Bidding lawsuits stumble

Thursday, July 31, 2008

Despite a flurry of last-minute legal wrangling in the run-up to national competitive bidding’s July 1 start, the HME industry suffered a series of setbacks in courtroom challenges across the country.

The primary stumbling block: The Medicare Modernization Act of 2003 (MMA) bars all judicial review.

On June 30, federal judges in Washington, D.C., and Cleveland denied requests for preliminary injunctions in two court cases to halt NCB.

The Washington, D.C., suit was filed on June 9 by AAHomecare on behalf of its members, while the Cleveland suit was filed in December on behalf of providers and beneficiaries and paid for by The VGM Group’s Last Chance for Patient Choice.

The rulings followed disappointing results in several other cases.

On June 26, a federal judge in Miami dismissed a complaint brought by the All Florida Network, which filed suit June 16, claiming it was damaged when it was unfairly disqualified from the bidding process.

“The court was very sympathetic to our clients’ situation, and it went out of its way to express frustration about the inconsistencies in CMS’s reasoning for disqualifying our clients,” said Daniel Leyton, an attorney with Miami-based law firm de la O, Marko, Magolnick & Leyton, one of two firms handling the case. “But at the end of the day, in its opinion, the statue cut off any review of this area of the law. We are considering an appeal.”

In Dallas on June 26, a judge declined to grant a temporary restraining order (TRO) in a suit filed June 11 by several area providers. Brown & Fortunato, the firm representing the providers, had sought the TRO when the case judge went on vacation for several weeks, putting the request for an immediate injunction on hold.

“Depending on what happens legislatively, and what happens in the other lawsuits, we may request a hearing for a preliminary injunction, at which time other evidence and live testimony would be presented, and additional plaintiffs may be added,” said attorney Jeff Baird.