Supporting Statement - Part A

Supporting Statement For Paperwork Reduction Act Submissions

A. Background

This application requests re-approval of an information collection associated with regulations that permit individuals or entities to appoint representatives to exercise their rights to appeal an initial determination. These regulations are described below.

B. Justification

1 . The authority for collecting this information is under §405.910 (a) of the Medicare Claims Appeal Procedures.

An appointment of representative must:

• be in writing

• be signed and dated by both the party and individual agreeing to be the representative;

• provide a statement appointing the representative to act on behalf of the party, and in the case of a beneficiary, authorize the adjudicator to release personally identifiable health information;

• include a written explanation of the purpose and scope of the representation;

• contain the party’s and appointed representative's name, phone number, and address;

• provide the beneficiary's Medicare health insurance claim number or the National Provider Identifier number;

• include the appointed representative's professional status or relationship to the party; and

• be filed with the entity processing the party's initial determination.

2. Information Users

This form would be completed by beneficiaries and providers and suppliers who wish to appoint representatives to assist them with their initial determinations and filing appeals.

3. Use of Information Technology

There is no provision for alternative uses of information technology.

*To comply with the Government Paperwork Elimination Act (GPEA), you must also include the following information in this section:

- Is this collection currently available for completion electronically? NO

- Does this collection require a signature from the respondent(s)? YES

- If CMS had the capability of accepting electronic signature(s), could this collection be made available electronically? No, because the Medicare contractor would need the capability to receive e-forms.

- If this collection isn’t currently electronic but will be made electronic in the future, please give a date (month & year) as to when this will be available electronically and explain why it can’t be done sooner. N/A.

- If this collection cannot be made electronic or if it isn’t cost beneficial to make it electronic, please explain. This collection requires a signature from both the respondent and the respondent’s prospective representative and therefore cannot currently be made electronic.

4. Duplication of Efforts

The CMS-1696 does not duplicate any existing information collection.

5. Small Businesses

This collection does not have a significant economic impact on a substantial number of small entities.

6. Less Frequent Collection

This form is submitted on an as needed basis, therefore we cannot conduct this collection less frequently.

7. Special Circumstances

This information collection is in accordance with the guidelines in 5 CFR § 1320.6.

8. Federal Register/Outside Consultation

A 60-day Federal Register notice was published on April 1, 2008.

No new outside consultation with the public has been obtained since we consulted with the public through the March 8, 2005 publication of CMS 4064-IFC in the Federal Register.

9. Payments/Gifts to Respondents

We do not plan to provide any payment or gifts to respondents.

10. Confidentiality

Beneficiaries who choose to appoint a representative are required by regulation (42 CFR 405.910 (c)(5)) to provide their Medicare Health Insurance Claim Number (which is derived from the beneficiary’s Social Security Number) on the AOR form. Contractors collect and maintain this information for CMS under the provisions of the Privacy Act.

11. Sensitive Questions

There are no questions of a sensitive nature associated with this request.

12. Burden Estimates (Hours & Wages)

We must estimate the burden for the Appointment of Representative (AOR) form because we do not maintain data on the use of appointed representatives. Therefore, our estimates are derived from anecdotal information.

Our estimates are limited to beneficiary appeals involving appointed representatives. Providers and suppliers rarely invoke the use of appointed representatives, and when they

do, it is most often during the higher levels of the appeals process. Providers and suppliers are required to submit requests for initial determinations electronically, often employing a billing service to handle the accounts. Therefore, we believe that providers and suppliers are likely to use the AOR form for initial determinations in limited circumstances.

We believe that when parties appoint representatives, they generally do so at the start of the appeals process. For FY 2007, 2,682,684 requests for first level appeals were received (this figure is obtained from the CROWD (Contractor Reporting of Operational & Workload Data) system used by contractors to report to CMS their annual claims processed data). We estimate that 10% of all appellants (268,268) will appoint a representative.

Since we have developed the optional standardized form, we estimate that it should take approximately 15 minutes to supply the information needed to comply with the requirements for a valid Appointment of Representative. Therefore, we estimate the total burden to be 67,067 hours on an annual basis.

Total burden hours computed as follows:

Total Burden Hours = (268,268*15)

Total Burden Hours = (4,024,020)/ 60

Total Burden Hours = 67,067

Computation of Wages:

We estimate that 90% of all AOR forms will be completed by providers or suppliers. As noted previously, providers and suppliers are likely to use a billing service to file claims and appeals. We also estimate that the AOR form would most likely be prepared by a staff person with professional skills at the GS-9, Step1 level with an hourly salary of $18.60, so we computed the wage burden as follows:

90% * Total of all Appointment of Representatives (.9*268,268)= 241,441

Total Burden Hours = (241,441*15)

Total Burden Hours = (3,621,618)/ 60

Total Burden Hours = 60,360

GS-9 (Step 1) hourly rate 2007=$18.60

Total Burden Hours x Hourly Rate = 60,360*18.60 = $1,122,701.58

The remaining 10% of the AOR forms filled out would be completed by beneficiaries and would have no wage burden associated with their completion. However, the following is a breakdown of the burden hours associated with the portion of forms completed by beneficiaries:

10% * Total of all Appointment of Representatives (.1*268,268)= 26,827

Total Burden Hours = (26,827*15)

Total Burden Hours = (402,405)/ 60

Total Burden Hours = 6,707

13. Capital Costs

There are no capital costs associated with this collection.

14. Cost to Federal Government

There is no cost to the Federal Government for this collection.

15. Changes to Burden

The burden hours are computed based on relevant available data for Medicare appeals, and those figures are updated annually. Current appeals data indicates that the number of first level appeals has decreased since 2005. However, because we have revised the form to make it useable by all appellants, we are now including providers and suppliers in calculating the number of respondents. Thus, the hourly burden estimates have decreased for beneficiaries, but the hourly burden and wage burden estimates have increased overall for this collection. These figures are reflected in separate OMB Forms 83 – Part II, included in this collection. There are no capital costs or costs to the Federal Government associated with the information collected using this form.

16. Publication/Tabulation Dates

The standardized form will be published on the Internet; however, no aggregate or individual data will be tabulated from them.

17. Expiration Date

We are not requesting exemption.

18. Certification Statement

There are no exceptions to the certification statement.

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