Center for Medicare Advocacy

Advancing Access to Medicare and Healthcare

January 2017 – The Fight to Protect the ACA, Medicare and Medicaid & Other Issues

Print Friendly, PDF & Email

THE FIGHT TO PROTECT THE ACA, MEDICARE AND MEDICAID

The President-Elect and Republican leaders in Congress have promised to repeal, and at some point, “replace” the Affordable Care Act.  They also plan to gut the Medicaid program by imposing block granting or per-capita caps.  Speaker Ryan, Trump’s nominee for HHS Secretary Rep. Price, and many others in Congress also want to further privatize Medicare by turning it into a voucher program. 

These are not isolated threats to be analyzed and defended against individually.  Rather, these efforts comprise a collective threat to the health care and coverage of millions of Americans.  Drew Altman of the Kaiser Family Foundation recently noted that, if carried through, this “health policy trifecta” would “fundamentally alter the direction of the federal role in health and core elements of the social contract” in a manner that would be “likely to shift costs to individuals and states as well as reduce consumer protections – and result in a significant increase in the number of uninsured.”

Affordable Care Act (ACA)

On the first day of the 115th Congress, January 3, 2017, Republican leadership in the Senate introduced a draft budget resolution that would begin the process of repealing the ACA.

In short, the budget resolution instructs the four committees between the House and Senate that control health care policy to draft legislation that would cut the deficit.  Legislation produced to meet these instructions – including repeal of major provisions of the ACA – will likely be in the form of a reconciliation bill, and would be able to pass the Senate with a simple majority, shielded from a Democratic filibuster.

  • Journalist Robert Pear of the New York Times provides an overview of the process in a recent article: “Republicans’ 4-Step Plan to Repeal the Affordable Care Act” (January 4, 2017), available at: http://nyti.ms/2j6srtU.

Outlook for Medicare and Medicaid

  • Medicare
  • Medicaid
    • Gutting the Medicaid program through block-granting or imposing per-capita caps would likely impact tens of millions of low-income families through cuts to eligibility, benefits and provider payments.  This would include the roughly 10 million people who have both Medicare and Medicaid (known as “dual eligibles”) for whom Medicaid can cover Medicare premiums, cost-sharing and additional benefits.

OBSERVATION STATUS UPDATE  

HHS Inspector General Report

In a new report, Vulnerabilities Remain Under Medicare’s 2-Midnight Hospital Policy, the Department of Health and Human Services’ (HHS) Office of Inspector General documents and confirms what Medicare beneficiaries and their advocates have seen: long outpatient stays in hospitals are increasing.

How hospitals bill the Medicare program – Part A for inpatient status, Part B for outpatient status – affects Medicare beneficiaries’ entitlement to Medicare and what patients must pay for their hospital and post-hospital care. The consequences of hospitals classifying patient stays as outpatient, rather than inpatient, are most significant for patients who need post-hospital care in a skilled nursing facility (SNF) since Medicare Part A does not cover patients’ SNF care if they do not have a three-day inpatient hospital stay.  Outpatient status also affects patients’ hospital bills.  Patients must pay for medications while they are in the hospital (unless payment is waived by the hospital), and if they do not have Medicare Part B, they must pay out-of-pocket for the entire hospital stay.  

Reviewing hospital claims data under Medicare Part A and Part B with dates of service in Fiscal Years (FYs) 2013 and 2014, the Inspector General found that hospital inpatient stays decreased by 2.8% (262,794 stays) but that hospital outpatient stays increased by 8.1% (158,908 stays) between FY 2013 and FY 2014.  This finding contradicts CMS’s expectation that inpatient stays would increase as a result of the 2-midnight rule.

Moreover, short inpatient stays (stays of fewer than two days) decreased considerably more than long outpatient stays (stays exceeding two days).  Specifically, short inpatient stays decreased by 9.9%, while long outpatient stays decreased by only 2.8% (and short outpatient stays increased by 11.6%).

In FY 2014, 352,940 outpatients paid more in Part B copayments than the inpatient deductible would have been for their hospital stay if they had been classified as inpatients.  The number of patients in this category increased by 16% (almost 50,000 patients) between FY 2013 and FY 2014.

Among the recommendations that OIG makes concerning the increase in long outpatient stays, they urge CMS to “Analyze the potential impacts of counting time spent as an outpatient toward the 3-night requirement for SNF services so that beneficiaries receiving similar hospital care have similar access to these services.”  While CMS accepted all of OIG’s findings, CMS states that it lacks authority to count the time.  The Center for Medicare Advocacy disagrees.  In a June 2014 memorandum, written at CMS’s request, the Center demonstrated that CMS has authority to count all time in the hospital towards meeting the three-day inpatient requirement.

Update on NOTICE Act and the MOON Notice

Beginning March 8, 2017, hospitals will be required to give patients in Observation Status a federal notice – the Medicare Outpatient Observation Notice (MOON) – informing them of their non-inpatient status and the financial implications for their hospital and post-hospital care.  Acute care hospitals must provide oral and written notification to patients who are classified as outpatients or observation status patients for more than 24 hours.  Notice of non-inpatient status must be provided within 36 hours. 

Advocates remain concerned about the MOON.   First, the MOON does not give patients any rights to appeal.  Second, not all outpatients will receive notice of their non-inpatient status.  CMS specifies that only inpatients who are classified as receiving “observation services” will receive the MOON.  In 2013, the HHS Inspector General reported that half the non-inpatients did not have an observation status classification and were only called outpatients.  The Inspector General reported, specifically, that, in 2012, 1.5 million patients were observation status patients and an additional 1.4 million patients were coded as outpatients. CMS’s interpretation of the NOTICE Act means that at least an additional million outpatients will not receive notice of their non-inpatient status.

Observation Status Infographic

The Center for Medicare Advocacy is partnering with the John A. Hartford Foundation to help people caught in the web of “outpatient” Observation Status. HAVE YOU DEALT WITH OBSERVATION STATUS? Share your story at MedicareAdvocacy.org/ObservationStory

CURES ACT: MEDICARE ADVANTAGE CHANGES

On December 13, 2016, President Obama signed into law the 21st Century Cures Act (Public Law No: 114-255, also known as “Cures”, H.R. 34).  The bill, which passed with overwhelming bipartisan support, addresses a wide range of issues, including medical research, the drug approval process, and, added in the final days leading up to passage, a number of mental health and Medicare provisions.  Of concern to the Center, the Cures bill include the following provisions that favor the Medicare Advantage (MA) program over traditional Medicare.

  • Delay in Authority to Terminate Contracts for MA Plans Failing to Achieve Minimum Quality Ratings – under the guise of waiting for further study of “the effects of socioeconomic status and dual eligible populations” on plans’ star ratings, Section 17001 of the Cures Act delays CMS’ authority to terminate consistently poor performing plans (solely on the basis that plans have failed to achieve minimum quality ratings) through the end of plan year 2018.
  • Reinstatement of the Medicare Advantage Open Enrollment Period – described in the bill as “Preservation of Medicare beneficiary choice under Medicare Advantage”, section 17005 reverses the Medicare enrollment period changes made by the Affordable Care Act.  Effective 2019, for the first 3 months of the calendar year there will be a continuous open enrollment and disenrollment period relating to MA plans (previously called the Medicare Advantage Open Enrollment Period, or MA-OEP).  During this 3-month period an MA eligible beneficiary can make a one-time change to another MA plan, they can elect traditional Medicare, or they can elect coverage under Part D.  The statute specifically limits the enrollment period’s application to Part D coverage in that changes to prescription drug coverage can only be made during this period “in the case of an individual who, previous to such change in enrollment, is enrolled in a Medicare Advantage plan.”  In other words, someone in traditional Medicare with a stand-alone Part D plan  may not use this enrollment period to switch from one Part D plan to another, whereas, if someone starts the year in an MA-PD, such person can switch to another MA-PD.  The plain language of the reinstated enrollment period in the Cures Act seems to add limitations that did not exist in the previous OEP. 
  • Failure to Strengthen Medigap Enrollment Rights while Expanding MA Enrollment to Individuals with ESRD – Section 17006 of the Cures Act removes the barrier for people with End-Stage Renal Disease (ESRD) to enroll in MA plans, beginning in 2021.  Current law prohibits people with ESRD from enrolling in MA plans except in limited situations. On its own, this provision significantly improves coverage options for people with ESRD, however their options still remain limited.  Federal law provides for certain protections concerning Medicare beneficiaries’ rights to purchase Medicare supplemental insurance policies (Medigaps).  These rights under federal law, however, do not extend to individuals under 65, including those with ESRD.  States can add to federal law by expanding Medigap open enrollment and guarantee issue rights. Currently, 31 states grant some degree of protection to disabled and ESRD Medicare beneficiaries.

For more information, see the Center’s Weekly Alert, “‘Cures’ Act Tips the Scales Even Further in Favor of Medicare Advantage Over Traditional Medicare” (December 28, 2016), available at: https://www.medicareadvocacy.org/cures-act-tips-the-scales-even-further-in-favor-of-medicare-advantage-over-traditional-medicare/.

UPDATE ON CMA HOME HEALTH ACCESS INITIATIVE

The Center continues to hear from people who meet Medicare coverage criteria for the Medicare home health benefit but who are unable to access care, or the appropriate amount of care.  The Center has created a repository for stories about home health care access barriers at https://www.medicareadvocacy.org/submit-your-home-health-access-story/. We seek experiences of people who have been unable to obtain services for which they are legally eligible. We would also like to hear from people who have been unable to remain at home and are forced to choose care in an institution because they cannot obtain adequate home care services. These stories continue to prove valuable with members of the administration, congress and the press to illustrate the injustice and hardship caused by lack of access to home care. We encourage you to direct people to the story repository link to share their experiences.

After researching and analyzing the extent of the access problems this past summer and fall, it became clear that the home health access issues most significantly impact the most vulnerable populations, those with long-term and chronic conditions. Staff from the Center met with CMS in late 2016 to discuss the Center’s findings and request action to administratively resolve the issues.

CMS has recently provided assurances that that incorrect and misleading CMS coverage publications on the website and in print will be corrected to reflect the correct coverage law. (Example of incorrect information on Medicare.gov: personal care is not a covered benefit.) This may better inform beneficiaries to understand services the law provides. Unfortunately, this will not likely alter home health provider behavior as it is the payment rules that are driving agencies to provide care for those with short-term, acute care needs. Staff from the Center will soon meet with the CMS’ Clinical Standards Group, including Conditions of Participation (COP), to discuss the shortfalls in the home health COP that generally allow agencies to choose to not serve Medicare beneficiaries or to discharge them at will, allowing those with more significant care needs to get no care or significantly less care than the law provides.

Recent payment rules and proposals for future payment rules will further devastate the vulnerable populations. Payment rules for services effective January 1, 2016 were tied to payments in future years. New Home Health Value Based Payments (HHVBP) highly incentivize services to those with short-term, acute care needs. Since the COP allow agencies to pick-and-choose their referrals, beneficiaries with long-term, chronic care needs will find themselves increasingly left out of the ability to obtain care. Payment rules effective January 1, 2017 (published in the Federal Register on November 5, 2016) further incent agencies toward only serving patients whose condition will improve (both considering financial incentives and quality rating standards).

Abt Associates, a consultant for CMS located in Cambridge, Massachusetts, recently proposed future payment rules available at the following link: https://downloads.cms.gov/files/hhgm%20technical%20report%20120516%20sxf.pdf. Suggestions in this report would make access problems worse. The report is premised on home health usage data realized by the emphasis of home health agencies providing more short-term acute care services over the past several years, leading to a distorted conclusion that since few people are given services (such as home health aide services), then few people must need them. In other words, people who can’t access care aren’t included in the statistics of those who have received care, which is the springboard for determining a future payment structure. Among some of the Abt suggestions that will certainly further disenfranchise people with long-term, chronic care needs from being able to get home care benefits are the following: give agencies higher payments to serve those who are admitted from the hospital; reduce home health episodes from 60 days to 30 days; provide lower payments for those who need “later” episodes. We are currently reviewing all the Abt recommendations and will circulate the Center’s response. For those who would like to sign on, please let us know.

Finally, the Center is considering general threads from discoveries/ideas made through the Home Health Access Initiative:

Dual Eligibles:

  • There is likely cost-shifting from Medicare to Medicaid due to reduced number of Medicare Aide hours.
  • Home health agencies are receiving payments from both Medicare and Medicaid for the same patient.
  • There are differences/overlaps in the Medicaid and Medicare home health aide benefits, Medicare only covers personal hands on care.

Payment system incentives:

  • Medicare Prospective Payment System (PPS) pays based on the number of skilled services assessed.
  • The current PPS encourages “legal fraud” by agencies (being paid for less services than they provide).

Patient perspectives:                                                

  • Barriers to care prevent them from remaining at home.
  • It’s misunderstood by CMS that we are only talking about beneficiaries who meet all the legal criteria for care.
  • There is a great unmet need in the patient communities for these HH Medicare covered services.

Agency perspectives:

  • New agencies face significant onerous barriers to certification.
  • Agencies that may want to use a different services delivery model are effectively prohibited by the payment and quality reporting structures.

Thank you to our Home Health Access Initiative funding partners: Team Gleason, ALS Association, John A. Hartford Foundation, Christopher and Dana Reeve Foundation

For general information on the Medicare home health benefit, reference the Center’s website at: https://www.medicareadvocacy.org/medicare-info/home-health-care/. 

ADMINISTRATION ON COMMUNITY LIVING GRANT – FOR MEDICARE BENEFICIARIES UNDER AGE 65

An update on the activity generated by Center’s Administration for Community Living grant to expand SHIP/SMP outreach opportunities to younger Medicare beneficiaries:

The grant work will conclude on February 28, 2017.

The 7th webinar will be held on January 19, 2017 at 2-3 pm EST. Best Practices and Tips for Education, Resources, and Community Collaboration to Assist Medicare Individuals Under Age 65. The registration for the free webinar is located at https://www.medicareadvocacy.org/hidden/products-services/web-seminars/. The webinar will be presented by the Center and the Social Security Administration, including Ben Belton, Senior Advisor to the Acting Commissioner who will discuss work the SSA has been doing to increase outreach, including work incentives, the ticket-to-work program, employment support, LIS, zip code data, and behavioral science findings.

An 8th webinar will be held on January 26, 2017 with a Senior Medicare Patrol emphasis and will be jointly presented by the Center and the SSA OIG who will help remind SMPs how to refer potential cases of fraud to their operations.

A survey of younger Medicare beneficiaries was conducted in collaboration with the American Association of People With Disabilities (AAPD) to see what people with disabilities want to know about Medicare, SHIPs, SMPs and in what format they like to receive information. If any organizations would like to participate in this survey process or provide feedback, please contact Communciations@MedicareAdvocacy.org.

Tool kits will be produced for SHIPs and SMPs in the grant target states, California, Connecticut and Louisiana inclusive of connecting with advocate groups to attend counselor trainings, substantive coverage YouTube vignettes, and brochures geared toward people under age 65 who are, or will be, Medicare eligible.

A final survey of SHIPs and SMPs will be conducted by the Center to determine the degree of benefit to SHIPs and SMPs produced by the grant work to educate about younger Medicare beneficiaries.

The Center has a webpage on the Center’s website (www.MedicareAdvocacy.org) dedicated to issues for people who are under the age of 65 and who are eligible for Medicare benefits. This webpage is available to SHIPs and SMPs and all beneficiaries and advocates of beneficiaries who are looking for information to Medicare beneficiaries who are under age 65. Currently the webpage includes resources and events that will benefit this hard-to-reach population. It also includes information on past webinars and upcoming webinars on topics of particular interest or need for individuals who are under 65 and eligible, or becoming eligible, for Medicare.

For more information, see: https://www.medicareadvocacy.org/under-65-project/.

LITIGATION UPDATE

  • Barrows v. Burwell (formerly Bagnall v. Sebelius), No. 3:11-cv-1703 (D. Conn.) (Observation Status). In November 2011, the Center for Medicare Advocacy and Justice in Aging filed a 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.

    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, a three-judge panel of 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 have 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.  If the Secretary has established criteria for inpatient hospitalization, plaintiffs have an interest that is protected by the Due Process Clause and thus they may be entitled to notice and opportunity to appeal their placement on observation. Plaintiffs received voluminous documentation from the government and conducted depositions of witnesses from the Department of Health and Human Services, Medicare contractors, and some of the hospitals that treated the named plaintiffs. The law firm of Wilson Sonsini Goodrich & Rosati, which has helped the Center in previous litigation, provided pro bono assistance

    Update: Briefing on cross motions for summary judgment and defendant’s supplemental motion to dismiss was complete as of November 2, 2016 and a hearing on those motions was held on December 15, 2016. The court ordered each side to submit a supplemental brief on several issues, including standing and mootness of named plaintiffs and evidence related to patients who are on observation status for the duration of their hospitalizations (as opposed to switched to observation after an inpatient admission. Those briefs will be filed on January 17, 2017 and a decision from the court is expected after that date.

  • Exley v. Burwell (formerly Lessler v. Burwell), No. 3:14-cv-1230 (D. Conn.) (ALJ Delays) The Medicare statute and regulations require that an administrative law judge (ALJ) issue a decision within 90 days the filing of a request for hearing. While the Chief ALJ has stated that individual beneficiary cases should not be delayed, still most of the Center’s cases were exceeding statutory timelines for decisions.

    On August 26, 2014, the Center filed a nationwide class action lawsuit in United States District Court in Connecticut. The named plaintiffs, from Connecticut, New York and Ohio, all waited longer than the statutory 90-day limit for a decision on their Medicare appeals. On January 29, 2015, defendant’s motion to dismiss was denied.  On June 10, 2015, the court granted the plaintiffs’ motion for certification of nationwide class of Medicare beneficiaries who have been or will be waiting more than 90 days for a decision on their timely-filed request for an ALJ hearing. The parties also conducted discovery. In March 2016 the court preliminarily approved a settlement and notice to the class was posted.

    A Fairness Hearing was held on August 1, 2016 and the Court granted final approval of the settlement agreement. The settlement calls for the Office of Medicare Hearings and Appeals (OMHA) to continue its policy of providing beneficiary appellants with priority over other appellants in receiving ALJ decisions, to designate a Headquarters Division Director to oversee inquiries about appeals initiated by beneficiary appellants, and to address any complaints or questions concerning the processing of those appeals. OMHA will also introduce a new, more user-friendly ALJ hearing request form that allows beneficiaries to self-identify, and will also publish data about the length of processing time for beneficiary appeals.

    On September 1, 2016 as part of the settlement, OMHA established a toll-free Beneficiary Help Line: (844) 419-3358.  This line, which is staffed by representatives of OMHA, will address inquiries about ALJ appeals being pursued by Medicare beneficiaries. The Center urges anyone pursuing a beneficiary appeal who believes the appeal is not receiving timely attention to call the Beneficiary Help Line. The expectation is that a call to this line will help resolve delays in cases that are eligible to be prioritized. The Beneficiary Help Line is staffed from 8:00 a.m. to 4:30 p.m., Eastern Time. If calling at other times or if the OMHA Beneficiary Help Line staff are assisting other callers, OMHA instructs callers to leave a voicemail. Please report your experiences using the Help Line to the Center at: abers@medicareadvocacy.org.

    As part of the settlement, as of November 1, 2016 CMS updated scripts for 1-800-Medicare to highlight the OMHA beneficiary prioritization policy for beneficiary callers and to refer them to the toll-free OMHA Beneficiary Help Line if they have questions about filing appeals with OMHA or about ALJ appeals that are pending with OMHA. OMHA also posted the beneficiary appeals data required by the settlement on their website at http://www.hhs.gov/about/agencies/omha/about/current-workload/beneficiary-appeals-data/index.html. The data shows beneficiary appeals now being processed within or very close to the 90-day statutory time period.

    Update: The next step in the settlement is that revised ALJ hearing request forms that make it easier for beneficiaries to identify themselves are scheduled to be released by February 1, 2017.
     

  • Jimmo v. Sebelius, No. 5:11-cv-17 (D. Vt.) (Improvement Standard).  As reported during previous Alliance calls, the settlement in Jimmo was approved on January 24, 2013 during a fairness hearing.  CMS issued revisions to its Medicare Benefit Policy Manual to clarify that Medicare coverage is available for skilled maintenance services in the home health, nursing home and outpatient settings.  CMS also implemented a nationwide Educational Campaign for all who make Medicare determinations to ensure that beneficiaries with chronic conditions are not denied coverage for critical services because their underlying conditions will not improve. Pursuant to the settlement, counsel for the parties have been meeting twice a year to discuss problems with implementation and possible solutions, and are in regular contact between meetings.

    On March 1, 2016, the Center and its co-counsel, Vermont Legal Aid, filed a Motion for Resolution of Non-Compliance with the settlement agreement. Oral argument was held on May 26, 2016.  The filing came after three years of urging the Centers for Medicare & Medicaid Services (CMS) to fulfill its obligation to end continued application of an “Improvement Standard” by Medicare providers, contractors and adjudicators to deny Medicare coverage for skilled maintenance nursing and therapy.

    If truly implemented and enforced, the settlement should improve access to skilled maintenance nursing and therapy for thousands of older adults and people with disabilities whose Medicare coverage for skilled care is denied or terminated because their conditions are “chronic,” “not improving,” “plateaued,” or “stable.” Unfortunately, providers and contractors continue to illegally deny Medicare coverage and care based on an “Improvement Standard,” resulting in beneficiaries nationwide failing to obtain needed skilled nursing and therapy coverage.

    The court announced its decision on the Motion for Resolution of Non-Compliance on August 18, 2016.  The Order requires CMS to remedy the inadequate Educational Campaign that was a cornerstone of the original Settlement Agreement. As the judge stated, “Plaintiffs bargained for the accurate provision of information regarding the maintenance coverage standard and their rights under the Settlement Agreement would be meaningless without it.” CMS must submit its proposed “corrective action” to plaintiffs’ counsel for consideration by October 3, 2016. If the parties cannot agree to that corrective action, they may petition the court for a resolution of their dispute.

    Update: CMS submitted its proposed corrective action plan to plaintiffs’ counsel and the parties negotiated but could not come to agreement on what the plan should entail.  The court then ordered each party to submit a brief explaining and justifying their proposed corrective action plans, which were filed on December 23, 2016.  Responses are due January 13, 2017 and plaintiffs expect the court to then issue a ruling on the corrective action plan.  Any such plan will likely include a new webpage by CMS dedicated to the Jimmo settlement with frequently asked questions and a statement that affirmatively disavows the Improvement Standard.  However additional elements and details will not be known until the court until the court issues a decision. 

  • Sherman v. Burwell (formerly Olsen-Ecker v. Burwell), No. 3:15-cv-1468 (D. Conn.) (Lower level Medicare appeals) On October 9, 2015, the Center filed a complaint in United States District Court in Connecticut against Sylvia Mathews Burwell, Secretary of Health and Human Services, on behalf of plaintiffs who have been denied a meaningful review of their Medicare claims at the first two levels of appeal. The case was brought as a class action on behalf of Medicare beneficiaries seeking home health care coverage, and the named plaintiff represents beneficiaries who have received the usual “rubber stamp” denials at redetermination and reconsideration. The plaintiff also filed a motion for class certification, and the government filed a motion to dismiss. Written discovery was served but responses were stayed while the motion to dismiss was pending. Oral argument was held on February 29, 2016.

    On August 8, 2016, the judge largely denied the government’s motion to dismiss and granted plaintiff’s motion for certification of a nationwide class. The court concluded that it had jurisdiction and decided that the case was not moot even though plaintiff’s claim had ultimately been approved. The judge dismissed the statutory claim, but found that plaintiff had stated a valid claim for relief under the Due Process Clause. He found plaintiff’s claim of policies or practices causing the denial rate sufficiently plausible to allow the case to continue to discovery. The judge also certified a nationwide class of Medicare beneficiaries of home health care services who had received adverse decisions at the first two levels of appeal on their Part A or Part B claims, and who had received an initial adverse initial determination on or after January 1, 2012. 

    Update: Plaintiffs and the Secretary have each served discovery and are in the process of providing written responses and document production. Plaintiffs expect that they will also conduct depositions. Discovery is expected to continue through May 2017.
     

  • Ryan v. Burwell, No. 5:14-cv-269 (D. Vt.) (Prior Favorable Homebound Determination) On December 19, 2014, the Center for Medicare Advocacy and Vermont Legal Aid filed a class action lawsuit against Sylvia Mathews Burwell, the Secretary of Health and Human Services, to stop Medicare’s practice of repeatedly denying coverage for home health services for beneficiaries on the basis that they are allegedly not homebound, when Medicare has previously determined them to be homebound. (Ryan v. Burwell). The lawsuit was filed in the United States District Court in Burlington, Vermont on behalf of two Vermont residents, Marcy Ryan and John Herbert, as a regional class action lawsuit covering New England and New York.

    On March 25, 2015, the government filed a motion to dismiss on the grounds that plaintiffs lack standing, that the court lacks subject matter jurisdiction, and that plaintiffs have failed to state claim on which relief may be granted.  On July 27, 2015, the court denied the government’s motion to dismiss, finding four separate grounds on which the dually eligible plaintiffs have standing. The court also found that it had subject matter jurisdiction and that plaintiffs had stated a claim on which relief could be granted.

    On December 2, 2015, the court granted plaintiffs’ motion for class certification and, at request of the plaintiffs, issued clarification on the class definition on February 23, 2016.  The regional class is defined as all beneficiaries of Medicare Part A or B in Connecticut, Maine, Massachusetts, New Hampshire, New York, Rhode Island, and Vermont (Medicare Administrative Contractor Jurisdiction K): (a) who have received a “favorable final appellate decision” that he or she was “confined to the home,” i.e. homebound, in the appeal of a home health nursing or therapy claim denial; (b) who have subsequently been denied, or will be denied, coverage for additional service on the basis of not being homebound, on or after January 1, 2010; (c) who had a non-lapsed, viable appeal of the subsequent denial for coverage of additional home health services as of March 5, 2015, or had a particularized individual basis for tolling of any applicable appeal deadline; and (d) for whom the claim for Medicare home health coverage was filed on or before August 2, 2015. Written discovery was served.

    Update: The government filed a motion for summary judgment in November 2016 and plaintiffs filed a cross motion and responded in December.  However the parties have now re-entered settlement talks and have postponed further briefing while those negotiations proceed.

  • Lodge v. Burwell, No. 3:15-cv-390 (D. Conn., filed 3/17/2015) (Medically necessary oral health care). This appeal filed in federal court, District of Connecticut, presents an opportunity for the court to review whether surgical treatment to a Medicare beneficiary’s teeth damaged by radiation therapy to the head and neck was 1) properly characterized by an Administrative Law Judge as a covered physician service that was medically reasonable and necessary as a part of an overall plan of care for cancer or 2) improperly characterized by the government contractor as excluded dental services.  These competing interpretations depend upon how the specific treatment is characterized. The plaintiff amended the complaint on June 30, 2015 to add a claim under the Administrative Procedure Act (APA), stating that in 1974 the agency removed the word “routine” from the description of excluded dental services without following proper notice-and-comment procedure. Plaintiff requests that the court therefore read the relevant regulation as if the word “routine” had never been removed, which would allow for coverage of his extraordinary, non-routine oral health care.

    The government filed a partial motion to dismiss in October 2015. The motion sought to dismiss the APA claim as barred by the statute of limitations. However after the motion was briefed, the government requested and was allowed to withdraw the partial motion to dismiss. The parties also conducted limited written discovery.  Cross motions for summary judgment were fully briefed and oral argument was conducted on September 23, 2016.

    Update: On December 30, 2016, the court issued a decision denying plaintiff’s motion for summary judgment and granting the government’s motion.  The court found that neither Chevron nor Skidmore deference should apply to Medicare’s manual provisions interpreting the dental exclusion. However, rather than accept the distinction between “routine” and “non-routine” services urged by the plaintiff, the court essentially created a new dichotomy between “routine and non-routine” services and “complex surgical procedures,” raising the bar for coverage higher than is justified by the statute and legislative history. The court also found that the exception for dental care that is incident to and an integral part of covered non-dental services did not apply to Mr. Lodge’s services. As for the APA claim, the court found that the proposed rule explanation “put interested persons on notice that the regulations would be amended to conform to the statute.” Plaintiff disagrees that the agency issued sufficient notice to remove the word “routine” from the regulation and believes the court applied an erroneous standard. Counsel for plaintiff is considering appeal.
     

  • Bremby v. Burwell, No. 3:15-cv-1397 (D. Conn.) (per se skilled services). This case was filed on September 22, 2015, in the U.S. District Court for the District of Connecticut.  It challenges the denial of Medicare home health coverage for a beneficiary who required monthly Vitamin B-12 intramuscular injections.  Intramuscular injections are, by regulation, a per se skilled service, and the beneficiary in this case has a condition (Total Gastrectomy) for which Medicare policy expressly recognizes B-12 injections to be a medically necessary treatment.  The Center is interested in hearing about similar problems that others are encountering with respect to denials of home health or SNF coverage for per se skilled services listed at 42 C.F.R.  409.33(b).  Advocates and beneficiaries are encouraged to contact Wey-Wey Kwok at wkwok@medicareadvocacy.org.
    Other examples of health care services that are defined by Medicare as skilled in either a Skilled Nursing Facility or for Home Health care include:

​​(1) Intravenous or intramuscular injections and intravenous feeding.
​(2) Enteral feeding that comprises at least 26 per cent of daily calorie requirements and provides at least 501 milliliters of fluid per day.
(3) Nasopharyngeal and tracheostomy aspiration;
(4) Insertion and sterile irrigation and replacement of suprapubic catheters;
(5) Application of dressings involving prescription medications and aseptic techniques;
(6) Treatment of extensive decubitus ulcers or other widespread skin disorder;
(7) Heat treatments which have been specifically ordered by a physician as part of active treatment and which require observation by nurses to adequately evaluate the patient's progress;
(8) Initial phases of a regimen involving administration of medical gases;
(9) Rehabilitation nursing procedures, including the related teaching and adaptive aspects of nursing, that are part of active treatment, e.g., the institution and supervision of bowel and bladder training programs.

On December 28, 2015, the government filed a motion to remand the case to the Medicare Appeals Council. On April 29, 2016, the court granted the government’s motion to remand, but retained jurisdiction and ordered defendant to submit a status report on further action taken by the Secretary of Health and Human Services by August 15, 2016.

On June 13, 2016, the Medicare Appeals Council issued a new decision, favorable to the beneficiary. It decided that the monthly Vitamin B-12 injections should be covered, however its rationale was questionable.  The Appeals Council stated that the medical records did not “clearly indicate the purpose for giving” the B-12 injections, “nor do most of the skilled nursing visit notes specifically reference the beneficiary’s gastrectomy.”  It found coverage as warranted nonetheless because the beneficiary’s plans of care referenced the total gastrectomy.  The decision made no reference to the serious problems with the original Appeals Council decision, which theorized that the beneficiary could have performed the intra-muscular injections herself. Despite the favorable ruling, the Center was not satisfied with the reasoning of the Appeals Council.

On August 15, 2016, as required by the court, the government filed a status update which stated that since coverage had been granted the case is now moot.  The Center responded with a filing explaining its continuing disagreement with the rationale used by the Appeals Council.  On August 16 the court ordered the government to file a motion to dismiss based on its contention that the case is moot. The motion to dismiss was fully briefed as of November 7, 2016. In opposition the plaintiff contends that the resolution of the single underlying claim did not resolve the policy issue the case sought to address. The parties await a decision from the court.

Skip to content