In a key case being watched by the industry, Judge Collyer of the United States District Court for the District of Columbia issued an opinion today granting UnitedHealthcare’s Motion for Summary Judgment in UnitedHealthcare Insurance Co. v. Azar, No. 16-157 (D.D.C.), which challenged CMS’ 2014 Overpayment Rule (the “Rule”). Judge Collyer’s decision vacated the Rule in its entirety, finding that, by effectively imposing a 100% accuracy requirement on the data that Medicare Advantage organizations (“MAOs”) report to CMS for risk adjusted payment purposes, the Rule violated the statutory mandate of “actuarial equivalence” between CMS payments for healthcare coverage under traditional Medicare and Medicare Advantage (“MA”). Moreover, the Court found that the Rule’s facilitation of False Claims Act liability for MAOs’ failures to engage in “reasonable diligence” overshot CMS’ statutory authority, and that its definition of when an overpayment is “identified” was finalized without adequate notice as required by the Administrative Procedure Act. These latter two holdings may also have significant implications in the context of CMS’ separate but similar overpayment rule for Medicare Part A and Part B providers.
Continue Reading CMS’ Medicare Advantage Overpayment Rule: Arbitrary, Capricious, and Vacated