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February 01, 2014

Using Mediation to Find Solutions

Erica Wood

(Note: The pdf for the issue in which this article appears is available for download: BIFOCAL Vol. 35, Issue 3.)

Medicaid Appeals Mediation Scenario: In-Home Personal Care Scenario

Medicaid beneficiary A is an 88-year-old who had been receiving 42 hours of in-home personal care assistance per month. An annual assessment of her Activities of Daily Living was conducted by an independent contract vendor for the North Carolina Department of Health & Human Services, Division of Medical Assistance (DMA). Beneficiary A suffers from mild to moderate dementia, severe hypertension and Type 2 diabetes. She was alone when the assessment was conducted.

The assessment results reduced the beneficiary’s in-home assistance from 42 hours to 24 hours. When the beneficiary was notified of the reduction and was advised of her appeal rights she requested that her grandson assist her with an appeal. As her appeal was timely filed, the beneficiary would continue to receive 42 hours as “maintenance of service” during the pendency of the appeal. The beneficiary’s appeal was assigned to a mediator.

Medicaid Appeals Mediation Scenario: Home Modification

Medicaid beneficiary B is a seven-year-old male diagnosed with autism—his mother requested that Medicaid pay for a Home Modification to install a fence with a lockable gate.

After a review of the request conducted by DMA, the request was denied because it did not meet the test for medical necessity and the mother was properly advised of her right as legal guardian to appeal the decision.

The appeal was filed and assigned to a mediator. The mediation was scheduled and conducted with the mother and a representative from DMA.

These scenarios are among thousands of Medicaid appeals that arise in North Carolina. Appeals might concern personal care services, payment for an adult care home or group home, behavioral health services, dental services, individual or group therapy, durable medical equipment, prescription drugs, eyeglasses, and much more. Beneficiaries have the right to appeal an adverse determination under federal and state law.1

In North Carolina, a Medicaid appeal request goes to the Office of Administrative Hearings, where it is heard by an administrative law judge. This Office does not hear Medicaid eligibility cases, only appeals. Even so, the Office processed close to 13,000 recipient appeals last year. But North Carolina has found a unique approach to appeals that is timely and allows beneficiaries to state their case directly to the Department of Medical Assistance Services: mediation.

The North Carolina Medicaid statute provides that upon receiving a request for appeal, the Office of Administrative Hearings must “immediately notify the Mediation Network of North Carolina, which shall contact the recipient within five days to offer mediation in an attempt to resolve the dispute.”

If the beneficiary agrees to go forward with mediation, the mediation must be completed within 25 days of the date it was submitted for appeal. When the mediation is completed, the mediator informs the Office and the Department within 24 hours. If the parties have resolved the problem, the Office dismisses the case. If not, the case goes on to the formal appeal. Participating in mediation “shall not restrict the right to a contested case hearing.”

We interviewed Jody Minor, Executive Director of the North Carolina Mediation Network, as well as Robin Anderson, Administrative Law Judge, to find out how this unusual approach to Medicaid appeals works. They explained that there are 14 participating mediation centers in the Network. Most of the Medicaid appeals mediation is by mediation center staff, with a small portion by volunteers, mostly retired attorneys and judges.

When the Network receives a case for mediation from the Office of Administrative Hearings, Mr. Minor examines it and selects one of the 14 mediation centers to conduct the mediation. Even though almost all of the mediations are by telephone, there is a right to attend in person, and he often assigns the case to the center closest to the person. Some beneficiaries have transportation or mobility problems and opt for a phone session. He also considers the volume of cases and the type of case. The case is assigned the same day he gets it.

In the large majority of the mediations, there is a beneficiary and also a representative or support person for the beneficiary. The representative does not have to be a legal representative, and could be a family member, friend, attorney, or someone else. Besides the beneficiary, the other party in the mediation is a Medicaid staff person.

In the mediation, each party is offered the opportunity to explain the case. The mediator will ask questions and try to reframe the issues. If there is any new evidence since the original adverse determination, it can be heard in the mediation. Mr. Minor noted that the mediator might, for example, ask the beneficiary to talk about a normal day and why he or she needs the services. Everyone, said Judge Anderson, “gets their day in court.”

Usually the mediation resolves the matter and a formal hearing is not needed. The rate of resolution in Medicaid appeals mediations is 81%. In the other 19% of cases, there is an impasse, or the beneficiary does not show up at the appointed time for the mediation, and the case goes on to appeal. Partly as a result of the mediations, the Office currently has no backlog of appeals cases. However, from mid-December 2012 to the end of March 2013, a change in Medicaid personal care regulations resulted in the filing of 11,000 appeals, many of which were resolved through mediation.

Since the inception of the mediation program in 2008, 7,600 appeals cases have been mediated. This has saved the state more than $25 million dollars in “maintenance of service” costs—under federal law, Medicaid monies must continue to be paid in a case pending the outcome of the appeal. Thus, if the appeal is heard sooner, funds are saved. The funding for the program comes through the Department of Medical Assistance Services, which includes both state and federal dollars. Mediators receive initial training, and must co-mediate five Medicaid appeals cases before mediating a case on their own. Mediators are supervised by the director of the mediation center.

While at first blush, the idea of mediating in an administrative entitlements case might appear to jeopardize basic beneficiary rights, the program is structured as a win-win. The mediation is fast, free, informal, and accessible. It allows the person to talk directly with the Medicaid staff, state the case, submit any new evidence, and get a resolution quickly.

If beneficiaries do not agree to the outcome, they can still appeal, so no rights are lost. The state addresses any case backlog and saves scarce Medicaid dollars. Medicaid staff find out more about real world problems routinely faced by beneficiaries. Mediators learn first-hand about Medicaid issues, which will continue to be of critical importance with changes in the program under the Affordable Care Act.

Scenario Resolutions

Here is how mediation worked in the scenarios presented at the beginning of the article:

Mediation Outcome

The mediation was scheduled five days after the appeal was filed. Participants in the mediation were the beneficiary, her grandson, a registered nurse representing DMA, and the mediator. The discussion guided by the mediator revealed that the beneficiary could not independently test her serum glucose levels daily. This was a service conducted by the CNA assigned to aid the beneficiary daily. During the initial assessment the beneficiary had stated that she managed her own medications but did not reveal that the CNA prepared the daily dosages for her.

With this new evidence the DMA nurse was able to modify the original allocation of in-home hours from 24 hours per month to 35 monthly hours. The beneficiary and grandson agreed that 35 hours would be sufficient assistance to allow the beneficiary to continue to safely live in her own home.

The beneficiary withdrew her appeal and the case was closed seven days after it was filed thereby saving lengthy “maintenance of service” and costly court time.  

Mediation Outcome

The mediator asked the DMA representative to explain the required criteria necessary to qualify for Home Modification. The beneficiary’s mother confirmed that her son’s needs did not meet the level of medical necessity for the modification but was able with the guidance of the mediator to articulate her fears and frustrations.

Armed with a more complete understanding of the child’s needs, the DMA representative was able to provide the mother with the appropriate information to request In-Home Care for Children which would more completely address all of her son’s needs.

With the information about the correct service to request, the mother withdrew the appeal for Home Modification.

1 42 CFR §431(E). N.C. Gen. Stat. § 108A-70.9A.

Erica Wood

About the Author: Erica Wood is the Assistant Director of the American Bar Association's Commission on Law and Aging in Washington, DC.