Gentiva Healthcare Corp. v. Kathleen Sebelius
723 F.3d 292
D.C. Cir.2013Background
- Gentiva challenges HHS Secretary’s delegation of the ‘sustained or high level of payment error’ determination under 42 U.S.C. §1395ddd(f)(3).
- The Medicare Integrity Program may contract out certain functions under 42 U.S.C. §1395kk(a).
- Cahaba Safeguard Administrators reviewed Gentiva’s claims (Jul 1, 2005–Nov 30, 2006); found 58% partial denials and high payments per beneficiary.
- Cahaba determined a sustained/high level error and extrapolated overpayments of about $4.24 million, later revised to about $2.11 million after challenge.
- An ALJ upheld Cahaba’s overall methodology; Gentiva challenged ten more claims and the sampling/extrapolation method; the ALJ allowed the method.
- The Medicare Appeals Council accepted that the Secretary delegated the determination to a contractor, then Gentiva sought review in district court; the district court granted summary judgment for the Secretary under Chevron deference.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Secretary’s delegation of the determination is proper under §1395kk(a) | Gentiva argues no delegation for the screening determination. | Secretary may delegate under §1395kk(a) to contractors. | Yes; delegation permissible under Chevron framework. |
| Whether the merits of the ‘sustained or high level’ determination are reviewable | §1395ddd(f)(3) bars review of merits. | Chevron applies to agency interpretation; merits precluded from review. | Merits are not reviewable; no administrative or judicial review of such determinations. |
| Whether Chevron deference applies to the Secretary’s construction of §1395ddd(f)(3) | The statute unambiguously requires Secretary to decide, not a contractor. | Statute ambiguous; Secretary’s interpretation reasonable and entitled to deferential review. | Chevron applies; Secretary’s reading reasonable and upheld. |
Key Cases Cited
- Chevron U.S.A. Inc. v. NRDC, 467 U.S. 837 (1984) (establishes deference for ambiguous statutes and reasonable agency interpretations)
- U.S. Telecom Ass’n v. FCC, 359 F.3d 554 (D.C. Cir. 2004) (presumes permissible subdelegation absent contrary intent)
- Allied Local and Reg’l Mfrs. Caucus v. EPA, 215 F.3d 61 (D.C. Cir. 2000) (upholds agency interpretations under Chevron when reasonable)
- Nat’l Ass’n of Home Health Agencies v. Schweiker, 690 F.2d 932 (D.C. Cir. 1982) (describes broad scope of §1395kk(a) delegation)
- NetCoalition v. SEC, 715 F.3d 342 (D.C. Cir. 2013) (court can address de novo construction when statute limits review)