UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA
MICHAEL GREENWALD
Plaintiff, Civ. Action No. 17-797(EGS/RMM) v.
XAVIER BECERRA, Secretary of the United States Department of Health and Human Services et al., Defendants. 1
MEMORANDUM OPINION AND ORDER
Plaintiff Michael Greenwald (“Mr. Greenwald”), a Medicare
beneficiary, brings this suit to challenge the validity of a
Local Coverage Determination (“LCD”) cited when he was denied
Medicare coverage for a pneumatic compression device prescribed
by his physician. See generally First Am. Compl. (“Compl.”), ECF
No. 26. He names as defendants the Secretary of the United
States Department of Health and Human Services (“HHS”)1 and the
Administrator of the Centers for Medicare and Medicaid Services
(“CMS”), both in their official capacities (collectively
“Defendants”). Defendants move to dismiss Mr. Greenwald’s claims
for lack of subject matter jurisdiction and failure to state a
1 Pursuant to Federal Rule of Civil Procedure 25(d), the Court substitutes as defendant Mr. Xavier Becerra, in place of former Secretary Alex Azar.
1 claim. See Defs.’ Mem. of P. & A. Supp. Mot. Dismiss (“Mot. to
Dismiss”), ECF No. 27-1. On March 30, 2018, the Court referred
the case to a Magistrate Judge for full case management,
including a Report and Recommendation (“R. & R.”) on the pending
Motion to Dismiss, and the case was randomly referred to
Magistrate Judge Robin M. Meriweather. See generally, Docket for
Civ. Act. No. 17-797. Pending before the Court is Defendants’
Motion to Dismiss, see ECF No. 17. Magistrate Judge Meriweather
issued a R. & R. recommending that this Court grant Defendants’
motion since this Court lacks subject matter jurisdiction over
Mr. Greenwald’s claims. See R. & R., ECF No. 47 at 1-2.
Plaintiff objects to Magistrate Judge Meriweather’s R. & R. See
generally Plaintiff Michael Greenwald’s Objections to the
November 8, 2021 Report and Recommendations Regarding
Defendants’ Motion to Dismiss the Complaint (“Pl.’s Objs.”), ECF
No. 49.
Upon careful consideration of the R. & R., the objections
of both parties and opposition thereto, the applicable law, and
the entire record herein, the Court hereby ADOPTS IN PART and
REJECTS IN PART the R. & R., see ECF No. 49; and GRANTS IN PART
and DENIES IN PART Defendants’ Motion to Dismiss, see ECF No.
27.
2 I. Background 2
A. Factual Background
Accepting the factual allegations in the complaint as true,
as is required at this stage of proceedings, see Jerome Stevens
Pharms., Inc. v. Food & Drug Admin., 402 F.3d 1249, 1253–54
(D.C. Cir. 2005); this case stems from Mr. Greenwald’s
lymphedema—a chronic medical condition that results in the
accumulation of fluid in the subcutaneous tissues of his legs.
See Compl., ECF No. 26 ¶¶ 1, 13, 48. Mr. Greenwald was first
diagnosed with lymphedema in 2014. See id. ¶¶ 13–14, 48. His
physician attempted to treat the condition with compression
stockings, exercise, and limb elevation. See id. ¶¶ 14, 48–49.
In 2016, the physician determined these treatments had been
ineffective in alleviating Mr. Greenwald’s symptoms and
prescribed him a pneumatic compression device (“PCD”). See id.
¶¶ 14, 52. PCDs are items of durable medical equipment designed
to treat patients suffering from a range of circulatory
conditions, including lymphedema. See id. at ¶ 30. They do so by
intermittently inflating a garment with compressed air to
2 In the interest of judicial efficiency, the Background section is adopted from Magistrate Judge Meriweather’s R. & R. See ECF No. 49.
3 stimulate fluid circulation in affected parts of the body. See
id. ¶ 31.
Mr. Greenwald is eligible for Medicare benefits and
expected his PCD prescription to be covered under Medicare Part
B. See id. ¶¶ 13, 18, 24, 54. Mr. Greenwald’s coverage claim was
denied, however. See id. ¶ 55. His appeal for a redetermination
was also unsuccessful. See id. ¶ 56. As a result, Mr. Greenwald
has paid the full cost of his prescribed PCD out-of-pocket. See
id. ¶¶ 47, 63. The following description of the Medicare system
provides necessary context for understanding why Mr. Greenwald’s
coverage claim was denied and the nature of his suit against the
Defendants.
B. The Medicare Program
Congress established the Medicare program in 1965 to
provide health benefits to persons aged sixty-five and older who
are eligible for Social Security benefits or retirement benefits
under the railroad retirement system. Cal. Clinical Lab’y Ass’n
v. Sec’y Health & Hum. Servs., 104 F. Supp. 3d 66, 70 (D.D.C.
2015) (citing Pub. L. No. 89-97, 79 Stat. 291 (July 30, 1965)
(codified at 42 U.S.C. §§ 1395 et seq.)). Part A of the program
covers institutional healthcare services. See 42 U.S.C. § 1395d.
Part B of the program is voluntary, providing enrollees with
coverage for medical professional services, outpatient and
4 homecare services, and durable medical equipment that is not
furnished in an inpatient setting or otherwise covered by Part
A. See id. § 1395k. Part C of the program, also enrollment
based, provides benefits to individuals who elect to receive
coverage through private health insurance companies. See id. §§
1395w-21 to 1395w-28. Both Parts B and C of the Medicare program
cover durable medical equipment, including PCDs, in appropriate
circumstances. See Compl., ECF No. 26 ¶ 46; see also 42 C.F.R.
§§ 410.38, 414.202.
Those appropriate circumstances are defined in part by the
Medicare Act. Relevant here, Medicare does not cover “expenses
incurred for 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[.]” 42 U.S.C. § 1395y(a)(1)(A). The HHS Secretary
implements this rule through CMS—the agency that administers
Medicare more generally. See id. § 1395b-9. CMS in turn
delegates some of its responsibilities to private Medicare
Administrative Contractors (“MACs”). See id. §§ 1395(u), 1395kk-
1. Under this scheme, a healthcare provider who seeks payment
for an item or service provided to a Medicare beneficiary
submits a claim for reimbursement to the MAC authorized in the
provider’s region. See id. § 1395kk-1(a). The MAC then assesses
5 whether the item or service is covered by Medicare, including
whether the item or service is “reasonable and necessary” under
§ 1395y.
The Secretary has significant control over these MAC
coverage determinations. He may promulgate binding regulations
regarding which items or services are covered by Medicare. See
id. §§ 1395hh, 1395ff(a)(1). He may also issue binding national
coverage determinations, or “NCDs,” that reflect his
determination that an item or service is covered under
designated medical circumstances on a nationwide basis. See id.
§ 1395ff(f)(1)(B); 42 C.F.R. § 405.1060(a)(4). Additionally, if
coverage is initially denied by a MAC, a Medicare beneficiary
may appeal the MAC determination to an administrative law judge
(“ALJ”) housed within the Secretary’s Office of Medicare
Hearings and Appeals. See id. § 1395ff(b)(1)(E), (d)(1)(A); see
also Am. Hosp. Ass’n v. Burwell, 76 F. Supp. 3d 43, 46 (D.D.C.
2014), rev’d on other grounds, 812 F.3d 183 (D.C. Cir. 2016)
(describing this process).
The MACs may also develop their own guidelines for coverage
determinations, known as local coverage determinations (“LCDs”).
See 42 U.S.C. § 1395ff(f)(2)(B). LCDs are limited in scope,
applying only on an “intermediary- or carrier-wide basis.” Id.
They are meant to guide MAC administrators in determining
6 whether an item or service is “covered . . . in accordance with
§ 1395y(a)(1)(A)”—in other words, that an item or service is
“reasonable and necessary” as required for Medicare coverage—
within the MAC’s designated service area. Id.
§§ 1395y(a)(1)(A); 1395ff(f)(2)(B). Individuals who believe
their claim was wrongly denied pursuant to an LCD can appeal
their individual coverage determination to an ALJ, and if that
appeal is unsuccessful, to the HHS Departmental Appeals Board
(“DAB”). Id. at § 1395ff(b)– (e); 42 C.F.R. §§ 405.900 et seq.
Neither the ALJ nor the DAB is bound by the LCD, but they cannot
invalidate or set aside the LCD in its entirety. See 42 C.F.R.
§§ 405.1062(a), (c); see also Cal. Clinical Lab’y, 104 F. Supp.
3d at 72. To challenge the validity of the LCD itself, a
Medicare beneficiary must utilize a different complaint process,
appealing to an ALJ and the DAB via 42 U.S.C. § 1395ff(f)(2). If
there are “no material issues of fact in dispute” and the “only
issue of law” is the validity of the LCD, the Medicare recipient
may also side-step the usual administrative review process and
file a complaint directly with “a court of competent
jurisdiction.” Id. § 1395ff(f)(3).
7 C. Local and National Coverage Determinations for Pneumatic Compression Devices, and Their Application to Mr. Greenwald’s Claim
The PCD prescribed by Mr. Greenwald’s physician is subject
to both a NCD and a LCD. The relevant NCD is published in CMS’s
Medicare Coverage Database. See Compl., ECF No. 26 ¶ 31; see
also CMS, Nat’l Coverage Determination for Pneumatic Compression
Devices, Pub. No. 100-3 § 280.6 (eff. Jan. 14, 2002) (“NCD
280.6”). The relevant LCD is also available on CMS’ website, and
is used by MACs serving most of the United States and its
territories. See Compl. ECF No. 26 ¶¶ 33–34, 40–45; Ex. A, ECF
No. 26-1 at 1 (“LCD L33829”) (listing the names and
jurisdictions of MACs using the LCD); see also Compl., ECF No.
26 ¶ 46 (asserting that the LCD is also used by private health
insurers under Medicare Part C, “even though these LCDs are not
binding on Medicare Advantage plans”). Both NCD 280.6 and LCD
L33829 purport to interpret the “reasonable and necessary”
requirement for Medicare coverage for PCDs. See 42 U.S.C. §§
1395ff(f)(1)(B), (f)(2)(B); LCD L33829 at 1 (“The purpose of
[this LCD] is to provide information regarding ‘reasonable and
necessary’ criteria[.]”). The problem, according to Mr.
Greenwald, is that NCD 280.6 and LCD L33829 conflict. See
Compl., ECF No. 26 ¶¶ 5, 6; Mem. of P. & A. in Supp. of Mot. for
Summ. J. and in Opp’n to Defs.’ Mot. to Dismiss (“Pl.’s Opp’n”),
8 ECF No. 29 at 29. Mr. Greenwald alleges the LCD “introduced new
legal standards for determining Medicare coverage that were not
included or mentioned in [the] NCD.” Id. at 24. These standards
are substantive, he says, because they add additional
requirements for coverage for a PCD instead of merely
interpreting the guidance in the NCD. See id. at 36; Surreply,
ECF No. 48 at 6. For this reason, when a MAC applied LCD L33829
to Mr. Greenwald’s claim for coverage for his PCD, the claim was
denied even though Mr. Greenwald insists it might have been
approved under the less restrictive NCD 280.6. See Compl., ECF
No. 26 ¶¶ 54–55, 57; Pl.’s Opp’n, ECF No. 29 at 26. That initial
determination was upheld at the redetermination stage, also
based on LCD L33829. See Compl., ECF No. 26 ¶ 56; see also
Compl. Ex. C, ECF No. 26-3 at 3.
D. Procedural Background
Mr. Greenwald did not request reconsideration of his
coverage redetermination. See Compl., ECF No. 26 ¶¶ 55–57; Mot.
to Dismiss, ECF No. 27-1 at 8–9. He instead brought this civil
action to challenge the overarching validity of LCD L33829. See
generally Compl., ECF No. 26. The suit is not an appeal of Mr.
Greenwald’s individual coverage determination, but a claim that
LCD L33829 is invalid as a general matter, whether applied to
Mr. Greenwald or to another. See id. at Prayer for Relief. Mr.
9 Greenwald’s theory is that, because LCD L33829 imposed new
substantive requirements for Medicare coverage for PCDs, the
Defendants were required to follow rulemaking procedures in the
Administrative Procedure Act and Social Security statutes. See
Pl.’s Opp’n, ECF No. 29 at 29; Surreply, ECF No. 48 at 6. Mr.
Greenwald asks this Court to conclude that LCD L33829 is invalid
as a matter of law because these procedures were not followed.
See id. Mr. Greenwald’s complaint was filed in April 2017. See
Compl., ECF No. 1. After several extensions of their time to
respond, Defendants filed a Rule 12 motion to dismiss Mr.
Greenwald’s complaint. See Mot. to Dismiss, ECF No. 20. Mr.
Greenwald amended his complaint soon thereafter. 3 See Compl., ECF
No. 26. This Court then dismissed the Defendants’ motion to
dismiss as moot, see Min. Order (Mar. 12, 2018); and Defendants
filed a renewed motion to dismiss Mr. Greenwald’s amended
complaint for lack of subject matter jurisdiction and failure to
state a claim. See Mot. to Dismiss, ECF No. 27-1. Mr. Greenwald
responded to the Defendants’ motion and moved for entry of
summary judgment. See Pl.’s Opp’n, ECF No. 29. The Court stayed
Mr. Greenwald’s summary judgment motion pending resolution of
3 Additional defendants named in Mr. Greenwald’s first complaint were dismissed by stipulation in August 2017. See ECF No. 16.
10 the Defendants’ renewed motion to dismiss and directed
Defendants to file their reply specifically for the motion to
dismiss. See Min. Order (Feb. 12, 2018). After Defendants filed
their reply, see Defs.’ Reply, ECF No.33; Mr. Greenwald
requested leave to file a sur-reply in further opposition to
Defendants’ motion to dismiss, see Mot. for Leave to File a Sur-
reply, ECF No. 34; which Defendants opposed, see Defs.’ Response
to Pl.’s Mot. for Leave to File Sur-Reply, ECF No. 35. This case
was referred to a Magistrate Judge for full case management, up
to but excluding trial, pursuant to Local Civil Rule 72.2. See
Min. Order (Mar. 30, 2018). Following the assignment of the case
to Magistrate Judge Meriweather, see Min. Entry (Mar. 30, 2018),
the parties filed two notices of supplemental authority and a
response thereto. See ECF Nos. 37, 38, 40. After reviewing these
initial briefs, Magistrate Judge Meriweather requested
supplemental briefing on an issue raised by the parties’
memoranda. See ECF No. 42. The parties’ responsive briefs were
filed in December 2020. See ECF Nos. 43, 44. On November 8,
2021, Magistrate Judge Meriweather entered an order granting Mr.
Greenwald’s motion for leave to fire a sur-reply. See Min. Order
(Nov. 8, 2021). Magistrate Judge Meriweather also issued a R. &
R. recommending that this Court grant Defendants’ motion to
dismiss for lack of subject matter jurisdiction. See ECF No. 49.
11 Mr. Greenwald objected to this conclusion, see Pl.’s Objs. ECF
No. 49; and Defendants filed a response thereto, see Defs.’
Resp. to Pl.’s Objs. to the Nov. 8, 2021 R. & R. (“Defs.’
Resp.”), ECF No. 51. The motion is ripe and ready for
adjudication.
II. Legal Standard
A. Objections to a Magistrate Judge's Report and Recommendation
Pursuant to Federal Rule of Civil Procedure 72(b), a party
may file specific written objections once a magistrate judge has
entered a recommended disposition. Fed. R. Civ. P. 72(b)(1)-(2).
A district court “may accept, reject or modify the recommended
disposition.” Fed. R. Civ. P. 72(b)(3); see also 28 U.S.C. §
636(b)(1) (“A judge of the court may accept, reject, or modify,
in whole or in part, the findings or recommendations made by the
magistrate judge.”). A district court “must determine de novo
any part of the magistrate judge's disposition that has been
properly objected to.” Fed. R. Civ. P. 72(b)(3). “If, however,
the party makes only conclusory or general objections, or simply
reiterates his original arguments, the Court reviews the [R. &
R.] only for clear error.” Houlahan v. Brown, 979 F. Supp. 2d
86, 88 (D.D.C. 2013) (citation omitted). “Under the clearly
erroneous standard, the magistrate judge's decision is entitled
to great deference” and “is clearly erroneous only if on the
12 entire evidence the court is left with the definite and firm
conviction that a mistake has been committed.” Buie v. D.C., No.
CV 16-1920 (CKK), 2019 WL 4345712, at *3 (D.D.C. Sept. 12, 2019)
(citing Graham v. Mukasey, 608 F. Supp. 2d 50, 52 (D.D.C. 2009))
(internal quotation marks omitted).
Objections must “specifically identify the portions of the
proposed findings and recommendations to which objection is made
and the basis for objection.” LCvR 72.3(b). “[O]bjections which
merely rehash an argument presented to and considered by the
magistrate judge are not ‘properly objected to’ and are
therefore not entitled to de novo review.” Shurtleff v. EPA, 991
F. Supp. 2d 1, 8 (D.D.C. 2013) (quoting Morgan v. Astrue, No.
08-2133, 2009 WL 3541001, at *3 (E.D. Pa. Oct. 30, 2009)).
B. Subject Matter Jurisdiction
Federal district courts are courts of limited jurisdiction
and “possess only that power conferred by [Article III of the]
Constitution and [by] statute.” Logan v. Dep’t of Veterans
Affairs, 357 F. Supp. 2d 149, 152 (D.D.C. 2004)
(quoting Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S.
375, 377, 114 S. Ct. 1673, 128 L. Ed. 2d 391 (1994)). “There is
a presumption against federal court jurisdiction and the burden
is on the party asserting the jurisdiction, the plaintiff in
this case, to establish that the Court has subject matter
13 jurisdiction over the action.” Id. at 153 (citing McNutt v. Gen.
Motors Acceptance Corp. of Ind., 298 U.S. 178, 182–83, 56 S. Ct.
780, 80 L. Ed. 1135 (1936)).
The requirement of “standing is an essential and unchanging
part of the case-or-controversy requirement of Article III.”
Lujan v. Defs. of Wildlife, 504 U.S. 555, 560, 112 S. Ct. 2130
(1992). “[T]he defect of standing is a defect in subject matter
jurisdiction.” Haase v. Sessions, 835 F.2d 902, 906 (D.C. Cir.
1987). There are three requirements for standing:
First, the plaintiff must have suffered an “injury in fact”—an invasion of a legally protected interest which is (a) concrete and particularized, and (b) “actual or imminent, not ‘conjectural’ or ‘hypothetical.’” Second, there must be a causal connection between the injury and the conduct complained of—the injury has to be “fairly . . . trace[able] to the challenged action of the defendant, and not . . . th[e] result [of] the independent action of some third party not before the court.” Third, it must be “likely,” as opposed to merely “speculative,” that the injury will be “redressed by a favorable decision.”
Lujan, 504 U.S. at 560–61 (citation omitted).
In assessing whether a complaint sufficiently alleges
subject matter jurisdiction, the Court accepts as true the
allegations of the complaint, see Ashcroft v. Iqbal, 556 U.S.
662, 678, 129 S. Ct. 1937 (2009); and liberally construes the
pleadings such that the plaintiff benefits from all inferences
14 derived from the facts alleged, Barr. v. Clinton, 370 F. 3d
1196, 1199 (D.C. Cir. 2004).
However, “[a] pleading that offers labels and conclusions
or a formulaic recitation of the elements of a cause of action
will not do. Nor does a complaint suffice if it tenders naked
assertions devoid of further factual enhancement.” Iqbal, 556
U.S. at 678 (citations, quotation marks and brackets omitted).
Consequently, “[a] claim invoking federal-question jurisdiction
under 28 U.S.C. § 1331 ... may be dismissed for want of subject
matter jurisdiction if it is not colorable, i.e., if it
is immaterial and made solely for the purpose of obtaining
jurisdiction or it is wholly insubstantial and
frivolous.” Arbaugh, 546 U.S. 500, 513 n.10, 126 S. Ct. 1235
(2006) (citation omitted); accord Tooley v. Napolitano, 586 F.3d
1006, 1009 (D.C. Cir. 2009) (citation omitted).
C. Rule 12(b)(6) Motion to Dismiss
A motion to dismiss pursuant to Federal Rule of Civil
Procedure 12(b)(6) tests the legal sufficiency of a complaint.
Browning v. Clinton, 292 F.3d 235, 242 (D.C. Cir. 2002). A
complaint must contain “a short and plain statement of the claim
showing that the pleader is entitled to relief, in order to give
the defendant fair notice of what the ... claim is and the
grounds upon which it rests.” Bell At. Corp. v. Twombly, 550
15 U.S. 544, 555, 127 S. Ct. 1955 (2007). While detailed factual
allegations are not required, a complaint must contain
“sufficient factual matter ... to state a claim to relief that
is plausible on its face.” Iqbal, 556 U.S. at 678 (quoting
Twombly, 550 U.S. at 570). When ruling on a Rule 12(b)(6)
motion, the Court “may consider only the facts alleged in the
complaint, any documents either attached to or incorporated in
the complaint and matters of which we may take judicial notice.”
EEOC v. St. Francis Xavier Parochial Sch., 117 F. 3d 621, 624
(D.C. Cir. 1997). In so doing, the court must give the plaintiff
the “benefit of all inferences that can be derived from the
facts alleged.” Kowal v. MCI Commc’ns Corp., 16 F.3d 1271, 1276
(D.C. Cir. 1994). “Threadbare recitals of the elements of a
cause of action, supported by mere conclusory statements” are
not sufficient to state a claim. Iqbal, 556 U.S. at 678. The
plaintiff must “give the defendant fair notice of what the . . .
claim is and the grounds upon which it rests.” Erickson v.
Pardus, 551 U.S. 89, 93 (2007) (quoting Twombly, 550 U.S. at
555).
III. Analysis
Mr. Greenwald argues that this Court has subject matter
jurisdiction over this matter under 28 U.S.C. § 1331 (federal
question jurisdiction) and 28 U.S.C. § 1346 (United States as
16 defendant), because it involves an agency of the United States
as a defendant, and because it involves the interpretation and
application of the laws of the United States, including the
Administrative Procedure Act and Title XVIII of the Social
Security Act, 42 U.S.C. §§ 1395 et seq. See Compl., ECF No. 26
¶ 10. He also asserts jurisdiction pursuant to 42 U.S.C.
§ 1395ff(f)(3), which authorizes judicial review of an LCD
without prior exhaustion of administrative remedies where there
are no material issues of fact in dispute. Id. ¶ 11. Defendants
respond that Mr. Greenwald is no longer seeking the relief that
his denied claim be reversed and covered under Medicare Part B,
and therefore has no stake in the outcome of this matter,
rendering federal question jurisdiction absent. See Defs.’ MTD,
ECF No. 27-1 at 13. Defendants also assert that this Court lacks
jurisdiction because Mr. Greenwald has not exhausted his
administrative remedies. Id. at 15.
Magistrate Judge Meriweather finds that Mr. Greenwald
cannot rely on 28 U.S.C. §§ 1331 and 1346, because Section
405(h) of the Social Security Act (as incorporated into the
Medicare Act through 42 U.S.C. § 1395ii) channels “most, if not
all, Medicare claims through agency review provisions,” unless
doing so would result in “complete preclusion of judicial
review,” which is not the case here, where the Medicare statutes
17 provide explicitly for judicial review of the agency’s final
determinations on both the issue of Mr. Greenwald’s individual
claim determination and the overarching validity of LCD L33829.
R. & R., ECF No. 47 at 10 (citation and quotation marks
omitted). As to jurisdiction under 42 U.S.C. § 1395ff(f)(3),
Magistrate Judge Meriweather finds that Mr. Greenwald has not
carried his burden of demonstrating that this case falls within
the limited jurisdictional grant of the statute, because the
“undisputed facts are insufficient to demonstrate whether NCD
280.6 and LCD L33829 conflict as a matter of law,” a conflict
which would render LCD L33829 invalid. Id. at 11. Mr. Greenwald
raises objections only as to Magistrate Judge Meriweather’s
findings on jurisdiction under 42 U.S.C. § 1395ff(f)(3).
A. Magistrate Judge Meriweather Erred In Concluding That This Court Lacks Jurisdiction Under 42 U.S.C. § 1395ff(f)(3)
Section 1395ff(f) provides for facial review of NCDs and
LCDs. See id. § 1395ff(f)(1), (2). Challenges brought under
§ 1395ff(f) are ordinarily reviewed by an ALJ, whose decision is
appealable to the DAB. Id. § 1395ff(2)(A)(i)–(ii). The DAB’s
decision constitutes final agency action subject to judicial
review. Id. § 1395ff(2)(A)(iv). But an aggrieved individual may
avoid the ordinary administrative review process and proceed
directly to a “court of competent jurisdiction” if “the moving
18 party alleges that (A) there are no material issues of fact in
dispute, and (B) the only issue of law is . . . that a
regulation, determination, or ruling by the Secretary is
invalid.” Id. § 1395ff(f)(3); see also Bailey v. Mut. of Omaha
Ins. Co., 534 F. Supp. 2d 43, 51 (D.D.C. 2008).
Here, the parties agree that the LCD at issue would be
invalid if it conflicts with the Medicare NCD for pneumatic
compression devices. R. & R., ECF No. 47 at 11. The relevant NCD
excludes coverage for a pneumatic compression device if
conservative treatment is shown to be effective, and states in
relevant part:
Pneumatic compression devices are covered in the home setting for the treatment of lymphedema if the patient has undergone a four-week trial of conservative therapy and the treating physician determines that there has been no significant improvement or if significant symptoms remain after the trial. The trial of conservative therapy must include use of an appropriate compression bandage system or compression garment, exercise, and elevation of the limb.
NCD 280.6, ECF No. 27-4. As Defendants acknowledge, “if a trial
of a compression bandage or garment leads to significant
improvement and relief of significant symptoms, there is no
Medicare coverage for pneumatic compression devices.” Defs.’
Resp., ECF No. 51 at 4.
19 The relevant LCD states as follows:
At the end of the four-week trial, if there has been improvement, then reimbursement for a [pneumatic compression device] is not justified. Where improvement has occurred, the trial of conservative therapy must be continued with subsequent reassessment at intervals at least a week apart. Only when no significant improvement has occurred in the most recent four weeks and the coverage criteria above are still met, may the lymphedema be considered unresponsive to conservative therapy, and coverage for a [pneumatic compression device] considered. CMS’ NCD for [pneumatic compression device] (280.6) instructs: “The determination by the physician of the medical necessity of a pneumatic compression device must include...symptoms and objective findings, including measurements which establish the severity of the condition.”
At a minimum, re-assessments conducted for a trial must include detailed measurements, obtained in the same manner and with reference to the same anatomic landmarks, prior to and at the conclusion of the various trials and therapy, with bilateral comparisons where appropriate.
LCD L33829, ECF No. 27-5. Explaining the LCD, Defendants state
that “if there has been improvement, but a patient is still
symptomatic, then the patient must continue the trial of
conservative therapy.” Defs.’ Resp., ECF No. 51 at 5. Magistrate
Judge Meriweather observes that “[t]he parties appear to agree
that LCD L33829 would be invalid if it is inconsistent with or
narrows NCD 280.6.” R. & R., ECF No. 47 at 11. However, “[t]hey
disagree on whether this Court can determine if the LCD and NCD
20 conflict without considering additional facts or expert
opinions.” Id. at 12. Magistrate Judge Meriweather concludes
that the Court requires additional facts to determine whether
NCD 280.6 and LCD L33829 conflict. Id. Specifically, Magistrate
Judge Meriweather states that:
[T]he Court is not equipped to assess the merits of [Plaintiff’s] theory without additional facts or expert opinions. The record in this case is too sparse to determine whether the coverage pathway required by the LCD conflicts with, or merely restates and interprets, the pre-coverage treatment requirements of the NCD. The parties have not provided the Court with adequate information about which symptoms associated with lymphedema and similar circulatory conditions are ‘significant,’ how their significance is measured, how improvement is documented and weighted, or whether any individuals would meet the conservative trial requirements of NCD 280.6 but not LCD L33829. Without that information, the undersigned cannot determine whether LCD conflicts with or is a substantive interpretation of NCD 280.6, and so recommends this Court dismiss Mr. Greenwald’s case, as it cannot exercise subject-matter jurisdiction under § 1395ff(f)(3).
R. & R., ECF No. 47 at 15-16. In response, Mr. Greenwald objects
that the question of whether the MACs lacked the legal authority
to impose new legal obligations or conditions for Medicare
coverage and payment through the LCD is purely a question of law
within the authority of this Court. Pl.’s Objs., ECF No. 49 at
3. The Court reviews the R. & R. only for clear error since Mr.
21 Greenwald’s argument is repeated from his filing in opposition
to the Motion to Dismiss. See Pl.’s Opp’n, ECF No. 29 at 28; see
also Houlahan, 979 F. Supp. 2d at 88 (“If, however, the party
makes only conclusory or general objections, or simply
reiterates his original arguments, the Court reviews the [R. &
R.] only for clear error.”) (Internal citation omitted). The
Court finds clear error here.
The critical question for the Court for the purposes of
subject matter jurisdiction is whether additional facts are
needed to determine if the LCD and NCD at issue conflict. The
potential conflict arises when a conservative therapy trial
leads to improvement, but significant symptoms remain. See Pl.’s
Objs., ECF No. 49 at 5; Defs.’ Resp., ECF No. 51 at 4. The
Medicare NCD clearly states two pathways to coverage: pneumatic
compression devices are covered if the treating physician
determines there has been no significant improvement or if
significant symptoms remain after the trial. NCD 280.6, ECF No.
27-4. As Mr. Greenwald points out, the LCD however, eliminates
the second phrase, by instead requiring that “[o]nly when no
significant improvement has occurred in the most recent four
weeks and the coverage criteria above are still met, may the
lymphedema be considered unresponsive to conservative therapy,
and coverage for a [pneumatic compression device] considered.”
22 LCD L33829. Thus, while the NCD ensures coverage for people who
continue to have significant symptoms after the trial,
regardless of improvement, the LCD restricts that coverage only
to people who have seen no significant improvement in the most
recent four weeks. This conflict is evident in the plain
language of the text, and additional facts or expert opinions
would not eliminate the conflict. As the R. & R. acknowledges,
“[t]he national rule requires on its face only one four-week
trial; the local rule might require several, potentially
prolonging a patient’s discomfort and health complications
considerably before the patient can obtain a PCD covered by
Medicare.” R. & R., ECF No. 47 at 15. The Court disagrees with
Magistrate Judge Meriweather that it needs to know “which
symptoms associated with lymphedema and similar circulatory
conditions are ‘significant,’ how their significance is
measured, how improvement is documented and weighted.” Id. at
15-16. The text makes amply clear that individuals who would
meet the conservative trial requirements of NCD 280.6 may not
satisfy LCD L33829 if they have had improvements in their
condition within the past four weeks. Any other conclusion would
make the plain language of NCD 280.6 surplusage and fail to give
it meaning, violating the fundamental tools of interpretation.
See, e.g., Bailey v. United States, 516 U.S. 137, 146 (1995)
23 (“We assume that Congress used two terms because it intended
each term to have a particular, nonsuperfluous meaning.”); see
also Colautti v. Franklin, 439 U.S. 379, 392 (1979)
(“Appellants’ argument . . . would make either the first or the
second condition redundant or largely superfluous, in violation
of the elementary canon of construction that a statute should be
interpreted so as not to render one part inoperative.”); Yates
v. United States, 135 S. Ct. 1074, 1085 (2015) (declining to
read statute so as to “significantly overlap” with a distinct
statute, resisting a reading that would “render superfluous an
entire provision passed in proximity as part of the same Act”).
The Court concludes that the LCD and NCD impermissibly conflict,
rendering LCD L33829 invalid and providing this Court with
jurisdiction under § 1395ff(f). The Court need not reach any
additional argument as to jurisdiction.
B. Mr. Greenwald Has Standing to Bring This Case
Because Magistrate Judge Meriweather determines that this
Court does not have subject matter jurisdiction, she does not
reach the issue of standing raised by Defendants in their Motion
to Dismiss. The Court therefore addresses it de novo. Defendants
argue that Mr. Greenwald lacks standing to bring this case
because he has failed to satisfy the redressability requirement
of standing. Defs.’ Reply, ECF No. 33 at 2. Specifically,
24 Defendants assert that even if the LCD were invalidated as Mr.
Greenwald requests, his sole injury, paying out of pocket for
the PCD, would not be redressed. Id. at 3. Defendants argue that
Mr. Greenwald’s ability to file future claims based on the NCD
rather than the LCD is too conjectural to be the basis of
redressability and add that even if the LCD and NCD conflict,
Mr. Greenwald “does not qualify for the pneumatic compression
device under the terms of the NCD,” and therefore has no
concrete stake in this lawsuit. Id. at 4-5. Mr. Greenwald
responds that he meets the statutory standing requirements in 42
U.S.C. § 1395ff(f)(5), which are only that he (1) be a Medicare
beneficiary who is (2) in need of the items or services that are
the subject of the coverage determination. Surreply, ECF No. 48
at 2. He further argues that he meets the Lujan standing
requirements since he suffered a concrete injury – the denial of
coverage for a pneumatic compression device through a LCD that
created new rules without the requisite process – and his injury
was caused solely and directly by the Secretary, who authorized
the publication of the LCD. Id. at 3. Mr. Greenwald adds that he
has a procedural right to challenge the LCD which comes with a
relaxed redressability standard. Id. Defendants reply that Mr.
Greenwald’s procedural right to file under section 1395ff(f)(5)
does not suffice for Article III standing, which requires a
25 concrete injury even in the context of a statutory violation.
Defs.’ Suppl. Brief, ECF No. 44 at 6-7. The Court concludes that
Mr. Greenwald has standing.
To demonstrate standing, a litigant must show that they
have suffered a concrete and particularized injury that is
either actual or imminent, that the injury is fairly traceable
to the defendant, and that it is likely that a favorable
decision will redress that injury. Massachusetts v. E.P.A., 549
U.S. 497, 127 S. Ct. 1438 (2007). However, when a litigant is
vested with a procedural right – here the right of Medicare
beneficiaries to directly challenge LCDs in a District Court
under 42 U.S.C. § 1395ff(f)(3) – that litigant has standing if
there is some possibility that the requested relief will prompt
the injury-causing party to reconsider the decision that
allegedly harmed the litigant. Id. Article III standing requires
a concrete injury even in the context of a statutory violation.
Thole v. U. S. Bank N.A, 140 S. Ct. 1615, 1619-20 (2020).
Defendants do not dispute that Mr. Greenwald has a
procedural right to challenge the LCD; they argue instead that
“Plaintiff’s procedural right to file under section 1395ff(f)(5)
does not suffice for Article III standing.” Defs.’ Suppl. Brief,
ECF No. 44 at 7. Defendants suggest that the reason Plaintiff’s
procedural right is insufficient is the lack of a concrete
26 injury, see id.; but it is indisputable that Plaintiff was
injured by having to pay for the PCD out of pocket. This case is
therefore distinct from Spokeo v. Robins, 136 S. Ct. 1540, 1549
(2016), where the Supreme Court held that plaintiff “could not,
for example, allege a bare procedural violation, divorced from
any concrete harm, and satisfy the injury-in-fact requirement of
Article III.”
It is also not the case, contrary to Defendants’
suggestions, that Mr. Greenwald lacks a concrete interest in the
case because he will not be compensated for his PCD if he
prevails. First, a favorable decision by the Court will redress
Mr. Greenwald’s past injury of having to pay out of pocket by
ensuring he is not in the future denied a PCD for his ongoing
chronic lymphedema because of an invalid LCD. Second, “[a
litigant] who alleges a deprivation of a procedural protection
to which he is entitled never has to prove that if he had
received the procedure the substantive result would have been
altered. All that is necessary is to show that the procedural
step was connected to the substantive result.” Sugar Cane
Growers Cooperative of Fla. v. Veneman, 289 F.3d 89, 94-95 (D.C.
Cir. 2002). Accordingly, Mr. Greenwald does not have to show
that he would receive Medicare coverage without an invalid LCD,
and “the Secretary’s contention that under the Medicare National
27 Coverage Determination for pneumatic compression devices Mr.
Greenwald would not qualify for Medicare coverage is pure
speculation and irrelevant to this case.” Surreply, ECF No. 48
at 5. This is especially true given that the record does not
reflect that any MAC relied on the NCD for any determination
affecting Mr. Greenwald. Additionally, the Court is cognizant
Defendants cannot “defeat standing merely by asserting that []
[they] will come to the same conclusion once the procedures are
satisfied on remand.” ADX Communications of Pensacola v. FCC,
794 F.3d 74, 82 (D.C. Cir. 2015) (citations omitted). Finally,
standing is supported by the fact that Mr. Greenwald continues
to suffer from lymphedema, such that the LCD represents an
ongoing harm. See, e.g., Friends of the Earth, Inc. v. Laidlaw
Envtl. Servs. (TOC), Inc., 528 U.S. 167, 184-86 (2000). The
Court concludes that Mr. Greenwald has standing to bring this
case.
Mr. Greenwald does not, however, have standing to bring
Count IV of his complaint, which alleges that the Secretary
violated the non-discretionary duty imposed by
42 U.S.C. § 1395ff(1). See Compl., ECF No. 26 at 21. Defendants
raise several arguments as to why Mr. Greenwald lacks standing
for this Count, none of which are addressed by Mr. Greenwald.
See generally Pl.’s Opp’n, ECF No. 29. The Court therefore
28 treats these arguments as conceded. See Bancoult v. McNamara,
227 F. Supp. 2d 144, 149 (D.D.C. 2002) (“[I]f the opposing party
files a responsive memorandum, but fails to address certain
arguments made by the moving party, the court may treat those
arguments as conceded, even when the result is dismissal of the
entire case.”).
IV. Conclusion and Order
For the foregoing reasons, the Court
ADOPTS IN PART and REJECTS IN PART Magistrate Judge
Meriweather’s R. & R., see ECF No. 49. The portion of the
R. &. R that is rejected is Magistrate Judge Meriweather’s
finding that there is no jurisdiction under 42 U.S.C. §
1395ff(f)(3); and further
GRANTS IN PART and DENIES IN PART Defendants’ Motion to
Dismiss, see ECF No. 27. The Motion is granted only as to Count
IV of the Complaint.
SO ORDERED.
Signed: Emmet G. Sullivan United States District Judge June 7, 2021