Federal Court Ruling Allows Face-to-Face Lawsuit to Go Forward

WASHINGTON (Jan. 6, 2015)—The U.S. District Court for the District of Columbia held that it has the power to hear a challenge to the validity of a Medicare rule that requires physicians to provide a “narrative” explaining why the patient meets Medicare coverage standards for home health services. The court issued an order denying Medicare’s effort to have the lawsuit dismissed by the court.

The Centers for Medicare and Medicaid Services (CMS) issued a face-to-face rule that physicians had to lay eyes on patients and certify under penalty of law that that they were eligible to participate in Medicare and, more specifically, were “homebound” and needed “skilled care.” In addition, the rule required physicians to write a detailed narrative explaining the reasons why they thought this was true.

The National Association for Home Care & Hospice (NAHC) filed suit in federal district court to overturn the rule. CMS withdrew the physician narrative requirement which would have been effective Jan. 1, but denied a request from NAHC to give the decision retroactive effect and pay claims that were denied between 2011 and 2014. CMS moved to dismiss the lawsuit.

In this recent action, the court denied the motion to dismiss. Federal District Judge Christopher R. Cooper found that it would be futile for home health agencies to pursue administrative appeals because Medicare had definitively stated that it considered the requirement to be valid. Cooper described the challenged policy as “embedded” and that “nothing indicates that administrative appeals might result in the agency overturning its regulation.”

The court did grant dismissal of two additional claims that challenged the ambiguity of the interpretive guidance issued by the Centers for Medicare and Medicaid Services along with its failure to waive the recoupment of alleged overpayments under the Medicare “without fault” provision. On those matters, the court found that the factual complexities warranted a review of individual claim determinations at the administrative levels prior to any judicial intervention.

“This great victory in federal court means that Medicare patients, physicians, and the home health community will have their day in court,” said Val J. Halamandaris, NAHC president. “It is a clear signal that a federal judge also does not see why a rule which CMS had invalidated effective January 2015 should be honored for the years 2011, 2012, 2013 and 2014. There is no reason why the home care community should not be paid for the services it rendered in good faith to Medicare home health beneficiaries.”