Saint Francis Medical Center v. Becerra

CourtDistrict Court, District of Columbia
DecidedSeptember 27, 2023
DocketCivil Action No. 2022-1960
StatusPublished

This text of Saint Francis Medical Center v. Becerra (Saint Francis Medical Center v. Becerra) is published on Counsel Stack Legal Research, covering District Court, District of Columbia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Saint Francis Medical Center v. Becerra, (D.D.C. 2023).

Opinion

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

SAINT FRANCIS MEDICAL CENTER, et al.

Plaintiffs, Case No. 1:22-cv-1960-RCL v. Case No. 1:22-cv-1964-RCL (consolidated) XAVIER BECERRA, Secretary, United States Department of Health and Human Services,

Defendant.

MEMORANDUM OPINION

Plaintiff-hospitals (“Hospitals”) bring this action challenging their total Medicare inpatient

hospital operating payments for fiscal years 2019, 2020, and 2021. Before the Court are the

Hospitals’ Motion for Partial Summary Judgment, ECF No. 15-1, and defendant Secretary of the

United States Department of Health and Human Services’ (“Secretary’s”) Cross-Motion to

Dismiss for Lack of Jurisdiction, ECF No. 18-1. Upon consideration of the parties’ briefing, the

record, and the applicable law, this Court will DENY the Hospitals’ motion and GRANT the

Secretary’s motion.

I. BACKGROUND

The Hospitals raise predicate fact challenges to Medicare Hospital Inpatient Prospective

Payment System (“IPPS”) payments for fiscal years 2019, 2020, and 2021. Compl. ¶¶ 1–7, ECF

No. 1; see generally Kaiser Found. Hosps. v. Sebelius, 708 F.3d 226, 232–33 (D.C. Cir. 2013);

Saint Francis Med. Center v. Azar, 894 F.3d 290, 291–92 (D.C. Cir. 2018). 1

1 Case No. 22-cv-1964 was consolidated with Case No. 22-cv-1960 on September 1, 2022. ECF No. 10. The Court cites to the Complaint filed in 22-cv-1960. Additionally, because the procedural history of these two suits is substantially similar, the Court will describe the case’s procedural background in general terms. This is consistent with the practice of both parties.

1 The Hospitals’ allege that the Secretary calculated payments for these years using

“invalidly low standardized amounts.” Compl. ¶ 1 (internal quotation marks omitted).

Standardized amounts provide “fundamental methodological building block[s]” for calculating

IPPS payments. Compl. ¶ 2. Standardized amounts are not recalculated from scratch each fiscal

year. Compl. ¶ 2. Instead, the Secretary carries forward the previous year’s standardized amounts

after applying certain adjustments. Compl. ¶ 2. The standardized amounts at issue here trace back

to when the Secretary originally calculated standardized amounts for fiscal year 1984. Compl. ¶ 2.

The Hospitals allege that the Secretary’s calculations for fiscal year 1984 were impermissibly low

and that this understatement has infected the Secretary’s calculations for all subsequent fiscal

years, including 2019, 2020, and 2021. Compl. ¶ 2. The Hospitals initiated their predicate fact

challenges by filing group appeals before the Provider Review Reimbursement Board (the

“Board”). Compl. ¶ 58.

On August 10, 2020, the Hospitals requested expedited judicial review (“EJR”) of their

claims. Compl. ¶ 61. EJR permits parties to bypass the Board hearing process in cases where the

Board “is without authority” to decide a “question of law or regulations relevant to the matters in

controversy.” 42 U.S.C. § 1395oo(f)(1). EJR requests are directed to the Board. Id. If the Board

fails to render a determination on EJR within the period required by law—ordinarily, thirty

days—then the party requesting EJR may bypass the Board entirely and file a civil action in the

appropriate United States District Court. Id. In their request, the Hospitals argued that they were

entitled to EJR because the Board had jurisdiction to hear their appeals but lacked authority to

decide the validity of the Secretary’s regulations concerning IPPS. Compl. ¶¶ 60–61, 63. In

response, the Board homed in on the issue of jurisdiction and requested “significant supplemental

briefing” on whether 42 U.S.C. § 1395ww(d)(7) renders the Hospitals’ claims administratively

2 and judicially unreviewable. Compl. ¶ 62. The parties spent approximately three months briefing

the jurisdictional issue. See Compl. ¶ 62.

The Board denied the Hospitals’ first EJR request with leave to refile on October 27, 2021.

Compl. ¶ 64. Simultaneously with the denial, the Board requested that the parties respond to

several questions “addressing both whether EJR is appropriate as well as whether the Board has

jurisdiction.” Compl. ¶ 64 (internal quotation marks omitted). The Centers for Medicare and

Medicaid Services Administrator declined to review the Board’s decision denying the first EJR

request on December 22, 2021. Compl. ¶ 65. The Hospitals responded to the Board’s requests for

information on February 4, 2022. Saint Francis Administrative Record 290–352; UCMC

Administrative Record 268–308. 2

On April 8, 2022, the Hospitals requested EJR for the second time. Compl. ¶ 66. In

response, the Board stated that it would not rule on the second EJR request within thirty days and

that “the 30-day period for responding to the EJR request is stayed for these group appeals.”

Compl. ¶ 67 (internal quotation marks omitted). The Board did not issue a determination

respecting the second EJR request within the thirty-day period after the Hospitals filed their second

EJR request. Compl. ¶ 73. On July 6, 2022, while the Board’s review of the second EJR request

was still outstanding, the Hospitals filed the two lawsuits that are presently consolidated before

this Court. The Hospitals claim that they are entitled to file suit in this Court because the Board

failed to act within the statutorily prescribed period for responding to their second EJR request.

Compl. ¶ 6.

2 The administrative records for these consolidated cases are located in the multi-volume joint appendix available at ECF No. 32.

3 The Hospitals moved for partial summary judgment on October 28, 2022. Pls.’ MSJ, ECF

No. 15-1. 3 They ask the Court “to confirm that they were entitled to file these [consolidated]

actions under 42 U.S.C. § 1395oo(f)(1).” Pls.’ MSJ at 10–11. In the alternative, they ask the Court

to exercise its mandamus powers to compel the Board to decide the jurisdiction issue within ten

days following remand. Pls.’ MSJ at 11. The Secretary opposed and cross-moved to dismiss. Def.’s

MTD, ECF Nos. 18-1, 19. 4 The Secretary argues that the Court lacks subject matter jurisdiction to

hear the merits of the Hospitals’ claims because the Hospitals failed to exhaust their administrative

remedies. Pls.’ MSJ at 25–47. The Secretary further argues that the Hospitals are not entitled to

mandamus relief. Pls.’ MSJ at 47–49. The Hospitals opposed the Secretary’s motion to dismiss

and replied in support of their motion for partial summary judgment. Pls.’ Reply, ECF Nos. 23,

24. 5 The Secretary replied in support of his motion to dismiss. Def.’s Reply, ECF No. 27.

Earlier this year, after the parties completed their motions briefing, the Board dismissed

several substantively identical group appeals for lack of jurisdiction. ECF Nos. 30, 33. The Board

issued a written decision in which it explained that “it lacks substantive

jurisdiction . . . because . . . 42 U.S.C.

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