November 12, 2013
Under the Affordable Care Act (ACA), insurance companies that offer Qualified Health Plans (QHPs) through the federal Health Benefit Exchange must meet a wide range of regulatory requirements.
The Department of Health and Human Services (HHS) has the authority to sanction a company for failure to adequately meet ACA requirements.
Insurance companies offering QHPs through state Exchanges must meet both applicable federal and state requirements, and can also be sanctioned for failures to adequately meet ACA requirements.
Final regulations were published in the Federal Register on October 30, 2013 ( pp. 65101-65105) regarding the appeal rights of insurance companies after ACA sanctions related to the federal Exchange.
(It may be expected that appeal rights for the state Exchanges will usually be similar, but must be assessed for each state situation.)
Appeals are first to be heard by Administrative Law Judges (ALJs) of the Appeals Board of HHS, who are to have all authority granted by the federal Administrative Procedures Act (APA).
A request for a hearing must be filed within 30 days of issuance of a notice of proposed assessment or decertification, to the address provided on the notice. This request must provide factual and legal detail regarding the basis for the appeal.
In many situations, given the early stages of operation of the ACA, it may be difficult to respond in such a short time frame. Clients should be given instructions as to how to respond to any such notices in a timely manner.
As noted in the regulations, “All hearings before an ALJ are on the record. The ALJ may receive arguments or testimony in writing, in person, or by telephone.” However, testimony by telephone is to take place only if “in the interest of justice and economy” and if not unduly prejudicial.
An attorney to appear in the matter must “promptly” file a notice of appearance.
After receipt of the request for hearing, the ALJ will provide instructions to the parties. The insurance company must file a brief within 60 days of the receipt of these instructions. HHS must then file a response brief within 30 days,
Again, this will be a tight schedule under many circumstances.
Each party is entitled to file a posthearing brief.
A final order by the ALJ may be appealed to U.S. District Court, but such an appeal must be made within 30 days.
Some of the major problems that may be faced by attorneys with respect to such appeals are—
(1) the timelines;
(2) newness of the Exchange operations, with likely difficulty in obtaining information and documentation;
(3) lack of precedent for such cases; and
(4) potential logistics regarding such hearings.
More on these and related ACA topics may be found in a recent book by the authors that describes implementation of the ACA, and in a new Practice Guide by the authors that addresses funding and access issues in health care.