Who regulates the regulator?

Federal statutes set many guidelines for Medicare & Medicaid. For example, 42 USC Sec. 1396a(a)(30) requires Medicaid provider payments be high enough to attract a sufficient network of providers:

(30) (A) provide such methods and procedures relating to the utilization of, and the payment for, care and services available under the plan … to assure that payments are consistent with efficiency, economy, and quality of care and are sufficient to enlist enough providers so that care and services are available under the plan at least to the extent that such care and services are available to the general population in the geographic area;

But who gets to enforce this statute? In a case recently argued in the Supreme Court, the government argued that Medicaid patients and providers can’t sue to enforce this law (Douglas v. ILC of Calif., SCOTUSBlog recap of the orals here). If the government wins this case, then the statute will only be enforceable by CMS.

This case is by no means an anomaly. The Medicare and Medicaid statutes are complex, and many times CMS or a state takes a position that providers, patients, or public interest organizations oppose. In a recent suit (Bagnell, et al. v. Sebelius, pdf of the complaint here), Medicare patients have asked for a class action against Medicare, claiming that patients in hospitals were inappropriately classified as “observational” rather than “inpatients.” For Medicare wonks, this means payment under Part B rather than Part A. (More on the case from one of the plaintiff firms, The Center for Medicare Advocacy). A similar suit was filed in January concerning the Medicare rule limiting rehab services when the patient wasn’t improving.

Leaving the merits of the cases for the moment, the larger question is where should these issues be decided? Only at CMS? Or should the people directly affected have the right to ask a federal judge to enforce the statute Congress wrote?

H/t to Reuters for the observational case, which was also in Austin’s recap on Nov 4.

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