VNAs lose appeal on interim payment system overpayments
VNAs lose appeal on interim payment system overpayments
By MATTHEW HAY
HHBR Washington Correspondent
WASHINGTON Home care providers lost a long-running battle with the government last week when the U.S. Court of Appeals for the Seventh Circuit refused to overturn a lower court decision on the need for home healthcare providers to repay the government overpayments stemming from the interim payment system (IPS).
"We do intend to ask the Supreme Court to review this case," reported Lucien Bernard, one of the attorneys for the plaintiffs. But he conceded that getting the high court to review the case will be an uphill fight.
The Health Care Financing Administration (HCFA; Baltimore) notified the Visiting Nurses Association of Southwestern Indiana in early 1999 that its overpayment liability for the previous year topped $4 million, while Visiting Nurses Health Care faced an overpayment of nearly $1 million.
The two Indiana VNAs contended they were not at fault with regard to their IPS overpayments and sought relief under the application for waiver provisions in the Social Security Act.
According to Bernard of the law firm Pearson and Bernard, the suit was premised on the fact that by the time HCFA published the IPS regulations in March 1998 and subsequently notified home health agencies of their per-beneficiary limits the following June, it was too late in the year for the agencies to make the necessary business decisions that were required.
The case was on appeal from a district court that ruled against the VNAs. The attorneys for the VNAs were asking the court to remand the case to the district court so they could proceed to trial on the issue of whether the plaintiffs were without fault in accruing those overpayments.
"The way we read the waiver of liability regulations, we felt they should apply exactly to this situation," Bernard told HHBR. He explained that on March 31, 1998, the Department of Health and Human Services (Washington) published proposed regulations on the waiver of liability provisions. "In other words, these proposed regulations interpret the waiver of liability exactly the way the government contends it does in this lawsuit," he said. "The problem is that they were only proposed regulations."
The court found that Congress must have intended that the waiver of liability provisions would be applicable to specific claims only and not to aggregate debt such as the VNAs alleged.
Bernard noted that many home health agencies are still carrying multiple-year repayment agreements for millions of dollars. He also pointed out that the Congressional Budget Office (Washington) recently reported that the savings achieved in home health through the implementation of the Balanced Budget Act of 1997 were more than three times what was originally projected.
"That does not even take into account for the millions that are being paid back now under extended repayment agreements at approximately 13.75% interest," he added.
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