High court hears arguments in Medicare hospital reimbursement case

U.S. Supreme Court justices heard arguments Jan. 15 in a case to determine whether HHS inappropriately altered methods for calculating Medicare hospital reimbursement, The Epoch Times reported.

At issue in Azar v. Allina Health Services is the federal government's decision to include Medicare Part C enrollees with Medicare Part A enrollees when calculating disproportionate share hospital payments.

The changes, which resulted in lower payments to various hospitals, were made in 2013, and Minneapolis-based Allina subsequently sued the federal government in 2014.

The lawsuit claims that the Medicare hospital reimbursement changes were made without first conducting a formal notice-and-comment rulemaking process.

But HHS argues that this process is not required when instructing Medicare administrative contractors in administering the Medicare program, according to The National Law Review.

HHS filed a petition asking the Supreme Court to review the case after a District of Columbia appeals court ruled that the federal government went against the Medicare Act when it did not conduct notice-and-comment rulemaking.

The federal government has argued that the D.C. circuit court's ruling conflicted with other appeals courts decisions and that the D.C. circuit's contrary decision "would significantly impair HHS' ability to administer annual Medicare reimbursements through the MACs [Medicare administrative contractors] that act on its behalf."

But the American Hospital Association, one of the healthcare groups supporting Allina's position, argues the federal government is overstating the potential effects of affirming the D.C. circuit court's decision, The Epoch Times reported.

During arguments on Jan. 15, discussions focused on "the meaning of specific words in the Medicare Act and in other statutes, and abstract, highly technical ruminations about administrative law," according to The Epoch Times.

Read more about the arguments on the Supreme Court blog.


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