United States District Court, District of Columbia
ARTURO C. PORZECANSKI, Plaintiff,
ALEX M. AZAR, Secretary, U.S. Department of Health and Human Services,  Defendant.
L. FRIEDRICH United States District Judge
the Court are Arturo Porzecanski's Motion for Summary
Judgment, Dkt. 15, and the U.S. Department of Health and
Human Services' Cross-Motion for Summary Judgment, Dkt.
17. For the reasons that follow, the Court will grant in part
and deny in part Porzecanski's motion, and the Court will
grant in part and deny in part HHS's motion.
2005, Porzecanski was diagnosed with systemic capillary leak
syndrome (SCLS), also known as Clarkson's disease.
Administrative Record (AR) 29, 124, Dkt. 22. SCLS is an
“exceedingly rare” and life-threatening dis,
characterized by debilitating episodes in which blood and
proteins shift from blood vessels into nearby body cavities
and muscles. See AR 59, 73, 124, 342-45. SCLS can be
treated with intravenous immune globulin (IVIG). AR 33, 137.
Porzecanski received IVIG treatment on December 16, 2014, but
when he submitted a Medicare claim for the treatment, an
administrative law judge denied the claim. AR 28-33.
Porzecanski now challenges that denial, and he seeks
declaratory and injunctive relief to prevent HHS from
continuing to deny similar claims.
Medicare Part B and the Claims Process
is a federal health insurance program that serves elderly or
disabled Americans. See 42 U.S.C. § 1395 et
seq. Medicare Part B covers “medical and other
health services, ” id. § 1395k(a)(2)(B),
including “services and supplies (including drugs
and biologicals which are not usually self-administered
by the patient) furnished as an incident to a physician's
professional service, ” id. §
1395x(s)(2)(A) (emphasis added). The Medicare statute, with a
few exceptions not relevant here, defines covered drugs and
biologicals based on whether they are approved by certain
hospital committees or listed in authoritative sources known
The term “drugs” and the term
“biologicals” . . . include only such drugs
(including contrast agents) and biologicals, respectively, as
are included (or approved for inclusion) in the United States
Pharmacopoeia, the National Formulary, or the United States
Homeopathic Pharmacopoeia, or in New Drugs or Accepted Dental
Remedies (except for any drugs and biologicals unfavorably
evaluated therein), or as are approved by the pharmacy and
drug therapeutics committee (or equivalent committee) of the
medical staff of the hospital furnishing such drugs and
biologicals for use in such hospital.
Id. § 1395x(t)(1).
addition, covered services must be reasonable and necessary.
“Notwithstanding any other provision of [the Medicare
statute], no payment may be made under . . . part B . . . for
any expenses incurred or items or services-which . . . are
not reasonable and necessary for the diagnosis or treatment
of illness or injury or to improve the functioning of a
malformed body member.” Id. §
1395y(a)(1)(A); see also Medicare Benefits Policy
Manual, Chapter 15, § 50 (drugs and biologicals must be
“reasonable and necessary for the diagnosis or
treatment of the illness or injury for which they are
administered according to accepted standards of medical
practice”). Drugs approved by the Food and Drug
Administration (FDA) are considered reasonable and necessary
when used for indications specified on their FDA-approved
labeling. Medicare Benefits Policy Manual, Chapter 15, §
50.4.1. And even when used for indications not
specified on the labeling, i.e.
“off-label” uses, a drug is considered reasonable
and necessary if the use is “medically accepted”:
An unlabeled use of a drug is a use that is not included as
an indication on the drug's label as approved by the FDA.
FDA approved drugs used for indications other than what is
indicated on the official label may be covered under Medicare
if the [Medicare administrative contractor] determines the
use to be medically accepted, taking into consideration the
major drug compendia, authoritative medical literature and/or
accepted standards of medical practice. . . . These decisions
are made by the [contractor] on a case-by-case basis.
Id. § 50.4.2.
submit a Medicare Part B claim, a beneficiary must first file
with an administrative contractor hired by HHS to make
initial coverage determinations. 42 C.F.R. §§
405.920, 405.924(b). The initial contractor may review the
claim individually, or the contractor may deny the claim
automatically by relying on a “local coverage
determination, ” which is a decision promulgated by the
contractor “to provide guidance to the public and the
medical community within their jurisdictions” as to the
clinical circumstances under which a “service is
considered to be reasonable and necessary.” Medicare
Program Integrity Manual, Chapter 13, § 13.1.3;
see 42 U.S.C. § 1395ff(f)(2)(B); 42 C.F.R.
§ 400.202. A local coverage determination binds only the
contractor that issued it, and only at the initial stages of
the Medicare claim review process. See 42 U.S.C.
beneficiary disagrees with the contractor's initial
determination, the beneficiary may request a
“redetermination” by the same contractor. 42
C.F.R. § 405.940. Assuming the contractor does not
reverse itself and the beneficiary remains dissatisfied, the
beneficiary may request “reconsideration” by
another Medicare program contractor called a “qualified
independent contractor.” Id. § 405.960.
After an adverse reconsideration, the beneficiary may appeal
to an HHS administrative law judge. Id. §
405.1000. The administrative law judge's decision binds
the parties unless the Medicare Appeals Council reviews the
decision on its own motion or the beneficiary appeals to the
Council. See Id. §§ 405.1048, 405.1110,
405.1102. When evaluating a claim, administrative law judges
and the Medicare Appeals Council are not bound by
contractors' local coverage determinations or by Medicare
program guidance such as manual instructions, but according
to HHS regulations, HHS “will give substantial
deference to these policies if they are applicable to a
particular case.” Id. § 405.1062. If the
Medicare Appeals Council does not issue a decision,
dismissal, or remand within 90 days of the beneficiary's
request for review, the beneficiary may escalate the appeal
to a federal district court. Id. §§
405.1132, 405.1100(c). And if the Medicare Appeals Council
does issue a decision, the beneficiary has 60 days to seek
review by a federal district court. Id. §
405.1130. Decisions by administrative law judges and the
Council generally lack precedential effect and bind the
parties only. Id. § 405.1048, 405.1130; see
also 82 Fed. Reg. 4974, 5105-06 (Jan. 17, 2017)
(authorizing HHS to designate certain Council decisions as