Justia U.S. D.C. Circuit Court of Appeals Opinion Summaries

Plaintiffs, hospitals that participate in Medicare, filed suit against the Secretary, claiming that she violated the Administrative Procedure Act (APA), 5 U.S.C. 551 et seq., by engaging in arbitrary and capricious decision-making. This dispute arose from plaintiffs' belief that the Secretary set the monetary threshold for outlier payments too high in 2004, 2005, and 2006. The court affirmed the district court’s partial denial of the motion to supplement the administrative record and its rejection of the APA challenges to the 2005 and 2006 outlier thresholds. The district court erred, however, in concluding that the Secretary adequately explained the 2004 outlier threshold. Therefore, the court reversed the grant of summary judgment on this claim and remanded for further proceedings. View "District Hosp. Partners v. Burwell" on Justia Law

The Medicare program provides federally funded healthcare to the elderly and the disabled. See Title XVIII of the Social Security Act, 42 U.S.C. 1395. Under a “complex statutory and regulatory regime” called Medicare Part A, the Government reimburses participating hospitals for care that they provide to inpatient Medicare beneficiaries. Most hospitals are reimbursed for inpatient hospital services pursuant to a standardized rate, but the Social Security Act also provides a method for calculating reimbursement rates for certain rural hospitals that qualify as “sole community hospital[s]” (SCHs) or that qualify as “medicare-dependent small rural hospital[s]” (MDHs). SCHs and MDHs receive reimbursement based on either the standard rate or a hospital-specific rate derived from its actual costs of treatment in one of the base years specified in the statute, whichever is higher. MDHs and SCHs challenged revisions to the rules covering their Medicare reimbursements for inpatient hospital services, arguing that the Medicare statute forbids the Secretary from modifying the hospitals’ reimbursements with budget neutrality adjustments from years prior to the base year. The district court rejected the claims. The D.C. Circuit affirmed, finding that the revisions were neither arbitrary nor manifestly contrary to the statute. View "Adirondack Med. Ctr. v. Burwell" on Justia Law

At issue in these consolidated cases is whether a regulatory accommodation for religious nonprofit organizations that permit them to opt out of the contraceptive coverage requirement under the Patient Protection and Affordable Care Act (ACA), 42 U.S.C. 300gg-13(a)(4), itself imposes an unjustified substantial burden on plaintiffs' religious exercise in violation of the Religious Freedom Restoration Act (RFRA), 42 U.S.C. 2000bb. The court concluded that the challenged regulations do not impose a substantial burden on plaintiffs' religious exercise under RFRA. All plaintiffs must do to opt out is express what they believe and seek what they want via a letter or two-page form. Religious nonprofits that opt out are excused from playing any role in the provision of contraceptive services, and they remain free to condemn contraception in the clearest terms. The ACA shifts to health insurers and administrators the obligation to pay for and provide contraceptive coverage for insured persons who would otherwise lose it as a result of the religious accommodation. Because the regulatory opt-out mechanism is the least restrictive means to serve compelling governmental interests, it is fully consistent with plaintiffs' rights under RFRA. The court also found no merit in plaintiffs' additional claims. The court rejected all of plaintiffs' challenges to the regulations and affirmed the district court's opinion in Priests for Life in its entirety. As for the RCAW decision, the court vacated the district court's grant of summary judgment for Thomas Aquinas and its holding as to the unconstitutionality of the non-interference provision and affirmed the remainder of the decision. View "Priests For Life v. HHS" on Justia Law

Section 5000A of the Patient Protection and Affordable Care Act, 26 U.S.C. 5000A, mandates that as of January 2014, non-exempt individuals maintain minimum health care coverage or, with limited exceptions, pay a penalty. Plaintiff filed suit alleging that the mandate violated the Commerce Clause and the Origination Clause of the Constitution. The court concluded that plaintiff's contention that the mandate obligating him to buy government-approved health insurance violates the Commerce Clause fails under the Supreme Court's interpretation of the mandate in National Federation of Independent Business v. Sebelius; plaintiff's contention that the mandate's shared responsibility payment was enacted in violation of the Origination Clause fails under Supreme Court precedent interpreting the Clause; and, therefore, the court affirmed the district court's dismissal of his complaint. View "Sissel v. HHS, et al." on Justia Law

Appellants challenged the IRS's interpretation of 26 U.S.C. 36B, enacted as part of the Patient Protection and Affordable Care Act, under the Administrative Procedure Act (APA), 5 U.S.C. 706(2)(A). The district court held that the ACA's text, structure, purpose, and legislative history make "clear that Congress intended to make premium tax credits available on both state-run and federally-facilitated Exchanges." The district court held that even if the ACA were ambiguous, the IRS's regulation would represent a permissible construction entitled to Chevron deference. The court concluded, however, that the ACA unambiguously restricts the section 36B subsidy to insurance purchased on Exchanges "established by the State." Accordingly, the court reversed the judgment of the district court and vacated the IRS's regulation. View "Halbig v. Burwell" on Justia Law

Petitioners, a group of hospitals that serve a significant number of elderly, very low-income patients, filed suit challenging the Secretary's issuance of a rule concerning the "disproportionate share percentage" calculation of supplemental payments for low-income Medicare patients. When the Secretary published reimbursement calculations for FY 2007, petitioners learned that their payments would decrease by tens of millions of dollars per year. The rule change had an enormous financial consequence on hospitals. The court held that the Secretary did not provide adequate notice and opportunity to comment before promulgating its 2004 rule, and so affirmed the portion of the district court's opinion vacating the rule. The court reversed only the portion of the district court's opinion directing the Secretary to recalculate the hospitals' reimbursements using the alternate methodology. View "Allina Health Services, et al. v. Sebelius" on Justia Law

Plaintiffs filed suit against the Secretary of Health and Human Services (HHS) and the Commissioner of the Social Security Administration (SSA) raising constitutional challenges to the Patient Protection and Affordable Care Act (ACA), Pub. L. No 111-148, 124 Stat. 119; raising statutory challenges to actions of HHS and the Commissioner relating to the implementation of the ACA and prior Medical legislation; and attacking the failure of defendants to render an "accounting" that would alter the American people to the insolvency towards which Medicare and Social Security programs were heading. On appeal, plaintiffs challenged the district court's dismissal of their claims. The court rejected plaintiffs' claims that 26 U.S.C. 5000A, which was sustained as a valid exercise of the taxing power, violated the Fifth Amendment's prohibition of the taking of private property without just compensation and violated the origination clause. The court concluded that plaintiffs' substantive attack on the Social Security Program Operations Manual System (POMS) provisions was clearly foreclosed by its decision in Hall v. Sebelius, holding that the statutory text establishing Medicare Part A precludes any option not to be entitled to benefits. The court rejected plaintiffs' second statutory claim attacking an interim final rule. Finally, the court concluded that plaintiffs failed to provide a legal argument for their claims against the Commissioner and Secretary, and therefore, the court lacked jurisdiction over plaintiffs' claim to an "accounting." Accordingly, the court affirmed the judgment of the district court. View "Assoc. Amer. Physicians, et al. v. Sebelius, et al." on Justia Law

The government filed suit against appellants, alleging that they violated federal laws regulating the manufacture and labeling of drugs and biological products by producing, as part of their medical practice, a substance consisting of a mixture of a patient's stem cells and the antibiotic doxycycline (the "Mixture"). The Federal Food, Drug & Cosmetic Act (FDCA) 21 U.S.C. 301 et seq., and the Public Health Service Act (PHSA), 42 U.S.C. 201 et seq., are statutes that promote the safety of drugs and biological products, respectively, by setting forth detailed requirements for how such substances are to be manufactured and labeled. The court held that, by virtue of its use of doxycycline, the Mixture was within the scope of drugs - and, by extension, biological products, - regulated by section 331(k) of the FDCA; appellants failed to establish that the Mixture was exempt from the FDCA's manufacturing and labeling requirements; the Mixture was per se adulterated where it was undisputed that appellants' facilities, methods, and controls for processing the Mixture violated federal manufacturing standards in numerous respects; because its label failed to provide the minimum information necessary to qualify for either exemption from section 352(f), the Mixture was misbranded; and the district court properly enjoined appellants from committing future violations of the FDCA's manufacturing and labeling provisions. Accordingly, the court affirmed the judgment of the district court and dismissed appellants' counterclaims. View "United States v. Regenerative Sciences, LLC, et al." on Justia Law

In 2007, the Secretary revamped Medicare's Inpatient Prospective Payment System, updating the diagnostic weighting used to calculate reimbursements for hospitals treating the program's beneficiaries. Plaintiffs sought review of the Secretary's decision regarding a downward prospective adjustment for hospital-specific rate payments. The district court concluded that the statutory scheme was ambiguous and deferred to the Secretary's reasonable interpretation of the adjustment provisions. Applying Chevron deference, the court agreed with the district court's conclusion that the statutory scheme was ambiguous and unclear. Accordingly, the court affirmed the judgment of the district court. View "Adirondack Medical Center, et al. v. Sebelius" on Justia Law

ATRA petitioned for review, challenging revisions made by OSHA to the wording of a paragraph (a)(2) of OSHA's hazard communication (HazCom) standard, 29 C.F.R. 1910.1200. HazCom establishes labeling requirements for chemicals used in the workplace. The changes reflect the agency's view that HazCom preempts state legislative and regulatory requirements, but not state tort claims. The court rejected ATRA's arguments under the Occupational Safety and Health Act (OSH Act), 29 U.S.C. 651-678, concluding that OSHA has no authority to speak with the force of law on preemption and the agency never meant for the disputed paragraph to have the effect of a legislative rule. Because Paragraph (a)(2) is merely interpretive, it is not subject to notice and comment rulemaking and was not subject to judicial review. Accordingly, ATRA's challenge was unripe for review. Accordingly, the court denied the petition for review. View "American Tort Reform Assoc. v. OSHA, et al." on Justia Law