Nathan A Adams IV is a Partner in Holland & Knight's Tallahassee office.
In Tennessee Hosp. Ass'n v. Azar, 908 F. 3d 1029, (6th Cir. 2018), the court of appeals ruled that CMS' payment-deduction policy directing states to deduct Medicare and private-insurance payments when calculating "uncompensated care costs" of serving Medicaid-eligible individuals and determining each hospital's disproportionate share hospital (DSH)-payment limit was a reasonable interpretation of ambiguous language in the Medicaid Act in accord with Chevron deference, despite purported inconsistent interpretations by CMS over time. But the court of appeals also found that CMS' directive was a legislative rule subject to the Administrative Procedure Act's (APA) notice and comment procedures. Consequently, the court of appeals enjoined enforcement of CMS' policy until CMS promulgates it in compliance with the APA process. The court of appeals disagreed with the district court that CMS' policy exceeds the agency's authority under the Medicaid Act.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
