Court Dismisses Self-Administered Drug Case
On April 22, 2024, a federal court in California granted the government’s motion to dismiss a lawsuit brought by the Center for Medicare Advocacy on behalf of beneficiaries who lost coverage of a very expensive drug without notice. The plaintiffs had received coverage of the injectable drug for years under a provision that allows Medicare Part B to pay for medications furnished incident to a health care practitioner’s service. Medicare then determined that the drug was “usually self-administered by the patient,” and Part B could no longer cover the drug. Medicare requires no notice to beneficiaries in this situation, and the plaintiffs received additional scheduled injections before they learned of the non-coverage. Despite the lack of notice, Medicare determined that the plaintiffs were financially liable for astronomically high costs, with some injections costing $40,000 each.
The district court acknowledged that “it does appear unfair to expect…any Medicare beneficiary…to keep abreast of such complex regulatory developments in order to avoid astronomical medical bills,” but still found that there was no violation of the constitution’s Due Process Clause. The Center is analyzing the disappointing decision and considering next steps.
Appellate Court Upholds Coverage for Gender-Affirming Care
In a victory for equal access to medically necessary health care for all, the U.S. Court of Appeals for the Fourth Circuit struck down restrictions on gender-affirming care in two state health care programs. On April 29, 2024, the court held that West Virginia’s Medicaid program and North Carolina’s state health plan unlawfully discriminate against transgender people because they cover certain medical procedures to treat non-gender dysphoria diagnoses, but not to treat gender dysphoria (for example, chest-reconstruction surgery for cisgender women post-mastectomy, but not for gender dysphoria in transgender women). The restrictions were found to violate the Equal Protection Clause of the Fourteenth Amendment, the Medicaid Act, and the Affordable Care Act.
The Center for Medicare Advocacy co-authored an amicus brief with the National Health Law Program in support of the West Virginia Medicaid beneficiaries. Medicare revoked a nationwide ban on gender-affirming surgery in 2014, finding it to be “safe and effective.” Medicare covers such care when it is reasonable and necessary for the individual beneficiary.
Another Win for the Medicare Drug Price Negotiation Program; Appeals Are Underway
Continuing an encouraging pattern, a federal district court in New Jersey held on April 29, 2024, that the Medicare drug price negotiation program is not an unconstitutional “taking” of property, does not violate drug companies’ First Amendment speech rights, and does not impose an unconstitutional condition on Medicare and Medicaid participation. Consistent with other decisions about the program, the New Jersey court stated that since drug manufacturers’ participation in Medicare is voluntary, there can be no unconstitutional taking of property through price negotiation. In rejecting the free speech challenge by Bristol Meyers Squibb and Janssen, the court also noted that, “nothing in the statute prevents Plaintiffs from publicly criticizing the Program or the final drug prices. Plaintiffs say they fear a ‘counternarrative’ that they ‘would charge more than a “fair” price for [the selected drugs] if not for the [Program’s] mandated “negotiations.”’…These, however, are public relations problems not constitutional problems.”
The drug companies are now pursuing appeals of the unfavorable decisions they have received. In one appeal argued at the Fifth Circuit Court of Appeals on May 1, 2024, at least one member of the three-judge panel appeared sympathetic to the drug industry group’s arguments against the negotiation program.
The Center for Medicare Advocacy strongly supports the Medicare drug price negotiation program established by the Inflation Reduction Act. We are part of a coalition of advocates submitting amicus briefs in support of the program in the numerous cases brought by drug companies and their allies around the country. Allowing Medicare to use its bargaining power to obtain lower prices will help beneficiaries afford life-sustaining prescription drugs. It will also help protect the financial integrity of Medicare and save taxpayers billions of dollars.
May 2, 2024 – A. Bers