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Dole v. Azar

United States District Court, W.D. Louisiana, Alexandria Division

November 5, 2019





         Before the court are Plaintiffs "Motion for Preliminary and Permanent Injunction, Mandamus and Consolidation Under F.R.C.P. 65(a)(2)" (Doc. 14) and Defendants' "Motion to Dismiss Plaintiffs Complaint for Injunctive Relief and Mandamus" (Doc. 21). Both motions were argued by the parties and taken under advisement on May 24, 2019.

         I. BACKGROUND

         A. Medicare Act

         The Medicare Act, 42 U.S.C. §1395, et seq., was enacted in 1965 under Title XVIII of the Social Security Act to provide a health insurance program for the elderly. The Secretary of the United States Department of Health and Human Services was entrusted with promulgating regulations for the administration of the Medicare program.

         As part of the resulting regulations, participating medical providers enter into a written agreement with Medicare. Medical providers submit claims for reimbursement to a designated Medicare Administrative Contractor ("MAC") after rendering services to a Medicare beneficiary.[1]42 U.S.C.§1395ff(a)(2)(A). An "initial determination" by the Secretary as to whether to pay or deny the claim must be made within 30 days of receiving the claim, but the Secretary may "reopen or revise any initial determination.. .under guidelines established by the Secretary in regulations." 42 U.S.C §h(c)(D), §ff(a), §ff(b)(1)(G), and 42 C.F.R. §402.920. Additionally, a "post payment review process" may be implemented by a Recovery Audit Contractor and/or a Zone Program Integrity Contractor ("ZPIC"), which is what transpired in this case. Providers agree that the Center for Medicare and Medicaid Services can recoup overpayments from current and future payments.

         B. Facts

         Dr. Michael Dole is a Louisiana licensed physician, board-certified in pain management, and a qualified provider of physician services covered by Medicare Part B[2]. Dr. Dole practices through a professional medical corporation, Michael Dole, M.D., A Professional Medical Corporation ("APMC"). APMC is the entity enrolled in Medicare and it submits charges to Medicare for payment. APMC's only physician is Dr. Dole and he is one of two physicians in the Alexandria, Louisiana area who limit their practice to the medical management of chronic pain. The other physician is aging, in declining health, and has severely restricted his practice. Neither physician is accepting new Medicare patients, so Medicare beneficiaries must travel to Shreveport, Lafayette, Baton Rouge or Houma to see a physician who medically manages chronic pain.[3]

         ZPIC contractor, AdvanceMed, conducted two separate post-payment reviews of APMC: one in November 2015 and the second in April 2016. On September 29, 2016, AdvanceMed provided a letter to APMC advising the post-payment review revealed two overpayments were made to APMC: the first in the amount of $9268.48 (58 claims reviewed) and the second in the amount of $10, 466.84 (90 claims reviewed). From these figures, AdvanceMed used statistical sampling and extrapolation to calculate and project an overpayment of claims to APMC in the amount of $4, 339, 672.96.

         Pursuant to 42 U.S.C. §1395ff, APMC initiated its four-level administrative appeal of the "post-payment review." APMC timely requested a redetermination from Novitas, the MAC that initially approved both the $9, 268.48 and the $10, 466.84 payments. Novitas issued a timely redetermination and denied APMC relief as to both amounts, APMC then timely submitted a request for reconsideration of both amounts to a "Qualified Independent Contractor", C2C Innovative Solutions, Inc. In two separate decisions, one issued on June 16, 2016 and the other on July 7, 2016, APMC was denied relief on the $4.3 million claim and the $9, 268 claim, respectively.

         APMC sought hearings before an Administrative Law Judge ("ALJ") on the $4.3 million claim on July 28, 2017 and on the $9, 268 claim on August 18, 2017, pursuant to 42 C.F.R. 405.1014. Over two years later, no ALJ has been assigned to either case and no hearing has been held. Nevertheless, the Defendants moved forward with recoupment efforts in July 2017, charging 10.25% interest per annum to all amounts allegedly owed and withholding 100% of APMC's current Medicare reimbursements.

         At the time of our hearing on May 24, 2019, it had been roughly 650 days since the ALJ hearing was requested, and in that time, Medicare recouped $2.4 million from APLC by withholding payments for services rendered. Medicare turned the remaining debt over the United States Department of Treasury who in turned hired Performant Recovery to collect the debt from APMC. In light of the backlog of appeals, it is more likely than not that Defendants will recoup 100% of the alleged overpayment and accrued interest before an ALJ holds a hearing.

         II. ...

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