80 F.4th 346
D.C. Cir.2023Background
- Medicare’s inpatient prospective payment includes a Disproportionate Share Hospital (DSH) adjustment based on a hospital’s “Medicare fraction,” which counts patient days for Medicare Part A beneficiaries who are “entitled to supplementary security income benefits … under subchapter XVI.”
- HHS calculates the Medicare fraction using SSA-provided monthly indicators that mark whether an inpatient was coded as receiving SSI cash payments (codes C01, M01, M02); HHS does not receive or provide the underlying month-by-month SSA reason codes.
- Over 200 hospitals challenged CMS’s DSH calculations for FY2006–2009, arguing “entitled to … SSI benefits” should include all SSI enrollees (even when not paid that month) because SSI enrollment confers other benefits (Medicare Part D subsidy, Ticket to Work vocational services).
- HHS (CMS) treats “entitled to … SSI benefits” as limited to those actually entitled to the monthly SSI cash payment in the month at issue and uses SSA’s C01/M01/M02 indicators for counting.
- The hospitals also challenged the matching process as arbitrary (including arguments about cross‑program recovery and certain SSA codes) and sought mandamus relief compelling HHS to provide the full SSA payment/reason codes under MMA §951.
- The district court granted summary judgment for HHS; the D.C. Circuit affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Meaning of “entitled to supplementary security income benefits … under subchapter XVI” | Phrase covers all SSI enrollees at hospitalization, even if not receiving the monthly cash payment (because SSI enrollment yields Part D and vocational benefits). | The phrase refers to the monthly cash payment under subchapter XVI; HHS counts only patients coded as receiving the cash payment (C01/M01/M02). | Affirmed HHS: the phrase means the SSI monthly cash benefit only; Part D and Ticket to Work are not benefits “under subchapter XVI.” |
| Applicability of Empire (Becerra) analogy | Empire’s reading of “entitled to benefits under Part A” implies the adjacent SSI phrase should likewise be read to cover broader entitlement beyond payment decisions. | Empire concerned ongoing Part A entitlement; SSI eligibility is month‑to‑month and the statutory scheme focuses on cash payments, so the analogy fails. | Court distinguished Empire and rejected hospitals’ analogy. |
| Arbitrary-and-capricious challenge to HHS’s matching (incl. cross‑program recovery; S and E02 codes) | HHS improperly excluded certain SSI recipients (e.g., benefits withheld for cross‑program recovery) and ignored other relevant codes. | SSA’s coding shows cross‑program recovery recipients remain coded C01/M01/M02; arguments about other codes were raised too late or lack merit. | Court held HHS’s matching was reasonable; cross‑program recoveries are counted and late‑raised claims (S, E02) were not considered. |
| Mandamus request to compel production of SSA payment/reason codes under MMA §951 | Section 951 requires HHS to provide the data necessary to compute DSH fractions, which includes the underlying SSA payment/reason codes so hospitals can re‑compute results. | HHS already provided the matched indicators it received; SSA never provided the individual SSA reason codes to HHS, and §951 does not unambiguously require release of data HHS never received. | Mandamus denied. §951 does not compel HHS to produce SSA’s month‑by‑month reason codes; hospitals have not shown the extraordinary circumstances required for mandamus. |
Key Cases Cited
- Becerra v. Empire Health Found., 142 S. Ct. 2354 (2022) (interpreting “entitled to benefits under part A” in Medicare‑fraction context and distinguishing ongoing Part A entitlement from other schemes)
- Sebelius v. Auburn Reg’l Med. Ctr., 568 U.S. 145 (2013) (explaining DSH adjustment purpose to compensate hospitals serving unusually high percentages of low‑income patients)
- Cape Cod Hosp. v. Sebelius, 630 F.3d 203 (D.C. Cir. 2011) (context on Medicare prospective payment encouraging efficiency)
- Gustafson v. Alloyd Co., 513 U.S. 561 (1995) (identical words in different parts of the same statute are presumed to bear the same meaning)
- Fornaro v. James, 416 F.3d 63 (D.C. Cir. 2005) (mandamus is an extraordinary remedy)