Supreme Court Decision Alert - January 22, 2013

Keywords: Medicare, equitable tolling, provider-reimbursement claims

Today the Supreme Court issued one decision, described below, of interest to the business community.

Medicare—No Equitable Tolling of Provider-Reimbursement Claims

Sebelius v. Auburn Regional Medical Center, No. 11-1231

Under Medicare Part A, a health-care provider submits a cost report at the end of each fiscal year to an intermediary that determines the amount that the provider will receive in reimbursement payments for that year. A provider may obtain a hearing before the Provider Reimbursement Review Board to challenge the amount if the provider "files a request for a hearing within 180 days after notice of the intermediary's final determination." 42 U.S.C.§ 1395oo(a)(3). Today, in a unanimous decision, the Supreme Court held that the 180-day time limit is not jurisdictional. The Court further held that the Secretary of the Department of Health and Human Services reasonably construed § 1395oo(a)(3) in promulgating a regulation (42 C.F.R. § 405.1841(b) (2007)) that extended the 180-day period to three years on a provider's showing of good cause for the delay. Finally, reversing the judgment of the U.S. Court of Appeals for the D.C. Circuit, the Court held that the 180-day time limit is not subject to equitable tolling.

The Court's decision in this case will be important to health-care providers seeking, under this pre-2008 version of the Medicare regulation, review of determinations that are older than three years, because the decision clarifies that providers may not bring such stale appeals. (The Court noted, however, that its opinion does not address the current version of the regulation, 42 C.F.R. § 405.1836(c)(2) (2012), which was enacted in 2008 but retains the strict three-year cutoff for all claims.) Of perhaps greater significance is the Court's conclusion that the equitable-tolling presumption from Irwin v. Department of Veterans Affairs, 498 U.S. 89, 95–96 (1990)—in which the Court held that "the same rebuttable presumption of equitable tolling applicable to suits against private defendants should also apply to suits against the United States"—does not apply to HHS's internal deadline for appeals.

According to the opinion, authored by Justice Ginsburg, the 180-day time limit for an appeal under § 1395oo(a)(3) is not jurisdictional because Congress did not "clearly state[ ]" that it was. Slip op. 6. Instead, the "language Congress used hardly reveals a design...