Palomar Case Appealed, Potentially Limiting Provider Rights to Challenge Claim Reopening

The Palomar Medical Center case—involving the critical issue of whether providers have recourse when a Medicare contractor, such as a RAC, fails to follow the timeframes and rules for reopening old claims—continues to wind its way through the courts. As reported in an earlier Client Alert, a federal magistrate judge in the Southern District of California entered a report and recommendation in the case that providers do not have the right to challenge a Medicare contractor’s decision to reopen a claim on grounds that the contractor lacked “good cause” for the reopening. A federal district court judge recently adopted the magistrate’s report and recommendation in full. On September 27, 2010, the provider in Palomar filed notice that it will appeal the District Court’s unfavorable ruling to the Ninth Circuit US Court of Appeals.

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