American Hospital Association v. Sylvia Burwell
421 U.S. App. D.C. 123
| D.C. Cir. | 2016Background
- Medicare has a four-step administrative appeals process (MAC redetermination, QIC reconsideration, ALJ hearing, DAB review) with statutory deadlines (60 days for MAC/QIC, 90 days for ALJ/DAB) and escalation remedies if deadlines are missed.
- Congress authorized and required a Recovery Audit Contractor (RAC) program to identify and recoup overpayments; RACs dramatically increased denials and appeals after full implementation in 2010.
- OMHA (ALJ office) backlog exploded: appeals rose from ~59,600 (2011) to ~384,000 (2013), producing multi-year delays (average ALJ decisions >500 days) despite agency efficiency improvements and modest staffing increases.
- Hospitals (including three named plaintiffs) contend delayed ALJ decisions (and automatic recoupment after QIC stage) deprive them of substantial funds, harming operations and patient care; many appeals succeed at the ALJ level.
- Plaintiffs sued for mandamus to compel the Secretary of HHS to meet statutory time frames; district court denied relief for lack of jurisdiction. The D.C. Circuit reversed and remanded, holding (1) the deadlines impose a clear statutory duty and (2) the district court must reassess equitable mandamus relief given worsening delays.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether statutory timeframes are mandatory and create a clear duty for mandamus | Time limits using "shall" and called "deadlines" are mandatory; plaintiffs have a right to timely decisions | Escalation remedies and practical limits mean deadlines are directory or provide adequate alternative remedies | Court: Deadlines are mandatory; a clear duty and right to demand compliance exist |
| Whether escalation and other remedies preclude mandamus jurisdiction | Escalation is inadequate here because systemic backlog makes escalation ineffective; district court or DAB review not timely or equivalent to ALJ de novo review | Escalation indicates Congress expected occasional delays and provides an alternative remedy; also discretionary resource allocation prevents mandamus | Court: Escalation is inadequate given systemic, widespread delay; does not defeat mandamus jurisdiction |
| Whether plaintiffs seek an impermissible programmatic reordering of agency priorities | Plaintiffs seek only timely decisions, not direction on how to run RAC program or specific resource allocations | Relief would be an intrusive programmatic attack forcing agency to curtail a statutorily mandated RAC program or reorder priorities | Court: Distinguishes programmatic-attack cases; seeking compliance with statutory deadlines is permissible and not barred |
| Whether equitable mandamus should issue now (discretionary) | Ongoing harms to hospitals and statutory clarity support issuing writ unless Congress or agency remedy the backlog promptly | Extraordinary nature of writ, separation-of-powers concerns, agency good-faith efforts, and Congress's ongoing consideration of reforms counsel against immediate issuance | Court: Jurisdiction exists; district court must reweigh equities on remand. If political branches fail to make meaningful progress by next appropriations cycle, writ likely required |
Key Cases Cited
- Power v. Barnhart, 292 F.3d 781 (D.C. Cir. 2002) (mandamus is drastic and requires showing clear and indisputable right)
- Telecommunications Research & Action Ctr. v. FCC, 750 F.2d 70 (D.C. Cir. 1984) (TRAC factors for evaluating agency delay)
- Norton v. Southern Utah Wilderness Alliance, 542 U.S. 55 (2004) (distinguishing programmatic attacks from suits compelling compliance with statutory deadlines)
- In re Aiken County, 725 F.3d 255 (D.C. Cir. 2013) (granting mandamus after Congress failed to act in a reasonable period)
- In re Barr Laboratories, Inc., 930 F.2d 72 (D.C. Cir. 1991) (denying relief where plaintiff sought to jump line among similarly situated applicants)
- Mashpee Wampanoag Tribal Council, Inc. v. Norton, 336 F.3d 1094 (D.C. Cir. 2003) (line-jumping and limits on mandamus relief)
- In re Medicare Reimbursement Litigation, 414 F.3d 7 (D.C. Cir. 2005) (threshold mandamus requirements are jurisdictional)