Sebelius v. Auburn Regional Medical Center

PETITIONER: Kathleen Sebelius, Secretary of Health and Human Services
RESPONDENT: Auburn Regional Medical Center et al.
LOCATION: Center for Medicare & Medicaid Services

DOCKET NO.: 11-1231
DECIDED BY: Roberts Court (2010-2016)
LOWER COURT: United States Court of Appeals for the District of Columbia Circuit

CITATION: 568 US 817 (2013)
GRANTED: Jun 25, 2012
ARGUED: Dec 04, 2012
DECIDED: Jan 22, 2013

ADVOCATES:
Edwin S. Kneedler - Deputy Solicitor General, Department of Justice, for the petitioner
John F. Manning - for the Court-appointed amicus curiae (appointed by the Court)
Robert L. Roth - for the respondent

Facts of the case

Hospitals receive compensation from the federal government based on the number of low-income patients they serve. The Center for Medicare & Medicaid Services (CMS) decides how much this payment will be. In an unrelated case, it came out that CMS miscalculated this payment between 1993 and 1996 so hospitals received less than they were due. In 2006, a group of hospitals filed claims with the Provider Reimbursement Review Board (PRRB) for full payment from the Department of Health and Human Services for years 1987-1994. Although the statute of limitations for such claims is 180 days, the hospitals argued that the limitations period should be tolled because CMS knowingly and unlawfully failed to disclose its error. The PRRB held that it did not have the authority to toll the statute of limitations, so the claims were untimely.

The hospitals sued in district court, but the district court held that it did not have jurisdiction because the PRRB's decision was not final. The court also held that the relevant statute does not allow for tolling the statute of limitations. The U.S. Court of Appeals for the District of Columbia Circuit reversed, holding that it did have jurisdiction because the PRRB decision was final. It also held that tolling the statute of limitations for "good cause" is possible, but whether it is appropriate in this case is a question for remand. The court of appeals denied a petition for a rehearing en banc.

Question

Is the statute of limitations for filing a claim with the PRRB for Medicare payments subject to tolling for good cause?

Media for Sebelius v. Auburn Regional Medical Center

Audio Transcription for Oral Argument - December 04, 2012 in Sebelius v. Auburn Regional Medical Center

Audio Transcription for Opinion Announcement - January 22, 2013 in Sebelius v. Auburn Regional Medical Center

John G. Roberts, Jr.:

Justice Ginsburg has the opinion this morning in case 11-1231, Sebelius versus Auburn Regional Medical Center.

Ruth Bader Ginsburg:

Hospitals providing Medicare services may pursue an administrative appeal from the initial determination of the amount of reimbursement they qualify to receive from the Department of Health and Human Services.

This case concerns the time within which the internal appeal maybe pursued.

Under the Medicare Act, a government contractor, known as a fiscal intermediary, annually determines the reimbursement amount due each hospital in the intermediary's area.

A hospital that disagrees with the intermediary -- intermediary's calculation, the Medicare Act provides -- may appeal to an -- to an administrative body called the Provider Reimbursement Review Board.

Such an administrative appeal, the Act specifies, must be brought within a 180-day timeframe.

In 1974, HHS adopted a regulation allowing the board to extend the 180-day period for a maximum of three years if the hospital shows good cause for the appeal-filing delay.

But three years is it.

The regulation wins.

No appeal filed after that time will be entertained.

In 2006, the board released a decision in an appeal timely brought by a hospital that is not a party to this case.

In that decision, the board determined that the intermediary's reimbursement calculation was flawed because the Government had not given the intermediary the best available data.

Many other hospitals were similarly disadvantaged by the government's flawed calculations and likely had been underpaid for the Medicare services they provided.

The hospitals in this case sought to piggyback on the board's determination in the timely appealed case.

Their appeal, however, was brought more than a decade after the 180-day clock ran out.

To overcome this obstacle, the hospitals invoked a doctrine called equitable tolling.

“The clock should be stopped,” they urged, until the Government's use of faulty data came to light.

The board refused to consider the untimely appeals.

Under -- under the HHS regulation, the board observed three years was the maximum stretch permissible.

The Court of Appeals for the District of Columbia Circuit reversed.

There is a presumption, the appellate court said, that equitable tolling applies to limitation periods stated in federal statutes.

Under that presumption, the court ruled, it was open to the hospitals to argue to the board that in fairness, they should be allowed to present their long post-deadline appeals.

We reversed the Court of Appeal's judgment.

First, we agree with both parties and the DC Circuit that the statute's 180-day limit on provider appeals is not jurisdictional.

That is, it does absolutely preclude HHS from allowing appeals once 180 days runs out.

But we also hold that the regulation which puts a firm three-year limit on late appeals was within the bounds of HHS' authority under the Medicare Act.

But we need to type the 180-day statute -- statutory deadline jurisdictional, it would mean that under no circumstances could the board hear and appeal outside the 180-day window.

Consequently, HHS' provision of a three-year outer limit would fall.

The language Congress used does not support such an iron bar to late appeals.

Several of our recent decisions confirm the directions like the statutory 180-day limit are claimed processing rules, not jurisdictional barriers.