HHS Enjoined from Enforcing Self-Disallowance Regulation

    13 August 2014

    On August 6th, the U.S. District Court for the District of Columbia enjoined HHS (along with the PRRB and CMS’s Medicare contractors) from applying HHS’s “self-disallowance” regulation to any appeals filed on the basis of an untimely NPR. 

    The court’s injunction unlocks the door for certain provider appeals that the self-disallowance regulation had facially barred.  The injunction was entered in three related Medicare reimbursement appeals.  The appeals were filed on behalf of a group of over 40 hospitals, each seeking reversal of PRRB dismissals for lack of jurisdiction for asserted non-compliance with the self-disallowance regulation.  The hospitals may now pursue their underlying reimbursement claims involving challenges to Medicare’s outlier supplemental payment program (~ $90 million) and the rural floor budget neutrality adjustments (~$20 million.)

    The court’s injunction goes hand in glove with HHS’s “technical correction” to the self-disallowance regulation, as scheduled to be published on August 22nd, in the 2015 final IPPS regulations, such that the regulation is inapplicable to appeals filed on the basis of untimely NPRs.  Hospitals that have had their appeals dismissed by the PRRB (or the CMS Administrator) – for failure to self-disallow – may be able to seek reopening.