FAIR DME Appeals Act
Sponsored By: Senator Cassidy, Bill [R-LA]
Introduced
Summary
Makes Medicare contractors pay attorneys' fees to winning DME suppliers. This bill would require certain Medicare contractors to pay reasonable attorney fees and out-of-pocket litigation costs to durable medical equipment suppliers that prevail on a final administrative appeal when the initial determination is found clearly erroneous, unsupported by substantial evidence, or contrary to law.
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- Durable medical equipment suppliers: They could recover reasonable attorney fees and traditional litigation costs when they win a favorable final appeal. Suppliers must apply for payment within 30 days and could be required to return fees if fraud or bad faith is later proven.
- Covered contractors: Medicare Administrative Contractors, qualified independent contractors, and eligible entities with certain contracts would be responsible for these payments when appeals meet the bill's standards. If one contractor affirms another's denial during the process, the contractors split fees evenly for that appeal.
- Appeal process and judges: A supplier serves its fee application on each covered contractor and each contractor has 30 days to respond. An administrative law judge must determine the fee amount within 60 days after that response period using the lodestar method and the judge's determination would not be appealable.
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Bill Overview
Analyzed Economic Effects
3 provisions identified: 1 benefits, 1 costs, 1 mixed.
Attorney fees for DME suppliers
If enacted, the bill would let a durable medical equipment (DME) supplier who wins a final appeal at OMHA recover reasonable attorney fees and litigation costs from the covered contractor. The award would apply when an ALJ finds the initial determination was clearly erroneous, unsupported by substantial evidence, or failed to follow law, regulation, or instruction. Fees and costs from every stage of the appeal up to the OMHA hearing would be covered, even stages where the supplier did not win. To get payment, the supplier would apply to the ALJ within 30 days, serve each covered contractor, contractors would have 30 days to respond, and the ALJ must decide within 60 days using the lodestar method; that decision would not be appealable. Contractors could not limit their liability or be indemnified by the Secretary for these awards. These rules would apply to contracts entered on or after the January 1 following HHS rulemaking.
Return fees if appeal was fraudulent
If enacted, the bill would require a DME supplier to return any attorney fees or litigation costs previously paid if a court or other adjudicator later finds the favorable appeal was obtained through fraud, misrepresentation, or bad-faith conduct. Returned money would go back to each covered contractor that paid those fees.
Timing rules for DME fee changes
If enacted, the bill would require HHS to issue regulations to carry out these changes within two years of enactment. The substantive amendments would apply only to contracts entered on or after the January 1 following issuance of those rules. This timing delays when suppliers and contractors must follow the new payment and liability rules.
Sponsors & CoSponsors
Sponsor
Cassidy, Bill [R-LA]
LA • R
Cosponsors
There are no cosponsors for this bill.
Roll Call Votes
No roll call votes available for this bill.
View on Congress.gov