BRIDGEPORT HOSPITAL, et al., v. XAVIER BECERRA, in his official capacity as Secretary of Health and Human Services
UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA
March 2, 2022
In 2019, the Department of Health and Human Services promulgated a regulation to address wage disparities among hospitals. The regulation increases the amount hospitals in certain low-wage geographic areas receive in Medicare-reimbursement payments and offsets that increase by reducing reimbursement payments for all hospitals. A group of hospitals filed this lawsuit challenging the regulation on several grounds. See generally Compl., ECF No. 1. Those hospitals have since moved for summary judgment, see Pls.‘s Mot. for Summ. J. (“Pls.‘s Mot.”), ECF No. 14, and the government has cross-moved for summary judgment, see Def.‘s Cross-Mot. for Summ. J. (“Def.‘s Mot.”), ECF No. 16. For the reasons explained below, the Court grants the hospitals’ motion in part, denies the government‘s cross-motion, and orders additional briefing on the issue of the appropriate remedy in light of this Memorandum Opinion.
I. Statutory & Regulatory Background
Title XVIII of the
For the first two decades after its passage in 1965, Medicare reimbursed hospitals providing inpatient services based on the actual costs of the services, assuming they were within certain limits. See
In general terms, HHS relies on a base payment rate (known as the “standardized amount”) tied to the national average cost of treating any given ailment. See Centra Health, Inc. v. Shalala, 102 F. Supp. 2d 654, 656 (W.D. Va. 2000); Adventist GlenOaks Hosp., 663 F.3d at 941. The standardized amount consists of both a “non-labor-related” portion and a “labor-related” portion. Centra Health, Inc., 102 F. Supp. 2d at 656. The non-labor-related portion involves the Medicare beneficiary‘s diagnosis among other considerations. Id. The labor-related portion consists of the proportion “of hospitals’ costs which are attributable to wages and wage-related costs.”
Congress recognized that hospitals operate in geographic regions with different wage and labor costs. See Dignity Health, 243 F. Supp. 3d at 45; Robert Wood Johnson Univ. Hosp. v. Thompson, 297 F.3d 273, 275 (3d Cir. 2002) (“In order to account for wide variations in the cost of labor across the country, the amount of a hospital‘s payment under the PPS will vary depending on its location.”). Congress thus required HHS to adjust a component of the labor-related portion of the standardized amount based on “the difference between hospitals’ local wages and wage-related costs and the national average.”
Specifically,
[T]he Secretary shall adjust the proportion, (as estimated by the Secretary from time to time) of hospitals’ costs which are attributable to wages and wage-related costs, of the DRG prospective payment rates computed under subparagraph (D) for area differences in hospital wage levels by a factor (established by the Secretary)
reflecting the relative hospital wage level in the geographic area of the hospital compared to the national average hospital wage level. . . . [A]t least every 12 months . . . the Secretary shall update the factor under the preceding sentence on the basis of a survey conducted by the Secretary (and updated as appropriate) of the wages and wage-related costs of subsection (d) hospitals in the United States.
“The wage index must be updated each year ‘on the basis of a survey’ of the wage-related costs for hospitals in the United States.” Anna Jacques Hosp. v. Burwell, 797 F.3d 1155, 1158 (D.C. Cir. 2015). To satisfy that requirement, HHS has hospitals submit their wage-and-hour data on an annual basis. See Robert Wood Johnson Univ. Hosp., 297 F.3d at 276 (“The wage index is updated each year based on hourly wage data collected from the hospitals.”); see also Adventist GlenOaks Hosp., 663 F.3d at 941 (noting that HHS “requires hospitals to report all paid hours, including paid lunch hours, overtime hours, paid holiday, vacation and sick leave hours, paid time-off hours, and hours associated with severance pay.”). HHS then compiles those data and publishes a document “containing the cost data from all hospitals in a given area.” See Dignity Health, 243 F. Supp. 3d at 47. After revising the data to account for corrections, the agency publishes a wage index in the federal register. Id.; Baystate Franklin Med. Ctr. v. Azar, 950 F.3d 84, 86 (D.C. Cir. 2020). The agency then uses the data “to create the wage
The wage data from each hospital therefore affect “the ultimate wage index for all hospitals, . . . and thus data errors or omissions by one hospital can” affect reimbursement “rates
for other hospitals.” Baystate Franklin Med. Ctr., 950 F.3d at 87 (quotation omitted). Beginning in 1991, Congress directed that the annual update to the wage index must not increase aggregate payments made to hospitals providing care to Medicare beneficiaries. See
When a hospital objects to a payment it has received, it may appeal the decision to the Provider Reimbursement Review Board, which Congress established to hear Medicare reimbursement disputes. See
An action brought in federal court under the expedited judicial review process “shall be tried pursuant to the applicable provisions under chapter 7 of title 5” of the U.S. Code.
II. Factual Background
In 2018, HHS invited public comment on potential changes to how the agency calculates the wage index. See 83 Fed. Reg. 20164 (May 7, 2018). Concern in part over what the agency described as the “downward spiral” motivated the contemplated action. 84 Fed. Reg. 19158, 19394 (May 3, 2019). The downward spiral refers to a scenario in which higher wage hospitals, by virtue of higher Medicare reimbursement payments, can afford to pay wages that keep them higher on the wage index; whereas lower wage hospitals, by virtue of lower Medicare payments, cannot afford to pay wages that allow them to ascend the index. Id. As the agency sees it, the spiral (though perhaps better described as a perpetual cycle) tends to keep higher wage hospitals in the higher end of the wage index and lower wage hospitals in the lower end.
In response to HHS‘s request for comment, several commentators echoed the agency‘s concern that how the agency calculates the wage index exacerbates disparities between and among hospitals in high- and low-wage areas. Id. In light of the comments, the agency agreed that the downward spiral, together with a “lag between when hospitals increase the compensation and when those increases are reflected in the calculation of the wage index,” does in fact exacerbate those disparities. 84 Fed. Reg. 19158, 19394–95 (May 3, 2019).
To mitigate these disparities, HHS first proposed “increasing wage index values for certain low wage index hospitals with low wage index values and decreasing the wage index values for certain hospitals with high wage index values to maintain budget neutrality.” Id. at 19162. In particular, the agency proposed inflating the wage index value of the hospitals in the lowest quartile by half the difference between (a) those hospitals’ actual, wage index value and (b) the 25th percentile of all wage index values. Id. at 19394–95. To illustrate, assuming a hospital in a particular geographic area would have had a wage index value of 0.5, and assuming the 25th percentile wage index value is 0.8, under the proposal the agency would apply a wage index value of 0.65 to that hospital. See 84 Fed. Reg. 42044, 42326 (Aug. 16, 2019). Though the agency proposed decreasing the wage index values for hospitals in the top quartile to maintain budget neutrality, it also discussed an alternative adjustment, which would “apply[ ] a budget neutrality factor to the standardized amount rather than focusing the adjustment on the wage index of high wage index hospitals.” Id. at 42338. In other words, instead of opting to reduce the wage index value for the top quartile of hospitals, HHS‘s alternative was to adopt a payment reduction scheme that would apply across the board.
The agency‘s proposed rule—and what it called the “low wage index hospital policy”—received its share of pushback. Commentators targeted what they termed the “redistribution policy.” They also targeted the ways in which HHS intended to maintain budget neutrality. Notwithstanding these objections, HHS adopted, in the Final Rule challenged here, the proposal to adjust the wage index values of the hospitals in the bottom quartile. In doing so, HHS determined that “quartiles are a reasonable method of dividing the distribution of hospitals’ wage index values” and that “identifying hospitals in the lowest quartile as low wage index hospitals . . . is a reasonable method of determining low wage index hospitals for purposes of . . .
HHS did not, however, adopt the approach of decreasing the wage index values for only hospitals in the top quartile. HHS opted instead to finalize the alternative proposal, i.e., “a budget neutrality adjustment to the national standardized amount for all hospitals so that the increase in the wage index for low wage index hospitals . . . is implemented in a budget neutral manner.” See 84 Fed. Reg. 42044, 42331 (Aug. 16, 2019). Stated differently, HHS decreased the standardized amount that all hospitals receive for reimbursements to offset the additional amount hospitals in the bottom quartile receive. The agency also stated its intention to continue with the low wage index hospital policy for at least four years. See id. at 42048 (“[T]his policy will be effective for at least 4 years, beginning in [FFY] 2020, in order to allow employee compensation increases implemented by these hospitals sufficient time to be reflected in the wage index calculation.”).
The Final Rule took effect on October 1, 2019. See id. at 42044. A number of hospitals located throughout the country grouped together to file an appeal with the Provider Reimbursement Review Board challenging the Rule and its effects on their 2020 reimbursement payments. See generally Compl. The hospitals also sought expedited judicial review, contending that the Board lacked authority to decide the validity of the low wage index hospital policy. See generally Compl., Ex 1, ECF No. 1-1 at 11. The Board agreed, granting the hospitals’ request for expedited judicial review. Id.
The hospitals filed this lawsuit within sixty days, see
III. Jurisdiction
The Court starts with Article III standing. See Colorado River Water Conservation Dist. v. United States, 424 U.S. 800, 817 (1976) (federal courts have a “virtually unflagging obligation . . . to exercise the jurisdiction given them”). The Constitution of the United States limits the “judicial Power” to resolving “Cases” and “Controversies.”
plaintiff‘s standing must be analyzed with reference to the particular claim made.”); see generally Canaday v. Anthem Companies, Inc., 9 F.4th 392, 396 (6th Cir. 2021).
The hospitals allege that, in order to adopt the low wage index hospital policy in a budget-neutral manner, HHS reduced the standardized amount to which they are otherwise entitled. In other words, they contend that they have and will continue to receive lower payments because of the reduction to the standardized amount. The government halfheartedly argues that this injury is not traceable to the low wage index hospital policy.5 In its view, the hospitals that brought this lawsuit do not fall in the bottom quartile, which means that they lack standing to challenge that policy because they neither benefit from nor are harmed by it. Instead, as the government sees it, the hospitals may challenge only the “separate budget neutrality policy.” See Def.‘s Mot. at 27.
But the two policies are inextricably linked. After all, HHS did not simply reduce the standardized amount, nor is there any suggestion that it would have done so independently. Instead, the agency expressly adopted that reduction as “a budget neutrality adjustment to the national standardized amount for all hospitals so that the increase in the wage index for low wage index hospitals . . . is implemented in a budget neutral manner.” See 84 Fed. Reg. 42044, 42331 (Aug. 16, 2019). Indeed, HHS appears to have believed that it was required to take some action to maintain budget neutrality because the low wage index hospital policy would increase payments to the hospitals in the bottom quartile. And the Rule couples the low wage index hospital policy and the reduction to the standardized amount. Indeed, the government all but conceded this point at oral argument when it admitted that a “linkage” exists between the two.
None of the cases cited by the government suggests a different result. In White v. Bank of America, for example, the court dismissed challenges to two bank policies because the plaintiff could not show that either policy deterred her from using the bank‘s services. 200 F. Supp. 3d 237, 243–44 (D.D.C. 2016). That case says nothing about whether a court can decouple an agency‘s decision to reduce payments from the policy that caused the agency to adopt the reduction. The same goes for Anson General Hospital v. Azar, 801 F. App‘x 273 (5th Cir. 2020). There, the court dismissed the case without any discussion of standing because the statute did not permit a challenge to another hospital‘s wage index data outside of the established wage data correction process. Id. at 278. Here, by contrast, the hospitals challenge a decision that affects the payments they receive, and they have brought their challenge in the manner required by
IV. The Summary Judgment Standard
A court may grant summary judgment “if the movant shows that there is no genuine dispute as to any material fact and that the movant is entitled to judgment as a matter of law.”
V. Standard of Review
The APA provides that a “reviewing court shall . . . hold unlawful and set aside agency action, findings, and conclusions found to be . . . in excess of statutory jurisdiction, authority, or limitations, or short of statutory right.”
An agency‘s rule promulgated through the notice-and-comment rule-making process may in some instances receive Chevron deference. See Toledo Hospital, 2021 WL 4502052, at *6. Step one of the Chevron framework requires courts to explore whether “Congress has spoken
directly to the precise question at issue,” and if so, courts “must give effect to [Congress‘s] unambiguously expressed intent.” Chevron, U.S.A., Inc. v. Nat. Res. Def. Council, Inc., 467 U.S. 837, 842–43 (1984); Util. Air Regul. Grp. v. E.P.A., 573 U.S. 302, 328 (2014) (“[A]n agency may not rewrite clear statutory terms to suit its own sense of how the statute should operate.”).7 Put differently, the analysis ends at step one unless a court, “employing traditional tools of statutory construction, is left with an unresolved ambiguity.” Epic Sys. Corp. v. Lewis, 138 S. Ct. 1612, 1630 (2018) (quotation omitted). Assuming that the statute is sufficiently ambiguous, Barnhart v. Walton, 535 U.S. 212, 218 (2002), step two of the Chevron framework directs courts to consider whether the agency‘s interpretation “is based on a permissible construction of the statute,” Chevron, 467 U.S. at 843. If so, courts will defer to the agency‘s interpretation. See Adirondack Med. Ctr. v. Sebelius, 740 F.3d 692, 696 (D.C. Cir. 2014).
In the specific context of Medicare, courts have recognized that broad deference may be warranted because Medicare constitutes “a complex and highly technical regulatory program.” Thomas Jefferson Univ., 512 U.S. at 512 (quotation omitted); Good Samaritan Hosp. v. Shalala, 508 U.S. 402, 419 (1993).
VI. The Statute Does Not Permit HHS to Promulgate the Low Wage Index Hospital Policy
The hospitals contend that the Rule is inconsistent with the Medicare statute. As the hospitals see it, the statute requires HHS to calculate the wage index based on data collected
through surveys, and the agency‘s decision to inflate the wage values of the hospitals in the bottom quartile based on policy considerations runs contrary to the statutory text. The Court agrees.
To return to the statute,
[T]he Secretary shall adjust the proportion, (as estimated by the Secretary from time to time) of hospitals’ costs which are attributable to wages and wage-related costs, of the DRG prospective payment rates computed under subparagraph (D) for area differences in hospital wage levels by a factor (established by the Secretary) reflecting the relative hospital wage level in the geographic area of the hospital compared to the national average hospital wage level. . . . [A]t least every 12 months . . . the Secretary shall update the factor under the preceding sentence on the basis of a survey conducted by the Secretary (and updated as appropriate) of the wages and wage-related costs of subsection (d) hospitals in the United States.
HHS is thus required to adjust the “proportion” of the payment “attributable to wages and wage-related costs” for “area differences in hospital wage levels.” Id. To account for such differences, HHS is required to establish a “factor” that “reflect[s] the relative hospital wage level in the geographic area of the hospital compared to the national average.” Id. (emphasis added). And the agency must “update the factor . . . on the basis of a survey
The statutory language confirms several points relevant here. First, and as the government conceded at oral argument, the use of the definite article “the” in the phrase “the national average hospital wage level” means that in any particular year there is a single national average hospital wage level; that single national level establishes the baseline. See Minute Order, February 15, 2022. Second, Congress‘s other “use[s] of the singular—‘the proportion’ and ‘a factor’—indicate[ ] that the wage index must be uniformly determined and applied.” Atrium Med. Ctr. v. U.S. of Health & Hum. Servs., 766 F.3d 560, 569 (6th Cir. 2014). Third, the requirement that the agency rely on survey data implies (at the least) that the agency‘s wage index “must in fact encompass only ‘wages and wage-related costs’ and must reasonably ‘reflect the relative hospital wage level’ in a given area.” Id. Fourth, and perhaps most important, the statute‘s use of “the” in the phrase “the relative hospital wage level” indicates that Congress intended that there would be a single wage index—determined on the basis of data gleaned from a survey.
These points point in a single direction: HHS is required to calculate “the” relative wage levels of hospitals in different geographic regions as compared to “the” national average hospital wage level. See Centra Health, Inc., 102 F. Supp. 2d at 660 (“[T]he Act requires the [agency] to create an index that accurately represents the relative wage levels of hospitals in a given [area].”); Atrium Med. Ctr. v. Sebelius, 917 F. Supp. 2d 688, 695 (S.D. Ohio 2013) (“The purpose of [the statutory command] is to ensure that the reimbursement rate is adjusted to reflect geographical variations in labor costs.”). Although the calculation need not be precisely accurate—after all, it is based on prior years’ data, among other things—“the wage index must reflect the [agency‘s] best approximation of relative regional wage variations.” Methodist Hosp. of Sacramento, 38 F.3d at 1230 (instructing the agency that it must not rely on erroneous data when calculating the wage index). The low wage index hospital policy, however, is not a calculation of “the” relative wage levels of hospitals in different geographic regions as compared to “the” national average hospital wage level, and it is not “uniformly determined and applied.” Atrium Med. Ctr. v. U.S. Dep‘t of Health & Hum. Servs., 766 F.3d 560, 569 (6th Cir. 2014). Instead, the low wage index policy inflates the wage index values of the hospitals in the lowest quartile.
The government responds by arguing that Congress conferred upon HHS the broad authority to establish wage index values and that the statute does not instruct the agency on how exactly the index must be calculated. It‘s true that Congress did not expressly direct the agency regarding all of the inputs that would be included in the index, and courts have recognized that the index need not meet a standard of “scientific exactitude.” Anna Jacques II, 797 F.3d at 1165 (quotation omitted). But nothing in the statute suggests that Congress intended to give the agency the authority to adjust upward the wage index values of only those hospitals in the bottom quartile in a manner that does not “reflect[ ] the relative hospital wage level in the geographic area of [low wage index] hospital[s] compared to the national average hospital wage level,” as required by
The government further argues that the phrase “reflecting the relative hospital wage level” is ambiguous, and that that ambiguity coupled with “the tremendous complexity” of the wage-index statute, Methodist Hosp., 38 F.3d at 1229, should lead the Court to defer under Chevron to the agency‘s interpretation. The government is correct that “reflects” does not have precisely the same meaning as “equals,” and that Congress could have used, but did not use, the phrase “equals the relative hospital wage level.” But reflect is not nearly as ambiguous as the agency suggests. Instead, the most relevant meaning of reflect is to “reproduce” or to “show as a mirror”—which again indicates that Congress had in mind that there would be a single relative wage index. See, e.g., Reflecting, Webster‘s Third New International Dictionary 1908 (1976) (“[T]o give back or exhibit as an image, likeness, or outline: reproduce or show as a mirror does <the trees on the shore line were [reflecting] in the clear water>”); Reflecting, Webster‘s New Twentieth Century Dictionary 1517 (unabridged 2d ed., 1977) (“[T]o give back an image of; to mirror or reproduce.”); Reflect, The American Heritage Dictionary 1093 (William Morris ed., 1976) (“To form an image of (an object); to mirror.”); see id. (“the give back a likeness; become mirrored.”). Increasing the wage index for the lowest-wage hospitals does not “reflect” such hospitals’ relative wage levels, but rather reflects something else entirely.
What‘s more, Chevron requires deferring to an agency‘s interpretation only if “the statute is silent or ambiguous with respect to the specific issue.” Chevron, 467 U.S. at 843. Judges should hesitate “to hand off the judicial power to an executive agency” when the statutory provisions at issue are “hardly so abstruse that we need an agency to interpret it for us.” Zurich Am. Ins. Grp. v. Duncan on behalf of Duncan, 889 F.3d 293, 306 (6th Cir. 2018) (Kethledge, J., concurring in the judgment). The word reflecting, based on the surrounding statutory context, including the requirement that the agency conduct a data-driven survey, does not leave room for HHS to adjust wage index values based on policy considerations. See Bellevue Hosp. Ctr. v. Leavitt, 443 F.3d 163, 174–75 (2d Cir. 2006) (“[The agency‘s] task is unambiguous: to calculate a factor that reflects geographic-area wage-level differences, and nothing else. We reject [HHS‘s] contention that this provision, or any other in the Medicare Act, confers upon [it] the discretion to take into account all sorts of unrelated policy considerations, such as whether certain hospitals receive unwarranted advantages from other provisions of the Medicare reimbursement scheme.”).
The government identifies another claimed ambiguity, contending that the low wage index hospital policy is permissible because the statute authorizes the agency to conduct the “survey” any way it sees fit. The government is correct that Congress did not direct HHS regarding how it would conduct such surveys. But Congress did require that updates to the wage index would be based on “a survey . . . of wages and wage-related costs of subsection (d) hospitals,” and requiring a survey to gather cost information as inputs is wholly consistent with the idea that Congress intended that there would be a single index resulting from the agency‘s calculation based on the data. Under the low wage index hospital policy, however, HHS would approve the data from the wage survey, calculate the wage index as required by the statute, but then inflate the wage index
The agency‘s position also appears inconsistent with past practice. Prior to adopting the low wage index hospital policy, the agency used data collected through a survey process to generate area wage index values. Anna Jacques Hosp., 797 F.3d at 1158. Indeed, that statutory directive has led the agency to collect “annual cost reports from each hospital.” Id. It has also led HHS to publish “a manual to guide hospitals through the reporting process.” Id. The record does not reflect that HHS has ever previously inflated wage index values to take account for wage disparities in particular geographic areas.
The government contends that the intent behind the low wage index hospital policy was “to increase the accuracy of the wage index as a technical adjustment, and not to use the wage index as a policy tool to address non-wage issues related to rural hospitals, or the laudable goals of the overall financial health of hospitals in low wage areas or broader wage index reform.” See 84 Fed. Reg. 42044, 42328 (Aug. 16, 2019). Put differently, the government argues that increasing the wage index values of the hospitals in the lowest quartile has the effect of making the wage index more accurate because the adjusted wage index reflects the future wage index values of the hospitals in the bottom quartile (assuming of course that those hospitals adjust their wages with the increased reimbursements they receive). But again, nothing in the statute suggests that Congress intended to grant the agency the authority to do something other than calculate the relative wage index values for different geographic areas. Simply put, the low wage index hospital policy increases the wage index values of hospitals in low-cost labor markets without regard for their actual labor costs.8
One last note (although a lengthy one). The agency invokes the Medicare statute‘s “exceptions and adjustments” provision,
But the statute does not suggest that Congress intended to delegate that question to the agency. Indeed, Congress has itself made adjustments on at least two occasions. In 2003, Congress decreased the proportion of the reimbursement payment that gets adjusted for area differences in hospital wage levels for those hospitals with low wage index values. See Medicare Prescription Drug, Improvement, and Modernization Act of 2003, Pub. L. 108-173, § 403, 117 Stat. 2066, 2265 (2003) (codified at
reaching this conclusion, Judge Moss correctly noted that the “‘exceptions and adjustments’ provision does not give the [agency] carte blanche to override the rest of the Act.” Id. at 259–60.
For several reasons, this clause does not authorize the Rule here. Specific provisions control over general ones. See Varity Corp. v. Howe, 516 U.S. 489, 511 (1996) (“This Court has understood the present canon (‘the specific governs the general’) as a warning against applying a general provision when doing so would undermine limitations created by a more specific provision.”). This principle of statutory construction has particular force where, as here, Congress has enacted a complex scheme and has targeted specific problems with specific solutions. See HCSC-Laundry v. United States, 450 U.S. 1, 6 (1981) (per curiam) (noting that this “basic principle of statutory construction” applies “particularly when the two [provisions] are interrelated and closely positioned, both in fact being parts of” the same statutory scheme). Reading the general “exceptions and adjustments” provision to allow the agency to adopt the low wage index hospital policy would gut the specific statutory provisions in place to calculate the wage index.
Courts also should be “reluctan[t] to treat statutory terms as surplusage.” Freeman v. Quicken Loans, Inc., 566 U.S. 624, 635 (2012) (quotation omitted); see Potter v. United States, 155 U.S. 438, 446 (1894) (noting that the presence of statutory language “cannot be regarded as mere surplusage; it means something”). Reading the “exceptions and adjustments” provision to permit HHS to adopt the low wage index hospital policy would render meaningless the statutory
Because HHS must use wage data to calculate the relative hospital wage levels of particular geographic regions as compared to the national average, the agency exceeded its statutory authority when it altered the wage index for hospitals in the bottom quartile, such that those hospitals’ wage index values were neither based on survey data nor rough approximations of the relative hospital wage levels. See Dist. Hosp. Partners, L.P. v. Burwell, 786 F.3d 46, 56 (D.C. Cir. 2015) (“[A]gencies do not have free rein to use inaccurate data.”). The hospitals have therefore bore “the burden of showing that the wage indices violated the Medicare statute.” Abington Mem‘l Hosp., 216 F. Supp. 3d at 139 (quotation omitted). As a result, the Rule must be set aside because it conflicts with Congress‘s statutory directive. See Sarasota Mem‘l Hosp. v. Shalala, 60 F.3d 1507, 1513 (11th Cir. 1995) (describing how the agency compromises the “uniformity of the wage index” when it picks and chooses what to include in the calculation).
VII. Additional Briefing on the Appropriate Remedy
Having concluded that the low wage index hospital policy must be set aside, the Court determines that additional briefing on the appropriate remedy is required. It is not uncommon for district courts to request such briefing where, as here, the parties have focused principally on the merits. See, e.g., Cemex Inc., 2021 WL 4191959, at *11; Kunaknana v. U.S. Army Corps of Engineers, 23 F. Supp. 3d 1063, 1098 (D. Alaska 2014) (“The Court” believes that the best path forward is for “the parties to provide additional briefing on what would be an appropriate remedy.”). Indeed, this is the approach the government requested if the Court were to invalidate the Rule. See Def.‘s Mem. in Supp. of Cross-Motion for Summ. J., ECF No. 17 at 54.
VIII. Conclusion
For the foregoing reasons, the hospitals’ motion for summary judgment is GRANTED in part. HHS‘s cross-motion for summary judgment is DENIED. The Court orders additional briefing on the issue of the appropriate remedy in light of this Memorandum Opinion. And an Order will be entered contemporaneously with this Memorandum Opinion.
It is so ORDERED.
DATE: March 2, 2022
CARL J. NICHOLS
United States District Judge