Competitive bidding lawsuits lose steam

Sunday, June 29, 2008

YARMOUTH, Maine - Two recent legal rulings dimmed hopes that the industry can fight national competitive bidding (NCB) in the courts.

On Thursday, 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 judge ruled that the Medicare Modernization Act of 2003 (MMA) bars all judicial review.

"The court was very sympathetic to our client's 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."

On June 18, a federal judge in Washington D.C. made a similar ruling in a suit filed by two North Carolina-based providers who challenged the inclusion of mail order diabetes supplies in NCB.

"I thought mail order had the greatest chance for (a successful legal challenge)," said Seth Lundy, an attorney with Washington, D.C.-based King & Spalding, which filed the suit last fall. "It had the biggest detour from the direct wording of the MMA."

Based on the rulings, both attorneys predicted that other lawsuits could be dismissed on similar grounds.

Late last week, attorneys in two other lawsuits seeking injunctions against tomorrow's July 1 start date of the program were still wrangling in court.

In Dallas on Thursday, 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. "Such a hearing would likely be held some time in July. "

That suit is being paid for by VGM's Last Chance for Patient Choice, which is also financing a suit in Cleveland. No updates were available on that suit.

Meanwhile, a suit filed June 9 by AAHomecare on behalf of its members was awaiting a ruling at press time.

Negotiations were ongoing, said Michael Reinemer, vice president of communications and policy for the association.

"It's a tough judge who's not inclined to grant preliminary injunctions," he said. "It could be a close call."