Healthcare providers cannot appeal a fiscal intermediary's refusal to re-examine a Medicare payment decision, the U.S. Supreme Court unanimously ruled last week.
The ruling is a victory for federal regulators, who had argued that Knoxville, Tenn.-based Your Home Visiting Nurse Services had to accept the judgment of its fiscal intermediary, Blue Cross and Blue Shield of South Carolina.
The decision rings true for all healthcare providers, virtually killing their chances of bringing a similar lawsuit in the future, said Dennis Barry, an attorney with Vinson & Elkins in Washington.
"Providers will be utterly and completely at the mercy of the intermediaries," Barry said.
In 1994, Your Home asked the Blues to reopen its Medicare cost report for 1989, saying it had new information that its owners were paid less than the owners of a competing nursing service.
All facilities serving Medicare patients must file Medicare cost reports, which are submitted to the government's fiscal intermediaries and serve as providers' final claims for services during a year.
Providers can appeal an unfavorable reimbursement decision to HCFA's Provider Reimbursement Review Board within 180 days. The board's ruling may be appealed to a federal court within 60 days.
Your Home did not challenge the Blues' decision after the initial 180-day period ended in 1991.
Medicare rules also allow providers to ask an intermediary to reopen a case within three years of a payment decision. However, the intermediary is not required to reopen the case, the government argued. The high court agreed.
The Blues did refuse, and Your Home challenged that decision in court.
Your Home argued that it was entitled to a hearing before the board because the fiscal intermediary's refusal to reopen the case constituted a new "final determination" of the payment, resetting the 180-day clock.
Officials at Your Home did not return calls for comment.
Justice Antonin Scalia, writing the opinion for a unanimous court, said the government's reading of the Medicare regulations on the matter seemed "more natural" than Your Home's interpretation.
"The statutory purpose of imposing a 180-day limit on the right to seek board review of the notice of program reimbursement would be frustrated by permitting requests to reopen to be reviewed indefinitely," Scalia wrote.
HCFA had no comment on the case.