Texas Alliance for Home Care Services v. Sebelius
811 F. Supp. 2d 76
D.D.C.2011Background
- Congress directed CMS to implement the DME Bidding Program under MMA and to require financial standards for suppliers.
- PAOC and CMS hosted public meetings and issued proposed/final rules describing purposes and metrics for evaluating suppliers’ financial viability.
- MIPPA amended the MMA, delaying rounds and adding a supplier feedback mechanism for missing financial documents.
- Plaintiffs Texas Alliance for Home Care Services and Dallas Oxygen challenged the Secretary’s procedural process, lack of published standards, FOIA concerns, and alleged ultra vires actions.
- Round 1 of the DME Bidding Program proceeded in 10 areas; Round 1 rebid occurred after MIPPA changes; suit was filed May 10, 2010.
- The court dismissed the action for lack of subject-matter jurisdiction and for failure to state a claim, without allowing amendment to cure deficiencies.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether §1395w-3(b)(11) precludes judicial review of the Secretary’s financial standards | Plaintiffs argue review is not precluded. | Defendants contend the preclusion bars review of the bidding structure and financial standards. | Precluded; court lacks jurisdiction over the challenged action. |
| Whether plaintiffs have standing to challenge the rulemaking | Plaintiffs claim procedural injuries threaten their interests in bidding. | Defendants assert no concrete, causally linked injury to plaintiffs. | Lack of standing; plaintiffs fail to show concrete injury, causation, or redressability. |
| Whether notice-and-comment, publication, and ultra vires claims state a viable APA/FOIA challenge | Plaintiffs contend inadequate notice, nonpublication, and arbitrary action. | Defendants maintained adequate notice, publication, and compliance with statutes; no ultra vires conduct proven. | Claims fail; Secretary’s rulemaking satisfied notice/publication requirements and was not ultra vires. |
Key Cases Cited
- Bowen v. Mich. Acad. of Family Physicians, 476 U.S. 667 (1986) (preclusion and review dynamics in Medicare context)
- Ill. Council on Long-Term Care v. Leavitt, 529 U.S. 8 (2000) (preclusion and review scope under Medicare Part B contexts clarified)
- All Fla. Network Corp. v. United States, 82 Fed. Cl. 468 (Ct. Cl. 2008) (preclusion breadth in DME bidding program challenges)
- Amgen Inc. v. Smith, 357 F.3d 103 (D.C. Cir. 2004) (judicial review limits under preclusion provisions)