Source: https://medicaidlawnc.com/2014/11/
Timestamp: 2019-04-23 09:07:44+00:00

Document:
Supreme Court Will Decide Whether Citizens in NC and 26 Other States Can Receive Tax Credits for Health Care Premiums!!
With a decision that, I can only imagine, ricocheted against the White House walls, the Supreme Court granted certiorari to hear King v. Burwell this past Friday, November 7, 2014, despite Obama’s administration’s request for the Supreme Court to postpone granting certiorari in order to wait for a D.C. circuit to re-visit an opinion, the Halbig ruling.
First of all, what the heck is certiorari…or “cert”, as many attorneys call it?
A writ of certiorari is actually an order from a higher court to a lower court demanding a record in a case so that the higher court may review the lower court’s decision. A writ of certiorari is the instrument most used by the Supreme Court to review cases. The Supreme Court hears such a small, minute fraction of lawsuits that when the Supreme Court “grants cert,” it is a big deal.
I have written in the past about these same two appellate court cases, which were both published July 22, 2014, within hours of one another, regarding the Health Care Premium Subsidies Section of the Affordable Care Act. These two cases yield polar opposite holdings. In Halbig v. Burwell, the D.C. Circuit Court found that the clear language of the ACA only allows the health care premium subsidies in states that created their own state-run health care exchanges, i.e, residents in NC along with 35 other states would not be eligible for the subsidies. See my blog: Halbig: Court Holds Clear Language of the ACA Prohibits Health Care Subsidies in Federally-Run Exchanges.
So the two cases came to two entirely different conclusions. Halbig: ACA is clear; King: ACA is ambiguous.
Well, for everyone else, that is as clear….as mud.
When the D.C. court decided Halbig, it was not an en banc decision. In English, this means that the entire bench of judges in the D. C. Circuit did not hear the case, only a panel of three (which is the usual way for a case to be heard on appeal to a federal circuit). The Obama administration, along with other proponents of the ACA, hoped that the U.S. Supreme Court would deny cert to King until the D.C. court could re-visit its decision, this time en banc.
Yet, this past Friday, the Supreme Court opted to consider King v. Burwell.
The sole issue to be decided is: Whether the Internal Revenue Service may permissibly promulgate regulations to extend tax-credit subsidies to coverage purchased through exchanges established by the federal government under Section 1321 of the Patient Protection and Affordable Care Act.
How is King v. Burwell NOT an attack on the ACA?
Section 1311 directs states to establish exchanges, and Section 1321 directs the federal government to establish exchanges “within” any state that opts to not set up its own state-run exchange, e.g., NC.
Section 1401 authorizes subsidies for people whose household income falls between 100 and 400% of the federal poverty level, who are not eligible for qualified employer coverage or other government programs, and who enroll in coverage “through an Exchange established by the State.” (emphasis added). These 3 criteria are crystal clear based on the plain language of the statute.
The statute makes no provision for subsidies in states that opt not to create their own exchange but, instead, allow the federal government to create an exchange within its state.
The ACA was intended to create penalties if the states do not establish their own exchanges. For example, the subsidies are not allowed to citizens of states without state-created exchanges.
Oklahoma began the litigation with Pruitt v. Burwell in September 2012. In September 2014, a federal district court held that the plain language of the ACA does not allow subsidies in states with federally-run exchanges. In May 2013, Halbig v. Burwell was filed, and in September 2013, King v. Burwell was filed.
So, much to the contrary of popular belief, these lawsuits are not “against the ACA” or “proving the unconstitutionality of the ACA.” Instead, these lawsuits are “against” the IRS interpreting the ACA to allow tax credits for all states, even if the state has a federally-run exchange.
Will it negatively impact the ACA if the plaintiffs win? That would be a resounding yes.
Oral argument could be as soon as March 2015.
Posted in Affordable Care Act, Federal Government, Federal Law, Final Rulings, Health Care Providers and Services, IRS, Lawsuit, Legal Analysis, Legislation, Medicaid, Medicaid Attorney, Medicaid Expansion, Medicare, Medicare Attorney, NC, North Carolina, Obamacare, Supreme Court, Tax Dollars, Taxpayers, Washington D.C.
Due Process…It’s such a fundamental part of our society that we rarely think about due process on a day-to-day basis. Not until due process is violated, do we usually contemplate it.
However, when it comes to credible allegations of fraud against a health care provider who accepts Medicaid or Medicare, the federal government, arguably, dropped the ball. The federal regulations instruct the states to “afford due process,” but fail to instruct how. 42 CFR 455.23. Which leaves the due process component in the states’ hands.
To begin with, the standard for a credible allegation of fraud is excruciatingly low. I mean, LOW. The bar has been set so low that an ant would probably climb over the bar rather than walk beneath it. See my past blogs: “New Mexico Affords No Due Process Based on a PCG Audit.”and “NC Medicaid Providers: “Credible Allegations of Fraud?” YOU ARE GUILTY UNTIL PROVEN INNOCENT!!” For example, a disgruntled employee or a competitor can draft an anonymous letter without a signature and without a return address, send it to the single state entity, and all your reimbursements could be suspended without any notice to you.
Senator Mary Kay Papen of New Mexico and her team have drafted a fantastic proposed state bill which would provide safeguards for health care providers’ due process while still allowing the state to investigate Medicaid fraud. I mean, let’s face it, we want to catch Medicaid fraud, but we don’t all live in Florida…or New York. 🙂 Fraud is much more infrequent than people imagine compared to the overreaching ability of the single state agencies to suspend innocent providers’ reimbursements.
I had the privilege of flying out to New Mexico a week or so ago to testify before a subcommittee of the legislature about my opinion of Senator Papen’s proposed bill.
Little known fact about New Mexico: The New Mexico legislature is the only unpaid legislature in the country. I had no idea. To which, I said, which I believed was a logical statement, “why doesn’t the legislature pass a bill that creates salaries for members of the legislature?” I was told that no bill providing salaries to members of legislature would ever be signed by the governor (no specific governor, I believe, but, any governor) because the status of governor is so important/powerful in New Mexico due to the less powerful legislature. In other words, supposedly, no governor would sign a bill instituting salaries for members of legislature because the governor would be fearful to lose power. (I do not know the validity of this conjecture, but I do find it interesting).
3. Determines that sufficient indicia of reliability exist to justify a reason to refer the provider to the Attorney General (AG) for further investigation.
The proposed bill also forbids extrapolation as to alleged overpayments.
Further, the proposed bill forbids the state agency from suspending payments until certain safety procedures are met. For example, all appeals and administrative remedies must be exhausted, and the bill allows the provider to post a bond in order to keep receiving reimbursements.
It also allows a provider to receive injunctive relief against the agency in order to continue receiving reimbursements.
And, my favorite part, states that a judge may award attorney’s fees if it shown that the agency substantially prejudiced the provider’s rights and acted arbitrarily and capriciously. Obviously, the attorneys’ fees are not a given; the provider would need to show that the state, somehow, acted, for example, without enough evidence or failed to provide due process.
Senator Papen’s proposed bill is just that…a proposed bill. But, it is a start in the right direction. If, in fact, the federal government placed the burden on the states to implement due process in situations in which there are allegations of fraud, then the states need to act. Because, right now, when there is noncredible allegation of fraud, the state has the ability, and is using this ability in many states, to completely shut down providers. In essence, an allegation of fraud becomes the death of a company…no reimbursements, no income, no payroll, terminate staff, cease paying bills, file for bankruptcy.
I encourage more states to review Senator Papen’s proposed bill and propose similar bills in other states.
And for you politicians…the best part? At least, in New Mexico, the bill appeared to be supported by a non-partisan group.
BTW, in case you are interested, here are the changes to our General Assembly and Congress after Tuesday’s election: (brought to you by Tracy Colvard, Vice President of Government Relations and Public Policy for AHHC).
Thanks, Tracy, for those demographics.
Now, let’s get some due process safeguards for health care providers!!!!
I was interviewed by Heather Waliga, ABC News, last Friday about the U.S. Attorney’s lawsuit against Computer Sciences Corporation (CSC) accusing CSC of hundreds of millions of dollars of Medicaid fraud.
But, beware! Do not make the video full screen unless you are prepared to see a very, large, close-up picture of my head. The camera man zoomed in to, literally, just my head.

References: v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v.