SUBJECT:

In re CMS LCD Complaint:

Non-Coverage of Transfer Factor,

DECISION DISMISSING CASE

This matter is before me following the filing of submissions by the National Heritage Insurance Company (NHIC), the Centers for Medicare & Medicaid Services (CMS), and the aggrieved parties in response to my Order Directing Further Submissions of December 12, 2005. Those responses show that the coverage decisions appealed in this case are not Local Coverage Determinations (LCDs) as defined by 42 C.F.R. � 400.202. Because they are not, I lack subject-matter jurisdiction over the merits of this appeal. In the alternative, if NHIC's policy regarding transfer factor did constitute an LCD, the policy has been withdrawn or revised. Under either theory, I am required to dismiss this case in its entirety.

1. The complaint must be dismissed because NHIC's policy is not an LCD. ⁽¹⁾

Pursuant to my Order of October 12, 2005, NHIC submitted "hard copies" of an article with a revision date of December 23, 2004, found on its internet website describing its policy on transfer factor. In the November 17, 2005 cover letter accompanying its submission, NHIC asserted that its policy on transfer factor therapy is not an LCD. Its most recent submission, on January 5, 2006, reasserts this position, characterizing its position on transfer factor therapy as "not payable as not reasonable and necessary in any case we reviewed." CMS's January 3, 2006 submission supports NHIC's position, and relies on 42 C.F.R. � 426.325 to state that "[s]ince this article is not an LCD and since there is no LCD on this topic, coverage will be determined on a claim by claim basis by the carrier."

The aggrieved parties' joint submission of January 4, 2006 argues that there is no applicable National Coverage Determination (NCD) finding transfer factor to be a noncovered service for the treatment of multiple chemical sensitivities, the use at issue in this case. ⁽²⁾ They also contend that, until it filed its November 17 submission, NHIC never denied that its policy was an LCD and behaved as if the policy was an LCD. However, the aggrieved parties' submission does not directly address NHIC's assertion that it determined that transfer factor was not reasonable and necessary based on an individual review of the claims of each of the aggrieved parties.

The regulations governing my review of these coverage matters grant me jurisdiction over cases involving LCDs only. 42 C.F.R. �� 426.400-463 My jurisdiction does not extend to other types of coverage decisions. Therefore, if the NHIC policy on transfer factor is not an LCD, I do not have jurisdiction over this matter. The regulations define an LCD as follows:

Local coverage determination (LCD) means a decision by a fiscal intermediary or a carrier under Medicare Part A or Part B, as applicable, whether to cover a particular service on an intermediary-wide or carrier-wide basis in accordance with section 1862(a)(1)(A) of the [Social Security] Act.

42 C.F.R. � 400.202. Under this definition, the significant factors are: (1) whether the coverage decision is applicable on a carrier-wide basis; and (2) whether the coverage decision is based on a determination that the service is not reasonable and necessary in accordance with section 1862 of the Social Security Act. The responses from NHIC and CMS establish that the coverage decisions were not made on a carrier-wide, but on a claim-by-claim basis, and were on that basis determined to be not reasonable and not necessary. Thus, the coverage decisions were not an LCD.

2. In the alternative, if the NHIC policy is an LCD, the policy has been retired or revised to eliminate the challenged provision, and is subject to dismissal for that reason.

Moreover, even if I were to conclude that the NHIC policy revision of December 23, 2004, as described in NHIC's letter to me of November 17, 2005, is an LCD, that policy has been changed. Under the applicable regulations, a contractor has an absolute right to retire or revise an LCD at any time before the administrative law judge (ALJ) issues a decision. 42 C.F.R. � 426.420(a), (b). If a contractor withdraws or revises the LCD under review to eliminate the provision being challenged, the ALJ must issue a decision dismissing the complaint. 42 C.F.R. � 426.420(e)(1).

NHIC's December 23, 2004 policy included a paragraph headed, in bold type, "Noncoverage of Transfer factor." That paragraph stated, in pertinent part:

The use of parenteral "Transfer Factor" to treat any illness is not a recognized treatment modality accepted by the scientific and medical community, and may be dangerous. The use of parenteral "Transfer Factor" is not a covered benefit under Medicare.

As CMS recognized in its letter of January 3, 2006, this language "may lead readers to believe [the article] is an LCD." CMS went on to say, however, that it would instruct the contractor to revise the article. NHIC's letter of January 5, 2006, attaches a revised version of the article in question which does not contain the paragraph headed "Noncoverage of Transfer Factor." If the December 23, 2004 article on transfer factor is an LCD, I conclude that the contractor has revised the article to eliminate the provision being challenged. Therefore, pursuant to 42 C.F.R. � 426.420(e)(1), I am required to dismiss the complaint. The effect of the policy having been revised is that the aggrieved parties "receive individual claim review without the retired/withdrawn provision(s)." Id.

By Order of October 12, 2005, 26 aggrieved parties were identified, and their amended claims were ruled to be an acceptable joint complaint as defined at 42 C.F.R. �� 426.400(c) and (d), and 426.410(b). Because it is now apparent that the underlying jurisdictional basis of that ruling was deficient, and that I have no jurisdiction to entertain this matter further, the joint complaint must be, and it is, DISMISSED. In the alternative, if the NHIC policy is an LCD, the challenged provision has been revised and/or withdrawn. For that reason, 42 C.F.R. � 426.420(e)(1) requires that the joint complaint be, and it is, DISMISSED.

Pursuant to 42 C.F.R. � 426.465(a), the aggrieved parties may appeal to the Departmental Appeals Board my decision that their complaint is subject to dismissal because the NHIC policy is not an LCD. Pursuant to 42 C.F.R. � 426.465(d)(1), the aggrieved parties do not have the right to appeal my decision that their complaint is subject to dismissal because the contractor has retired the LCD provision(s) under review. ⁽³⁾

Richard J. Smith

Administrative Law Judge

1. Pursuant to 42 C.F.R. � 426.450(a), my decision must include findings . My findings in this case are set out in the two numbered headings.

2. NHIC's November 17 submission can be read to assert that NHIC considered itself bound by an NCD which finds transfer factor to be a noncovered service for the treatment of multiple sclerosis. I interpret the aggrieved parties' argument as an attempt to refute this assertion.

3. The regulations, at 42 C.F.R. � 426.450(b), require that an ALJ's decision contain certain other information. This decision contains the information required by 42 C.F.R. � 426.450(b)(1), (2), and (6). Because I am dismissing this case on jurisdictional grounds, the information required by42 C.F.R. � 426.450(b)(3), (4), and (5) is not relevant to my decision and/or is not a part of the record, and is not included for that reason.