ANDREW AVERETT, M.D., et al., Plaintiffs-Appellees, v. UNITED STATES DEPARTMENT OF HEALTH AND HUMAN SERVICES, et al., Defendants-Appellants.
No. 18-5595
UNITED STATES COURT OF APPEALS FOR THE SIXTH CIRCUIT
Argued: March 21, 2019
Decided and Filed: November 25, 2019
File Name: 19a0288p.06
Before: GRIFFIN, KETHLEDGE, and THAPAR, Circuit Judges.
RECOMMENDED FOR FULL-TEXT PUBLICATION Pursuant to Sixth Circuit I.O.P. 32.1(b)
Appeal from the United States District Court for the Middle District of Tennessee at Nashville. No. 3:16-cv-02815—Matthew F. Leitman, District Judge.
COUNSEL
ARGUED: Laura E. Myron, UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C., for Appellants. Michael A. Cottone, BASS, BERRY & SIMS, PLC, Nashville, Tennessee, for Appellees. ON BRIEF: Laura E. Myron, Mark B. Stern, UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C., for Appellants. Michael A. Cottone, David A. King, David R. Esquivel, BASS, BERRY & SIMS, PLC, Nashville, Tennessee, for Appellees.
KETHLEDGE, Circuit Judge. A statute‘s terms are not ambiguous simply because the statute itself does not define them. Here, the Centers for Medicare and Medicaid Services interpreted the same phrase—“a physician with a primary specialty designation”—to have very different meanings in parallel provisions of the Affordable Care Act. The agency did so not because of any difference in context between the two provisions—instead their context is identical—but rather because the agency thought the different meanings made good policy sense. One of those meanings closely tracked the statute‘s terms; the other, set forth in the agency‘s “Final Medicaid Payment Rule,” assuredly did not. The plaintiffs here—all physicians—challenged that rule after the Tennessee Medicaid agency invoked it in an effort to “recoup” some $2.3 million in payments to them. In a carefully reasoned opinion, the district court granted summary judgment to the plaintiffs and declared the rule invalid. We affirm.
I.
A.
The Medicare program is funded and administered by the federal government; the Medicaid program is funded largely by the federal government but administered primarily by the states. In 1996, Congress directed the Secretary of Health and Human Services to create a “standard unique health identifier” for each “health care provider” participating in the Medicare and Medicaid programs and to “take into account” each provider‘s “specialty classifications.”
Congress enacted the Affordable Care Act in 2010. The Act provided for a temporary increase in payments to certain physicians who provided primary-care services to Medicare and Medicaid patients. To have been eligible for increased payments for those services under Medicare, a physician must have had “a primary specialty designation” of certain primary-care services (for example, “family medicine” or “internal medicine”).
In 2012, the Centers for Medicare and Medicaid Services (an agency within HHS) promulgated its “Final Medicare Payment Rule,” which without much fuss said that physicians who met the criteria specified in
But the agency gave an altogether different meaning to the phrase “a physician with a primary specialty designation” as used in the Medicaid provision. Specifically, in its “Final Medicaid Payment Rule,” the agency did not—as it did in the Final Medicare Payment Rule—interpret that phrase to refer simply to physicians who had designated, as their primary specialty, one of the specialties recited in
B.
The plaintiffs in this case are 21 physicians who practice family medicine in Tennessee, mostly in rural areas, and who received increased payments in 2013 and 2014 under the Medicaid provision described above. But in 2015 Tennessee‘s Medicaid agency, TennCare, brought an administrative action to “recoup” about $2.3 million of those payments—an average of more than $100,000 per physician. As grounds for the recoupment, TennCare alleged that the physicians had not met the 60-percent requirement of the Final Medicaid Payment Rule. The physicians then brought this lawsuit in federal court, seeking both a declaration that the 60-percent requirement is contrary to the terms of the Medicaid provision, and an injunction barring the requirement‘s enforcement against them. The district court granted summary judgment to the physicians, declared the Final Medicaid Payment Rule invalid, and enjoined the defendants from enforcing that rule against them. This appeal followed.
II.
We review the district court‘s decision de novo. See McMullen v. Meijer, Inc., 355 F.3d 485, 489 (6th Cir. 2004) (per curiam).
The statutory provision at issue states as follows:
[A state plan for medical assistance must provide] payment for primary care services . . . furnished in 2013 and 2014 by a physician with a primary specialty designation of family medicine, general internal medicine, or pediatric medicine at a rate not less than 100 percent of the payment rate that applies to such services and physician under part B of subchapter XVIII . . . .
As an initial matter, we address briefly the agency‘s argument—made without a single citation to precedent—that the district court‘s decision to invalidate the Final Medicaid Payment Rule is reversible on the ground that it does not “redress the plaintiffs’ injury.” Gov‘t Br. at 16. Specifically, the agency says, “invalidation of the regulation does not establish that plaintiffs are entitled to keep the enhanced payments they received pursuant to the regulation.”
As for the merits, we begin by asking whether, “employing traditional tools of statutory construction,” Congress has already answered the question presented—in the statute itself. See Chevron, U.S.A., Inc. v. Nat. Res. Def. Council, Inc., 467 U.S. 837, 842–43 & n.9 (1984). If so, “that is the end of the matter.” Id. at 842.
Here, nobody disputes the meaning of “primary specialty”; that term simply refers to the physician‘s principal area of practice or expertise. Nor is the meaning of “designate” hard to discern; in the sense employed here, it simply means “[t]o indicate or specify; point out.” See, e.g., The American Heritage Dictionary 506 (3d ed. 1992). Again nobody argues otherwise.
That leaves the question of who must do the designating. As to this question too there is not much dispute: in the relevant Medicare provision of the Affordable Care Act, as discussed above, Congress used precisely the same term—“primary specialty designation”—in precisely the same context of providing a temporary bump in payments to primary-care providers. See
We see no reason to conclude otherwise. As an initial matter, nobody assigns any significance to the fact that, for technical reasons, the relevant Medicare and Medicaid provisions of the Affordable Care Act were enacted in separate bills passed four days apart. Nor does the agency offer any actual interpretation of the statute in support of its reading of “primary specialty designation” as used in
Instead the agency offers only policy arguments. CMS argues as follows: “Congress did not define ‘primary specialty designation’ in either the Medicare or Medicaid” provisions; “[i]t was thus incumbent on the agency to give effect to the limitation of payments to providers with a ‘primary specialty designation‘”; and CMS did so by reading that term to mean one thing in the Medicare provision and a different, much more restrictive thing in the Medicaid provision. Gov‘t Br. at 20–21. (The agency based that more restrictive interpretation upon a perceived need to “verif[y]” the physician‘s designation of her specialty. 77 Fed. Reg. 66,674.) But the Medicare and Medicaid provisions are not merely starting points, from which the agency can then make the real policy choices. “Statutes are instead law, which are bounded in a meaningful sense by the words that Congress chose in enacting them.” United States v. Hughes, 733 F.3d 642, 646 (6th Cir. 2013) (emphasis added). The agency is seriously mistaken, therefore, to assert that “the statute . . . imposed no specific limitations on the agency‘s authority” to interpret the Medicaid provision as it did. Gov‘t Br. at 21. The “specific limitations” were the statute‘s words themselves. And here no one (the agency included, as to the Medicare provision) seems to be confused about what they mean.
The actual content of the Final Medicaid Payment Rule only underscores its lack of any statutory basis. Congress included a 60-percent-of-billings requirement in the Medicare provision (
In sum, “whatever its virtues or vices, Congress‘s prescribed policy here is clear[.]” Iancu, 138 S. Ct. at 1358. There is no 60-percent-of-billings requirement in
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The district court‘s judgment is affirmed.