Porzecanski v. Azar

• Decision Date: 26 November 2019
• Docket Number: No. 18-5222,18-5222
• Citation: 943 F.3d 472
• Parties: Arturo C. PORZECANSKI, Appellant v. Alex Michael AZAR, II, Secretary, United States Department of Health and Human Services, Appellee
• Court: U.S. Court of Appeals — District of Columbia Circuit

943 F.3d 472

Arturo C. PORZECANSKI, Appellant

v.Alex Michael AZAR, II, Secretary, United States Department of Health and Human Services, Appellee

No. 18-5222

United States Court of Appeals, District of Columbia Circuit.

Argued September 5, 2019

Decided November 26, 2019

Caroline L. Wolverton, Washington, DC, argued the cause for appellant. With her on the briefs was Christopher L. Keough, Washington, DC.

Jaynie Lilley, Attorney, U.S. Department of Justice, argued the cause for appellee. With her on the brief was Alisa B. Klein, Attorney. R. Craig Lawrence, Assistant U.S. Attorney, entered an appearance.

Before: Henderson and Katsas, Circuit Judges, and Sentelle, Senior Circuit Judge.

Karen LeCraft Henderson, Circuit Judge:

Judicial review of claims arising under the Medicare Act is carefully circumscribed. A plaintiff must first present his claims to the Secretary of the United States Department of Health and Human Services (HHS) and exhaust administrative remedies, unless doing so would foreclose access to federal court. In this appeal we consider whether, after properly channeling a single claim for "medical and other health services" benefits, a Medicare beneficiary can obtain prospective equitable relief mandating that HHS recognize his treatment as a covered Medicare benefit in all future claim determinations. The district court concluded it could not issue such relief. For the reasons that follow, we affirm.

I. BACKGROUND

A

Medicare is a federally funded health insurance program that serves qualified elderly and disabled individuals. See Social Security Amendments of 1965 (Medicare Act), Pub. L. No. 89-97, 79 Stat. 286 (1965) (codified as amended at 42 U.S.C. §§ 1395 et seq. ). Medicare Part A primarily provides inpatient hospital coverage and Part B covers outpatient services. See 42 U.S.C. §§ 1395c, 1395j, 1395k. Eligible Part B beneficiaries may submit claims for "medical and other health services," id. § 1395k(a)(2)(B), "including drugs and biologicals ... furnished as an incident to a physician’s professional service," id. § 1395x(s)(2)(A). But a drug or biological¹ that otherwise qualifies as a "medical or other health service" will not be covered under Medicare Part B unless it is also "reasonable and necessary for the diagnosis or treatment of illness or injury." Id. § 1395y(a)(1)(A) (emphasis added). When a drug or biological is approved by the United States Food and Drug Administration (FDA) but administered for a use "that is not included as an indication" on the official FDA label, the off-label use may be covered if it is "medically accepted" as determined on a case-by-case basis after consideration of "the major drug compendia, authoritative medical literature and/or accepted standards of medical practice." Medicare Benefit Policy Manual § 50.4.2 (Rev. 1, Oct. 1, 2003) https://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/Downloads/bp102c15.pdf.

The individualized nature of many coverage decisions is reflected in Medicare’s elaborate claim determination and review regimen. To start, a Medicare Part B beneficiary must submit a claim for an "initial determination" of whether "the items and services furnished are covered or otherwise reimbursable." 42 C.F.R. § 405.920. Initial coverage determinations are made by contractors HHS hires to manage the preliminary claims administration process in designated geographic areas. See 42 U.S.C. §§ 1395ff(a)(1)(C), 1395kk-1(a)(1)–(4) ; 42 C.F.R. §§ 405.920, 405.924(b). The contractor can either review claims individually or act pursuant to a "local coverage determination" (LCD). An LCD sets forth "whether or not a particular item or service is covered on a contractor-wide basis," Medicare Program Integrity Manual § 13.1.1 (Rev. 863, Feb. 12, 2019), https://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/Downloads/pim83c13.pdf; see also 42 U.S.C. § 1395ff(f)(2)(B), and may reflect the LCD’s conclusion "that a service is not reasonable and necessary for certain diagnoses." 42 C.F.R. § 400.202.

If the contractor denies the beneficiary’s claim, the beneficiary is entitled to appeal his claim to HHS. See 42 U.S.C. § 1395ff(b)(1)(A). Initially, he must obtain a "redetermination" from the same contractor. See id. § 1395ff(a)(3)(A) ; 42 C.F.R. § 405.940. If unsuccessful, the beneficiary can seek "reconsideration" by a "qualified independent contractor" who is wholly independent of the initial determination contractor. See 42 U.S.C. § 1395ff(c)(1)–(2) ; 42 C.F.R. § 405.960. If the beneficiary remains unsatisfied, he can request a hearing before an administrative law judge (ALJ). See 42 C.F.R. § 405.1000. The ALJ’s decision is binding on the parties unless reviewed by the Medicare Appeals Council (Council). Id. § 405.1048. If Council review is sought, the Council must either issue a decision, dismiss the case or remand to the ALJ, ordinarily within ninety days of receipt of the request for review. Id. § 405.1100(c). If it fails to do so, the beneficiary is entitled to request that his appeal be escalated to federal court. Id. § 405.1132(a). Upon receipt of the request, the Council must act within five calendar days or, alternatively, notify the beneficiary that it is unable to issue a decision within the time allotted. Id. § 405.1132(a)(1)–(2). The beneficiary then has sixty days to file an action. Id. § 405.1132(b).

B

Arturo Porzecanski was diagnosed with systemic capillary leak syndrome

(SCLS) in 2005. SCLS, also known as Clarkson’s disease, is a rare, life-threatening condition, "characterized by debilitating episodes in which blood and proteins shift from blood vessels into nearby body cavities and muscles." Porzecanski v. Azar , 316 F. Supp. 3d 11, 14 (D.D.C. 2018). SCLS has no known cure. Following his diagnosis, Porzecanski began a preventive course of theophylline and terbutaline but, within a few years, his episodes occurred more frequently. Id. at 15.

In 2009 Porzecanski started an experimental regimen of intravenous immune globulin

(IVIG), a biological product. Id. The FDA has approved IVIG for certain indications; IVIG for the treatment of SCLS, however, is considered an off-label use. Although the body of research at that time comprised only a few published articles, anecdotal reports and unpublished case studies, IVIG showed promising results for controlling SCLS symptoms. The dearth of scientific testing is unsurprising: SCLS’s deadliness and rarity render clinical trials virtually impossible. Since starting on IVIG, Porzecanski has been symptom-free. Id. at 16. According to the National Institutes of Health, IVIG is now "the best available treatment" for SCLS patients. Id. at 19 n.4. Porzecanski’s physicians recommend that he continue his IVIG infusion schedule—two consecutive days every four weeks—indefinitely.

On December 16, 2014, Porzecanski underwent a round of IVIG therapy at Georgetown University Medical Center, for which the Medical Center billed $29,860.95. Id. at 16. He submitted a Medicare Part B claim for the treatment.² The initial contractor—Novitas Solutions—denied coverage. Novitas’ LCD then in effect did not include SCLS as an approved indication for IVIG. Id. at 16 & n.2, 20.

As mandated by the regulatory scheme, Porzecanski requested a redetermination and Novitas affirmed its initial denial. Id. at 16. He then sought a reconsideration by Maximus Federal Services, a qualified independent contractor. Id. Maximus also rejected his claim, in a decision the district court described as "not entirely clear." Id. Porzecanski fared no better before an ALJ, who denied coverage as well. Id. Porzecanski then appealed to the Council and, after the ninety-day review period lapsed, informed the Council of his desire to escalate the appeal to federal court. Id. The Council acknowledged his request and confirmed it could not issue a decision within the required time frame, which permitted Porzecanski to proceed to federal court.

While Porzecanski pursued his claim through the lengthy administrative appeals process, he underwent monthly IVIG therapy and submitted Medicare claims for each treatment. Initial contractors continued to deny coverage. Unlike the December 2014 claim, however, each subsequent denial was eventually overturned by either a qualified independent contractor or an ALJ, obviating the need for judicial review of those claims. Id. Yet Porzecanski’s success on agency review did not interrupt the initial denials. Because the review generally binds only the parties unless specifically designated as precedential, a favorable determination in one proceeding does not ensure that future claims will be approved. See 42 C.F.R. §§ 401.109, 405.1130, 405.1048.

Porzecanski filed suit in district court on October 17, 2016. On summary judgment, Porzecanski sought to reverse the denial of benefits for his December 16, 2014 claim and, because HHS’s favorable coverage rulings had done nothing to stem the flow of adverse initial determinations, also requested "declaratory and injunctive relief ... confirming his entitlement to Medicare coverage for his medically necessary and life-saving treatment, and requiring the Secretary, his agency, and its contractors to honor the agency’s obligation to provide the Medicare benefits to which he is entitled." Plaintiff’s Memorandum in Support of Motion for Summary Judgment at 2–3, Porzecanski , 316 F. Supp. 3d 11 (No. 16-2064), ECF No. 15-1. The proposed order accompanying Porzecanski’s motion asked the court to order the Secretary to "take all timely and appropriate actions necessary to ensure that [HHS], its contractors, and its administrative review officials will not deny Medicare Part B coverage for ... future IVIG treatments furnished to [Porzecanski] for SCLS pursuant to a physician’s order and incident to a physician’s service to [Porzecanski]." Proposed Order at 2, Porzecanski , 316 F. Supp. 3d 11 (No. 16-2064), ECF No. 15-6 (emphasis added).

On May 30, 2018, the district court granted...