Healthcare providers facing Medicare overpayment allegations often enter an appeals system that feels fundamentally one-sided. At critical stages—especially early levels and even sometimes at Administrative Law Judge (ALJ) hearings—contractors such as MACs, RACs, or UPICs frequently submit written position papers instead of appearing live. The result? Providers are denied a meaningful opportunity to confront the very parties accusing them of wrongdoing.
This practice raises serious constitutional concerns.
Due Process Requires More Than Paper Reviews
The Fifth Amendment’s Due Process Clause guarantees that the government cannot deprive a person of property without “due process of law.” Medicare recoupments—often involving hundreds of thousands of dollars; even millions—are unquestionably a deprivation of property.
At its core, procedural due process requires:
- Notice of the allegations
- A meaningful opportunity to be heard
- The ability to challenge opposing evidence
Critically, longstanding legal principles include the right to confront and cross-examine adverse witnesses as a component of fair procedure.
Yet in Medicare appeals, particularly at the reconsideration level, there is no hearing at all—only a paper review by a contractor. Even when a case reaches an ALJ, contractors may participate merely by filing written position papers rather than appearing for questioning.
That is not what most would recognize as a “hearing.”
Supreme Court Precedent Emphasizes Confrontation
The U.S. Supreme Court has repeatedly held that due process is flexible but must include fundamental fairness. In Goldberg v. Kelly, 397 U.S. 254 (1970), the Court ruled that when government benefits are at stake, due process requires:
- An evidentiary hearing
- The opportunity to confront and cross-examine adverse witnesses
The Court emphasized that written submissions alone are insufficient where credibility and factual disputes are central.
Similarly, in Mathews v. Eldridge, 424 U.S. 319 (1976), the Court created a balancing test for due process but still recognized that procedural protections must match the risk of erroneous deprivation. When the stakes are high and the evidence complex—as in medical necessity audits—the need for robust procedural safeguards increases.
Applying Mathews, the Medicare appeals system raises red flags:
- Private contractors (RACs) are financially incentivized to find overpayments
- Decisions rely heavily on subjective medical judgments
- Providers face significant financial harm
Yet the system often denies them the ability to question the auditor’s reasoning directly.
The Problem with “Position Papers”
In practice, Medicare contractors can influence outcomes without ever appearing in person. Instead, they submit written arguments summarizing their position.
This creates a structural imbalance:
- Providers must defend themselves live before an ALJ
- The accusing party avoids cross-examination
- The decision-maker hears one side tested, the other insulated
This is particularly troubling given that administrative law traditionally values adversarial testing of evidence. As Judge Henry Friendly famously outlined, a fair hearing includes “the right to know opposing evidence” and “the right to cross-examine adverse witnesses.”
A paper-only accusation undermines both.
Administrative Convenience vs. Constitutional Rights
The government may argue that efficiency justifies this structure. But courts have repeatedly rejected administrative convenience as a substitute for due process when property rights are at stake.
Medicare appeals already involve a five-level process culminating in federal court review, demonstrating the seriousness of these disputes. Yet at the very stages where facts are developed, providers are often denied the tools needed to challenge those facts effectively.
A System That Needs Reform
At minimum, fairness demands:
- Mandatory availability of contractor witnesses at ALJ hearings
- The right to cross-examine those who made or influenced the overpayment determination
- Greater transparency in how audit conclusions are reached
Without these protections, the Medicare appeals system risks becoming a process where the government accuses—and wins—without ever being questioned. And may I mention the upcoming AI accusations. Are you going to cross examine a computer?
That is not due process. That is paperwork masquerading as justice.