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Supreme Court Rules against Hospitals in DSH Payment Decision

January 25, 2013—The U.S. Supreme Court Jan. 22 in a unanimous decision overturned a circuit court ruling and held that hospitals receiving Medicare disproportionate share hospitals (DSH) payments could not reopen claims after a three-year appeals deadline had passed. 

Auburn Regional Medical Center and 17 other hospitals attempted to appeal their Provider Reimbursement Review Board (PRRB) decisions more than ten years after the decisions were issued because they did not discover the Centers for Medicare and Medicaid Services (CMS) errors in calculating DSH payments until the Baystate Medical Center case became public in 2006.

Writing for the Court, Justice Ruth Bader Ginsburg stated that the Department of Health and Human Services (HHS) was not unreasonable in promulgating a regulation that grants providers a three-year period to appeal PRRB decisions and that the principle of “equitable tolling” — which would have permitted the hospitals a longer period to file an appeal — does not apply in this case.

In a concurring opinion, Justice Sonia Sotomayor indicated that the decision regarding equitable tolling does not apply to all administrative deadlines, and that the secretary’s decision to allow a three-year period for filing appeals was “a reasonable accommodation of the competing interests in administrative efficiency and fair­ness.”

The Supreme Court granted review of the case in June 2012 and heard oral arguments on Dec. 4, 2012.


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Washington Highlights, a weekly electronic newsletter, features brief updates on the latest legislative and regulatory activities affecting medical schools and teaching hospitals.

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Jason Kleinman
Sr. Legislative Analyst, Govt. Relations
Telephone: 202-903-0806