Porzecanski v. Azar
Porzecanski v. Azar
Opinion of the Court
Before the Court are Arturo Porzecanski's Motion for Summary Judgment, Dkt. 15, and the U.S. Department of Health and *14Human Services' Cross-Motion for Summary Judgment, Dkt. 17. For the reasons that follow, the Court will grant in part and deny in part Porzecanski's motion, and the Court will grant in part and deny in part HHS's motion.
I. BACKGROUND
In 2005, Porzecanski was diagnosed with systemic capillary leak syndrome (SCLS), also known as Clarkson's disease. Administrative Record (AR) 29, 124, Dkt. 22. SCLS is an "exceedingly rare" and life-threatening disorder, characterized by debilitating episodes in which blood and proteins shift from blood vessels into nearby body cavities and muscles. See AR 59, 73, 124, 342-45. SCLS can be treated with intravenous immune globulin (IVIG). AR 33, 137. Porzecanski received IVIG treatment on December 16, 2014, but when he submitted a Medicare claim for the treatment, an administrative law judge denied the claim. AR 28-33. Porzecanski now challenges that denial, and he seeks declaratory and injunctive relief to prevent HHS from continuing to deny similar claims.
A. Medicare Part B and the Claims Process
Medicare is a federal health insurance program that serves elderly or disabled Americans. See
The term "drugs" and the term "biologicals" ... include only such drugs (including contrast agents) and biologicals, respectively, as are included (or approved for inclusion) in the United States Pharmacopoeia, the National Formulary, or the United States Homeopathic Pharmacopoeia, or in New Drugs or Accepted Dental Remedies (except for any drugs and biologicals unfavorably evaluated therein), or as are approved by the pharmacy and drug therapeutics committee (or equivalent committee) of the medical staff of the hospital furnishing such drugs and biologicals for use in such hospital.
In addition, covered services must be reasonable and necessary. "Notwithstanding any other provision of [the Medicare statute], no payment may be made under ... part B ... for any expenses incurred or items or services-which ... are not reasonable and necessary for the diagnosis or treatment of illness or injury or to improve the functioning of a malformed body member."
*15An unlabeled use of a drug is a use that is not included as an indication on the drug's label as approved by the FDA. FDA approved drugs used for indications other than what is indicated on the official label may be covered under Medicare if the [Medicare administrative contractor] determines the use to be medically accepted, taking into consideration the major drug compendia, authoritative medical literature and/or accepted standards of medical practice.... These decisions are made by the [contractor] on a case-by-case basis.
To submit a Medicare Part B claim, a beneficiary must first file with an administrative contractor hired by HHS to make initial coverage determinations.
If the beneficiary disagrees with the contractor's initial determination, the beneficiary may request a "redetermination" by the same contractor.
B. Porzecanski's Claims
Beginning in 2005, Porzecanski experienced numerous life-threatening SCLS episodes that required prolonged stays at intensive care units. AR 21. Despite a preventive regimen of theophylline and terbutaline, the episodes began occurring more frequently.
*16Since receiving IVIG, he has been symptom-free.
This case involves an IVIG treatment that Porzecanski received on December 16, 2014 at Georgetown University Medical Center, for which the Medical Center billed $29,860.95. AR 21. Porzecanski submitted a Medicare claim for the IVIG treatment, but the initial contractor-Novitas Solutions-denied coverage. AR 333. Porzecanski requested a redetermination, and Novitas Solutions again denied coverage.
Porzecanski then appealed to an administrative law judge, who held a brief hearing at which Porzecanski testified. AR 53 (appeal); AR 478-91 (hearing transcript). The administrative law judge denied coverage on April 28, 2016. AR 28-33 (opinion). Porzecanski sought review by the Medicare Appeals Council, see AR 7, but the Council did not act within 90 days. Porzecanski requested escalation to federal district court, see AR 2-4, and filed his complaint on October 17, 2016, asserting that the administrative law judge's decision violated the Administrative Procedure Act. See Compl. ¶¶ 9, 44-51, Dkt. 1; see also Pl.'s Mem. at 13-14, Dkt. 15-1. The parties cross-moved for summary judgment in summer 2017, and the case was reassigned to the undersigned judge on December 5, 2017. See Dkt. 15; Dkt. 17.
Since Porzecanski received the IVIG treatment at issue in this case, initial contractors have continued to deny his claims for other monthly treatments, but he has fared better with at least one qualified independent contractor and all other administrative law judges who have heard his appeals. Relying on a local coverage determination, the initial contractor Novitas Solutions and the qualified independent contractor Maximus Federal Services rejected Porzecanski's claims for IVIG treatments received in November 2015, December 2015, and January 2016. Administrative law judges, however, reversed the contractors in early 2017. See Dkt. 15-2; Dkt. 15-3; Dkt. 15-4. In addition, Novitas Solutions denied Porzecanski's claim for IVIG treatment received in April 2016, but the qualified independent contractor Maximus Federal Services reversed in early 2017. See Dkt. 15-5. Also, Novitas Solutions and qualified independent contractor C2C Innovative Solutions rejected Porzecanski's claim for IVIG treatment received in April 2017, but an administrative law judge again reversed the contractors in early 2018. See Dkt. 23-1. The administrative law judges' decisions highlight the alternating-and oftentimes unclear-reasons given by contractors for denying Porzecanski's monthly claims: (a) Porzecanski lacked documentation to support his diagnosis and treatment; (b) IVIG was not medically necessary; or (c) local coverage determinations did not cover SCLS.
II. LEGAL STANDARDS
A court grants summary judgment if the moving party "shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a) ; see also Anderson v. Liberty Lobby, Inc. ,
In a Medicare action, the court reviews the agency's decision under the Administrative Procedure Act. 42 U.S.C. § 1395oo(f)(1) ; see Marymount Hosp., Inc. v. Shalala ,
In an arbitrary and capricious challenge, the core question is whether the agency's decision was "the product of reasoned decisionmaking." Motor Vehicle Mfrs. Ass'n of U.S., Inc. v. State Farm Mut. Auto. Ins. Co. ,
To the extent that an agency action is based on the agency's interpretation of a statute it administers, the court's review is governed by the two-step Chevron doctrine. At Step One, a court must determine "whether Congress has directly spoken to the precise question at issue" or instead has delegated to an agency the legislative authority to "elucidate a specific provision of the statute by regulation." Chevron, U.S.A., Inc. v. Nat. Res. Def. Council, Inc. ,
III. ANALYSIS
The statutory framework governing Medicare claims like Porzecanski's is clear. Medicare Part B covers "medical and other health services," 42 U.S.C. § 1395k(a)(2)(B), including "services and supplies (including drugs and biologicals which are not usually self-administered by the patient) furnished as an incident to a physician's professional service,"
The administrative law judge's reasoning-and the HHS arguments in this litigation-do not redeem the decision, which goes astray in four ways. First, the administrative law judge's decision relies on the wrong law. The decision imports the Medicaid statute's definition of a "covered outpatient drug" as one used for a "medically accepted indication," 42 U.S.C. § 1396r-8(k)(3), meaning "a use that is approved by the FDA or the use of which is supported by one or more of the statutorily approved drug compendia," AR 30. Relying on the Medicaid definition, the decision denies coverage for Porzecanski's IVIG treatment because such a use is not listed in the approved compendia. See AR 32. Needless *20to say, the Medicaid statute does not govern coverage under Medicare Part B, which defines coverage as discussed above. Cf. Caring Hearts Pers. Home Servs., Inc. v. Burwell ,
Second, when the administrative law judge's decision turns to the Medicare statute, the decision points out that Medicare Part B defines anticancer drugs to include drugs used for a "medically accepted indication," but does not define non -anticancer drugs in the same way. AR 30 (quoting 42 U.S.C. § 1395x(t)(2)(A) ). From that fact, the decision infers that non-anticancer drugs or biologicals (like IVIG treatment) "must be prescribed for an FDA-approved use or the use must be supported [by] a listing in one of the specified drug compendia."
Third, the decision relies on an inapposite statutory provision to suggest that Medicare limits IVIG coverage to patients who, unlike Porzecanski, have an immune deficiency disease and receive treatment in their homes. See AR 31 (citing 42 U.S.C. § 1395x(s)(2)(Z), 1395x(zz) ); AR 33 ("The statute specifically covers IVIG only for the treatment of primary immune deficiency diseases."). But the provision cited by the administrative law judge-although it expands coverage to include in-home IVIG treatment-does not apply here. As explained above, different provisions makes clear that certain drugs or biologicals furnished in a hospital incident to a physician's professional service, such as Porzecanski's IVIG treatment at issue here, are covered when they are reasonable and necessary. See 42 U.S.C. §§ 1395x(s)(2)(A), 1395x(t)(1), 1395y(a)(1)(A).
Fourth, the decision appears to lean on a local coverage determination promulgated by Novitas Solutions. See AR 32 ("[SCLS] is not one of the listed codes. The LCD instructs that all [such] codes not listed under the codes that support medical necessity will be denied."); AR 33 ("[The local coverage determination] lists the only ICD-9 diagnoses codes that describe a covered primary immune deficiency disease."). A local coverage determination, however, is not binding on administrative law judges. See
Faced with these missteps, HHS now argues that any errors were harmless or non-prejudicial because the administrative law judge ultimately reached the correct result. See Def.'s Mem. at 19-21; Def.'s Reply at 1-4, Dkt. 21; see also
Due to its errors, the administrative law judge's decision is arbitrary, capricious, and otherwise not in accordance with law. In particular, the decision ignores the Medicare statute and HHS's own rules, the decision is not the product of reasoned decisionmaking, and the decision does not "articulate a satisfactory explanation for its action including a rational connection between the facts found and the choice made." State Farm ,
In addition to seeking reversal of the adverse decision, Porzecanski seeks further declaratory and injunctive relief. In particular, Porzecanski asks the Court "to make certain that the Secretary and his various contractors, [administrative law judges] and administrative tribunals will make appropriate coverage determination for future rounds of the Beneficiary's IVIG treatment." Pl.'s Mem. at 27 (emphasis added); see also Dkt. 15-6 at 2 (Porzecanski's proposed order directing HHS to "take all timely and appropriate actions" needed to ensure that HHS and its contractors "will not deny Medicare Part B coverage for past, present, or future IVIG
*22treatments"). Porzecanski's request is understandable. On a monthly basis, he must navigate a warren of contractors who appear to deny his claims summarily. And then Porzecanski must appeal similar legal and medical issues, over and over again.
Although this process is burdensome, the Medicare statute precludes the further relief Porzecanski seeks here. For benefits claims "arising under" the Medicare statute, "the sole avenue for judicial review" is
Even so, the Court's decision does not leave Porzecanski without recourse. He may challenge the local coverage determination under which contractors have summarily denied his claims. See 42. C.F.R. § 426.400. Also, he may request that HHS issue a national coverage determination on IVIG treatment for SCLS, see 42 U.S.C. § 1395ff(f)(4)(A) ;
CONCLUSION
For the foregoing reasons, the Court grants in part and denies in part Porzecanski's motion, Dkt. 15, and the Court grants in part and denies in part HHS's cross-motion, Dkt. 17. A separate order consistent with this decision accompanies this memorandum opinion.
For example, contractors gave the following reasons:
"Maximus Federal Services ... issued an unfavorable decision, holding that the requirements of the pertinent [local coverage determination] were not met." Dkt. 15-3 at 2; see also Dkt. 15-2 at 2 (same).
"Novitas Solutions ... denied coverage [because] the service was ... not reasonable and necessary. [At redetermination], Novitas denied coverage [because] the documentation ... did not support the indications outlined within [the local coverage determination]." Dkt. 15-4 at 2-3.
"C2C characterized the [contractor's] unfavorable redetermination decision as being upon a lack of documentation. Another decision denied coverage on the basis that SCLS was not a covered indication. C2C denied reconsideration based on the lack of documentation, but was more forthcoming it its recitation of what it believed were the deficiencies. C2C indicated that, while there was sufficient information to support the use of the off-label treatment, it did not believe that there was sufficient medical documentation, 'including clinical notes and pertain [sic] testing' to support the diagnosis and treatment for the drug at issue.
The [contractor's] decision in [a companion appeal found that] SCLS is 'not an appropriate diagnosis for treatment per the [local coverage determination].' C2C's reconsideration denial presented a somewhat lengthier list of deficiencies than the recitation in the companion appeal, but ultimately, its conclusions were the same. C2C considered that the journals were approved medical literature, and seemed to indicate that off-label treatment was justified for the condition. However, again, C2C indicated that the progress notes that indicated the diagnosis of SCLS and treatment plan were insufficient to support medical necessity because the laboratory studies, history of bleeding, infection, disease progression, prior medical/surgical therapies, and any other essential information was not provided." Dkt. 23-1 at 7 (citations omitted).
The arbitrary and capricious standard of § 706(2)(A) is a "catchall" that generally subsumes the "substantial evidence" standard of § 706(2)(E). See Ass'n of Data Processing Serv. Organizations, Inc. v. Bd. of Governors of Fed. Reserve Sys. ,
Even if the administrative law judge's finding was not conclusive on the Court, the record establishes that Porzecanski's IVIG treatment was "reasonable and necessary," 42 U.S.C. § 1395y(a)(1)(A), because it is "medically accepted," Medicare Benefits Policy Manual, Chapter 15, § 50.4.2. The National Institute of Health-itself part of HHS-is "the primary referral center for SCLS in the United States and ha[s] the largest cohort of patients with SCLS in the world." AR 135. In a longitudinal study completed in 2014 and published in the double-blind peer-reviewed American Journal of Medicine in 2015, the National Institute "found that an overwhelming majority of our patients who experienced one or more severe SCLS attacks prior to starting IVIG (and many while on theophylline ) have become essentially episode-free after starting monthly IVIG, some for as long as 8 years." AR 135, 137; see also AR 139-43 (study); AR 32-33 (administrative law judge relying on the study). Other medical literature in the record also supports that IVIG is medically accepted for treating SCLS. See Dkt. 22 at 79-93.
Based on the National Institute's "unique and extensive experience with SCLS," it believes that "IVIG is the best available treatment for this rare and enigmatic condition, and therefore should be considered the current standard of care for SCLS patients." AR 137. Furthermore, the National Institute "strongly recommend[s] that Dr. Porzecanski continue with his monthly IVIG infusions ... and do so indefinitely ."
In lieu of reversal, HHS asks the Court to "remand the matter to the agency for additional evidence development." Def.'s Mem. at 24; see also
Reference
- Full Case Name
- Arturo C. PORZECANSKI v. Alex M. AZAR, Secretary, U.S. Department of Health and Human Services
- Cited By
- 5 cases
- Status
- Published