The Five Levels of Medicare Appeal, and Where Practices Stop

Medicare provides five levels of appeal. Most practices use one, and it is the least favourable one.

The levels

1. Redetermination — reviewed by the same contractor that denied the claim.
2. Reconsideration — reviewed by an independent contractor, a different organization.
3. Administrative Law Judge hearing — an actual hearing, with a minimum amount in controversy.
4. Medicare Appeals Council review.
5. Federal district court review, above a higher threshold.

Why stopping at level one is the wrong place

Level one is decided by the organization that made the original decision. Reversal requires them to conclude their own determination was wrong. That is not a hostile process, but it is structurally the least likely place to prevail.

Level two moves to an independent reviewer with no stake in the original decision. It is a genuinely different reading, and it is where a well-documented appeal has the most room to succeed.

What stops practices

Effort, mostly. Each level has its own deadline and format, and without a defined process every appeal is reinvented. The amount-in-controversy threshold at level three also rules out individual small claims — though claims can sometimes be aggregated to meet it, which is the part most practices do not know.

A workable policy

• Appeal to level two by default when the denial is contestable and the balance justifies it.
• Track deadlines per level. They differ, and missing one ends the matter permanently.
• Group similar denials. One argument built once can serve many claims and can help clear the threshold for higher levels.

None of this makes an outcome certain — the decision is the adjudicator's. It just stops the practice from conceding at the point where conceding is least justified.