Latest News | Mcare Court

HHS Files Petition to Supreme court on Equitable Tolling Issue
From: King & Spalding 4/23/12

Note: Toyon Associates is pursuing this equitable tolling issue for several of our clients.

Article Excerpt:
On April 13, 2012, Health and Human Services Secretary Kathleen Sebelius filed a petition for writ of certiorari with the U.S. Supreme Court requesting that the Court overturn the D.C. Circuit’s ruling that equitable tolling applies to the 180-day time limit for providers to file administrative appeals of final Medicare cost report payment determinations. Sebelius v. Auburn Regional Medical Center, U.S., No. 11-1231, petition for cert. filed Apr. 13, 2012.

At issue is the June 2011 decision, whereby the D.C. Circuit’s three-judge panel ruled that equitable tolling is available for Medicare cost report appeals because a claim for Medicare payment is analogous to a contract claim. Auburn Regional Medical Center, et al. v. Sebelius, 642 F.3d 1145 (D.C. Cir. 2011). By way of background, the equitable tolling issue arose in the context of provider appeals of the SSI Ratio component of the disproportionate share hospital (DSH) adjustment for fiscal years 1987-1994. The providers did not appeal the SSI Ratio issue to the Provider Reimbursement Review Board (PRRB) until they learned of the issue in 2006 (as a result of the Baystate litigation), more than a decade after the 180-day window for appealing their Medicare cost reports had passed.
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Click here to view the Supreme Court petition submitted by HHS.

From: US District Court of Columbia – 1/30/12

Great news from the US District Court of Columbia – Regarding the issue of Part A exhausted dual-eligible days and the inclusion of these patients in the Medicaid fraction for Medicare DSH purposes.  The DC court concluded that these types of days must be included in the Medicaid fraction for the period at issue.

This court followed the Northeast decision from the DC Circuit and concluded that CMS’s current policy on these days cannot be applied retroactively to periods before the 10/1/04 rule change.

Toyon has in place literally hundreds of years of appeals outstanding that this decision will apply to assuming CMS does not appeal the decision. We are hopeful that this will help move these appeal years to settlement resolutions over the next year.

Northeast Hosp Group v. Sebelius – Appellate Court Decision

U.S. Court of Appeals – District of Columbia – 9/13/11

Issue:

Medicare Choice M+C (Part C) Days Inclusion with the Medicaid Patient Days Ratio

Fiscal Years: 1999 – 2002

History:

PRRB ruled that the dual eligible patients with Medicare M+C coverage should be included in the Medicare proxy of the DSH ratio.  They denied the request of the provider that patients with these days be included in the Medicaid patient day ratio.

The CMS Administrator affirmed the PRRB decision.  The Provider pursued the issue at District Court (District of Columbia).  An opinion was issued on March 30, 2010 that granted the Providers request for inclusion of these dual eligible days in the Medicaid patient day ratio.  This decision was appealed by the Secretary of HHS.

Appeals Court Decision:

The District of Columbia’s ruling was upheld for the years in question.  The Appeals Court reasoning for upholding the decision did not follow the lower court’s reasoning.  

The Appeals Court in their decision validated CMS’ 2004 rule making that adopted a policy of counting M+C days in the Medicare fraction.  This rule making became effective on October 1, 2004.  What they didn’t allow however was the retroactive application of this rule prior to October 1, 2004.  So Northeast still prevailed, but only due to the fact that the Secretary cannot retroactively implement this policy. 

What does this Decision Mean?

The decision delineates the M+C issue to before and after October 1, 2004.  Appeals for M+C dual eligible days will before October 1, 2004 have a win from this decision.  Appeals for services on or after October 1, 2004, will have a much tougher time prevailing.

It remains to be seen whether this Court’s decision will be appealed further.  The next level is the U.S. Supreme Court.  Given that the decision is in the District Columbia, its applicability is for the entire Country.  This decision further validates CMS’ inclusion of the M+C days in the Medicare SSI proxy effective October 1, 2004.