PRRB chairman discusses board's role, case load - Provider Reimbursement Review Board's Elise Smith - includes related information on members and staff - interview

Healthcare Financial Management, April, 1990 by Ronald E. Keener, Ronald R. Kovener

In September 1989, Elise Smith was reappointed to a three-year term as chairman of the Provider Reimbursement Review Board (PRRB), which hears institutional appeals concerning Medicare allowable costs. An attorney, Smith has been in healthcare law for several years, starting as a litigator for the U.S. Department of Health and Human Services.

Smith was named chairman after a year as a member of the PRRB, coming from two years as general counsel of the Prospective Payment Assessment Commission [ProPAC].

HFMA Vice President Ronald R. Kovener, FHFAM, and HEALTHCARE FINANCIAL MANAGEMENT Publisher Ronald E. Keener recently talked with Smith in Washington, D.C.

In FY89, the PRRB received 2,242 appeals, the highest number ever received. In contrast, when the board was begun in 1975, it received only 107 appeals. Currently, there are 5,252 cases or requests "live in the system," Smith reports (see Exhibit 1).

She demurs when the word backlog is used. "I wish they could invent another word for backlog because it sounds like it is cast in concrete. We have an incredible number of appeals, a limited number of board members, and a limited number of days in the year."

With a single hearing panel of five board members and a staff complement of 22, Smith has calculated that in any given year there is a potential for hearings in only 123 cases.

Now, 123 hearings is the absolute. That would be a perfect number-if nothing ever fell out and there were no problems."

Over time, about 80 percent of the cases fall out; that is, they are resolved without a hearing or litigation. That's fine, that's the way it should go. The purpose is not to litigate these things, but to be able to use the board efficiently.'

Yet if 20 percent of 2,000 annual hearing requests must go to the board for decision, that is still 400 cases and constitutes more than three years of work on one year of appeals.

For years the board never went above 598 cases. Then in 1982, it started jumping into the 1,000-case range. She observes that "if appeals keep being filed in those numbers, this size board, doing its very best, cannot diminish those rapidly overnight. They just have to be taken over time." Effective case management

Despite the PRRBs heavy case-load, HFMA has never perceived that justice has been denied, even if decisions have been delayed.

"We believe that we now have an accurate databank of all of our active cases, and we input cases on a very quick turnaround. We acknowledge all appeals. Providers have been able to call upon us to help them determine the status of various cases, and we believe that we are effectively providing much better case management and a much more rational system for everyone. I think providers realize that. In a perfect world you might be able to dispose of all these cases faster, but then you have to design a system to do that.

One approach to such a system would be establishing two panels of the board instead of the present five members of the board sitting as one panel. "I think we should think about constituting two panels. As a matter of fact, you don't need a statutory change to have these two panels. It can be done with five [board members], it's just more complicated, that's all.'

The law requires that all board members have knowledge in the field of cost reimbursement. Two board members must be provider representatives. These members, while not named by the provider industry, usually are recommended by it.

The law also requires that one of the two provider representatives be involved in each decision of the PRRB. The only provider representative on the board until recently was Keith Braganza, FHFMA, CPA. Another provider, Joseph E Sloan, was appointed in February and was slated to be seated in March. Making final decisions

HFMA has supported the concept that the board's decisions should be final, suggesting that the administrator of the Health Care Financing Administration (HCFA) should appeal decisions in the courts, just as the providers must now do. A summary of the HCFA administrator's action on PRRB decisions is shown in Exhibit 2.

Smith was asked about her views on giving the board final decision making authority.

"I was never privy to the considerations that went into structuring the appeals mechanism as it is. I think that if Congress were to consider [such] restructuring, they would probably have to consider the constitution of the board itself. I don't know then whether or not you should consider replacing the board with an ALJ [administrative law judge] system."

Smith defends the independence and objectivity of the board in an environment where some procedures give the appearance of the fox guarding the chicken coop. Potential conflicts include the HCFA administrator deciding disputes that arise largely with rules initiated by HCFA, or the appointment and reappointment of PRRB members by people who are ultimately affected by the board's decisions.

"I really dispute that emphatically ... I think there is no influence whatsoever. I think every single board member does his job and does his job to the best of his ability."