United States District Court, D. Columbia
Allina Health Services, doing business as ABBOTT NORTHWESTERN
HOSPITAL, Allina Health Services, doing business as UNITED
HOSPITAL, Allina Health Services, doing business as UNITY
HOSPITAL, Florida Health Sciences Center, Inc., doing
business as TAMPA GENERAL HOSPITAL, Montefiore Medical
Center, Montefiore Medical Center, New York Hospital Medical
Center of Queens, New York Methodist Hospital, New York And
Presbyterian Hospital, doing business as NEW YORK
PRESBYTERIAN HOSPITAL/WEILL CORNELL MEDICAL CENTER, All
Plaintiffs, Plaintiffs: Stephanie Ann Webster, AKIN GUMP
STRAUSS HAUER & FELD LLP, Washington, DC USA.
Sylvia M. Burwell, Defendant: Kyle Renee Freeny, LEAD
ATTORNEY, U.S. DEPARTMENT OF JUSTICE, Federal Programs
Branch, Washington, DC USA; Tamra Tyree Moore, LEAD ATTORNEY,
U.S. DEPARTMENT OF JUSTICE, Civil Division/Federal Programs
Branch, Washington, DC USA.
Kessler, United States District Judge.
Allina Health Services, et al. (" Plaintiffs" ),
bring this action against Sylvia M. Burwell, in her official
capacity as Secretary of the United States Department of
Health and Human Services (" Secretary" or "
Defendant" ), challenging the calculation of certain
disproportionate share hospital (" DSH" ) payments
as procedurally and substantively invalid.
matter is before the Court on the Defendant's Motion to
Dismiss for Lack of
Jurisdiction or in the Alternative for Voluntary Remand [Dkt.
No. 15]. Upon consideration of the Motion, Opposition [Dkt.
No. 16], Reply [Dkt. No. 18], the entire record herein, and
for the reasons set forth below, the Motion shall be denied.
Allina Health Services v. Sebelius, a group of hospitals,
including the Plaintiffs in the present case, challenged a
2004 rulemaking by the Secretary (" 2004 Final
Rule" ) pertaining to calculations for Disproportionate
Share Hospital (" DSH" ) payment determinations
under Medicare. See No. 10-cv-1463 (D.D.C.). In November
2012, the Court (Collyer, J.) granted summary judgment for
the plaintiffs, finding that the 2004 Final Rule violated the
procedural requirements of the Administrative Procedure Act
(" APA" ) and vacating the rule. See Allina
Health Servs. v. Sebelius, 904 F.Supp.2d 75 (D.D.C.
2012) (" Allina I" ).
appeal, our Court of Appeals affirmed the part of the Allina
I Court's decision vacating the 2004 Final Rule. But, the
Court of Appeals held that the Allina I Court erred when it
directed the Secretary to calculate the DSH payments in a
particular manner, rather than simply remanding. See
Allina Health Servs. v. Sebelius, 746 F.3d 1102,
1111, 409 U.S.App.D.C. 133 (D.C. Cir. 2014).
allege that after the D.C. Circuit's opinion, the
Secretary published calculations for federal fiscal year 2012
DSH payments (" 2012 DSH Calculations"
) based on the 2004 Final Rule that had
been vacated. Plaintiffs also allege that the new 2012 DSH
Calculations are procedurally invalid. Compl. ¶ ¶
47-49. Plaintiffs timely appealed to the Provider
Reimbursement Review Board (" PRRB" ) challenging
the 2012 DSH Calculations, see Compl. ¶ ¶ 36-39,
and requested that the PRRB grant expedited judicial review.
Id. ¶ 41.
PRRB is an independent administrative tribunal that resolves
disputes regarding hospital reimbursement determinations by
Medicare contractors or the Centers for Medicare & Medicaid
Services (" CMS" ). See 42 U.S.C. § 1395oo(a).
The PRRB may resolve certain payment disputes without
following low-level policy guidance, see 42 C.F.R. §
405.1867; however, it is bound by agency regulation and
rulings, id., and cannot decide " question[s] of law or
regulations." 42 U.S.C. § 1395oo(f) (1). Section
1395oo(f) gives providers " the right to obtain judicial
review of any action . . . which involves a question of law
or regulations . . . whenever the [PRRB] determines . . .
that it is without the authority to decide the
letter dated August 13, 2014, the PRRB granted
Plaintiffs' request for expedited judicial review,
finding that " it is without the authority to decide the
legal question of whether the regulation regarding the [2012
DSH Calculations] is valid and whether the Secretary's
actions subsequent to the decision in Allina [I] are
legal." Letter from the Provider Reimbursement Review
Board to Stephanie
Webster 6 (Aug. 13, 2014) [Dkt. No. 14-1] (" PRRB