Problems with Medicare’s Settlement Methods

One option for dealing with the backlog of Medicare claims waiting for a hearing is to settle them. That’s up to the Centers for Medicare and Medicaid Services, not the Office of Medicare Hearings and Appeals that actually oversees the process, so it’s not an administrative fix that the Office of Medicare Hearings and Appeals could actually implement alone. But it is worth considering, and the CMS has shown an openness to it by going along with the proposal for facilitated settlement and by offering to settle a big chunk of pending inpatient hospital admission disputes for 68 cents on the dollar. (See Nick Bagley’s post at the incidental economist.)

These settlement efforts have received some high-level scrutiny, however. Last month Representative Brady, Chair of the House Ways and Means Committee, Subcommittee on Health, sent the HHS a strongly-worded letter after the inpatient hospital settlement was announced, arguing that the settlement may exceed CMS’s statutory authority, among other problems. (See the letter linked here (“I question whether HHS has statutory authority for this settlement process.”)

I tend to share Congressman Brady’s skepticism.  Read More

Upcoming Medicare Forum on Appeals Backlog, Posts

Next week (on October 29) Medicare’s Office of Medicare Hearings and Appeals (OMHA) is holding another appellant forum to discuss the ongoing backlog of Medicare claims waiting for a hearing.  In one sense, a lot has happened since the last forum in February (I covered that here): OMHA announced pilot projects to try statistical sampling and facilitated settlement in some cases (see here and here); CMS (effectively the “defendant” for settlement purposes in these appeals; functionally independent from OMHA) announced a willingness to settle a subset of pending inpatient hospital billing claims for 68 cents on the dollar (see Nick Bagley’s post at the incidental economist); the backlog came up at a couple congressional hearings; and two lawsuits were filed to challenge it, one by providers (see here) and another by beneficiaries (see here).

In another sense, not that much has happened. Unless Thursday’s forum brings big news—and I know that OMHA and CMS have been working hard on reforms so perhaps it will—there is still a big backlog of Medicare appeals, there is still not a resource fix in sight, and the influx of Medicare appeals seems to still far outstrip OMHA’s capacity to hold hearings.

In advance of the forum, I’m planning a series of posts offering my thoughts, such as they are, on where we are and where we are going. I invite anyone who disagrees or thinks I’ve gotten something wrong to post their own views in the comments. Or you can email me and I will look into sharing your thoughts as an independent posting. You can get all my posts on this subject, including new ones as they come in, by clicking here.

A caveat: I’m approaching these as blog posts—trying to get my educated thoughts based on everything I have read out in a timely way—but I might be missing something. If the upcoming forum or comments reveal that I am–I won’t be there in person but will be watching remotely–I will either post a general update or go add particular updates in the text of my posts as necessary.

And a disclosure: I’ve said this before but want to do it once more again before pontificating—I worked in government until a little over a year ago, so my views on these matters may be biased. (And of course I will not discuss anything I worked on.)  But I’ve done my best to be objective.

To Watch: Rural Enrollment on Exchanges

As we gear up for a second year of exchange marketplace enrollment, one issue to keep an eye on is the success we have at getting people who live in rural areas onto the healthcare rolls.  As pointed out in today’s Kaiser Health News write-up (here), there is potential for the ACA to increase rural health disparities, even while it gets more people insured, because many of the efforts to encourage enrollment–think navigators, enrollment centers, advertising, and outreach–just work better in urban areas.  For some reading on this issue, see the Kaiser Family Foundation’s posting here, the HHS’s Health Resources and Services Administration’s report here, and the Rural Health Foundation’s roundup here.

Beneficiaries File Class Action Lawsuit Challenging Medicare Hearing Delays

I have blogged a few times about the current backlog in Medicare’s coverage appeals process, including observations about a lawsuit by providers challenging the backlog in federal court in the District of Columbia.  (See here.)  Yesterday a new lawsuit was filed, this one a class action lawsuit by beneficiaries represented by the Center for Medicare Advocacy.  (See their press release here.)  The case is Lessler et al. v. Burwell, 3:14-CV-1230 (D.Conn.).  I am blocked from accessing the complaint on PACER but am working on getting a copy.

Without access to the complaint it is dangerous to speculate, but I wonder whether this suit may be subject to many of the exhaustion-based arguments that I thought could lead to dismissal of the provider suit.  But the Center for Medicare Advocacy has had success pursuing class action suits on behalf of Medicare beneficiaries before, most notably the Jimmo case that led to a significant change in the standard of qualification for skilled nursing care.  (See here.)

One thing about this suit that may only be interesting to administrative law buffs is the choice of forum.  This case was filed in Connecticut, not the District of Columbia (where the providers filed their suit).  As I have written about elsewhere, there are pros and cons to channeling administrative law cases through DC, among them DC’s expertise in exhaustion and other administrative law issues.

I can’t say whether the Center for Medicare Advocacy chose to file in Connecticut rather than the District solely because that is their home forum, or whether they thought they’d get a more sympathetic judge/more plaintiff-friendly exhaustion doctrine.  And the same goes for the providers’ choice to file in the District rather than some other state.  I can say from experience, though, that the choice can really matter; DC judges’ familiarity with administrative law issues just makes them perceive these cases differently from the start.  So it would not surprise me at all if there are considerations beyond mere location at play here.  (Not that there’s anything wrong with that!)

Government seeks en banc rehearing in Halbig

Today the government moved for en banc rehearing in Halbig, as expected.  (HT: Rachana Dixit Pradhan @ insidehealthpolicy.com.)  I have not had the chance to review the petition but thought I would share it.  (For those looking to brush up on some of the blog debate on the case before reading, see here and here.  For more details on the en banc process see my earlier post here.)

The Government argues that rehearing en banc is warranted because the “disruption threatened” by Halbig makes the case one with exceptional importance.  One interesting bit did catch my eye, in light of that assertion.  It is footnote 7, which offers the Government’s view on the impact of the ruling in Halbig, and might be taken as sort of a cf.:

“The panel majority suggested that its ruling would apply nationwide, Op. 41-42, but it did not squarely hold as much or address the many reasons why relief should not extend beyond the named plaintiffs. The panel’s decision does not control in other circuits, just as the Fourth Circuit’s King decision does not control here.”

Here is the petition: Halbig En Banc Petition

How En Banc Review Would Work in Halbig

This morning the D.C. Circuit ruled that the ACA “unambiguously restricts the section 36B subsidy to insurance purchased on Exchanges “established by the State.”  (See opinion here.)  In other words, the court ruled that the subsidies that make insurance on federally-operated exchanges affordable are illegal.

In the news and blog coverage this has already received, the possibility of this decision being reversed “en banc” has been mentioned.  (See here, here, and here for news, here and here for blogs.  For other blog reading on the opinion itself, see here and here.)  Having written a bit elsewhere about the logistics of the DC Circuit (see here), I thought I would chime in with specifics about exactly how the decision whether to rehear the case en banc, and en banc rehearing, would work.

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Update and Thoughts on Lawsuit Over Medicare Hearing Backlog

Several months ago, I promised to post my thoughts on the viability of the American Hospital Association’s threatened lawsuit against the Secretary of Health and Human Services challenging the growing backlog of coverage appeals.  (See my post here).  That issue has become timely, because the AHA and several providers filed suit in May in the District of Columbia, and a few days ago filed a motion for summary judgment.   (See here).  There has been some coverage of the suit.  (See here and here.)  In short, their argument is that the statute says that a hearing must be held in 90 days and Medicare officials admit that the plaintiffs will not get a hearing for years, so therefore the court should order “mandamus,” forcing compliance with the 90 day deadline.

When I was in practice before moving to academia, I represented the Secretary in cases like this, so keep in mind my view might be biased.  But the government’s response to the complaint is due (by my calculation) Monday, July 28, so I wanted to offer my quick reactions about the case and what sort of response we might hear from the government.  I’ve just read over the AHA’s motion for summary judgment and I think that in a case like this, with an admitted violation of a statutory requirement, you have to start with the presumption that things could go bad for the government.  But with that said, I don’t think that the government’s case is as gloomy as it might at first appear, so this could be an interesting case to watch going forward.

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Medicare Coverage for Sex Change Therapy: What’s Next

By Matthew Lawrence and Elizabeth Guo

Last month Medicare’s policy on coverage for sex change therapy changed somewhat. (See Matt’s earlier post here.) Specifically, Medicare’s Departmental Appeals Board invalidated the long-standing National Coverage Determination that dubbed sex change therapy to be non-covered, per se.

Co-blogger Elizabeth Guo and I have done some further digging on this issue and put together two posts answering some questions left open by Medicare’s decision and the news coverage surrounding it.  In this post we discuss next steps: what the change in coverage policy means for Medicare beneficiaries who want coverage for sex change therapy, and what, if any, additional developments are likely to follow.  In a companion post, we will be discussing the somewhat unusual process that was used to make this policy change.

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Medicare No Longer Excludes Coverage for Sex Change Surgery

Yesterday, Medicare’s Departmental Appeals Board set aside a thirty-year-old National Coverage Determination excluding Medicare coverage for sex change surgery.  As a result, Medicare beneficiaries may now seek coverage for sex change surgery, though the ruling does not make such coverage automatic; it only lifts the blanket national exclusion.  Regional and case-by-case determinations that such surgery is not “medically necessary” could still apply.  For news coverage, see here, here, and here.

The decision is not entirely surprising, Medicare had already in December reopened consideration of the National Coverage Determination precluding coverage.  One question to watch is whether this decision, and the changed Medicare policy that ultimately results from it, winds up furthering the case for coverage in private insurance.  There is an unmistakable trend in this area toward more coverage.  Connecticut recently mandated coverage for many plans, and California and Oregon expanded coverage last year.  And let’s not forget prison, in the First Circuit, at least, the refusal to provide sex change surgery to Michael Kosilek that doctors deemed to be medically necessary was ruled “cruel and unusual punishment.”  (Coverage in the Globe here.)

 

Wait Times in the News in Canada

At the same time that wait times at VA hospitals have been in the news here in the U.S., a recent report has put healthcare queues in the news in Canada.  Specifically, a recent report from the Fraser Institute (a research institute that I’ve seen described as “conservative” and “pro-free market“) concluded that 44,723 women in Canada died between 1993 and 2009 due to increased wait times–or 2.5% of all female deaths during that period.  One week of delay was equated with 3 extra deaths per 100,000.  That surprising result led to a good bit of coverage, which is how it came across my desk (thanks to a google news search).  (See here, here, and here.)  But I have to admit I am a little bit skeptical.

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