideration; late filing may be considered for good cause with explanation and supporting documentation.
LEP reconsideration requests must include a signed LEP Reconsideration Request Form or a written request containing the form elements; if represented, proof of authority is required; materials should include HICN/MBI and photocopies of originals as instructed.
Part D plan sponsors must send the LEP Reconsideration Notice and form with the LEP letter, attempt to obtain Declaration of Prior Prescription Drug Coverage where appropriate, assist enrollees in completing forms, retain copies of LEP letters, and forward the case file to the IRE upon request.
The IRE processes LEP reconsiderations within 90 days (90 + 14 if extension/good cause); the IRE will notify parties of final decision and may dismiss for untimely filing without good cause, unverified representative authority, death with no financial interest, or ineligible issues.
Higher-level appeals filing, evidence, timeframes, participation, and reopening criteria
Filing and evidence submission requirements for third-, fourth-, and fifth-level appeals.
Requests for third/fourth/fifth level reviews must be filed within 60 calendar days of receipt of the decision or dismissal (receipt presumed 5 days after date) unless extended for good cause; extension requests must be in writing except Part D expedited hearings may be verbal.
If not using specified forms, third‑level (ALJ) filings should include appellant and representative contact info, Medicare number, case/appeal number, reasons for disagreement, statement of additional evidence and timing; Part C filings require dates of service, Part D filings require drug name, plan name, and expedited rationale if requested.
Evidence submission rules: Part C parties must submit evidence with hearing request or by date specified or within 10 days of notice of hearing (not required for unrepresented enrollees); Part D requires submission with request or by specified date or within 10 days for standard hearings and 2 days for expedited hearings; evidence of changed medical condition may prompt remand to IRE.
Participation rules for ALJ hearings: plan sponsor, CMS, or IRE may request to participate by filing within prescribed timeframes (30 days if no hearing scheduled; 5 days if hearing scheduled); participation allows position papers and testimony but not witness cross‑examination and ALJ may deny participation.
Reopening and Effectuation Criteria
Operational requirements when a determination is reopened or an appeal reverses a plan decision.
No reopening is permitted while a case is under active appeal; reopenings are separate and distinct from appeals and should not be used to circumvent appeal processes.
Plans should complete agreed reopenings within 60 days; the IRE will notify within 30 days whether it will reopen and, if it reopens, will issue a revised determination within 120 days.
Grounds for reopening include new and material evidence not available at time of decision, clear error in the original decision, fraud or similar fault, and clerical errors; CMS law/policy changes generally do not constitute good cause for reopening.
When a determination is reopened and revised, the plan must provide written notification stating rationale and appeal rights in understandable language and revise remittance advice if payment was issued; effectuation timeframes apply and reversed decisions must be effectuated promptly per specified timeframes (e.g., Part C IRE reconsiderations: standard items no later than 14 days or 72 hours if urgent).
Plan responsibility and effectuation
Obligations related to effectuation of coverage and responsibility when appeals reverse prior denials or when BFCC-QIO appeals are filed.
MA plans are financially responsible for continued coverage of services during BFCC‑QIO review (hospital, SNF/HHA/CORF) regardless of delegated authority; plans must deliver required beneficiary notices (e.g., DND, DENC) within specified timeframes and provide documentation to enrollees and BFCC‑QIO as required.
When an appeal reverses a prior denial, plans must effectuate the decision promptly and submit an attestation of compliance to the IRE; the IRE monitors effectuation and reports failures to CMS, including reminder and reporting timelines if the plan fails to submit compliance statements.
A plan remains legally responsible to authorize, provide, or pay for services or prescription drugs that were denied and are subsequently found to have been covered, even if the enrollee has disenrolled or the contract terminated, per applicable CFR provisions.
Regulatory Citations, Codes, and Filing Timeframes
Regulatory citations referencedmixed
42 CFR Part 422
Medicare Advantage appeals and grievance requirements
42 CFR Part 423
Medicare Part D appeals, grievances, and related requirements
Provider claim appeal examplesmixed
Examples of provider claim appeal scenarios: DRG/diagnosis payment denials, downcoding, bundling disputes, level of care or payment rate denials
Notice content requirements for adverse Part D redeterminationsmixed
No codes listed
Clerical error examplesmixed
No codes listed
inv-26: Appeal filing timeframe
Filing deadlineAppeals (level 1 reconsideration/redetermination) must be filed within 65 calendar days from the date of the notice of the initial determination (effective Jan 1, 2025).
Required contentRequests should include enrollee name, identification of the denial being appealed, and contact information; representatives must provide proof of appointment.
Verbal requestsPlans must accept verbal requests and should repeat the summarized verbal request back and/or send an acknowledgement to confirm facts; processing timeframe begins when appropriate department receives request for expedited and when plan/department receives request for standard.
inv-27: IRE review filing deadline for dismissal
IRE review filing window for dismissal
Actions Required by Providers and Plans
Prior Authorization
Prior Authorization / Utilization Management
Prior Authorization (PA) and other utilization management (UM) requirements may make a plan's decision an initial determination. Providers must submit PA requests and any supporting clinical information; the plan will process PA/UM requests as coverage determinations subject to notice and appeal rights. When necessary to decide a PA or UM request, the plan should contact the prescribing clinician in accordance with outreach standards (§10.6). Do not use peer‑to‑peer discussions to suggest substantive lowering of requested services to obtain approval.
PA/UM decisions = initial determinations and are appealable
Plans should provide PA form promptly when available
Peer‑to‑peer must not be used to obtain substantive modifications
Note
Outreach and expedited information requests
Plans must make reasonable and diligent efforts to obtain necessary clinical documentation when information is insufficient for a coverage decision. For standard (non‑expedited) requests, at least one attempt to contact the provider is sufficient, though best practice may include multiple attempts and multiple methods (phone, fax, e‑mail). For expedited organization determinations or reconsiderations, if medical information is needed from a non‑contract provider, request it within 24 hours of receipt (Part C). For Part D expedited redeterminations, request needed information within 24 hours. Document all requests in the case file; if a denial is issued due to missing information, identify the basis in the written notice.
Key Terms and Definitions
inv-56: Appeal
Definition — AppealProcedures for review of adverse initial determinations including plan reconsideration/redetermination, IRE reconsideration, ALJ/attorney adjudicator, Medicare Appeals Council, and judicial review as defined at 42 CFR §§422.561 and 423.560.
ScopeIncludes reviews of adverse decisions about services, drug coverage, delays that adversely affect enrollee health, and amounts owed by enrollee.
LevelsAppeals encompass plan level 1 (reconsideration/redetermination), IRE level 2, ALJ/attorney adjudicator level 3, Council level 4, and federal court level 5.
inv-57: BFCC-QIO
Definition — BFCC-QIOOrganizations of practicing doctors and health care experts under federal contract to monitor and improve care; they review quality-of-care complaints and certain continued stay and coverage termination disputes.
Role in grievances
Policy Summary
Payerpriority health
PolicyParts C & D Enrollee Grievances, Organization/Coverage Determinations, and Appeals Guidance
Policy CodePolicy N/A
Change TypeNo material changes
Effective DateNov 18, 2024
Next Review DateN/A
Key ActionSubmit coverage and exception requests with required prescriber supporting statements and respond to plan outreach so determinations and any expedited processing timelines can proceed.
When an adverse initial determination has been made and the enrollee disputes it, the communication should be treated as an appeal; if a plan does not accept verbal standard appeals it must instruct the enrollee how to file a written appeal.
Situations may be dual‑classified (both grievance and coverage request), for example untimely receipt of a covered service that also threatens the enrollee's health — plans must process both as appropriate.
Representative & defective forms
If a representative form (e.g., CMS‑1696) is on file, notices may be sent to the representative instead of the enrollee; representative forms may be valid for one year or for the life of a grievance/appeal if filed within one year of signature.
When representative documentation is missing or defective, plans must attempt to obtain the documentation, may delay decisions until received, and may dismiss requests if documentation is not provided per procedures; plans should inform parties when requests are not valid until documentation is provided.
When an enrollee/physician is attempting to satisfy a PA, the plan must process as a coverage determination and notify decision no later than 24 hours (expedited) or 72 hours (standard); waiver/exception requests require a prescriber supporting statement and follow exception timeframes once statement received, with limited tolling allowed.
Tiering exceptions permit coverage of a higher‑tier drug at the cost‑sharing of a lower tier when prescriber supporting statement shows lower‑tier alternatives would not be as effective or would cause adverse effects; plans may obtain additional information if needed and may limit exceptions per regulatory limitations, including specialty tier rules.
Formulary exceptions require a prescriber supporting statement demonstrating medical necessity per specified factors (ineffectiveness or adverse effects of formulary alternatives, dose restriction failure, or clinical evidence); plans must obtain additional information if needed and select an existing tier's cost‑sharing level for approved non‑formulary drugs.
Expedited Level 1 appeals: a physician (Part C) or prescribing physician/other prescriber (Part D) indicating that applying the standard timeframe could seriously jeopardize life/health or ability to regain maximum function requires expedited processing; Part C expedited decisions must be made and notice given within 72 hours and services authorized/provided as appropriate with written confirmation within 3 days if initially verbal; the 72‑hour timeframe for items/services may be extended up to 14 days in limited circumstances (Part B drug timeframes cannot be extended).
If a plan fails to decide within required timeframe this constitutes an adverse decision and the plan must forward the case file to the IRE; plans should notify the enrollee when forwarding (Part D guidance indicates notification).
Plans must provide parties reasonable opportunity to submit evidence; Part C enrollees may request a 14‑day extension to submit evidence in level 1 appeals; expedited appeals have limited opportunity and plans must inform parties of conditions for evidence submission.
When forwarding case files to the IRE, plans must submit by mail/overnight/fax or IRE web portal within forwarding deadlines; when the IRE requests the file plans should forward within 24 hours; failure to make appropriate efforts may lead to sanctions.
IRE must dismiss reconsiderations for specified statutory reasons (improper party, invalid request, untimely filing without good cause, death with no financial interest, timely withdrawal); IRE decisions are final and binding unless a party files for ALJ/level‑3 review when amount‑in‑controversy thresholds are met.
AIC calculation guidance applies to higher‑level review eligibility: AIC computed as actual or projected amount charged minus deductible/coinsurance/copays; for Part D drug denial appeals project refills and reduce by enrollee cost sharing; AIC thresholds determine ALJ/level‑3 eligibility.
Reopening rules: reopening is separate from appeals, used sparingly, may be initiated by plan/IRE/ALJ/Council/enrollee, must meet reopening timeframes (plans: within 1 year for any reason if not under appeal; within 4 years for good cause; any time for fraud/clerical error), and generally cannot occur while case is under active appeal.
A former plan that originally denied services remains responsible to authorize or pay for services if an appeal is decided in the enrollee's favor even after disenrollment or contract termination per cited CFRs.
A request for IRE review of a plan's dismissal must be filed with the IRE within 65 calendar days from the date of the plan's dismissal notice (effective Jan 1, 2025).
Dismissal notice contentDismissal notice must state reason for dismissal, right to request vacatur, and right to request IRE review.
Plan forwarding on IRE requestUpon IRE request, plans must assemble and forward the case file to the IRE within 24 hours.
inv-28: ALJ review eligibility
ALJ/level 3 eligibilityA party may request ALJ/attorney adjudicator (level 3) review if the amount in controversy (AIC) meets the required thresholds; plans may not request ALJ review.
Part C specificsUnder Part C, any party to the reconsideration determination except the MA plan has right to request level 3 review if AIC met (per 42 CFR §422.600).
Part D specificsPart D enrollees dissatisfied with IRE reconsideration may request level 3 review subject to AIC thresholds; links to CMS ALJ guidance referenced in manual.
inv-29: Amount in Controversy (AIC) requirement
AIC definitionAmount in Controversy (AIC) is computed as the actual amount charged (or amount enrollee would have been charged) minus applicable deductible, coinsurance, or copayments; for Part D use projected value of benefits reduced by cost sharing and include projected refills.
AggregationAppeals may be aggregated to meet the AIC requirement where applicable.
Projection methodFor Part C and Part D, projected value is used when appropriate (e.g., services or drug refills) per guidance at §70.2.
inv-30: Amount in controversy requirements
AIC by review levelThird level (ALJ/attorney adjudicator) requires meeting the AIC; Fourth level (Medicare Appeals Council) has no additional AIC requirement; Fifth level (Federal Court) requires meeting the Secretary's AIC for federal court review.
ReferencesGuidance references applicable CMS webpages and regulations for AIC thresholds and procedures at §70.2.
Effect of not meeting AICIf required AIC is not satisfied for ALJ review, the ALJ-level appeal is dismissed at OMHA level.
inv-31: Reopening time limits
Plan-initiated reopening time limitsPlans may initiate reopenings within 1 year for any reason (if case not under appeal); within 4 years for good cause; any time for fraud or similar fault; for clerical errors Part C plans may reopen to correct clerical errors as described.
Good-cause standardGood cause for reopening includes new and material evidence, clear error, fraud or similar fault; CMS guidance details requirements in §80.5.
IRE/ALJ/Council timingIRE, ALJ, or Council may reopen for good cause within 180 days or any time if fraud or similar fault exists (see §80.3.1 and §80.1).
Minimum: one documented attempt to obtain additional information
Expedited (Part C/Part D): request needed medical information within 24 hours
If no additional info received, decide based on available information within adjudication timeframes
Documentation Required
Representative appointment and verification actions
Representatives must be appointed or authorized and documented. Use CMS‑1696 (AOR) or an equivalent written notice containing required elements; plans may accept electronic signatures via secure portal. For authorized legal representatives (e.g., court‑appointed guardian, durable power of attorney), supporting legal paperwork suffices and an AOR is not required. Until a valid written representative form is on file, communications must be delivered to the enrollee.
Accept CMS‑1696 or equivalent written notice; may not require a specific form
Equivalent notice must include enrollee and representative identifiers, scope, signatures, and acceptance by representative
Electronic AORs accepted if secure and compliant
Documentation Required
Representative: missing or defective forms
If a person submits a grievance, initial determination, or level 1 appeal claiming to be a representative but fails to provide valid documentation, the plan must: ensure expedited requests are not unduly delayed; inform the enrollee and purported representative in writing that the request is invalid until documentation is provided; make and document reasonable efforts to obtain the documentation; and not issue a decision until such documentation is received. The timeframe for acting begins when representative documentation is received. If documentation is not received by the end of the applicable timeframe (plus any extension), the plan must dismiss the request and send a dismissal notice explaining the reason and remedies.
Do not issue a decision until valid representative documentation is obtained
Document attempts to obtain AOR/equivalent
If not received, send dismissal notice with reason and cure instructions
Prior Authorization
PA/UM determinations as initial determinations
When a PA or other UM requirement is being satisfied (provider/enrollee actively submitting authorization), treat that submission as a coverage determination. Plan must notify the enrollee and prescribing clinician of the decision within 24 hours for expedited requests or 72 hours for standard requests. If an available PA form exists, promptly provide it to the prescriber. Model Part D Coverage Determination Request Form may be used for overrides.
Expedited decision notification = within 24 hours
Standard decision notification = within 72 hours
Provide PA form to prescriber when available
Prior Authorization
Waiver/exception requests for PA/UM
Requests to waive a PA or other UM requirement are exceptions and must be supported by a prescriber's statement consistent with regulatory requirements. Written supporting statements may use the model Part D Coverage Determination Request Form but plans may not require a specific form. For exceptions concerning benefits not yet received, plans must decide within 24 hours (expedited) or 72 hours (standard) after receiving the prescriber's supporting statement; for reimbursement of benefits already received, decide within 14 calendar days after receipt.
Prescriber must submit supporting statement for exception requests
Expedited: decision within 24 hours after receiving support; Standard: within 72 hours
Reimbursement requests for past benefits: decision within 14 calendar days
Note
Who may request determinations
Who may request initial determinations varies by request type and Part. Enrollees and their representatives may request all types. Part C standard coverage/payment requests: contract or non‑contract providers (or their staff). Part C expedited requests: physicians or their staff. Part D standard/expedited requests: the enrollee's prescribing physician or their staff. For Part D payment reimbursement to member, only the enrollee or their representative may request reimbursement.
Part C standard: contract/non‑contract providers or their staff
Part C expedited: physician or physician office staff
Part D standard/expedited: prescribing physician or prescriber office staff
Part D payment reimbursement: enrollee or enrollee's representative only
Denial Risk
Denial of Expedited Organization Determination
If a plan denies a request to expedite an organization determination, the notice must explain that the request will be processed under standard timeframes, inform the enrollee of the right to file an expedited grievance, provide instructions and timeframes for that grievance process, and explain the right to resubmit the expedited determination with a supporting physician/prescriber statement that will trigger automatic expedition.
Explain transfer to standard timeframe in the notice
Include right to file an expedited grievance and instructions
Advise enrollee they may resubmit with prescriber support to obtain automatic expedition
Billing Rule
Non‑contract provider appeal requirement (WOL)
Non‑contract providers seeking reconsideration of a denied claim (Part C) must submit a Waiver of Liability (WOL) with the appeal stating they will not bill the enrollee regardless of outcome. If WOL is not filed, the plan must make reasonable efforts to obtain it; adjudication timeframe begins when WOL is received. If WOL is not obtained by the end of the timeframe, the plan must dismiss the appeal per dismissal procedures. Providers executing a WOL are not required to submit a representative form.
WOL must accompany the appeal for non‑contract provider claim appeals (Part C)
Plan may begin review while attempting to obtain WOL but timeframe starts when WOL received
If WOL not received by deadline, issue dismissal notice
Note
Provider‑initiated priority change and reviewer qualification
A provider may request a change of review priority from standard to expedited. If a physician requests expedition indicating the enrollee's health would be seriously jeopardized by standard timeframes, the plan must begin the expedited review period upon receipt of that request. A priority change does not grant extra review time—if remaining standard time is shorter than the expedited timeframe, the original standard deadline still applies.
Provider‑initiated priority change must be honored when prescriber support indicates jeopardy
Beginning of expedited period is the time plan receives physician's request
Priority change does not extend the overall deadline
Documentation Required
Evidence submission during appeals
During appeals, parties (including providers) must be given a reasonable opportunity to submit evidence in person or in writing (telephone, fax, hand delivery). The plan must consider all evidence when deciding. For expedited level 1 appeals, the plan must inform parties of the conditions and any time limitations for submitting evidence. For Part C appeals, advise parties of the right to request a 14‑day extension to submit evidence.
Opportunity to present evidence in person or in writing
Expedited appeals: limited opportunity—plan must state conditions
Part C: right to request 14‑day extension to submit evidence
Note
Plan responsibilities for forwarding case files to IRE
When a plan's appeal decision affirms an adverse initial determination (in whole or part), or a Part D sponsor fails to timely provide a redetermination, or the IRE requests the file, the plan must make reasonable and diligent efforts to gather and forward all pertinent documentation (including medical records), submit a written explanation and the complete case file to the IRE within the required forwarding timeframes, and may use mail, overnight delivery, fax, or the IRE web portal. Plans should follow the IRE guidance for electronic submission.
Forward all pertinent documentation and medical records to the IRE
Include written explanation and required transmittal cover sheets/forms
Submit within CMS/IRe timeframes via mail, courier, fax, or IRE web portal
Note
Escalation rights and party eligibility
Escalation and further review rights depend on the level. Parties to reconsideration (except the MA plan) may request an ALJ/attorney adjudicator hearing (third level) if amount‑in‑controversy thresholds are met (Part C and Part D). Council and federal court review rights vary by Part; Council has no AIC requirement. Parties eligible include enrollees, providers (in certain circumstances), and other affected entities as defined by the adjudicator.
Third level (ALJ): any party to the reconsideration except the MA plan (Part C) or enrollee (Part D) subject to AIC
Fourth level (Council): any party to ALJ decision — no AIC
Fifth level (Federal Court): any party; separate AIC rules apply
Note
Requesting participation in ALJ hearings (Part D)
For Part D ALJ hearings, if the plan sponsor, CMS, or the IRE wishes to participate (submit position papers or testimony but not call/cross‑examine witnesses), requests to participate must follow timing rules: within 30 calendar days after notice that a standard hearing was filed (or within 5 calendar days if a hearing is scheduled), or within 2 calendar days for expedited hearings if no hearing is scheduled. Written notice of the request must be sent to the ALJ and the enrollee (or to the assigned ALJ/designee and the enrollee if before notice of hearing). The ALJ retains discretion to allow or deny participation.
Timing: 30 days (no hearing scheduled), 5 days (hearing scheduled); expedited: 2 days (no hearing scheduled)
Send written notice to ALJ and enrollee; for requests before hearing notice, send to assigned ALJ or designee
ALJ may deny participation at discretion
Note
Reopening vs Appeal Jurisdiction
Reopenings are separate from appeals. If a party files a valid appeal at any level, no adjudicator may reopen the case until all appeal rights are exhausted or the appellant withdraws the appeal. If evidence is submitted after denial, the plan must ascertain whether the submitter seeks an appeal or reopening; generally, treat such submissions as appeals.
A reopening cannot occur while an appeal is pending for the same case
If new evidence is submitted after denial, determine if it is a reopening or an appeal (treat generally as an appeal)
Note
Intended Action Determination
An intended action determination (e.g., proposed termination or reduction of services) must follow the applicable notice and appeal protections. When classifying requests or determinations, ensure proper identification as an intended action to trigger respondent rights and timeframes.
Classify and notify appropriately to trigger rights for intended actions
Documentation Required
Clerical Error Handling (Part C)
For Part C, clerical errors (including minor errors/omissions) that require correction should be handled through the reopening process, not the appeals process. If the plan receives a reopening request and disagrees that it is a clerical error, the plan must dismiss the reopening request and notify the party of appeal rights, provided appeal timeframes have not expired.
Clerical errors corrected via reopening, not appeal (Part C)
If plan declines reopening, send notice explaining appeal rights if still timely
Note
Hospital BFCC‑QIO notification responsibilities
When a hospital BFCC‑QIO notifies the MA plan of an immediate review appeal, the plan must execute and deliver a Detailed Notice of Discharge (DND, CMS‑10066) to the enrollee no later than noon the day after notification, ensure delivery (even if delegated), provide copies of any documentation sent to the BFCC‑QIO upon enrollee request by close of business the next day, and supply all information the BFCC‑QIO needs (including IM and DND) by noon the next day.
Deliver DND (CMS‑10066) to enrollee by noon of the day after BFCC‑QIO notification
Provide copies of documentation to enrollee by close of business the next day upon request
Transmit all needed information to BFCC‑QIO by noon of the next day
When a BFCC‑QIO notifies the MA plan that an enrollee has requested an appeal of noncoverage (SNF/HHA/CORF), the plan must execute and deliver a Detailed Explanation of Noncoverage (DENC) to the enrollee no later than close of business the day of notification, ensure delivery regardless of delegation, provide copies of documentation to the enrollee by close of business the next day upon request, and provide all information the BFCC‑QIO needs by close of business the day of notification.
Deliver DENC to enrollee by close of business the day of BFCC‑QIO notification
Provide copies of documentation to enrollee by close of business the next day upon request
Provide all information to BFCC‑QIO by close of business the day of notification
Billing Rule
Financial responsibility during BFCC‑QIO review
During BFCC‑QIO reviews (hospital or SNF/HHA/CORF), the MA plan is financially responsible for continued coverage of services during the review period, regardless of whether the plan has delegated authorization or discharge determination responsibilities to providers.
Plan remains financially responsible for continued coverage during BFCC‑QIO review
Responsibility applies even if authorization/discharge decisions are delegated to providers
BFCC-QIOs may review quality-of-care grievances and provide informal dispute resolution between providers and enrollees; plans must cooperate and provide records within 14 days when involved.
Settings reviewedReviews include physicians, hospitals, ERs, SNFs, HHAs, MA plans, Part D plans, and ambulatory surgical centers; may review continued stay denials and coverage terminations.
inv-58: Clean Claim
Definition — Clean Claim (Part C)A claim that has no defect, impropriety, or lack of required substantiating documentation (consistent with 42 CFR §422.500(b)) that prevents timely payment and otherwise conforms to clean claim requirements for equivalent Original Medicare claims.
ApplicabilityApplies to Part C claims processing in accordance with cited regulation and plan procedures.
ImplicationClaims not meeting clean claim standard may be subject to rejection or require additional documentation before payment.
inv-59: Grievance
Definition — GrievanceAn expression of dissatisfaction with any aspect of plan operations, activities, or behavior in provision of health care or prescription drug services or benefits; distinct from appeals and not appealable.
AvailabilityGrievance process is available to enrollees or their representatives; providers should follow plan dispute processes and may contact CMS Regional Office if unresolved.
Procedural requirementPlans must have meaningful procedures for timely resolution, provide written grievance procedures on enrollment and upon request, and notify enrollees of changes 30 days before effective date.
inv-60: Representative
Definition — RepresentativeAn individual appointed by the enrollee (e.g., relative, friend, advocate, attorney) via Form CMS-1696 or equivalent written notice, or authorized under law (e.g., guardian, durable power of attorney) to act on enrollee's behalf with rights and responsibilities similar to enrollee.
Form requirementsEquivalent written notice must include enrollee and appointee name/contact, enrollee identifier (HICN/MBI/plan ID), scope/purpose, acceptance by appointee, and signatures/dates; plans cannot require a specific form and must accept CMS-1696 including electronic signatures via secure portal.
Verbal limitationsEnrollees cannot verbally appoint a representative; until a valid written form is on file all communications must be delivered to the enrollee.
inv-61: Withdrawal
Definition — WithdrawalA voluntary verbal or written request to rescind or cancel a pending grievance, initial determination, or appeal request submitted by the same party; plan will dismiss the request if withdrawn before decision.
Timing and documentationWithdrawal may occur any time before decision is issued; plans must document withdrawal and may send confirmation though not always required.
Effect on QoC grievancesEven if a grievance is withdrawn, the plan must still investigate quality-of-care grievances though not required to notify of outcome if withdrawn.
Definitions — Reconsideration / Redetermination / Reopening / RepresentativeReconsideration (Part C first level) and redetermination (Part D first level) are level 1 appeals; reopening is a remedial action to change a binding determination; representative is an appointed or authorized person with enrollee rights.
Reopening scopeReopening is separate from appeals and used sparingly to change binding decisions; adjudicators reopening must follow reopening regulations (42 CFR §422.616; 42 CFR §§423.1978–423.1986; Part 405 reopening regs).
Effect on appealsReopenings generally cannot occur while case is under active appeal; reopening decisions are binding and not subject to appeal unless otherwise provided.
inv-63: Medical exigency standard
Medical exigency standardDecisions must be made 'as expeditiously as the enrollee's health condition requires,' applying accepted standards of medical practice; plans must triage and prioritize requests and should not routinely take maximum adjudication time.
Evidence sourcesEvidence may be obtained from treating providers or medical records (diagnosis, symptoms, test results) to assess urgency.
Operational expectationPlans must establish criteria to determine urgency and prioritize appropriately per the standard.
inv-64: Representative / AOR
Representative / AOR requirementsPlans must accept Form CMS-1696 (AOR) or equivalent written notice containing required elements; AORs with electronic signatures are acceptable via secure portal if regulatory/CMS requirements met.
Equivalent notice elementsMust include names, enrollee identifier (HICN/MBI/plan ID), appointee relationship/status, scope/purpose, disclosure authorization, appointee acceptance, and signatures/dates.
Validity and communicationAll communications must be delivered to the enrollee until valid written representative form is on file; if authorized under law no representative form required but legal papers must be provided.
inv-65: Grievance
Grievance definition and scopeA grievance is an expression of dissatisfaction with any aspect of plan operations, activities, or behavior in provision of health care or prescription drug services or benefits; grievance procedures are separate from appeals and are not appealable.
Process requirementsPlans must provide written grievance procedures on enrollment, involuntary disenrollment, annually, and upon request, and maintain timely resolution processes per 42 CFR §§422.564 and 423.564.
Quality-of-care coordinationQuality-of-care grievances may be handled by the plan, BFCC-QIO, or both; plans must cooperate with BFCC-QIO requests and provide records within 14 days.
inv-66: Classification of requests
Classification of requestsPlans must review communications case-by-case to determine if they are grievances, inquiries, coverage requests, appeals, or combinations, inform the enrollee of categorization, and process multiple issues separately when raised together.
Misclassification handlingIf misclassified (e.g., coverage request classified as grievance), plan must notify enrollee in writing and reprocess as appropriate; misclassified appeals sent to IRE may be dismissed and returned to plan for correct processing.
Training expectationPlans should ensure customer service representatives are trained to distinguish between coverage requests, appeals, and grievances.
inv-67: quality of care grievance
Quality-of-care grievance definitionA grievance related to whether the quality of covered services meets professionally recognized standards; examples include misdiagnosis, inappropriate treatment, or care adversely impacting health.
Handling and cooperationQuality-of-care grievances may be reviewed by the plan or BFCC-QIO; plans must cooperate with BFCC-QIO and provide requested records within 14 days.
Submission timeframeQuality-of-care grievances must be submitted no later than 60 days after the incident though plans may accept late filings.
inv-68: initial determination
Definition — Initial determinationAn initial determination (organization or coverage determination) is a decision by the plan or its delegated entity concerning payment or provision of an item, service, or drug.
ScopeApplies to decisions involving items/services/drugs whether or not subject to prior authorization, made before/during/after provision, or without a party's request.
Regulatory basisPlans must adhere to requirements in 42 CFR Part 422 Subpart M and Part 423 Subpart M when making initial determinations.
inv-69: at-risk determination
Definition — At-risk determinationA decision under a Part D plan sponsor's drug management program identifying an enrollee as at-risk for prescription drug abuse or imposing limits/lock-in; subject to Part D appeals and forwarded to IRE within 24 hours if affirmed.
ExamplesIncludes identification as at-risk enrollee, limits on access (POS edits, prescriber/pharmacy lock-in), and information sharing for subsequent enrollments.
Automatic forwardingAll partially favorable or adverse at-risk redetermination decisions are forwarded automatically to the IRE within 24 hours.
inv-70: Supporting statement
Supporting statement definitionA prescriber's supporting statement is any verbal or written statement indicating the drug is medically necessary; it need not be complete to start the adjudication timeframe.
Tiering exception contentFor tiering exceptions the statement must indicate lower-tier alternatives would not be as effective and/or would have adverse effects (see §40.5.3 and §77).
Formulary exception contentFor formulary exceptions the statement must demonstrate medical necessity because formulary alternatives are ineffective or likely to cause adverse effects, or dose restrictions are ineffective, supported by clinical evidence (see §78).
inv-71: Tiering exception vs formulary exception
Tiering vs formulary exception distinctionTiering exceptions allow a non-preferred drug to be covered at the cost-sharing level of a lower-tier alternative; formulary exceptions permit coverage of non-formulary drugs or waiver of UM with plan selecting a single existing formulary tier's cost-sharing level.
LimitationsPlans may limit tiering exceptions to comparable alternative drug types and specialty-tier rules may restrict exceptions; formulary exceptions cannot be converted into tiering exceptions for approved non-formulary drugs.
Cost-sharing rulesFor formulary exceptions, plan chooses a single existing tier's cost-sharing or may apply a second lower cost-sharing for generic exceptions, uniformly applied.
inv-72: Coverage determination vs pharmacy transaction
Coverage determination vs pharmacy transactionA pharmacy transaction that notifies an enrollee that a drug cannot be filled under Part D is not automatically a coverage determination unless the plan treats the presentation as a request for a coverage determination.
Pharmacy notice requirementPlans must arrange with network pharmacies to provide Form CMS-10147 (standardized pharmacy notice) when prescription cannot be filled and designated NCPDP response code returned; exceptions apply.
Point-of-sale exceptionsDesignated NCPDP response code may not be returned for issues like missing adjudication data, OTC noncoverage, excluded manufacturers/NDCs, refill-too-soon edits, etc., which affect notice delivery rules.
inv-73: Misclassified initial determination
Misclassified initial determinationIf a plan misclassifies a coverage request as a grievance, it must notify the enrollee in writing that the issue was misclassified and will be handled as a coverage request; processing timeframe begins on date request received, not date of discovery.
Remedy and auditPlans are expected to audit classification errors and institute quality improvement projects as needed.
Conversion guidanceSee §40.11 when plan fails to meet timeframe for processing an initial determination due to misclassification.
Level 1 appeal definitionA level 1 appeal is a reconsideration (Part C) or redetermination (Part D) by the plan reviewing an adverse initial determination and any evidence submitted or obtained.
Filing timeframeMust be filed within 65 calendar days from notice of initial determination (effective Jan 1, 2025); plans must accept verbal expedited requests and may accept verbal standard requests.
Expedited processingExpedited level 1 appeals require prescriber support (physician for Part C; prescribing physician for Part D) indicating that standard timeframes could seriously jeopardize life/health or ability to regain function; Part C expedited decisions must be made within 72 hours with written confirmation within 3 days if initially verbal, and may be extended up to 14 days in limited circumstances (not for Part B drugs).
inv-75: Appeal parties
Appeal parties (Part C)Part C parties include the enrollee (or representative), assignee (provider waiving enrollee payment), legal representative of deceased enrollee's estate, or any other provider/entity with an appealable interest (excluding the MA plan).
Appeal parties (Part D)Part D parties include the enrollee and enrollee's representative; in some cases the enrollee's prescribing physician or other prescriber may be a party but does not have all enrollee rights unless also the representative.
Non-contracted providersNon-contracted providers may have payment appeal rights for Part C under specific conditions (e.g., WOL) but contract disputes are governed by provider-plan contracts.
inv-76: Person conducting level 1 appeal
Person conducting level 1 appealThe level 1 appeal must be performed by someone other than the person involved in making the initial determination; if the initial denial was for lack of medical necessity, a physician with appropriate expertise must conduct the review.
Reviewer expertiseIf same specialty as treating physician not available, reviewer must have appropriate training and expertise to evaluate the necessity of the requested service or drug.
Independence requirementReviewer must not have been involved in the initial determination to ensure impartiality.
inv-77: Prudent layperson standard
Prudent layperson standardFor Part C emergency and urgently needed services, the physician performing the reconsideration must apply the prudent layperson standard per 42 CFR §422.113(b)(1)(i).
Application contextUsed in cases involving emergency and urgently needed services as part of reconsideration reviews.
Reviewer obligationReviewer must assess whether a prudent layperson would have believed emergency care was necessary based on presenting symptoms.
inv-78: Dismissal of a Level 1 Appeal Request
Grounds for dismissal of level 1 appealPlans must dismiss level 1 appeal requests when requester is not proper party, missing required documentation (e.g., representative form or WOL for non-contracted provider), request fails to substantially comply with filing requirements (insufficient ID/contact), enrollee dies with no financial interest, or requester withdraws timely.
Dismissal notice and rightsDismissal notice must be mailed by end of adjudication timeframe, state reason, right to request vacatur, and right to request IRE review; IRE review must be filed within 65 calendar days of dismissal notice.
Vacatur periodPlan may vacate its own dismissal within 6 months of dismissal date for good cause; if vacated, plan must conduct level 1 appeal consistent with adjudication timeframes upon remand.
inv-79: Untimely Decision (treated as adverse and forwarded to IRE)
Untimely decision treated as adverseIf a plan fails to decide within required timeframe, the failure constitutes an adverse decision and the plan must forward the complete case file to the IRE (untimely decisions are treated as adverse and forwarded to IRE).
Plan notificationPlan should notify the enrollee that the appeal decision was not made timely and is being forwarded to the IRE (Part D guidance recommends notifying the enrollee when forwarding).
Forwarding timeframeAffirmed adverse expedited reconsiderations or missed timeframes must be forwarded to the IRE within 24 hours; plans must assemble and forward all pertinent documentation per §50.12.1.
inv-80: Parties who may be involved in forwarding or appealing
Parties who may be involved in forwarding or appealingPart D: enrollee, enrollee's representative, or enrollee's prescribing physician/other prescriber (acting on behalf of enrollee); Part C: enrollee and other parties with appealable interest (except MA plan) may seek higher levels of review.
Non-contracted provider roleNon-contracted providers may be parties for payment appeals in Part C when Waiver of Liability is filed; otherwise party status varies by case and regulation.
IRE forwardingAll partially favorable or adverse reconsideration decisions (Part C) and certain Part D decisions (e.g., at-risk) are forwarded to IRE automatically; parties need not request level 2 in those cases.
inv-81: Creditable prescription drug coverage
Definition — Creditable prescription drug coverageCoverage expected to pay, on average, at least as much as Medicare's standard prescription drug coverage; includes employer-based coverage, SPAPs, military-related coverage, and certain Medigap policies.
Implication for LEPEntities offering prescription drug coverage must make annual determinations of creditable coverage status and provide disclosure notices; this affects LEP calculations and reconsiderations.
ExamplesEmployer-based coverage, FEHBP, SPAPs, VA/TRICARE, and certain Medigap policies may be creditable coverage depending on specifics.
inv-82: IRE reconsideration finality
IRE reconsideration finalityAn IRE reconsideration determination is final and binding on the enrollee and the plan unless a party files a request for a hearing before an ALJ or attorney adjudicator (level 3).
Right to appealA party may appeal an IRE decision to ALJ/level 3 if AIC thresholds are met (plans may not appeal to ALJ/attorney adjudicator).
Notice and storageIRE must notify parties of its decision in understandable language and store reconsideration case files per CMS Records Management Program.
inv-83: Amount in Controversy (AIC)
AIC calculation methodAIC is computed as actual amount charged (or amount enrollee would have been charged) minus applicable deductible, coinsurance, or copayments; for Part D use projected value reduced by cost sharing and include projected refills.
Aggregation and projectionAppeals may be aggregated to meet AIC; projected value includes costs based on number of refills prescribed during plan year.
ReferenceGuidance and computation rules described in §70.2 of the manual.
inv-84: Amount in Controversy
ALJ/Council/Federal Court AIC rulesThird level (ALJ/attorney adjudicator) requires meeting AIC; fourth level (Council) requires no additional AIC beyond that met for third level; fifth level (Federal Court) requires AIC established by the Secretary for federal court review.
Consequences of not meeting AICIf AIC not satisfied for ALJ review, the appeal is dismissed at OMHA level; Council review assumes AIC met at third level.
References and linksManual references CMS webpages for ALJ and Federal Court procedures and thresholds per §70.2.
inv-85: Reopening
Reopening definitionA reopening is a remedial action taken to change a binding determination or decision even though it may have been correct based on evidence at the time; adjudicators with authority include plans, IRE, ALJ, or Council.
Time limitsPlans: within 1 year for any reason (if case not under appeal); within 4 years for good cause; any time for fraud or similar fault; IRE/ALJ/Council have specified timeframes in §80.3.1.
Regulatory citationsReopening process must comply with 42 CFR §422.616 and 42 CFR §§423.1978–423.1986 and applicable Part 405 reopening regs.
inv-86: Clerical error
Clerical error definition examplesClerical error includes human and mechanical errors such as mathematical mistakes, inaccurate data entry or coding, computer errors, or duplicate claim denials.
Part C handlingMA plans must remedy clerical errors using the reopening process and may dismiss reopening requests they do not agree are clerical errors; notify parties of appeal rights if reopening dismissed.
Effect on timingClerical error reopenings may be initiated any time to correct such errors per §80.3.1 for Part C.
inv-87: New and material evidence
New and material evidence standardEvidence is new and material if it was not readily available or known at the time of the decision, could not reasonably have been available to the decision-maker, and may result in a different conclusion; adjudicators assess from requester’s perspective.
Reopening basisNew and material evidence is a recognized ground for reopening for plans and IRE under §80.5.1.
Consideration criteriaAdjudicators must determine whether evidence meets new-and-material criteria considering availability and potential to change outcome.
inv-88: IM
IM — Important Message from MedicareStandardized beneficiary notice (IM) informs hospital inpatients of rights and steps to request BFCC-QIO immediate review; enrollee must follow IM instructions to request review.
DND — Detailed Notice of DischargeWhen BFCC-QIO notifies MA plan of an immediate review request, plan must deliver DND (Form CMS-10066) to enrollee as soon as possible but no later than noon of the day after notification.
DENC/NOMNC/MOONSNF/HHA/CORF: deliver DENC no later than close of business of day of BFCC-QIO notification; NOMNC and MOON are standardized notices with specific delivery requirements per setting.
inv-89: DND
DND definition and timingDetailed Notice of Discharge (DND), Form CMS-10066, must be delivered to enrollee as soon as possible and no later than noon of the day after BFCC-QIO notification of immediate review.
Plan responsibilitiesMA plan must ensure delivery of DND regardless of delegation and provide documentation to enrollee upon request by close of next business day.
BFCC-QIO coordinationPlan must provide all information BFCC-QIO needs to make determination by noon of the day after notification.
inv-90: DENC
DENC definition and timingDetailed Explanation of Noncoverage (DENC) must be delivered to enrollee as soon as possible, but no later than close of business of the day of BFCC-QIO's notification for SNF/HHA/CORF settings.
ContentDENC must include special instructions for repeat appeals within same episode of care and other elements per manual; plan must ensure delivery regardless of delegation.
Documentation provisionAt enrollee's request, plan must deliver any documentation sent to BFCC-QIO by close of business of first day after request.
inv-91: NOMNC
NOMNC definitionNotice of Medicare NonCoverage (NOMNC) is the standardized notice that must be provided in SNF/HHA/CORF settings before services end, enabling enrollee to request BFCC-QIO immediate review by specified deadlines.
Timing for appeal requestEnrollee should request immediate review by telephone or in writing by noon of the day before the NOMNC effective date, with emergency exceptions if BFCC-QIO closed.
Delivery instructionsInstructions for NOMNC are in the Medicare Claims Processing Manual and plans/providers must follow those procedures.
inv-92: MOON
MOON definitionMedicare Outpatient Observation Notice (MOON), Form CMS-10611, is the standardized notice hospitals must deliver when observation services exceed 24 hours, with delivery procedures in Medicare Claims Processing Manual.§400.
ApplicabilityMOON applies to hospitals and Critical Access Hospitals for Medicare Advantage and Original Medicare enrollees receiving observation services as outpatients for more than 24 hours.
Further guidanceSee Beneficiary Notices Initiative webpage for copies and delivery instructions.