I. NURSING FACILITY UPDATES
Report: Geography Is Not Destiny: Protecting Nursing Home Residents from the Next Pandemic
On February 18, 2021, the Center for Medicare Advocacy released a new report – Geography Is Not Destiny: Protecting Nursing Home Residents from the Next Pandemic – which explores facilities’ responses to the coronavirus crisis and examines how residents’ deaths were not “inevitable”, as some have claimed. The report contends that COVID-19 exploited and exacerbated long-standing issues, such as staffing, infection control, and management problems, that existed for decades in the long-term care industry.
As our nation’s nursing homes continue to reel from the unprecedented toll that COVID-19 has taken, questions remain about how many deaths could have been avoided, and – crucially – what can be done to save lives moving forward to prevent a similar catastrophe in the future. Nationwide, 36% of COVID-related deaths have occurred in long-term care facilities (and in some states that figure jumps to over 60%). These statistics are even more shocking considering that less than 1% of the nation’s population live in these facilities.
“The wrath of COVID-19 in our nursing homes was felt, in large part, because we as a nation have not prioritized fixing these issues,” states Cinnamon St. John, the report’s author – who was also the Center’s Health and Aging Policy Fellow and Associate Director of NYU Rory Meyers’ Hartford Institute of Geriatric Nursing. “COVID-19 will very likely not be the last pandemic we experience in our lifetimes. If we don’t address these issues now, will see these mass casualties again. The good news is that we know more now. The lessons are clear. But we must act. The currency is lives – lives lost, or lives saved,” she added
The report:
- Analyzes and challenges the assertion that “Geography is Destiny” as the prevailing theory of nursing home transmission (concluding “a facility’s location does not equate to a facility’s fate”)
- Identifies lessons learned for nursing homes
- Provides specific policy recommendations for change
Read the full report at: https://medicareadvocacy.org/wp-content/uploads/2021/02/CMA-NH-Report-Geography-is-Not-Destiny.pdf
Other Nursing Home Issues
- Visitation
CMS issued revised guidance on March 10, 2021 that allows all residents to have in-person visits with their families. CMS, “Nursing Home Visitation – COVID-19 (REVISED),” QSO-20-39-NH (revised Mar. 10, 2021), https://www.cms.gov/files/document/qso-20-39-nh-revised.pdf. Discussed in CMA Weekly Alert (March 11, 2021): https://medicareadvocacy.org/cms-allows-nursing-home-visits/.
- Temporary Nurse Aides
In March 2020, CMS waived the part of longstanding nurse aide training rules that prohibited facilities from using individuals for more than four months as aides unless they completed their state’s training and competency evaluation requirements. Federal rules require at least 75 hours of training, although many states require more hours. The American Health Care Association (AHCA) immediately developed a free eight-hour on-line training program for “temporary nurse aides.” Many states have permitted facilities to use temporary nurse aides who were trained on-line under AHCA’s program.
The nursing home industry is now pushing at the state and federal levels to grandfather these workers as certified nurse aides. Advocates think it’s illegal and bad policy.
Discussed in “Nursing Home Advocates and Members of Congress Call for Reinstatement of Nurse Aide Training Rules” (CMA Weekly Alert, Mar. 4, 2021), https://medicareadvocacy.org/reinstate-nurse-aide-training-rules/
- Private Equity
One of the changes in nursing home ownership over the past 15 or so years is the purchase of nursing facilities by private equity firms. Studies show that, during the pandemic, these facilities have had worse residents outcomes (more COVID-19 cases and deaths) than facilities with different ownership patterns.
Discussed in “Nursing Facilities owned By Private Equity Firms Have Higher Rates of Covid Infections than Other Facilities” (CMA Weekly Alert, Aug. 13, 2020), https://medicareadvocacy.org/nursing-facilities-owned-by-private-equity-firms-have-higher-rates-of-covid-infections-than-other-facilities/
Evidence about private equity continues to mount:
Atul Gupta, Sabrina T. Howell, Constantine Yannelis, and Abhinav Gupta, “Does Private Equity Investment in Healthcare Benefit Patients? Evidence from Nursing Homes,” Becker Friedman Institute, Working Paper No. 2021-20 (Feb. 2021), BFI_WP_2021-20.pdf (uchicago.edu)
Charlene Harrington, Anne Montgomery, Terris Kind, David C. Grabowski, Michael Wasserman, “These Administrative Actions Would Improve Nursing Home Ownership And Financial Transparency in The Post COVID-19 Period,” Health Affairs (Feb. 11, 2021), https://www.healthaffairs.org/do/10.1377/hblog20210208.597573/full/
Interest in Congressional offices in addressing this and other ownership/management issues.
II. FEDERAL UPDATE
COVID Relief Bill – American Rescue Act of 2021
On March 11, 2021, President Biden signed the $1.9 trillion American Rescue Plan Act of 2021 into law.
The Rescue Act, which is the sixth major COVID relief bill passed in the last year in which the pandemic has gripped the nation, includes a range of economic stimulus provisions and an expansion of federal safety net programs (some of which is temporary), including: child tax benefits; extension of unemployment benefits; stimulus checks; additional funding for COVID testing and contract tracing and vaccine distribution; aid to state and local governments; housing assistance; funding to support the opening of schools; support for child care providers; relief for multi-employer pension plans; and a number of health care related provisions, discussed below. (For summaries of the bill, see, e.g., this Senate Title-by-Title summary; the Center on Budget and Policy Priorities (CBPP) issue brief “American Rescue Plan Act Will Help Millions and Bolster the Economy”; also see this Washington Post summary and NPR summary.)
Health care specific provisions of the Rescue Act include:
- Expansion of marketplace coverage – according to CBPP, “the Act eliminates or vastly reduces premiums for many people with low or moderate incomes who enroll in plans through the Affordable Care Act (ACA) marketplaces and provides new help to people with somewhat higher incomes who face high premiums.” The Kaiser Family Foundation has updated its 2021 Health Insurance Marketplace Calculator to reflect these changes, which will be in effect for two years. In addition, there are protections for marketplace enrollees with fluctuating income over the last year from having to repay significant portions of their federal premium tax credits.
- Expansion of COBRA coverage – per the Senate summary, the “bill subsidizes 100 percent of COBRA premiums for six months for individuals who lost employment or had reduced hours.”
- Medicaid – provisions include:
- Increased financial incentives for the states that have not implemented the ACA’s Medicaid expansion to do so
- Increased federal portion of Medicaid funding for Home and Community Based Services (HCBS)
- According to the Senate summary referenced above, “The bill also includes numerous investments to reduce health disparities, including an option for states to provide one-year of postpartum Medicaid coverage, […] and resources for COVID-19 response in nursing homes.”
Discussed in CMA Weekly Alert (March 11, 2021): https://medicareadvocacy.org/covid-relief-bill-passes/
Medicare Fiscal Solvency
In January 2021, the Commonwealth Fund published a series of articles entitled Options for Extending Medicare’s Trust Fund: The Commonwealth Fund Solvency Series.
Recognizing that the Medicare Part A Trust Fund is projected to become insolvent in 2024 (since revised to 2026 by the Congressional Budget Office), the introduction to the series notes that “[w]ithout changes to expected spending or trust fund revenue, the trust fund will not have sufficient funds to cover the entire cost of beneficiaries’ health care.” Noting that the Trust Fund “is primarily funded through payroll taxes paid by employers and employees, with some additional income from interest as well as premiums paid by voluntary enrollees not automatically entitled to Medicare Part A”, the authors ask “[w]ill the trust fund solvency be adequately extended by reducing the projected growth in expenditures, raising revenues, changes to the services covered by Medicare Part A, or a combination of these options?”
The Commonwealth Fund invited Medicare thought leaders with a range of perspectives, including Marilyn Moon, a Center for Medicare Advocacy Visiting Scholar, to “outline how they would extend the life of the trust fund.” The articles include a breadth of policy proposals offered by these experts, some of which the Center for Medicare Advocacy agrees with, others we oppose.
Overall, the Center agrees with Dr. Moon that there should be a robust discussion concerning raising additional revenue, and that cost reductions should not lead to a reduction in services for beneficiaries (see her statement in the Alert, linked below).
With respect to raising additional revenue, we agree with exploring some of the proposals outlined by Dr. Moon and others, such as an “excess profits tax” during the pandemic, and/or a modest payroll tax increase. We also agree with Dr. Bruce Vladeck who promotes expanding the revenue base by taxing all personal income, including returns on capital that are currently not subject to payroll taxes.
With respect to cost-savings, we support proposals such as negotiating drug prices and reining in Medicare Advantage overpayments, including by reforming the quality bonus program and risk-coding adjustments.
We disagree with some of the other proposals, such as transforming Medicare into a premium support program, expanding the role of Medicare Advantage, raising the eligibility age for Medicare, and prohibiting supplemental coverage from offering first-dollar coverage. These suggestions would not attain savings while retaining the intent of Medicare to provide equitable health care for all beneficiaries.
The new Congress and Administration will soon have to address Medicare solvency issues. As Dr. Moon notes, this Commonwealth Fund series provides a good foundation for the coming debate.
Discussed in CMA Weekly Alert (February 11, 2021): https://medicareadvocacy.org/m-moon-medicare-solvency/
III. HOME HEALTH UPDATE
- Quality Measures and the Home Health Value Based Purchasing Program Proposed Expansion
The Centers for Medicare and Medicaid Services (CMS) has announced plans to expand a Medicare home health program model that discriminates against people with longer term and chronic impairments whose conditions are not improving. It significantly limits access to home health care for beneficiaries who need it most, and directly conflicts with the Jimmo v. Sebelius settlement.
The Home Health Value-Based Purchasing Model (HHVBP) was implemented in 2016 in nine states.[1] According to CMS’ January 8, 2021 press release, the purpose of the model was “to test whether providing payment incentives for better quality care with greater efficiency would improve the quality and delivery of home health care services to Medicare beneficiaries.” CMS recently concluded the model was successful, with a 4.6% improvement in agencies’ quality scores[2] and certified program expansion to be accomplished through future rule-making.
One major flaw of HHVBP is that it does not provide any meaningful measurement criteria for people who qualify for home health care under the law, but who have an illness or injury that will not improve, or will not improve relatively quickly. As a result, the HHVBP design penalizes agencies that serve people with longer term and chronic conditions, by taking payments back from agencies serving people who do not meet the improvement criteria.[3]
Under HHVBP, Medicare payments to home health agencies are adjusted based on a home health agency’s (HHA) total performance score (TPS) on specified quality measures compared to other HHAs in a state. The maximum payment adjustment, upward or downward, is 7% for 2021.[4] The quality measures in the HHVBP are based primarily on improvement in a patient’s condition, and quality measures in the model are absent for conditions not likely to improve (or to improve quickly). Thus, agencies are monetarily discouraged under HHVBP from serving many patients with longer-term conditions who qualify for Medicare-covered care.
As CMS developed HHVBP, “maintenance or stabilization measures” were considered to allow for inclusion of beneficiaries who were not improving and were, therefore, deliberately excluded. Discussion of this exclusion is reflected in the final Medicare home health rule for 2019 and has not been addressed by CMS since that time:
Comment: Many commentators suggested that stabilization measures should be recognized in HHVBP as opposed to just focusing on improvement measures, given that stabilization is sometimes a more realistic goal than improvement for certain patients.
CMS Response: We previously discussed our analyses of existing measures relating to stabilization in the CY 2016 HH PPS final rule. Specifically, we stated that while we considered using some of the stabilization measures for the model…we have not identified any such measures that we believe would allow for meaningful comparison of HHA performance. Although we appreciate commenter’s concerns that some beneficiaries may have limited opportunity to improve and that stabilization may be a more realistic goal for such patients, based on these analyses, we do not believe these measures are appropriate for inclusion in the Model at this time.[5]
Since HHVBP was first proposed, the Center for Medicare Advocacy has continuously urged CMS to develop appropriate quality measures for all patients who qualify for Medicare-covered home health care. The quality measurement void for serving people with chronic conditions has not been addressed. Simply put, if a person cannot be measured in some way that is of value to the home health agency – to show improvement – that person will face barriers to home care because of potential penalties and sacrificed rewards. The lack of measures that properly relate to quality care to maintain an individual’s condition or slow decline creates a discriminatory practice against patients who medically and legally qualify for care.
The HHVBP model should not continue, let alone expand, until quality care for all patients is included in the measurements and policies are developed that provide fair access to care for all qualifying beneficiaries.
Discussed in CMA Weekly Alert (January 14, 2021): https://medicareadvocacy.org/cms-to-expand-harmful-hh-system/
- Case-Mix Adjustments Favoring only 30 Days of Services
Results from the first year of Medicare’s home health payment system, PDGM (Patient Driven Groupings Model) reveal that Medicare home health payments for the first 30 days of care are, on average, more than 34% higher than for subsequent 30-day periods of care – regardless of the amount of home health services a patient needs, or for how long.[6]
Although Medicare coverage for home health care is not time-limited under the law[7] (as long as a beneficiary is homebound and needs intermittent or part-time skilled services), Medicare beneficiaries are being discharged from home health services faster than ever before. The Center for Medicare Advocacy hears regularly from beneficiaries who are told by home health agencies that their agency “only provides short-term care.”
Beneficiaries with longer-term and chronic conditions – such as diabetes, stroke, paralysis, multiple sclerosis, Parkinson’s, ALS, heart disease, pulmonary disorders and more – are too often denied ongoing care for which they legally qualify. Beneficiaries who need continuing home health services to stay safely at home are left to fend for themselves, although most are not able to do so.
Repeatedly, the Centers for Medicare & Medicaid Services (CMS) has implemented practices that have a discriminatory impact (through policies, procedures, payment and quality models) to encourage that only short-term, post-acute care services are provided. Payments, quality reporting measures, the value-based purchasing model (HHVBP), CMS audits of home health agencies by the Office of Inspector General (OIG) and Medicare Administrative Contractor (MAC) and state enforcement training programs cumulatively limit Medicare home health care to only a short-term, post-acute care benefit.[8] Beneficiaries who legally qualify for longer-term coverage are unable to find agencies to provide services.
PDGM, the Medicare home health payment model implemented in 2020, is one such discriminatory policy. Case-mix weights[9] in PDGM are applied to a national standard base rate, calculated with a labor component for the geographic region serving the patient. The first full year of PDGM illustrates the sharp payment decline to agencies after 30 days of home health care. The table below, shows the decrease in case-mix (equating to a similar decrease in payment), from the first 30 days to the second 30 days of care for the complete list of clinical groups in PDGM (every patient fits into one of these clinical groups). After the first 60 days of home health care, payments decline even further.
PDGM Case Mix for 2020 Data[10]
Clinical Group | Period 1 (Day 1-30) Case Mix | Period 2 (Day 31-60) Case Mix | % Decrease from Period 1 to Period 2 |
Neuro/Stroke rehab | 1.449 | 0.998 | 31% |
Wounds | 1.502 | 1.089 | 27% |
Complex nursing | 1.224 | 0.786 | 36% |
Musculoskeletal rehab | 1.375 | 0.896 | 35% |
Behavioral health | 1.136 | 0.726 | 36% |
MMTA* – Surgical aftercare | 1.281 | 0.767 | 40% |
MMTA – Cardiac/circulatory | 1.277 | 0.816 | 36% |
MMTA – Endocrine | 1.384 | 0.954 | 31% |
MMTA – GI/GU | 1.265 | 0.790 | 38% |
MMTA – Infectious disease | 1.283 | 0.818 | 35% |
MMTA – Respiratory | 1.288 | 0.800 | 38% |
MMTA – Other | 1.261 | 0.817 | 35% |
Overall | 1.346 | 0.887 | 34% |
*MMTA = Medication, Management, Teaching and Assessment
Conclusion
PDGM is a significant factor in reducing, and often eliminating, access to ongoing home health care for beneficiaries with longer-term and chronic conditions. CMS should develop payments, policies and practices that support home health care for all individuals who qualify for coverage under the law.
If you, or someone you know, is prematurely discharged from home health care, or unable to obtain home health services, please contact the Center for Medicare Advocacy.
Discussed in CMA Weekly Alert (March 4, 2021): https://medicareadvocacy.org/medicare-home-health-is-not-a-short-term-benefit/
- Office of Inspector General (OIG) Audits
See the most recent Office of Inspector General Audit of Brookdale Home Health, improperly narrowing interpretation of home health Medicare covered services. Medicare Home Health Agency Provider Compliance Audit: Brookdale Home Health, LLC, A-04-18-06221 (hhs.gov).
IV. LITIGATION UPDATE
Affordable Care Act Case
California v. Texas is the lawsuit brought by several states and supported by the Trump administration that seeks to strike down the entire Affordable Care Act (ACA). In 2019, a divided panel of the Fifth Circuit ruled that the ACA’s individual mandate is now unconstitutional because Congress reduced the penalty for remaining without insurance to $0. Then, although it was clear that Congress did not intend to strike down the entire ACA when it eliminated the penalty (because, among other things, it left the rest of the law in place), the Fifth Circuit concluded that many of the ACA’s provisions may not be “severable” from the mandate and therefore must also be struck down. It ordered the same district court judge who had struck down the entire law to parse through all of the ACA’s provisions with a “finer-toothed comb” to determine which can survive. However, before the remand occurred, the Supreme Court granted review in early 2020.
This lawsuit threatens the entire ACA: protections for pre-existing conditions, the expansion of Medicaid, and, critically for older adults and people with disabilities, many provisions that improved Medicare. The ACA closed the donut hole in Part D, saving beneficiaries millions on prescription drugs. It eliminated out-of-pocket costs for preventive services, such as mammograms and diabetes screenings. It extended the solvency of the Part A Trust Fund for many years. Simply put, the ACA is woven into Medicare, including over 165 provisions that help beneficiaries and strengthen the program’s financial well-being. Striking down the ACA would have disastrous ramifications for Medicare beneficiaries and the U.S. health care system as a whole.
In May 2020 the Center joined AARP and Justice in Aging in submitting an amicus brief in support of California and the other states defending the law. The amicus brief highlights the ACA’s key protections for older adults and the devastating consequences that would ensue if the law is nullified. It was one of 40 amicus briefs that were filed in support of the ACA. On June 25, 2020, Texas and several other states as well as the Trump administration filed their opening briefs, asking the Court to strike down the entire ACA. Three amicus briefs were filed in support.
Oral argument at the Supreme Court was held on November 10, 2020. Key Justices appeared to be skeptical of the claim that the entire statute must be invalidated if the mandate coupled with a $0 penalty is found unconstitutional.
Update: In February 2021, the U.S. government changed its position in the case. In a letter to the Supreme Court, government lawyers explained that following the change in administration from Trump to Biden, the Department of Justice reconsidered and its position is now that the ACA’s individual mandate is constitutional, and that even if the Court were to find that it is unconstitutional, the mandate is severable from the rest of the law. The federal government’s position is now consistent with the position of California and other states defending the law, as well as the position of the Center and numerous other organizations who filed amicus briefs urging the Supreme Court to uphold the law. A decision is expected soon.
For more information, see these resources from the Kaiser Family Foundation:
- “Potential Impact of Texas v. U.S. Decision on Key Provisions of the Affordable Care Act” (Sept. 2020).
- “Explaining Texas v. U.S.: A Guide to the Case Challenging the ACA” (Sept. 2020).
- Center for Medicare Advocacy’s Statement on Supreme Court ACA Oral Argument (Nov. 2020).
Center for Medicare Advocacy Cases
- Alexander v. Azar (formerly Bagnall v. Sebelius, Barrows v. Burwell), No. 3:11-cv-1703 (D. Conn.), No. 13-4179 (2d Cir.); Bagnall v. Cochran, No. 20-1642 (2d Cir., second appeal) (Beneficiary Appeals of Observation Status). In November 2011, the Center for Medicare Advocacy and Justice in Aging filed a proposed class action lawsuit on behalf of individuals who have been denied Medicare Part A coverage of hospital and nursing home stays because their care in the hospital was considered “outpatient observation” rather than an inpatient admission. When hospital patients are placed on observation status, they are labeled “outpatients,” even though they are often on a regular hospital floor for many days, receiving the same care as inpatients. Because patients must be hospitalized as inpatients for three consecutive days to receive Medicare Part A coverage of post-hospital nursing home care, people on observation status do not have access to nursing home coverage. They must either privately pay the high cost of nursing care or forgo that skilled care. The number of people placed on observation status has greatly increased in recent years, as CMS has strictly enforced its definition of which services hospitals should bill as inpatient/Part A and which services they should bill as observation/Part B. However, CMS has not allowed beneficiaries to appeal the issue of whether their hospitalizations should be classified as observation or as inpatient for Medicare coverage purposes.
On September 23, 2013, a federal judge in Connecticut granted the government’s motion to dismiss the lawsuit. Plaintiffs appealed, but limited the appeal to the issue of the right to an effective notice and review procedure for beneficiaries placed on observation status. On January 22, 2015, the U.S. Court of Appeals for the Second Circuit decided that Medicare patients who are placed on observation status in hospitals may have an interest, protected by the Constitution, in challenging that classification. The panel held that the district court erred when it dismissed the plaintiffs’ due process claims, and it sent the case back to that court for further proceedings. Barrows v. Burwell, 777 F.3d 106 (2d Cir. 2015).
The parties completed discovery on the issue ordered by the Second Circuit: whether plaintiffs have a “protected property interest” in Part A coverage of their hospital stays, which depends on whether CMS has “meaningfully channeled” discretion on the question of patient status determinations. The law firm of Wilson Sonsini Goodrich & Rosati, which has helped the Center in previous litigation, joined as representatives of the plaintiffs during this phase and has provide extraordinary and invaluable pro bono assistance.
On February 8, 2017, the court used a decision denying both parties’ motions for summary judgment and largely denying the government’s motion to dismiss. Plaintiffs then filed a renewed motion for class certification, and on July 31, 2017, the court issued a decision certifying a nationwide class of Medicare beneficiaries who have received “observation services” in a hospital since January 1, 2009. A second round of discovery was conducted, and the government filed for summary judgment for a second time on July 30, 2018, this time on the “what process is due” element of plaintiffs’ claim. The government also filed a motion to decertify the class on August 24, 2018.
After a hearing and additional dispositive motions filed by the government, the court
issued a ruling denying the government’s motion for summary judgment, motion to decertify the class, and motion to dismiss on March 27, 2019. Alexander v. Azar, 370 F. Supp. 3d 302 (D. Conn. 2019). The judge concluded that evidence submitted by the plaintiffs could reasonably establish that physician decisions about whether to classify beneficiaries as inpatients are “meaningfully constrained” by criteria set by Medicare, including the “Two-Midnight Rule” since it came into effect in 2013, and class members may therefore possess a property interest in the inpatient Medicare coverage they seek. It also found that a trial was necessary to balance the evidence submitted about the three Mathews v. Eldridge factors. The court declined to dismiss the case and also did not take the drastic step of decertifying the nationwide class, but did modify the class definition to target individuals who, in the court’s view, are more certain to experience harm from the observation designation.
A bench trial was held from August 12 – 20, 2019. The plaintiffs presented several witness who were affected by observation status (two beneficiaries, a family member of a named plaintiff, a doctor), an expert witness, and also several witnesses from the government. The government also examined several witnesses from CMS as well as their own expert. The court then set a post-trial briefing schedule and requested responses to certain questions. It asked whether it should find a property interest in Medicare Part A coverage for the periods both before and after the Two-Midnight Rule went into effect, whether that interest should be found for patients who are admitted as inpatients but later switched to observation, and how a successful appeal should affect class members’ eligibility for SNF care.
In March 2020, the court issued a decision. Alexander v. Azar, — F. Supp. 3d –, 2020 WL 1430089 (D. Conn. Mar. 24, 2020). It held that the Secretary of Health and Human Services is violating the Fifth Amendment Due Process Clause by not allowing certain patients to appeal their placement on observation status. Thus, as matter of constitutional due process, patients who are admitted as inpatients by a physician, but whose status is changed to observation by their hospital, have the right to appeal to Medicare and argue for coverage as hospital inpatients. In making this ruling, the court held that there is a protected property interest in Medicare Part A coverage, meaning that an individual cannot be deprived of that coverage without procedural safeguards. The court did not, however, find a due process violation for patients whose doctors never order inpatient status, or whose status is switched only from observation to inpatient. It drew a distinction between the actions of doctors, and the actions of hospital utilization review staff. It decided that doctors’ decisions to admit patients as inpatients are not attributable to the government and thus not “state action,” a required component of a due process claim. But it held that then when a hospital’s utilization review staff finds that patient should be in observation status rather than an inpatient, that is due to Medicare’s billing rules and therefore does constitute state action.
The court modified the class definition accordingly. It is now:
All Medicare beneficiaries who, on or after January 1, 2009: (1) have been or will have been formally admitted as a hospital inpatient, (2) have been or will have been subsequently reclassified as an outpatient receiving “observation services”; (3) have received or will have received an initial determination or Medicare Outpatient Observation Notice (MOON) indicating that the observation services are not covered under Medicare Part A; and (4) either (a) were not enrolled in Part B coverage at the time of their hospitalization; or (b) stayed at the hospital for three or more consecutive days but were designated as inpatients for fewer than three days, unless more than 30 days has passed after the hospital stay without the beneficiary’s having been admitted to a skilled nursing facility. Medicare beneficiaries who meet the requirements of the foregoing sentence but who pursued an administrative appeal and received a final decision of the Secretary before September 4, 2011, are excluded from this definition.
The court ordered that the agency establish appeals process for class members, under which they can argue that their inpatient admission satisfied the relevant criteria for Part A coverage—for example, that the medical record supported a reasonable expectation of a medically necessary two-midnight stay at the time of the physician’s inpatient order. Patients will be able to pursue these appeals in an expedited manner while still hospitalized. The court also ordered the agency to provide notice of these procedural rights.
In May 2020, the government appealed the district court’s trial decision to the Second Circuit. At the time it did not request a stay, meaning it was still obligated to implement the court’s order. A status conference was held with the district court on October 16, 2020 at plaintiffs’ request. Plaintiffs explained that they had received no indicia of implementation of the court’s order other than that the agency was analyzing the decision and coordinating among its personnel. Since the order has no timeline for implementation, class members have been left wondering when they will be able to submit claims. This is urgent due to the age of many class members. The court requested that plaintiffs submit proposed measures the agency could take while the case is on appeal. That proposal was filed on November 5, 2020, and plaintiffs offered several ideas for implementation, including posting of notice on CMS’s website and development of a form for class members to submit their appeals. The government filed its response on December 22, 2020, and also indicated that it intended to seek a stay of the court’s decision. The government stated that plaintiffs’ proposed implementation measures were unworkable and did not offer any counterproposals. The court ordered another status conference for January 13, 2021.
UPDATE: The government’s opening appellate brief in Second Circuit was filed on October 27, 2020. It challenges the district court’s decisions regarding standing, class certification, and the merits of the due process claim. Plaintiffs’ response was filed February 26, 2021, and a reply brief from the government is expected by April 9. Three amicus briefs in support of plaintiffs were also filed on March 5: one from AARP and Disability Rights Connecticut, one from the American Medical Association and the Connecticut State Medical Society, and one from the American Health Care Association.
At the district court, the government filed a motion for a stay of the judgment on January 11, 2021, claiming that it would be irreparably harmed by implementing the court’s order, and that there are serious questions about the district court’s decision, which indicates a likelihood of success on appeal. Because of the pending stay motion, the status conference on January 13 did not address proposed implementation measures, as the district court wishes to rule on the stay motion first. The stay motion was fully briefed as of February 16. Plaintiffs have argued against a stay based on a lack of irreparable harm to the government (demonstrated in part by its delay in requesting a stay) and a lack of likelihood of success of the government’s appeal to the Second Circuit.
For answers to frequently asked questions from people who think they may be class members, please see the Center’s website here.
- Dobson v. Cochran, No. 4:18-cv-10038-JLK (S.D. Fla.), No. 20-11996 (11th Cir.) (Part D Off-Label Drug). On April 6, 2018, the Center for Medicare Advocacy and Florida Health Justice Project filed a lawsuit in the United States District Court for the Southern District of Florida on behalf of a 49-year-old Medicare beneficiary seeking Part D coverage for the “off-label” (non-FDA-approved) use of a critically needed medication. The plaintiff is disabled from a traumatic workplace injury that damaged his spinal cord. As a result of severe pain and multiple surgeries, he suffers daily from debilitating nausea and vomiting. After numerous medications failed to provide relief, his doctor prescribed Dronabinol, which significantly relieved his nausea and vomiting and allowed him to resume many activities of a normal life.
When Mr. Dobson became eligible for Medicare Part D, his plan denied coverage because his particular use of Dronabinol is not FDA-approved. However, the Part D plan should cover the medication because Mr. Dobson’s use of the drug is supported by one of the “compendia” (DRUGDEX) of medically-accepted indications listed in the Medicare law. Medicare looks to the compendia for acceptable off-label uses of medications, and the symptoms of nausea and vomiting are listed in an entry for Dronabinol. The plaintiff’s position is strongly supported by a recent federal decision granting Part D coverage of the same medication for a beneficiary with very similar symptoms (Tangney v. Burwell, 186 F. Supp. 3d 45 (D. Mass. 2016)). In spite of this, Mr. Dobson was denied coverage at each level of administrative review. In appealing his claim to federal court, Mr. Dobson contests the agency’s use of an inappropriately restrictive reading of the law to claim that coverage cannot be granted.
Briefing on cross-motions for summary judgment was complete as of December 2018. A hearing on the parties’ cross motions for summary judgment was held in September 2019 in Miami before a magistrate judge.
The judge issued a decision on March 31, 2020, finding that Mr. Dobson’s medication cannot be covered by Medicare Part D. She credited the government’s argument that Mr. Dobson’s use was not a “medically accepted indication,” “supported by citation” in DRUGDEX. This was because he does not have the identical diagnosis as the patient in the study contained within the DRUGDEX citation for disease-related, treatment-refractory nausea and vomiting. The judge rejected the reasoning of the Tangney court. In May 2020 the plaintiff appealed the district court’s decision to the 11th Circuit.
Mr. Dobson’s opening appellate brief was filed on September 8, 2020. He argued that the plain meaning of the Medicare statute mandates coverage of his medication because his use is “supported by” the Drugdex citation in question. He also argued that even if the statute was deemed to be ambiguous, the court should not have afforded “Skidmore deference” to Medicare’s narrow interpretation of the law. The American Medical Association and Greater Boston Legal Services (which litigated the Tangney case) also filed amicus briefs in support of Mr. Dobson.
UPDATE: The case was fully briefed in the 11th Circuit as of February 11, 2021.
- Chinatown Service Center v. Cochran, No. 1:21-cv-00331 (D.D.C.) (LEP Protections under Section 1557 of the ACA). Justice in Aging and the Center for Medicare Advocacy, along with pro bono firm Stinson LLP, filed this case on February 5, 2021 on behalf of two community-based organizations that provide social services to Limited English Proficient (LEP) older adults. In the waning days of the Trump Administration, the federal government eliminated protections for LEP individuals in health care by rolling back regulations that were put in place as part of Section 1557 of the Affordable Care Act. The protections were intended to target health disparities by requiring health plans and other entities to inform patients both of their right to interpretation, and their right to legally challenge discrimination based on language ability. But, in 2020, the Trump Administration issued a rule that eliminated these language access protections (as well as many others affecting LGBTQ people, immigrants, and women). The plaintiffs are asking the court to vacate the 2020 rule and enjoin its implementation.
[1] Arizona, Florida, Iowa, Maryland, Massachusetts, Nebraska, North Carolina, Tennessee, and Washington.
[2] CMS Takes Action to Improve Home Health Care for Seniors, Announces Intent to Expand Home Health Value-Based Purchasing Model | CMS
[3] FR-2017-07-28.pdf (thefederalregister.org), Table 43, page 35335.
[4] https://www.govinfo.gov/content/pkg/FR-2017-11-07/pdf/2017-23935.pdf, pages 56527-56547.
[5] https://www.govinfo.gov/content/pkg/FR-2017-11-07/pdf/2017-23935.pdf, page 56532.
[6] Strategic Healthcare Programs National Client Database, as reported by DecisionHealth on February 25, 2021.
[7] 42 C.F.R. 42 CFR § 409.48; Medicare Benefit Policy Manual, Chapter 7, § 70.1.
[8] See these topics discussed in greater detail in Articles and Updates Section of the CMA website: https://medicareadvocacy.org/medicare-info/home-health-care/
[9] PDGM case-mix weights include: Admission Source (institution or community), Functional Impairment Level (low-medium-high), Co-Morbidity Adjustment (none-low-high). https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HomeHealthPPS/Downloads/Overview-of-the-Patient-Driven-Groupings-Model.pdf
[10] Strategic Healthcare Programs National Client Database, as reported by DecisionHealth on February 25, 2021.