1

UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUMBIA

SELECT SPECIALTY HOSPITALDENVER, INC., et al.,

Plaintiffs,

v.

XAVIER BECERRA,

1 Secretary, U.S. 

Department of Health and Human Services,

Defendant.

Civil Action No. 10-1356 (BAH)

Chief Judge Beryl A. Howell

MEMORANDUM OPINION

In August 2019, this Court granted summary judgment in favor of plaintiffs—seventyfive long-term care hospitals (“LTCHs”) located in 26 states—on their claims for reimbursement

from the Department of Health and Human Services (“HHS”) for unpaid co-insurance and 

deductible obligations (“bad debts”) of patients eligible for both Medicare and Medicaid. See 

Select Specialty Hosp.-Denver, Inc. v. Azar (“Select Specialty I”), 391 F. Supp. 3d 53, 55 

(D.D.C. 2019). Contravening the notice-and-comment rulemaking required by the Medicare 

Act, 42 U.S.C. § 1395hh(a)(2), in 2007, the Centers for Medicare and Medicaid Services 

(“CMS”) abruptly began to refuse reimbursement of bad debts under the must-bill policy and 

concomitant remittance advice (“RA”) requirement, which directed plaintiffs first to seek 

reimbursement from their state Medicaid programs prior to billing Medicare. Id. This Court 

ordered the CMS Administrator to “promptly . . . reconsider,” on remand, “whether, absent the 

must-bill and RA requirements, the plaintiffs are entitled to bad debt reimbursement.” Id. at 70. 

1 Pursuant to Federal Rule of Civil Procedure 25(d), plaintiffs automatically substitute Xavier Becerra, 

successor to formerly listed Alex M. Azar II, as the defendant in this action. 
2

Plaintiffs were also entitled to prejudgment interest pursuant to 42 U.S.C. § 1395oo(f)(2). Select 

Specialty Hosp.-Denver, Inc. v. Azar (“Select Specialty II”), 2019 WL 5697076, at *6–7 (D.D.C. 

Nov. 4, 2019). HHS unsuccessfully sought reconsideration of this Court’s decision, see id., and

then filed an appeal to the D.C. Circuit, which the agency subsequently voluntarily dismissed, 

see Select Specialty Hosp.-Denver, Inc. v. Azar, 391 F. Supp. 3d 53 (D.D.C. 2019), appeal 

dismissed No. 20-5004 (D.C. Cir. Jan. 28, 2020). 

After nearly a year and a half of negotiations between the parties, Pls.’ Mem. in Supp. 

Pls.’ Mot. to Enforce J. (“Pls.’ Mem.”) at 1, ECF No. 101, CMS still had not calculated the total 

reimbursements owed, prompting plaintiffs to file, in December 2020, the instant motion for an 

order to enforce the August 2019 judgment and to direct HHS to “reimburse Plaintiffs for their 

dual eligible bad debts without any reduction for Medicaid liability,” Pls.’ Mot. to Enforce J. 

(“Pls.’ Mot.”), ECF No. 101. Less than a month after plaintiffs sought this enforcement order, 

CMS agreed to reimburse $18,656,588 in bad debt and $4,992,904 in associated interest for most 

plaintiffs. Def.’s Notice, Ex. 1 (Jan. 12, 2021 Letter from Susan Burris, Director of Cost 

Reporting Division, CMS, to Jason Healy, plaintiffs’ counsel) (“CMS Letter”), at 1, ECF No. 

104-1. 

Remaining in dispute is $1,992,629 in unpaid claimed reimbursements, plus interest, that

HHS has reduced or otherwise denied to eight plaintiff LTCHs located in five states—Alabama, 

Arkansas, Mississippi, Nebraska, and Wisconsin. Parties’ Joint Status Report ¶ 5, ECF No. 105; 

see also id. ¶ 1; Pls.’ Suppl. Mem. Supp. Mot. to Enforce J. (“Pls.’ Suppl. Mem.”) at 2, ECF No. 

106. 2 HHS maintains that the disputed reimbursements do not reflect a “federal obligation,”

2 Although reimbursement payments to nine LTCHs were initially denied, in whole or part, by CMS, see

CMS Letter at 3, one of those nine—plaintiff Select Specialty Hospital–Jackson, Inc.—ultimately received full 

reimbursement and no longer seeks relief through the instant motion to enforce, Pls.’ Suppl. Mem. at 9. 
3

Def.’s Resp. Pls.’ Suppl. Mem. Supp. Mot. to Enforce J. (“Def.’s Suppl. Opp’n”) at 5, ECF No. 

109, but instead account for what state Medicaid programs would have been required to 

contribute pursuant to their cost-sharing obligations under the corresponding state Medicaid 

plans. Plaintiffs, for their part, insist that reducing bad debt reimbursement based on any 

“perceived Medicaid liability” flouts the Court’s judgment holding that their receipt of 

reimbursement for the claims at issue could not be preconditioned on complying with the mustbill and RA requirements. Pls.’ Suppl. Mem. at 4. 

To effectuate the judgment of Select Specialty I, CMS cannot withhold or reduce 

reimbursement for bad debt claims that plaintiffs incurred while they were non-participants in 

state Medicaid programs during the 2005 to 2010 period at issue. Doing otherwise essentially 

denies plaintiffs the relief awarded to them in Select Specialty I, which held that CMS acted 

unlawfully in subjecting plaintiffs, while they were not enrolled in state Medicaid programs, to a 

new requirement of “Medicaid participation” (through the sudden imposition of the must-bill 

policy and RA requirement) without notice-and-comment. See Select Specialty I, 391 F. Supp. 

3d at 70. No aspect of the Court’s judgment, however, prevents CMS from withholding or 

reducing reimbursements for claims that accrued after plaintiffs enrolled in state Medicaid 

programs and were the responsibility of those state Medicaid programs. Accordingly, for 

reasons set forth in detail below, plaintiffs’ motion to enforce judgment will be granted in part 

and denied in part. 

I. BACKGROUND

The statutory, regulatory, factual, and procedural background for this case is fully set out 

in Select Specialty I, 391 F. Supp. 3d at 56–66, and Select Specialty II, 2019 WL 5697076, at *1–

3, and thus only the background necessary to resolving the instant motion is summarized below. 
4

A. Statutory and Regulatory Background

“Medicare is a federally funded program that reimburses healthcare providers for 

delivering medical care to qualifying elderly and disabled individuals,” whereas “Medicaid is a 

cooperative-federal state program—administered by states, and subject to federal guidelines—

that pays for medical care provided to eligible low-income individuals.” New LifeCare Hosps. of 

N.C., LLC v. Becerra, 7 F.4th 1215, 1219 (D.C. Cir. 2021) (citations omitted). 3

 The federal 

government covers most of the costs incurred for the care provided to Medicare patients, who 

nonetheless continue to be responsible for both deductible and coinsurance payments for hospital 

care. See 42 U.S.C. § 1395e; 42 C.F.R. §§ 409.82, 409.83. Individuals eligible for both 

Medicare and Medicaid (“dual-eligible patients”), however, often lack the financial means “to 

afford the coinsurances and deductibles required of them under Medicare.” New LifeCare 

Hosps., 7 F.4th at 1219. In such circumstances, the unpaid obligations, or bad debts, of these 

dual-eligible patients may be charged to a state Medicaid agency if required by that state’s

3 In New LifeCare Hosps., the D.C. Circuit recently considered a similar challenge, brought by LTCHs 

located in North Carolina, Pennsylvania, Texas, and Louisiana, to CMS’s enforcement of the must-bill policy and 

subsequent denial of bad-debt reimbursement. See 7 F.4th at 1219. Like the Select Specialty I plaintiffs, the New 

LifeCare Hosps. plaintiffs argued, inter alia, that CMS’s enforcement of the policy was unlawful because it required 

notice-and-comment rulemaking under the Medicare Act. See id. at 1222. The Circuit rejected that argument, 

finding that plaintiffs failed to establish they experienced a change in the must-bill policy’s enforcement beginning 

in 2008. See id. at 1222 (“The problem for the hospitals is that they identify no change in CMS policy taking place 

in 2008.”). The Circuit distinguished this Court’s ruling in Select Specialty I on grounds that “Select involved a 

different administrative record.” Id. at 1224. Specifically, the administrative records of the instant case and New 

LifeCare Hosps. differed in that the New LifeCare “[p]roviders have not proven that the contractors, in the past, did

reimburse them for bad debts without requiring RAs” and therefore “have not shown a change, abrupt or otherwise”

in CMS’s enforcement of the must-bill policy and RA requirement. New LifeCare Hosps. of N.C. LLC v. Azar, 416 

F. Supp. 3d 11, 21 (D.D.C. 2019) (emphasis in original); see id. at 21-22 (explaining that the Select Specialty I

plaintiffs presented evidence of CMS’s “abrupt change” in policy, such as “a pre-2007 Adjustment Report that 

showed no deductions were made for failure to comply with the must-bill policy” and “emails from the CMS 

contractors to plaintiffs, confirming that CMS’s application of the must-bill policy was a change in policy,” whereas 

the New LifeCare Hosps. providers “failed to develop a similar record . . . confirming that there was a change in 

policy around this time”). The Circuit’s holding in New LifeCare Hosps. thus is immaterial to resolving the instant 

motion to enforce—and the parties do not argue otherwise—because the Circuit’s decision was predicated on a 

different administrative record and this Court’s inquiry is limited to the record before it. See CTS Corp. v. EPA, 759 

F.3d 52, 64 (D.C. Cir. 2014) (observing that in administrative law cases “a reviewing court should have before it 

neither more nor less information than did the agency when it made its decision”). 
5

Medicaid program. See id. (citing Grossmont Hosp. Corp. v. Burwell, 797 F.3d 1079, 1081 

(D.C. Cir. 2015). Only when states do “not cover the deductibles and coinsurances of dualeligible patients through Medicaid” can “healthcare providers . . . seek reimbursement through 

Medicare.” Id. (citing 42 C.F.R. § 413.89). Thus, if a state Medicaid program is “obligated 

either by statute or under the terms of its plan to pay all, or any part, of the Medicare deductible 

or coinsurance amounts, those amounts are not allowable as bad debts under Medicare.” CMS 

Provider Reimbursement Manual Part I § 322 (1967). Conversely, a bad debt that “the State is 

not obligated to pay can be included as a bad debt under Medicare,” provided that other

conditions not at issue here are met. Id. (emphasis added).

4

To implement the statutory requirement that state Medicaid programs determine their 

cost-sharing obligations regarding Medicare deductible and coinsurance amounts payable by 

dual-eligible beneficiaries, CMS adopted a must-bill policy, which requires hospitals to “(1) bill 

the state Medicaid program to determine whether Medicaid will cover the bad debts first, and (2) 

obtain a document known as a remittance advice (‘RA’) indicating whether the state refuses 

payment, before seeking reimbursement under Medicare.” New LifeCare Hosps., 7 F.4th at 1220 

(citations omitted). HHS explains that, due to this statutory directive, CMS, “[e]ven absent the 

must-bill policy and the RA requirements . . . must still consider states’ liabilities for Medicare 

cost-sharing in order to determine the amount of Plaintiffs’ bad debt reimbursement due from the 

federal government.” Def.’s Opp’n to Pls.’ Mot. to Enforce J. (Def.’s Opp’n”) at 12, ECF No. 

102.

4 CMS may reimburse Medicare providers only for “allowable” bad debts. 42 C.F.R. § 413.89(e). A bad 

debt is allowable and therefore reimbursable by Medicare if (1) the debt is “related to covered services and derived 

from deductible and coinsurance amounts,” (2) if “[t]he provider [is]. . . able to establish that reasonable collection 

efforts were made,” (3) if “[t]he debt was actually uncollectible when claimed as worthless,” and (4) “[s]ound 

business judgment established that there was no likelihood of recovery at any time in the future.” Id. § 413.89(e)(1)-

(4). 
6

B. Factual Background 

Before 2007, CMS generally “had not applied the must-bill policy and the concomitant 

RA requirement to the plaintiffs,” as LTCHs, Select Specialty I, 391 F. Supp. 3d at 61, and 

“[b]illing state Medicaid programs was regarded as unnecessary, because the states were not 

liable for Medicare bad debts incurred at LTCHs,” id. at 55. As a result, “none of the plaintiffs 

participated in their respective state Medicaid programs,” id. at 60, given that their participation 

had never been required to obtain reimbursement from Medicare. 

In 2007, however, CMS “began denying [reimbursement] requests” from plaintiffs and 

“consistently cited the must-bill policy and the plaintiffs’ lack of RAs as reasons for the denials.” 

Id. at 61. Reacting to these unanticipated denials, plaintiffs attempted to obtain RAs and enroll 

in their respective state Medicaid programs to qualify for reimbursement under the must-bill 

policy and RA requirement, id. at 63, but their efforts yielded little fruit. When plaintiffs “began 

submitting bills to state Medicaid programs in which they were not enrolled, in an attempt to 

obtain RAs,” they were typically rejected because they were “not, or could not, be enrolled in 

Medicaid.” Id. Similarly, when plaintiffs “attempted to enroll in Medicaid for the limited 

purpose of obtaining RAs,” they were either “unable to enroll,” or were able to enroll but were 

still not able to obtain “the requisite RAs for earlier periods,” as was the case for the majority of 

plaintiffs. Id. at 63-64. Beginning in 2007, CMS thus preconditioned plaintiffs’ ability to obtain 

reimbursement for bad debts from dual-eligible patients on “Medicaid participation,” despite the 

fact that plaintiffs were barred in many states from participating in Medicaid because of their 

status as long-term care facilities. See id. at 70. 

C. Procedural History

Plaintiffs instituted this lawsuit over a decade ago for reimbursement of dual-eligible bad 

debts claimed on their Medicare cost reports between 2005 and 2010 and denied by defendant 
7

for failing to meet the must-bill policy. See Select Specialty I, 391 F. Supp. 3d at 60.

5

Summarized below is what happened thereafter.

1. This Court’s 2019 Ruling in Select Specialty I

In August 2019, Select Specialty I granted plaintiffs’ motion for summary judgment and 

denied HHS’s cross motion, because CMS was required under the Medicare Act, 42 U.S.C. § 

1395hh(a)(2), to conduct notice-and-comment rulemaking before subjecting the non-Medicaid 

participating plaintiffs to the must-bill and RA requirements. Select Specialty I, 391 F. Supp. 3d 

at 67. Undergirding this holding was the determination that the must-bill policy and RA 

requirement constituted a “change in a ‘substantive legal standard,’” id. at 67, which, as defined 

by the D.C. Circuit, “at a minimum[,] include[d] a standard that ‘creates, defines, and regulates 

the rights, duties, and powers of parties,’” for purposes of § 1395hh(a)(2), id. (quoting Allina 

Health Servs. v. Sebelius, 863 F.3d 937, 943 (D.C. Cir. 2017) (quoting BLACK’S LAW 

DICTIONARY (10th ed. 2014))). CMS, without any prior notice, “changed not just the steps that 

existing LTCHs must take, vis-à-vis CMS, to be reimbursed, but also changed whether such 

entities must form contracts with third parties” like state Medicaid programs. Id. at 69.

Specifically, the must-bill policy and RA requirement were found to be “substantive” because 

5 Following the 2007 policy change and after an initial round of proceedings before the agency, plaintiffs 

first appealed CMS’s denial of bad-debt reimbursement to this Court on August 12, 2010. See Select Specialty I, 

391 F. Supp. 3d at 65. On March 26, 2012, plaintiffs were granted partial summary judgment “because the 

Administrator's decision may have failed to take into account the plaintiffs' legitimate reliance on prior 

interpretation, and remanded the case to the Administrator for reconsideration of the limited issue of whether 

Plaintiffs were justified in relying on CMS's prior failure to enforce the must-bill policy with respect to dual-eligible 

reimbursement claims from non-participating Medicaid providers.” Id. (citations omitted). Four years later, in 

March 2016, CMS affirmed its previous decision to deny reimbursement, after which plaintiffs moved to reopen 

their case in this Court. Id. at 65-66. This case was then reassigned to the undersigned Chief Judge on February 10, 

2017, see Minute Entry (Feb. 10, 2017), and was afterwards stayed for ten months as the parties unsuccessfully 

attempted to settle, see Minute Entry (Dec. 18, 2018). Summary judgment briefing was ultimately completed in late 

May 2019. See Minute Entry (Jan. 10, 2019). 
8

they “essentially changed the eligibility criteria for reimbursement under the Medicare Act for 

dual-eligible patients[] by requiring provider participation in the state Medicaid program.” Id. 

After the ruling in Select Specialty I issued, the parties filed two motions: HHS sought 

reconsideration of the decision, arguing that CMS’s “sudden application of the must-bill and RA 

requirements” did not amount to a change in policy, Select Specialty II, 2019 WL 5697076, at 

*4, whereas plaintiffs sought an “order amending the earlier judgment to include an award of 

prejudgment interest,” id. at *3. Again, HHS’s motion was denied and plaintiffs’ motion

granted. Id. at *7 (concluding that “[w]hile the Secretary must still determine on remand the 

amounts to which plaintiffs are entitled, plaintiffs are entitled to prejudgment interest on those 

amounts as a matter of right”). HHS then, in January 2020, appealed this denial of 

reconsideration to the D.C. Circuit, but ten days later voluntarily dismissed that appeal. See

Select Specialty Hosp.-Denver, Inc. v. Azar, 391 F. Supp. 3d 53 (D.D.C. 2019), appeal dismissed

No. 20-5004 (D.C. Cir. Jan. 28, 2020).

2. The Pending Motion to Enforce Judgment 

Between January 2020 and November 2020, the parties exchanged data and discussed the 

amounts owed on remand, Def.’s Opp’n at 6, eventually agreeing on “the calculations of 

allowable bad debt amounts and the rate of court-ordered interest the Defendant owes Plaintiffs,” 

Pls.’ Reply Supp. Mot. Enforce J. (“Pls.’ Reply”) at 1–2, ECF No. 103. The parties reached an 

impasse, however, “as to whether Defendant may reduce the amounts owed to Plaintiffs to 

account for the amounts that state Medicaid programs may have paid Plaintiffs toward the dual 

eligible bad debts at issue,” Pls.’ Mem. at 1, prompting plaintiffs to file the pending motion to 

enforce judgment. HHS initially opposed this motion as premature because no “final, reviewable 

agency action on the amounts payable under the Court’s remand order” had been issued and “the 
9

agency ha[d] not yet been afforded the opportunity to effectuate payment using the most accurate 

methods at its disposal.” Def.’s Opp’n at 8. 

On January 13, 2021, HHS notified the Court that the “administrative process ha[d] . . . 

concluded” and that CMS would, by February 5, 2021, “issue payments to Plaintiffs,” Def.’s 

Notice at 2, in accordance with CMS’s calculations of the “appropriate amount of payment,” id.

at 1-2. CMS subsequently reimbursed plaintiffs in the amount of $18,656,588, plus $4,992,904 

in interest. See CMS Letter at 4. CMS, however, withheld $1,992,629 in principal, plus interest, 

from the eight LTCH-plaintiffs in five states that now seek reimbursement through the pending 

motion to enforce. See Pls.’ Suppl. Mem. at 6–10. In the wake of CMS’s 2007 policy shift, each 

of these plaintiffs faced a variety of bureaucratic hurdles to participate in their state Medicaid 

programs, which hurdles were likely exacerbated by CMS’s implementation of the policy change 

without the requisite notice and comment that would have alerted plaintiffs and the states in 

which they are located to the then-newly required contractual relationship between LTCHs and 

state Medicaid programs.

6 The situation in each of the five states where the eight LTCH 

plaintiffs are located is as follows:

Alabama: Plaintiff Select Specialty Hospital-Birmingham unsuccessfully attempted to 

enroll in Alabama Medicaid after 2007. In December 2008, “Alabama Medicaid sent a rejection 

letter . . . indicating that Alabama Medicaid does not enroll LTCHs.” Select Specialty I, 391 F. 

Supp. 3d at 63. The administrative record contained “ample evidence” that the Alabama 

plaintiffs could not enroll in their state’s Medicaid program, id. at 64, and is devoid of any 

6 Following receipt of CMS’s January 2021 Notice outlining these reductions to plaintiffs’ reimbursements, 

the parties were directed to file supplemental briefs providing “a precise description of how defendant has failed to 

comply with [Select Specialty I] with respect to the disputed non-payments.” See Minute Order (Feb. 14, 2021). 
10

indication that this plaintiff was ever permitted to enroll in Alabama Medicaid during the 2005-

2010 billing period at issue.

Plaintiff Select Specialty Hospital-Birmingham has received a reimbursement payment in 

the amount of $587,886, see CMS Letter at 4, but CMS withheld $7,343, plus interest, on 

grounds that Alabama Medicaid required the state to pay the deductible amounts for dual-eligible 

bad debt claims incurred during the period at issue, see id. at 2. 

Arkansas: The four plaintiffs from Arkansas—Specialty Hospital-Little Rock, Select 

Specialty Hospital-Fort Smith, Select Specialty Hospital-Little Rock/BMC, and Select Specialty 

Hospital-Pine Bluff—“attempted to enroll in Arkansas Medicaid [in November 2007] and 

initially received a rejection letter, dated February 14, 2008, citing various provisions of the 

Arkansas Code.” Select Specialty I, 391 F. Supp. 3d at 64. These plaintiffs, however, were 

eventually admitted to Arkansas Medicaid in either 2009 or 2010. Compare id. at 65 n.10 

(noting that the Arkansas plaintiffs were admitted to Medicaid in 2010), with Pls.’ Suppl. Reply 

Brief Supp. Mot. Enforce J. (“Pls.’ Suppl. Reply”) at 9, ECF No. 110 (“The Arkansas Plaintiffs 

obtained Medicaid provider agreements effective as of April 27, 2009.”).

None of the four plaintiffs from this state have received any reimbursement from CMS 

because CMS posits that the state “had full responsibility” to pay both deductible and 

coinsurance amounts for dual-eligible patients under the Arkansas Medicaid State Plan. CMS 

Letter at 2. CMS has accordingly withheld $1,510,755, plus interest, from these plaintiffs. Id. at 

3. 

Mississippi: Plaintiff Select Specialty Hospital-Gulf Coast “tried to enroll in Mississippi 

Medicaid on November 11, 2008, but received a rejection letter dated May 26, 2009 advising 

that LTCHs in Harrison County, where this hospital was located, could not enroll” under the 
11

Mississippi Code. Select Specialty I, 391 F. Supp. 3d at 64. The administrative record included 

“ample evidence” indicating that plaintiffs located in Harrison County, Mississippi “were unable 

to enroll in Medicaid . . . during the relevant period because of their status as LTCHs.” Id. The 

record is devoid of any indication that this plaintiff was ever permitted to enroll in Mississippi

Medicaid during the period at issue. 

Plaintiff Select Specialty Hospital-Gulf Coast has received reimbursement in the amount of 

$800,326, see CMS Letter at 4, but CMS withheld an additional $76,376 because CMS posits 

that Mississippi Medicaid had “full responsibility to pay . . . for claims on or after January 1, 

2010,” id. at 2. 

Nebraska: Plaintiff Select Specialty Hospital-Omaha sought to enroll in Nebraska Medicaid 

following the 2007 policy change, but its enrollment did not become effective until March 1, 

2008. See Pls.’ Suppl. Mem. at 9 (citing S2-AR at 212, 317). This plaintiff has not received any 

payment from CMS because CMS asserts that the state “had full responsibility” to pay both 

deductible and coinsurance amounts for dual-eligible patients under the Nebraska Medicaid State 

Plan. CMS Letter at 2. CMS has accordingly withheld $346,852, plus interest, from this 

plaintiff. Id. at 3. 

Wisconsin: Plaintiff Select Specialty Hospital-Madison did not receive approval to join 

Wisconsin Medicaid until August 27, 2008, with an effective date of December 17, 2007. Pls.’ 

Suppl. Mem. at 10 (citing S2-AR at 167-170). This plaintiff has not received any reimbursement 

from CMS, which is withholding $51,303, plus interest, because CMS posits that the state was 

fully responsible for both deductible and coinsurance claims under the Wisconsin Medicaid State 

Plan during the period at issue. CMS Letter at 2, 3. 
12

***

The quest for bad debt reimbursement for the eight plaintiffs involved in the current 

motion was far from finished even after some of them were permitted to enroll in their state

Medicaid programs. Notwithstanding their Medicaid registration, state Medicaid agencies 

refused to process plaintiffs’ bad debt reimbursement requests for claims incurred prior to their 

Medicaid enrollment approval. See Select Specialty I, 391 F. Supp. 3d at 64 (citing S2-AR at 

457 (Stipulations ¶8: “In no state could the Providers . . . obtain Medicaid RAs for dates of 

service when the Providers were not enrolled in Medicaid.”)). Lacking an avenue to 

reimbursement even with state Medicaid enrollment, the 2007 shift in CMS’s enforcement of the 

must-bill policy and RA requirement left plaintiffs “holding the proverbial bag of unreimbursed 

bad debt.” Id. at 64. 7

 Nevertheless, according to CMS, the reductions in payments made to their 

7 Following this Court’s 2019 ruling in Select Specialty I, HHS submitted the must-bill policy to notice-andcomment rulemaking and has undertaken additional actions that appear geared at preventing CMS and state 

Medicaid programs from putting medical providers servicing dual-eligible patients through the same “bureaucratic 

nightmare,” Select Specialty I, 391 F. Supp. 3d at 70, experienced by plaintiffs here. 

First, on October 1, 2020, CMS issued a final rule, now codified at 42 C.F.R. § 413.89(e)(2)(iii)(A), “to

clarify and codify our longstanding” must-bill policy that to receive Medicare reimbursement for dual-eligible bad 

debts, “a provider that has furnished services to a dual eligible beneficiary must determine whether the State’s Title 

XIX Medicaid Program . . . is responsible to pay all or a portion of the beneficiary’s Medicare deductible and/or 

coinsurance amounts” by first submitting a bill to the state Medicaid agency. Fed. Reg. 58,432, 59,001 (Sept. 18, 

2020); see id. at 58,990 (“[W]e believe it is appropriate to clarify certain Medicare bad debt policies that have been 

the subject of litigation, and generated interest and questions from stakeholders over the past several years.”). CMS 

has also issued a rule establishing a mechanism for providers to seek Medicare reimbursement for dual-eligible bad 

debts even “[w]hen, through no fault of the provider, a provider does not receive a Medicaid remittance advice 

because the State does not permit a Medicare provider’s Medicaid enrollment for the purposes of processing a 

beneficiary’s claim, or because the State does not generate a Medicaid remittance advice.” 42 C.F.R. §

413.89(e)(2)(iii)(B); see also Fed. Reg. 58,432, 59,001 (Sept. 18, 2020) (“Some States’ noncompliance with the 

statutory requirement to process Medicare crossover claims and produce a Medicaid RA have resulted in numerous 

appeals filed by providers whose claims for reimbursement of unpaid Medicare cost sharing from services provided 

to dual eligible beneficiaries were denied for Medicare bad debt reimbursement because the State did not process the 

Medicare crossover claim and issue a Medicaid RA to the provider.”). 

Most recently, on May 10, 2021, CMS published a notice of proposed rulemaking concerning LTCH 

payments that intends “[t]o clarify states’ obligations regarding claims for Medicare cost-sharing by adding a new 

paragraph (d) to 42 C.F.R. 455.410 to specify in regulation how states must meet this obligation.” Notice of 

Proposed Rule, Medicare Program; Hospital Inpatient Prospective Payment Systems for Acute Care Hospitals and 

the Long-Term Care Hospital Prospective Payment System and Proposed Policy Changes and Fiscal Year 2022 

Rates; Quality Programs and Medicare Promoting Interoperability program Requirements for Eligible Hospitals 

and Critical Access Hospitals; Proposed Changes to Medicaid Provider Enrollment; and Proposed Changes to the 

Medicare Shared Savings Program, Fed. Reg. 25,070, 25,655 (May 10, 2021). The notice proposes that “State 
13

bad debt reimbursement are justified because “states are required to determine their cost sharing 

obligations” for bad debt claims from dual Medicare-Medicaid patients and, in accordance with 

the Provider Reimbursement Manual, “any Medicare deductible and coinsurance amount that is 

payable by a state, under its Medicaid program, must be excluded from the computation of 

allowable Medicare bad debt reimbursable by the federal government.” CMS Letter at 1. 

To calculate the contested reimbursement reductions, CMS looked to the Medicaid State 

Plans as the “definitive source for establishing the [dual-eligible patient] cost sharing 

obligations” of the five states where the eight LTCH-plaintiffs are located. Id. 8 Medicaid State 

Plans use a series of “policy codes” to indicate their cost-sharing policy for dual-eligible bad 

debt claims, including: (1) a Medicare Rate (MP) policy code, which indicates that the state is 

required to pay “the full Medicare deductible, coinsurance, or both amounts,” id.; (2) a State Plan 

Rate (SP) code, which indicates that “the state generally may be responsible to pay a portion of, 

or none of the cost sharing amount, depending on their approved Medicaid rate setting 

methodology,” id.; and (3) a Negotiated Rate (NR) code, which indicates that “the state has 

established its own methodology to pay a portion of, or none of the cost sharing amount,” id. at 

2. 

Medicaid programs must accept enrollment of all Medicare-enrolled providers and suppliers (even if a provider or 

supplier is of a type not recognized as eligible to enroll in the State Medicaid program) if the provider or supplier 

otherwise meets all Federal Medicaid enrollment requirements” so that “[s]tates [will] process claims from such 

providers requesting that the State determine its cost-sharing liability.” Id. This change, according to CMS, was 

occasioned by the phenomenon at issue here, where “Medicare-enrolled provider[s] or supplier[s] ha[ve] been 

unable to enroll with the State Medicaid program, [so] . . . the State [Medicaid Management Information System] 

may not adjudicate the cost-sharing claim and also may not return a Medicaid RA to the provider for the purpose[]

of computing Medicare bad debt absent further actions by the State or by the provider.” Id. 

8 A Medicaid State Plan “is a comprehensive written statement submitted by the [state Medicaid] agency 

describing the nature and scope of its Medicaid program” and which “contains all information necessary for CMS to 

determine whether the plan can be approved to serve as a basis for Federal financial participation . . . in the State 

program.” 42 C.F.R. § 430.10. 
14

After reviewing the Medicaid State Plans and relevant policy codes for the five states 

where plaintiffs are located, CMS concluded that reimbursement for the Alabama and 

Mississippi plaintiffs had to be reduced because the Medicaid plans for those states used the 

Medicare Rate policy code and, consequently, required Alabama Medicaid to cover deductible 

claims in their totality, and Mississippi Medicaid to cover all claims (whether coinsurance or 

deductibles) incurred on or after January 1, 2010. Id. For plaintiffs’ claims in Arkansas, 

Nebraska, and Wisconsin, CMS similarly determined that they were governed by the Medicare 

Rate policy code and thus the states “had full responsibility to pay both the . . . deductible and 

coinsurance amounts” for all bad debt claims that plaintiffs incurred during the 2005 to 2010 

period. See id. at 2, 4. 

The eight LTCH-plaintiffs now challenge CMS’s decision to withhold reimbursements 

and seek an order enforcing the judgment in Select Specialty I and directing that CMS “must not 

reduce the amounts owed to Plaintiffs for state Medicaid liability.” Pls.’ Mem. at 6. According 

to plaintiffs, Select Specialty I’s “directive that CMS not apply the state billing and RA 

requirements when determining the amounts owed to Plaintiffs does not allow for CMS to 

consider Medicaid liability when effectuating the Court’s judgment.” Id. CMS, for its part, 

maintains that “any reduction of Plaintiffs’ Medicare reimbursement to account for state 

Medicaid liability would be entirely lawful and completely consistent with the Court’s decisions 

in this case.” Def.’s Opp’n at 11. CMS further asserts that it “has not applied the must-bill and 

RA requirements again on remand” but has instead “performed the completely separate operation 

of determining the amounts due without application of those requirements, which precluded 

payment altogether.” Def.’s Suppl. Opp’n at 4. 
15

II. LEGAL STANDARD

“District Courts have the authority to enforce the terms of their mandates.” Salazar v. 

District of Columbia, 236 F. Supp. 3d 411, 413 (D.D.C. 2017). “[A] motion to enforce is the 

usual method for requesting a court to interpret its own judgment and to compel compliance if 

necessary in light of that interpretation.” Burns v. Anderson, No. 16-mc-02509 (TNM), 2021 

WL 1840368, at *2 (D.D.C. May 7, 2021) (citing Anglers Conservation Network v. Ross, 387 F. 

Supp. 3d 87, 93 (D.D.C. 2019)). A district court’s exercise of its authority to enforce its 

judgments “is particularly appropriate in a case . . . where an administrative agency plainly 

neglects the terms of a mandate, and the case then returns to the court—under the same docket 

number and involving the same parties—on a motion to enforce the original mandate.” Int’l 

Ladies’ Garment Workers’ Union v. Donovan, 733 F.2d 920, 922 (D.C. Cir. 1984). Indeed, 

“[t]he court is generally the authoritative interpreter of its own remand,” AT&T Wireless Servs., 

Inc. v. FCC, 365 F.3d 1095, 1099 (D.C. Cir. 2004), and “[i]n performing this analysis, it is 

guided not only by the text of the Order in question but also by its relevant opinions,” Resolute 

Forest Prods. v. USDA, 427 F. Supp. 3d 37, 41 (D.D.C. 2019) (citations omitted). Success on a 

motion to enforce a judgment, however, allows a plaintiff only “the relief to which the plaintiff is 

entitled under its original action and the judgment entered therein.” Heartland Reg’l Med. Ctr. v. 

Leavitt, 415 F.3d 24, 29 (D.C. Cir. 2005) (quoting Watkins v. Washington, 511 F.2d 404, 406 

(D.C. Cir. 1975)). 

III. DISCUSSION

The remaining dispute between the parties is limited to whether CMS’s reimbursement

reductions for the eight LTCH-plaintiffs in Alabama, Arkansas, Mississippi, Nebraska, and 

Wisconsin are consistent with the Court’s direction that the CMS Administrator “reconsider 

whether, absent the must-bill and RA requirements, the plaintiffs are entitled to bad debt 
16

reimbursement.” Select Specialty I, 391 F. Supp. 3d at 70. Plaintiffs argue that these reductions 

are impermissible, emphasizing that this Court’s instructions on remand directed CMS to not 

“reduce Plaintiffs’ bad debt amounts owed by what [it] thinks the state Medicaid programs 

would have paid if Plaintiffs had (1) enrolled in Medicaid, (2) timely billed the Medicaid 

programs, and (3) obtained valid Medicaid RAs with state payment determinations.” Pls.’ Suppl. 

Mem. at 4–5 (emphasis in original). CMS counters that it was not barred, under Select Specialty 

I, from considering whether “[the] states [were] responsible for certain cost-sharing amounts.” 

Def.’s Suppl. Opp’n at 3. Both sides are partially right.

For the reasons explained below, plaintiffs’ motion to enforce the judgment will be

granted in part and denied in part. In effectuating this Court’s judgment, plaintiffs are correct 

that CMS cannot reduce reimbursements based on perceived Medicaid liability for claims 

incurred while plaintiffs were not enrolled in Medicaid during the billing years at issue. 

Nevertheless, nothing in Select Specialty I precludes CMS from decreasing reimbursements on 

the same basis for claims that plaintiffs incurred after becoming state Medicaid program 

registrants.

A. Reimbursement for Claims Incurred Before Plaintiffs Enrolled in Medicaid 

Select Specialty I presented an unambiguous command: CMS “could not, and indeed 

cannot, impose the must-bill policy and RA requirement on the plaintiffs for the period when 

they were non-Medicaid-participating providers.” 391 F. Supp. 3d at 70 (emphasis added). As 

recently explained by the D.C. Circuit, complying with the must-bill policy and RA requirement 

requires that medical providers “(1) bill the state Medicaid program to determine whether 

Medicaid will cover the bad debts first, and (2) obtain a document known as a remittance advice 

(‘RA’) indicating whether the state refuses payment, before seeking reimbursement under 

Medicare.” New LifeCare Hosps., 7 F.4th at 1220 (citations omitted). The must-bill policy and 
17

RA requirement thus impose a degree of “state Medicaid participation . . . that the LTCHs [have]

to satisfy for reimbursement to occur.” Select Specialty I, 391 F. Supp. 3d at 70. By withholding 

or decreasing reimbursements based on purported Medicaid liability for periods in which 

plaintiffs were not state Medicaid program participants, CMS is again subjecting plaintiffs to the 

must-bill policy and RA requirement, both of which are predicated on participating in and billing 

state Medicaid programs. Such an approach neglects the core holding of this Court’s judgment. 

Select Specialty I invalidated the application of the must-bill policy and RA requirement 

to plaintiffs during their period as non-Medicaid participants because, under the Medicare Act, 

CMS should have first engaged in notice-and-comment before imposing “participation in the 

state Medicaid program” as a requisite for dual-eligible bad debt reimbursement when such 

Medicaid participation was not previously required. Id. at 69. Indeed, as plaintiffs reiterate and

this Court has noted, before 2007, CMS “did not reduce Medicare reimbursement to Plaintiffs for 

their dual eligible bad debts to account for state Medicaid liability.” Pls.’ Reply at 14; see also 

Select Specialty I, 391 F. Supp. 3d at 55 (“Prior to 2007, [CMS] had reimbursed LTCHs for their 

dual-eligible patients’ unpaid co-insurance and deductible obligations . . . without requiring the 

LTCHs to bill state Medicaid programs for a formal determination of how much of that bad debt 

would be covered by state Medicaid programs.”). This was the status quo ante that Select 

Specialty I sought to preserve for plaintiffs during the billing periods at issue, when many were 

not permitted to enroll in state Medicaid programs because of their LTCH status and those 

permitted to enroll were barred from billing the states for their bad debt claims preceding their 

Medicaid enrollment dates. See Select Specialty I, 391 F. Supp. 3d at 69. CMS’s 2007 shift in 

policy therefore put plaintiffs in an impossible position in which they could not comply with the 

new Medicaid billing requirements even after endeavoring to do so, and Select Specialty I held 
18

that plaintiffs could not be penalized as a result due to the agency’s failure to engage in noticeand-comment. The agency’s arguments to the contrary—asserting that it enjoys carte blanche to 

deny or reduce reimbursements based on any perceived Medicaid liability accrued during the 

billing years at issue—are unavailing and driven by an improperly reductive reading of Select 

Specialty I. 9

 

According to CMS, “any reduction of Plaintiffs’ Medicare reimbursement to account for 

state Medicaid liability would be entirely lawful and completely consistent with the Court’s 

decision,” Def.’s Opp’n at 11, in part, because CMS was not ordered to make payment in any 

specific amount to any plaintiff, with that determination left to the agency, see id. at 9-10. 

Instead, CMS asserts the Court “simply instructed the agency ‘to reconsider whether, absent the 

must-bill and RA requirements, the plaintiffs are entitled to bad debt reimbursement.’” Def.’s 

Suppl. Opp’n at 4 (citing Select Specialty I, 391 F. Supp. 3d at 70) (emphasis added). This 

reductionist view of the Court’s order treats the must-bill policy and RA requirement as a “mere 

change in procedure,” without substantive consequences, that demanded of the plaintiffs nothing 

more than checking off two boxes on their way to receiving bad debt reimbursement. See Select 

Specialty I, 391 F. Supp. 3d at 69. CMS ignores, however, that the must-bill policy and RA 

requirement, “even if superficially appearing to be merely procedural, had significant substantive 

consequences . . . [,]essentially changed the eligibility criteria for reimbursement under the 

Medicare Act for dual-eligible patients . . . [and] newly require[d] LTCHs to assume some form 

of Medicaid participation.” Id. at 69-70.

9 CMS necessarily backs off on its original opposing argument that plaintiffs’ motion should be denied as 

premature because the agency “has not yet been afforded the opportunity to effectuate payment,” Def.’s Opp’n at 8, 

because HHS has now issued the payments and “concluded . . . [the] administrative process,” Def.’s Notice at 2. 
19

CMS also insists that the reimbursement reductions “stem not from an application of the 

must-bill or RA policies, but from a calculation of the amounts for which states were responsible 

pertaining to each Plaintiff’s bad debt claims.” Def.’s Suppl. Opp’n at 5. This representation 

creates a distinction that Select Specialty I made clear does not exist because “[t]o bill state 

Medicaid programs and obtain RAs, providers must now necessarily participate in state 

Medicaid programs, even though Medicaid participation is not a condition of participation or 

payment for purposes of Medicare reimbursement.” Specialty I, 391 F. Supp. 3d at 69. Put 

differently, “applying” the must-bill policy and RA requirement to plaintiffs would have resulted 

in state Medicaid programs determining what responsibility they had, if any, for the bad debts at 

issue. See New LifeCare Hosps., 7 F.4th at 1220 (explaining that the must-bill policy requires 

providers “to bill the state Medicaid program to determine whether Medicaid will cover the bad 

debts first”). Select Specialty I held that the Medicare Act did not permit CMS to require this 

degree of Medicaid participation from plaintiffs while they were not enrolled in their respective 

state Medicaid programs if the agency first did not engage in notice-and-comment. See 391 F. 

Supp. 3d at 70. For CMS now to deny reimbursement in complete disregard of plaintiffs’ 

Medicaid enrollment status and declare that “[n]othing about the payments issued here implicates 

the Plaintiff providers’ state Medicaid participation,” Def.’s Suppl. Opp’n at 4, indisputably 

defies the judgment and order in Select Specialty I. 

Accordingly, CMS is directed on remand to consider whether the eight plaintiffs are 

entitled to bad debt reimbursement without withholding or reducing any such reimbursement 

based on purported Medicaid liability incurred when plaintiffs were not enrolled in state 

Medicaid programs during the relevant fiscal years. For plaintiffs that were ultimately able to 

enroll in Medicaid, this includes reimbursement requests billed to, but rejected by, state 
20

Medicaid programs as pre-dating plaintiffs’ Medicaid enrollment dates. See Select Specialty I, 

391 F. Supp. 3d at 64 (citing S2-AR at 457 (Stipulations ¶8: “In no state could the Providers . . . 

obtain Medicaid RAs for dates of service when the Providers were not enrolled in Medicaid.”)). 

For example, the two plaintiffs located in Alabama and Mississippi “were unable to 

enroll in Medicaid . . . during the relevant period because of their status as LTCHs.” Id. at 64. 

Nonetheless, CMS has denied $7,343, plus interest, to the Alabama plaintiff (Select Specialty 

Hospital-Birmingham) on grounds that Alabama Medicaid was responsible for deductible 

amounts of dual-eligible bad debt claims during the period at issue, and withheld $76,736 from 

the Mississippi plaintiff (Select Specialty Hospital-Gulf Coast) because Mississippi Medicaid 

had “full responsibility to pay . . . for claims on or after January 1, 2010.” See CMS Letter at 2-

3. In implementing Select Specialty I, CMS may not deny these payments solely because of

perceived Medicaid liability during a period when both the Alabama and Mississippi plaintiffs—

given their status as LTCHs—were ineligible to participate in their states’ Medicaid programs. 

Doing so would fail to comply with this Court’s judgment that plaintiffs may not be held subject 

to a degree of Medicaid participation, without a period of notice-and-comment, that they simply 

could not assume as LTCHs under the Alabama and Mississippi Medicaid rules in place at the 

time. See Select Specialty I, 391 F. Supp. 3d at 69-70. 

By contrast, the six plaintiffs from Arkansas, Nebraska, and Wisconsin were each able to 

enroll in their respective state Medicaid programs during the relevant period. The four Arkansas 

plaintiffs (Specialty Hospital-Little Rock, Select Specialty Hospital-Fort Smith, Select Specialty 

Hospital-Little Rock/BMC, and Select Specialty Hospital-Pine Bluff) were not admitted to 

Arkansas Medicaid until either 2009 or 2010. Compare Select Specialty I, 391 F. Supp. 3d. at 65 

n.10 (noting that the Arkansas plaintiffs were admitted to Medicaid in 2010), with Pls.’ Suppl. 
21

Reply at 9 (“The Arkansas Plaintiffs obtained Medicaid provider agreements effective as of 

April 27, 2009.”). Still, CMS has collectively denied these four providers $1,510,755, plus 

interest, asserting that Arkansas Medicaid “had full responsibility” for their bad debt claims, 

including those claims incurred in the fiscal years that preceded plaintiffs’ Medicaid enrollment 

(whether that occurred in 2009 or 2010). CMS Letter at 2-3; see also id. at 4 (noting as “$0” the 

reimbursements that CMS issued to the Arkansas plaintiffs for fiscal years 2005-2008). 

Also asserting full state responsibility for the debts at issue, CMS is withholding all 

reimbursement from plaintiffs Select Specialty Hospital-Omaha in Nebraska, which enrolled in 

the state Medicaid program on March 1, 2008, see Pls.’ Suppl. Mem. at 9 (citing S2-AR at 212, 

317), and Select Specialty Hospital-Madison in Wisconsin, which became a state Medicaid 

participant on December 17, 2007, id. at 10 (citing S2-AR at 167-170); see also CMS Letter at 4 

(noting as “$0” the reimbursements that CMS issued to the Nebraska and Wisconsin plaintiffs 

for fiscal years 2005-2007). On remand, CMS must evaluate whether these six plaintiffs are 

entitled to any reimbursement for claims incurred before their Medicaid enrollment effective 

dates.

10 

B. Reimbursement for Claims Incurred After Plaintiffs Enrolled in Medicaid 

Notwithstanding the foregoing, to fulfill Select Specialty I’s mandate, CMS is not 

required to reimburse plaintiffs for claims incurred after their state Medicaid program enrollment 

10 The parties also dispute whether the Nebraska plaintiff may receive reimbursement for bad debts “incurred 

from treating patients who were eligible for an out-of-state Medicaid program,” Pls.’ Suppl. Mem. at 10; see also

Def.’s Suppl. Opp’n at 7, and the proper interpretation of the Wisconsin Medicaid State Plan, see Pls.’ Suppl. Reply

at 13; Def.’s Suppl. Opp’n at 7. These arguments, which are presented for the first time on this motion to enforce, 

are beyond the scope of the ruling reached in Select Specialty I and may thus not be entertained at this stage. See 

Heartland Reg’l Med. Ctr., 415 F.3d at 24 (explaining that succeeding on a motion to enforce allows a plaintiff only 

“the relief to which the plaintiff is entitled under its original action and the judgment entered therein”) (citations 

omitted); Resolute Forest Prods., Inc., 427 F. Supp. 3d at 41 (“A motion to enforce the judgment does not provide a 

means for a court to reconsider its judgment or for a plaintiff to raise new arguments that should have been offered 

in prior proceedings.”). 
22

date, at which point forward the state Medicaid programs bear responsibility for sharing the 

costs. CMS correctly points out that “the Court did not invalidate the premise that states may be 

responsible for certain cost-sharing amounts.” Def.’s Suppl. Opp’n at 3. Again, the precise 

holding of Select Specialty I was that, “without satisfying the notice-and-comment obligation 

[under the Medicare Act], CMS could not, and indeed cannot, impose the must-bill policy and 

RA requirement on the plaintiffs for the period when they were non-Medicaid-participating 

providers.” 391 F. Supp. 3d at 70 (emphasis added). No aspect of that holding, or any other 

dimension of that decision, entitled plaintiffs to reimbursement for claims accrued after they 

became Medicaid participants in those states where the Medicaid programs would have been 

liable for a portion of such claims. 

Although plaintiffs flatly assert they “were not enrolled in Medicaid during the periods at 

issue,” Pls.’ Mem at 4, the record establishes otherwise, revealing enrollment dates by 2010 for 

the Arkansas plaintiffs, see Select Specialty I, 391 F. Supp. 3d. at 65 n.10, Pls.’ Suppl. Reply at 

9; in March 2008 for the Nebraska plaintiff, see Pls.’ Suppl. Mem. at 9; and in December 2007 

for the Wisconsin plaintiff, see id. at 10. This Court’s judgment was limited to granting 

plaintiffs relief for their period as “non-Medicaid-participating providers,” Select Specialty I, 391 

F. Supp. 3d. at 70, not for bad debt claims that arose once plaintiffs became Medicaid registrants 

and had no obstacle to complying with the must-bill policy and RA requirement. CMS is 

therefore not required, on remand, to grant the Arkansas, Nebraska, and Wisconsin plaintiffs 

reimbursement for claims incurred after their Medicaid enrollment dates and from which point 

forward should have been the responsibility of their state Medicaid programs, to the extent that 

the states’ cost-sharing obligation can be clearly discerned by the agency. See New LifeCare 

Hosps., 7 F.4th at 1219 (explaining that only when states do “not cover the deductibles and 
23

coinsurances of dual-eligible patients through Medicaid” can “healthcare providers . . . seek 

reimbursement through Medicare” (citing 42 C.F.R. § 413.89)). 11

IV. CONCLUSION 

Consistent with the reasoning in Select Specialty I, CMS may not deny plaintiffs 

reimbursement for claims incurred while they were non-participants in state Medicaid programs 

during the billing periods at issue between 2005 and 2010. Otherwise, the “bureaucratic 

nightmare” that CMS created “by requiring a certain type of paperwork that the plaintiffs simply 

could not provide without sufficient advanced notice” would be prolonged and the relief granted 

to plaintiffs “for the period when they were non-Medicaid-participating providers” would be 

nullified. Select Specialty I, 391 F. Supp. 3d. at 70. The current record makes plain that CMS 

has denied plaintiffs all the relief required under the prior judgment by rejecting reimbursement 

for claims arising when they were non-participants in state Medicaid programs, and thus their 

motion to enforce is granted to that extent. Nevertheless, Select Specialty I did not require CMS 

to reimburse plaintiffs for bad debt claims incurred after plaintiffs enrolled in state Medicaid 

programs to the extent the states’ Medicaid plans were responsible for covering such claims. 

HHS is correct that, for such claims, plaintiffs’ recourse is to sue the appropriate state Medicaid 

program rather to seek an order directing CMS to reimburse the eight plaintiffs for those claims

that are not “a federal obligation.” Def.’s Suppl. Opp’n. at 5. 

Accordingly, plaintiffs’ motion to enforce judgment is granted in part and denied in part. 

An Order will be entered contemporaneously with this Memorandum Opinion.

11 Notably, this is the approach already adopted by CMS. In its January 2021 Notice, CMS explained that, 

after reviewing the relevant Medicaid State Plans, it was unable to discern the state cost-sharing responsibility policy 

for six states (Kansas, Kentucky, Pennsylvania, Ohio, Oklahoma, and South Dakota). CMS Letter at 2. The agency 

thus decided to give “the 17 providers in these six states the benefit of the doubt,” and remitted to them “the full 

allowable bad debt amounts without a state cost sharing liability reduction” totaling $2,743,006. Id. 
24

Date: September 20, 2021

__________________________

BERYL A. HOWELL

Chief Judge