NAHC Litigation Update
April 21, 2015 08:05 AM
The National Association for Home Care & Hospice (NAHC) is currently prosecuting two lawsuits in federal court on behalf of the home care community. In one case, NAHC continues to challenge the Medicare rule that required physicians to compose a “narrative” following the physician’s face-to-face encounter with the home health patient. While Medicare dropped the requirement following the filing of the lawsuit, NAHC continues to litigate the case as a potential remedy for the tens of thousands of claim denials already imposed in home health agencies and the risk of future claim audits.
In the second lawsuit, NAHC is challenging new US Department of Labor (DoL) rules that essentially eliminate any use of the “companionship services” and “live-in domestic services” exemptions from overtime pay under the Fair Labor Standards Act (FLSA).
NAHC v. Burwell: This case is in the middle of briefing by the parties. The Department of Justice, on behalf on the Medicare program, recently filed its Motion for Summary Judgment and supporting Memorandum. NAHC’s cross-motion and brief are due on May 7.
Medicare’s brief argues that it has the authority to require a physician narrative under the law passed by Congress in 2010 as part of the Affordable Care Act (ACA). Its position is that the ACA provision does not prohibit the Centers for Medicare and Medicaid Services (CMS) from requiring that the physician, who certifies the Medicare patient eligibility for coverage, support that certification with a narrative explaining what specifically in the face-to-face encounter demonstrates that the patient is homebound and in need of skilled care. The crux of that argument is that the word “document” in the ACA language permits CMS to define the standard of necessary documentation. With that authority in the law, CMS argues it was within its power to require that a narrative be part of that documentation.
In litigation involving challenges to the validity of a regulation, courts review the case using standards set by the US Supreme Court that apply a two-part test. First, is the regulation in conflict with the plain language of the law? If it is not, the second part of the test is whether the interpretation by the federal agency is wholly unreasonable, rising to the level of being an arbitrary and capricious interpretation of the law. In the second test, the federal agency’s interpretation is given deference by the courts as the federal agency, rather than the court, is considered to be the expert in the laws under its purview.
CMS argues in its brief that the plain language of the law does not prohibit its interpretation on what is required documentation. Further, CMS argues that its interpretation is reasonable because it helps validate the bona fides of the physician’s certification of the patient.
The NAHC responsive brief is under development. It will argue that the plain language of the ACA limits CMS to requiring only that the physician document that the encounter occurred, thereby prohibiting a narrative requirement. NAHC will also argue that the narrative requirement is arbitrary and capricious as the standards for compliance are at best vague and the narrative requirement results in the irrational outcome of patients who are clearly homebound and in need of skilled care being denied coverage without a full record review.
Briefing in NAHC v. Burwell continues through July 24.
HCOA, IFA, and NAHC v. Weil and Perez: In this challenge to DoL’s new rules on overtime compensation for home care aides, the US District Court ruled in NAHC’s favor and invalidated the DoL rules redefining the application of the “companionship services” and “live-in domestic services” exemptions under the Fair Labor Standards Act. The case is presently before the US Court of Appeal for the District of Columbia.
All briefs have been filed in this case and oral argument before a three-judge panel is set for May 7. DoL argues that the case is controlled by an earlier ruling of the Supreme Court in Coke v. Long Island Care at Home. In Coke, the Court held that DoL had the authority to include third-party employers (home care agencies) under the “companionship services” exemption. DoL argues that the Coke decision means that DoL has the discretionary authority to apply or not apply the exemption to third-party employed home care aides.
NAHC argues in its brief that the District Court was correct in concluding that the Coke decision is not controlling as the Supreme Court was not addressing the same issues now presented. NAHC argues that the plain language of the FLSA requires the exemptions to apply to any employee engaged in companionship services or live-in domestic services. Further, NAHC argues that the redefinition of “companionship services” is beyond DoL’s authority as that redefinition effectively eliminates “care” from the employee’s function in the application of the exemption.
One interesting development in the case is the nature and volume of “friend of the court” briefs filed. DoL has on its side an assortment of unions, states, Members of Congress, and consumer organizations. On NAHC’s side, there are Members of Congress, disability rights groups, and state Medicaid programs. Most notably, the Members of Congress include Senate Majority Leader Mitch McConnell, several Senate Committee chairs including Lamar Alexander who heads up the committee with jurisdiction over the FLSA, and Tim Wahlberg, the Chair of the Workforce Protection Subcommittee of the House Education and the Workforce Committee.
The Medicaid programs argue to the court that they cannot be forced to cover the unfunded costs of overtime compensation. At the same time, the disability rights groups argue that Medicare will not raise reimbursement rates and instead force restrictions on working hours of home care aides to the detriment of people with disabilities.
Litigation is always a last resort for NAHC. However, NAHC will always fight every reasonable fight on behalf of the home care community. These lawsuits are more than reasonable. Please stay tuned to NAHC Report for future updates on these lawsuits.