Healey v. Thompson
| Decision Date | 21 September 2001 |
| Docket Number | No. 3:98CV418(DJS).,3:98CV418(DJS). |
| Parties | Ruth HEALEY; Marcia Lutwin; Linda Wierda; Jane Kozlowski; Margaret A. Walz; Roger Audette; Marion Morgan, by her next friend, Dorothy M. Hiltz; Julia M. Culver, by her next friend, the Reverend Horace Mitchell; and Bertha Chiplin, by her next friend, Alfred J. Chiplin, Sr.; Madalyn Rovner; Roland Cote; Florentina Calderon, by her next friend, EVA Moreno; Helen Bagwell; Maxine Marmor; and Katherine Watts, individually and on behalf of all others similarly situated, Plaintiffs v. Tommy G. THOMPSON, Secretary of the United States Department of Health and Human Services, Defendant |
| Court | U.S. District Court — District of Connecticut |
Sarah L. Lock, AARP Foundation Litigation, Washington, DC, for plaintiffs.
Carolyn Aiko Ikari, U.S. Attorney's Office, Hartford, CT, Andrea G. Cohen, U.S. Dept. of Justice, Washington, DC, Sheila Lieber, Adam Issenberg, U.S. Dept. of Justice, Federal Programs Branch, Washington, DC, William A. Dombi, Center for Health Care Law, Washington, DC, for defendant.
Upon review and pursuant to 28 U.S.C. § 636(b)(1)(B) and Rule 2 of the Local Rules for United States Magistrate Judges (D.Conn.), Magistrate Judge Thomas P. Smith's Recommended Ruling (Doc. # 140), is APPROVED and ADOPTED as the Ruling of this Court, over objection.
IT IS SO ORDERED.
RECOMMENDED RULING ON CROSS MOTIONS FOR SUMMARY JUDGMENT
This case is a nation-wide class action brought on behalf of recipients of home health care benefits from Medicare seeking "meaningful notice and appeal rights when their home health benefits are reduced or terminated," (Compl., ¶ 1), in the form of injunctive relief against the Department of Health and Human Services. On February 11, 2000, the court partially granted plaintiffs' first motion for summary judgment in part, issued a declaratory judgment, and afforded plaintiffs the opportunity to seek further relief. Plaintiffs have now come forth in search of such relief by way of a second motion for summary judgment (docket no. 114), which defendant opposes by way of his own motion for summary judgment (docket no. 123). For the reasons set forth below, plaintiffs' motion is DENIED, and defendant's motion is GRANTED. In light of the considerations discussed herein, this court's prior ruling addressing the circumstances in which home health agencies ("HHAs") are required to give written notice of decisions regarding Medicare coverage and the procedure to appeal such decisions should not be expanded upon.
This is a provisionally certified class action, see Fed. R. Civ. Pro. 23(c)(1), brought by named plaintiffs who reside across the country on behalf of "persons entitled to Medicare benefits who need and/or have received home health services which have been or will be denied, reduced or terminated." (Compl. ¶ 10). Familiarity with this court's prior ruling, Healey v. Shalala, No. 3:98cv418(DJS), 2000 WL 303439 (D.Conn. Feb. 11, 2000), which sets forth much of the necessary background information, is presumed, and therefore only the pertinent changes in the landscape of this litigation are discussed herein.
The plaintiffs are either aged 65 and over, or have been found to be disabled; are eligible for Medicare; and have been receiving home health care services1 from private home health agencies, which contract with the defendant to be reimbursed for the services covered by the Medicare program. # 116, ¶¶ 1-2 )).2 Generally speaking, home health care is, in appropriate cases, a less expensive and more comfortable alternative to hospital or skilled nursing facility care. Each of these named plaintiffs has experienced an actual or proposed reduction or termination of home health services resulting from a determination of the home health agency administering care. (See id., ¶ 6). Briefly stated, they all challenge the adequacy of the notice provided to them upon a change in care and the sufficiency of the appeals process available to them.
After this lawsuit was filed, the payment system for the home health services program within the Medicare scheme has undergone fundamental changes that have a significant impact upon this litigation. On July 3, 2000, the Health Care Financing Administration ("HCFA") published the final rule implementing the Home Health Prospective Payment System "HH PPS" effective October 1, 2000, as required by the Balanced Budget Act of 1997. See Medicare Program: Prospective Payment System for Home Health Agencies, 65 Fed.Reg. 41128 (Jul. 3, 2000) (codified at 42 C.F.R. 409, 410, 411, 413, 424, and 484); see also 42 U.S.C. § 1395fff(a); 42 C.F.R. 484.200. The new rule "establishes requirements for the new prospective payment system for home health agencies," which include "the implementation of a prospective payment system for home health agencies, consolidated billing requirements, and a number of other related changes." Id. at 41128.
The linchpin of the HH PPS is the sixty-day episode of care. See 42 C.F.R. § 484.205(a). When a patient eligible for Medicare coverage requires home health care services, the physician, in conjunction with the provider, devises a plan of care for the patient for the next sixty days that includes, among other things, a diagnosis and prognosis, description of the types of services required, the frequency of the services, and the provider of the services. See 42 C.F.R. § 484.18(a). This plan of care must then be certified in order to obtain final payment. 42 U.S.C. § 1395f(a)(2)(C).3
In addition, the HHA must conduct a comprehensive assessment of the patient as follows:
Each patient must receive, and an HHA must provide, a patient-specific, comprehensive assessment that accurately reflects the patient's current health status and includes information that may be used to demonstrate the patient's progress toward achievement of desired outcomes. The comprehensive assessment must identify the patient's continuing need for home care and meet the patient's medical, nursing, rehabilitative, social, and discharge planning needs. For Medicare beneficiaries, the HHA must verify the patient's eligibility for the Medicare home health benefit including homebound status, both at the time of the initial assessment visit and the time of the comprehensive assessment.
42 C.F.R. § 484.55. This assessment must incorporate the Outcomes and Assessment Information Set ("OASIS"), which is "a standardized assessment tool that provides a detailed examination of the patient's physical and mental condition, as well as other information pertinent to the patient's care, such as the patient's health history, living arrangements, and activities of daily living." (Hoyer Dec., Dkt # 90, ¶ 5). At a minimum an OASIS review must be conducted every sixty days, and a new physician certified plan of care must be issued at the same increment of time. 42 C.F.R. § 484.55(d).
Upon evaluation of the patient and formulation of a plan of care, the HHA then submits a request for anticipated payment. This request is based upon a nationally uniform price figure that is modified through the application of two adjustments: the case-mix adjustment and the wage adjustment. In determining the case-mix adjustment, the patient is assigned to one of eighty home health resource groups, which is done by assigning three different variables pursuant to the data from the OASIS evaluation, including clinical severity factors, functional severity factors, and services utilization factors. (See Wardwell Dec., Dkt # 127, Ex. C, ¶ 5). The wage adjustment takes into account the geographic variation in wages. These adjustments represent the HCFA's standardized valuation of the services the HHAs intend to provide, taking into account the beneficiary's condition and needs, during the sixty-day episode of care.
Upon submission of a properly supported request for anticipated payment, the HHA will then receive 60% (50% for subsequent episodes) of the total payment from the fiscal intermediary, and the remaining 40% upon submission of a final claim, detailing the actual services provided, along with a physician certified plan of care. See 42 C.F.R. § 484.205(b). This final request is considered the actual Medicare claim; the fiscal intermediary reserves the right to cancel and recover the initial payment in situations when "protecting Medicare integrity warrants this action," and when the final claim is not submitted beyond the greater of sixty days from the end of the episode or sixty days from the issuance of the request for anticipated payment. 42 C.F.R. § 409.43(c)(2).
In addition to the change in the payment system, the Secretary has also required that HHAs provide a mandatory notice to beneficiaries in certain situations. As of March 1, 2001, HHAs must provide Home Health Advance Beneficiary Notices ("HHABNs") when a physician orders services under the following circumstances:
Provision of Home Health Advance Beneficiary Notices (HHABNs) — Provide a HHABN to beneficiaries, according to the following instructions, whenever Medicare payment denial is expected on any one of the following statutory bases: not medically necessary and reasonable (under § 1862(a)(1) of the Act); custodial care exclusion (under § 1862(a)(9) of the Act); and failure to meet the HHA services homebound and intermittent care requirements (under § 1879(g)(1) of the Act). Do not pre-select any option on the form.
a. Providing HHABNs at Initiation of Services. — In the situation in which you advise a beneficiary that you will not accept the beneficiary as a Medicare patient because you expect that Medicare will not pay for the services, for one of the reasons listed above, provide a HHABN to the beneficiary before you furnish home health services to the beneficiary. Check the first block ("We expect Medicare will not pay for any...
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