Justia Public Benefits Opinion Summaries

In 2016, the Secretary of Health and Human Services (“HHS”) issued a final rule that implemented The Protecting Access to Medicare Act of 2014 (“PAMA” or “Act”), definition of “applicable laboratory” (“2016 Rule”). The American Clinical Laboratory Association (“ACLA”) filed a lawsuit challenging the 2016 Rule as arbitrary and capricious under the Administrative Procedure Act (“APA”) on the basis that it depresses Medicare reimbursement rates by excluding most hospital laboratories from PAMA’s reporting requirements. ACLA contended that because hospital laboratories tend to charge higher prices than standalone laboratories, their exclusion from reporting obligations results in an artificially low weighted median.   On remand, the parties cross-moved for summary judgment. The district court declined to reach the merits of ACLA’s APA challenge to the 2016 Rule, based on its determination that the Secretary had issued a new rule (“2018 Rule”) that superseded the 2016 Rule and mooted ACLA’s lawsuit.   The DC Circuit concluded that the case is not moot. Accordingly, the court reversed the district court’s dismissal for lack of subject matter jurisdiction and reached the merits of ACLA’s APA claim. The court explained that the 2016 Rule is arbitrary and capricious because the agency “failed to consider an important aspect of the problem.” The court wrote that PAMA provides that an applicable laboratory “means a laboratory that” receives “a majority” of its Medicare revenues from the Physician Fee Schedule or Clinical Laboratory Fee Schedule. Thus, hospital laboratories that provide outreach services may, in some instances, constitute “applicable laboratories” under PAMA. View "American Clinical Laboratory Association v. Xavier Becerra" on Justia Law

Illinois moved its Medicaid program from a fee‐for‐service model, where a state agency pays providers’ medical bills, to one dominated by managed care, where private insurers pay medical bills. Most patients of Saint Anthony Hospital are covered by Medicaid, so Saint Anthony depends on Medicaid payments. Over the last four years, it has lost roughly 98% of its cash reserves, allegedly because managed‐care organizations have repeatedly and systematically delayed and reduced Medicaid payments to it. Saint Anthony sued, arguing that Illinois officials owe it a duty under the Medicaid Act to remedy the late and short payments.The Seventh Circuit reversed the dismissal of the suit, concluding that Saint Anthony has alleged a viable claim for relief under 42 U.S.C. 1396u‐ 2(f) and may seek injunctive relief under 42 U.S.C. 1983 against the state official who administers the Medicaid program in Illinois. Illinois has tools available to remedy systemic slow payment problems—problems alleged to be so serious that they threaten the viability of a major hospital and even of the managed‐care Medicaid program as administered in Illinois. If Saint Anthony can prove its claims, the chief state official could be ordered to use some of those tools to remedy systemic problems that threaten this literally vital health care program. View "Saint Anthony Hospital v. Eagleson" on Justia Law

Genesis Healthcare was a healthcare provider participating in the federal “340B Program,” which was designed to provide drugs to qualified persons at discounted prices. Under the Program, the Secretary of the Department of Health and Human Services (“HHS”) enters into agreements with drug manufacturers to sell drugs at discounted prices to entities such as Genesis Healthcare, which could, in turn, sell the drugs to their patients at discounted prices. After Genesis Healthcare purchased the covered drugs from the manufacturers, it dispensed them to patients through its wholly owned pharmacies or contract pharmacies. After the Health Resources and Services Administration (“HRSA”) conducted an audit of Genesis Healthcare in June 2017 for Program compliance, HRSA removed Genesis Healthcare from the 340B Program. The audit report found, among other things, that Genesis Healthcare dispensed 340B drugs to individuals who were ineligible because they were not “patients” of Genesis Healthcare. HRSA rejected Genesis Healthcare’s challenges; Genesis Healthcare, in turn, filed suit seeking a declaration it did not violate the requirements of the Program, and injunctive relief requiring HRSA to reinstate it into the Program and to retract any notifications that HRSA had provided to manufacturers stating that Genesis Healthcare was ineligible under the Program. In response to the lawsuit, HRSA ultimately: (1) notified Genesis Healthcare by letter that it “ha[d] voided” all audit findings and that Genesis Healthcare “ha[d] no further obligations or responsibilities in regard to the audit” and (2) filed a motion to dismiss Genesis Healthcare’s action as moot based on the letter. The district court granted HRSA’s motion, finding that the action was moot. The Fourth Circuit reversed the district court's finding the case was moot: Genesis Healthcare continued to be governed by a definition of “patient” that, Genesis maintained, was illegal and harmful to it. Therefore, there remained a live controversy between the parties. View "Genesis HealthCare, Inc. v. Becerra" on Justia Law

After Wilkinson County Senior Care changed ownership, it received the maximum per diem rate from the Mississippi Division of Medicaid (DOM) for a period of twenty months. The DOM notified Wilkinson County Senior Care multiple times that the maximum per diem rate it received during this time period was subject to adjustment based on its initial cost report. The DOM did not seek recoupment of the overpayment based on the adjustment until 2011. Wilkinson County Senior Care argued that this delay foreclosed the DOM from recouping the overpayment it received. The DOM and the chancery court both affirmed that the recoupment was allowable. Because no legal or equitable principles provide that the delay in this case forecloses recoupment, the Mississippi Supreme Court affirmed the decisions of the chancery court and the DOM. View "Wilkinson County Senior Care, LLC v. Mississippi Division of Medicaid" on Justia Law

Patricia Allen appealed the Idaho Industrial Commission’s (the “Commission”) decision denying unemployment benefits. Allen was employed by Partners in Healthcare, Inc., doing business as North Canyon Medical Center (“NCMC”), between February 5, 1999, and May 8, 2020. On May 8, 2020, the CEO of NCMC and the HR director met with Allen to discuss her job performance. Allen was presented with a performance improvement plan (“PIP”), which outlined examples of Allen’s poor job performance and identified expectations for improving her performance. It was explained to Allen that if she wanted to forego the PIP, she could sign a severance agreement. Allen was then presented with a proposed severance agreement. Allen asked if she could discuss her options with her husband, but was pressed to make her decision then and there. The CEO told Allen that he thought it was in her best interest to take the severance package. Allen decided to forgo the PIP and took the severance agreement. After separating from NCMC, Allen filed an unemployment claim with the Idaho Department of Labor (“IDOL”). NCMC’s response to the Idaho Department of Labor was prepared by the Idaho Hospital Association (“IHA”), NCMC’s third-party administrator. IHA’s human resources director identified Allen’s reason for separation as “Fired/Discharged” and indicated Allen did not receive any compensation after her separation. IDOL determined Allen was eligible for unemployment benefits. NCMC’s HR director appealed the IDOL decision; IDOL sent NCMC and Allen a hearing notice on whether Allen quit voluntarily and, if so, whether she quit for good cause or was discharged for misconduct in connection with her employment. Following the hearing, the appeals examiner issued a written decision that denied Allen unemployment benefits. The examiner also found that Allen did not follow the grievance procedures to report her issues with her supervisor prior to quitting. In reversing the Commission’s decision, the Idaho Supreme Court concluded the Commission erred in failing to analyze whether the PIP was a viable option that would have allowed Allen to continue working. The matter was remanded for further proceedings. View "Allen v. Partners in Healthcare, Inc." on Justia Law

Long served in the Air Force, 1969-1976 and spent most of that time as an air traffic control radar repairman, working without ear protection near active runways. In 2009, Long filed a disability compensation claim for hearing loss and tinnitus. The Department of Veterans Affairs found his hearing loss and tinnitus were service-connected, assigning a 0% disability rating for his hearing loss and a 10% disability rating for his tinnitus according to the schedular rating criteria, 38 C.F.R. 4.85. The Board of Veterans’ Appeals denied his request for an extra-schedular rating. Long had argued that the schedular rating criteria did not capture the functional effects of his hearing loss, including ear pain caused by his hearing aids. The Veterans Court affirmed, finding no direct causal link between Long’s ear pain and his service-connected hearing loss.The Federal Circuit vacated. A secondary condition is considered service-connected if it is “proximately due to or the result of” a service-connected disability. Direct causation is not required. The court remanded, stating that the Veterans Court engaged in impermissible fact-finding. View "Long v. McDonough" on Justia Law

Bowling and Appling were discharged from military service under conditions other than honorable. Each eventually sought veterans’ benefits. Their discharges would statutorily bar the benefits at issue unless they came within an exception that applies where an offense led to the discharge and the service member was “insane” at the time of the offense, 38 U.S.C. 5303(b). The Board of Veterans’ Appeals found the regulatory definition of “insane” not to be met either in either case. The Veterans Court rejected their argument of unconstitutional vagueness of the insanity-defining regulation on its face, though not as applied to them. The court declined to take judicial notice of material outside the record, such as a publication by advocates for veterans addressing VA actions across a range of cases over many years.The Federal Circuit affirmed. The court upheld the Veterans Court’s refusal to take judicial notice; there was no "futility" in developing the record on the constitutional issue before the Board even if the Board could not have held the regulation unconstitutional. The Board could have performed at least record-development functions and associated fact-finding functions. The facial-vagueness challenge fails on the merits. The court noted that the regulation does not call for a categorical approach to interpretation. View "Bowling v. McDonough" on Justia Law

Plaintiff applied for disability benefits, alleging that, as of August 2016, she was unable to work because of degenerative disc disease, bulging and herniated discs, other spine issues, fatigue, migraines, asthma, fatty liver, and food allergies. The district court affirmed the decision of the administrative law judge denying Plaintiff's claims. The district court determined that section 404.1520c, and not the treating-physician rule, applied to Plaintiff’s claim. Plaintiff argued that the court's earlier precedents establishing and applying the treating-physician rule are still good law, notwithstanding the promulgation of section 404.1520c.   The Eleventh Circuit affirmed, finding that the new regulation validly abrogated the treating-physician rule and applied to Plaintiff’s claim. The court found that the new regulation instructs administrative law judges to give a treating physician’s opinion no deference and instead to weigh medical opinions based on their persuasiveness. The Social Security Act (“Act”) conferred “exceptionally broad authority” to the Commissioner “to prescribe standards for applying certain sections of the . . . Act.” The court explained that it has never held that the treating-physician rule is unambiguously required by the Act.   Here, Plaintiff filed her disability claim on April 28, 2017, after the effective date for section 404.1520c. And because section 404.1520 forbids administrative law judges from “defer[ring] or giv[ing] any specific evidentiary weight, including controlling weight, to any medical opinion(s),” 20 C.F.R. Section 404.1520c(a), the administrative law judge did not err by declining to give more weight to the medical opinions of Plaintiff’s treating physicians. View "Zinta Harner v. Social Security Administration, Commissioner" on Justia Law

Once a person turns 65 or has received federal disability benefits for 24 months, he becomes “entitled” to Medicare Part A, 42 U.S.C. 426(a)–(b) benefits. Not all patients who qualify for Medicare Part A have their hospital treatment paid for by the program; a patient’s stay may exceed Medicare’s 90-day cap or a patient may be covered by private insurance.Medicare pays hospitals a fixed rate for in-patient treatment based on the patient’s diagnosis, regardless of the hospital’s actual cost, subject to the “disproportionate share hospital” (DSH) adjustment, which provides higher-than-usual rates to hospitals that serve a higher-than-usual percentage of low-income patients. The DSH adjustment is calculated by adding the Medicare fraction (proportion of a hospital’s Medicare patients who have low incomes) and the Medicaid fraction (proportion of a hospital’s total patients who are not entitled to Medicare and have low incomes). A 2004 HHS regulation provides: If the patient meets the basic statutory criteria for Medicare, that patient counts in the denominator and, if poor, in the numerator of the Medicare fraction. The Ninth Circuit declared the regulation invalid.The Supreme Court reversed. In calculating the Medicare fraction, individuals “entitled to" Medicare Part A benefits are all those qualifying for the program, regardless of whether they receive Medicare payments for a hospital stay. Counting everyone who qualifies for Medicare benefits in the Medicare fraction—and no one who qualifies for those benefits in the Medicaid fraction—accords with the statute’s attempt to capture, through separate measurements, two different segments of a hospital’s low-income patient population. Throughout the Medicare statute, “entitled to benefits” is essentially a term of art meaning “qualifying for benefits” and coexists with limitations on payment. View "Becerra v. Empire Health Foundation, For Valley Hospital Medical Center" on Justia Law

The employer-sponsored group health plan offers all of its participants the same limited coverage for outpatient dialysis. A dialysis provider sued the plan, citing the Medicare Secondary Payer statute, which makes Medicare a “secondary” payer to an individual’s existing insurance plan for certain medical services, including dialysis, when that plan already covers the same services, 42 U.S.C. 1395y(b)(1)(C), (2), (4). To prevent plans from circumventing their primary-payer obligation for end-stage renal disease treatment, a plan may not differentiate in the benefits it provides between individuals having end-stage renal disease and other individuals based on the existence of end-stage renal disease, the need for renal dialysis, “or in any other manner” and may not take into account that an individual is entitled to or eligible for Medicare due to end-stage renal disease. The Sixth Circuit ruled that the limited payments for dialysis treatment had a disparate impact on individuals with end-stage renal disease.The Supreme Court reversed. The plan's coverage terms for outpatient dialysis do not violate section 1395y(b)(1)(C) because those terms apply uniformly to all covered individuals. The statute prohibits a plan from differentiating in benefits between individuals with and without end-stage renal disease; it cannot be read to encompass a disparate-impact theory. The statute simply coordinates payments between group health plans and Medicare without dictating any particular level of dialysis coverage. The plan does not “take into account” whether its participants are entitled to or eligible for Medicare. View "Marietta Memorial Hospital Employee Health Benefit Plan v. DaVita Inc." on Justia Law