The National Association for Home Care & Hospice is considering its next move after a district judge threw out its lawsuit to block Medicare home health cuts.
“Currently, NAHC is evaluating its options on next steps,” NAHC said in a statement to members released Monday.
NAHC sued the Department of Health and Human Services in July 2023, challenging the methodology the Centers for Medicare & Medicaid Services used in calculating the budget neutrality adjustment for the Patient-Driven Groupings Model, which took effect in 2020. It also argued that in instituting the rate reductions, CMS violated the requirement that it eliminate use of therapy thresholds. The case was brought to the US District Court for the District of Columbia.
CMS has applied payment rate reductions of 3.925% and 2.89% in 2023 and 2024, respectively. Home health providers are awaiting a proposed home health rule for 2025; it is expected to be released this summer.
The district court said in its memorandum opinion issued Friday night that NAHC “failed to exhaust its administrative remedies” before filing a lawsuit. NAHC never requested an expedited judicial review and never provided a justification for skipping this important administrative step, according to the court.
NAHC assured its members that the court ruling merely delays the court’s consideration of NAHC’s challenge, not stop it.
“We are disappointed with the court’s ruling. However, it is a minor setback that we can readily overcome,” William Dombi, NAHC’s president and legal counsel to NAHC in the lawsuit, said in a statement. “Often justice delayed is justice denied. Here, we will have our day in court. This battle is far from over.”
NAHC intentionally skipped the “request for expedited judicial review” step because “the full panoply of appeal steps generally takes an extended period, possibly years, and providers are struggling with the rate cuts today,” the association said in its statement.
The association also argued in its lawsuit that these appeals would be futile because “no administrative body has the authority to rule in [NAHC’s] favor.” However, the court maintained that NAHC must demonstrate that the expedited judicial review step specifically would be futile.
Two positive takeaways from the court’s ruling, according to NAHC: The court specifically held that NAHC could challenge the budget neutrality adjustment methodology once administrative remedies are exhausted. And the court did not rule on or evaluate the merits of the NAHC claim that the methodology violated Medicare law.
Several options remain for NAHC following the court’s decision. The association could appeal the court’s opinion regarding the exhaustion of administrative appeals. Alternatively, NAHC could pursue a request for judicial review with CMS. In the event an expedited judicial review is granted — a highly likely outcome, NAHC noted — NAHC would “essentially refine the same lawsuit” it had initially presented, it said.
