Swedish American Hospital v. Sebelius
845 F. Supp. 2d 245
D.D.C.2012Background
- SAH sues HHS to review NPRs recouping nearly $5 million tied to GME/IME FTE caps.
- GME/IME reimbursements depend on FTE resident counts, reported via cost reports and NPRs with possible reopenings.
- BBA 1997 capped FTE counts; Congress delegated rulemaking to HHS with flexibility for rural needs.
- 1997/1998/1999/2001 rules created Affiliated Group Exception and other cap-sharing provisions; SAH and St. Anthony’s status debated.
- St. Anthony deferred training; SAH absorbed those residents; Mutual re-opened/reduced 1999–2002 NPRs; PRRB upheld reductions in 2008.
- Court denied SAH’s Rule 59(e) reconsideration in February 2012, affirming prior rulings on affiliates and rural treatment.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Affiliated Group Exception includes SAH and St. Anthony. | SAH and St. Anthony were affiliates under 1997 Final Rule. | They were not affiliates; no aggregate cap sharing. | No; SAH and St. Anthony not affiliates; exception not triggered. |
| Whether SAH qualifies for rural special consideration under § 413.86(g)(6)(iii). | Rockford is rural; special consideration should apply. | Program not new; rural exception does not apply. | Rockford not rural under 1997 rules; exception inapplicable. |
| Whether the court should reconsider based on new argument/clear error under Rule 59(e). | Challenges to congressional intent and caps were neglected. | Issues already ruled; no new evidence or controlling law. | Denied; arguments were previously decided; no intervening change. |
| Whether SAH’s program was new to trigger rural consideration. | Program should be treated as new due to shifts in residency. | Program predates 1995; not a new program. | Not a new program; rural consideration not required. |
Key Cases Cited
- Firestone v. Firestone, 76 F.3d 1205 (D.C. Cir. 1996) (Rule 59(e) reconsideration standards)
- Ciralsky v. Central Intelligence Agency, 355 F.3d 661 (D.C. Cir. 2004) (intervening change or manifest injustice standard)
- New York v. United States, 880 F. Supp. 37 (D.D.C. 1995) (reconsideration not a vehicle for reargument)
- Kattan v. District of Columbia, 995 F.2d 274 (D.C. Cir. 1993) (limits on reargument in Rule 59(e))
- W.C. & A.N. Miller Cos. v. United States, 173 F.R.D. 1 (D.D.C. 1997) (limitations on reconsideration motions)
- Heartland Reg’l Med. Ctr. v. Leavitt, 511 F. Supp. 2d 46 (D.D.C. 2007) (MSA-based urban area definition in this context)
- Heartland Reg’l Med. Ctr. v. Sebelius, 566 F.3d 193 (D.C. Cir. 2009) (affirms urban area interpretation of MSA-based rule)