Provider groups appeal PATH lawsuit dismissal

Following the April 27 dismissal of their lawsuit seeking to end the government’s Physicians At Teaching Hospitals (PATH) audits, the case’s various physician and hospital-related plaintiffs have appealed the court’s decision.

The appeal will be considered by the U.S. Court of Appeals for the Ninth Circuit in Los Angeles.

Among the provider parties bringing the suit are the Association of American Medical Colleges, American Medical Association, American Hospital Association, Medical Group Management Association, and more than a dozen teaching hospitals from across the country.

The court dismissed the group’s original lawsuit on the grounds that it had not yet exhausted all of the administrative options open to it.

"We were greatly disappointed with the court’s decision to dismiss our complaint," says AAMC’s president Jordon J. Cohen. "We still believe that the Medicare audits of teaching hospitals are unfair and will continue to seek to remedy this situation."

Last month, several of the plaintiffs held a "fly-in" meeting in Chicago to "consider the effect of a related case," according to a Medical Group Management Association spokesman. The case in question involved Cedars-Sinai Hospital in Los Angeles and touched on several issues related to the PATH case. The plaintiffs had hoped that a favorable ruling in the Cedars case would boost the chances of an appeal. But that case suffered a setback when a district court judge ruled that the statute of limitations for filing the claim had run out.

Meanwhile, the Greater New York Hospital Association and a group of New York teaching hospitals have filed their own separate suit challenging government audits of how teaching hospitals in the past billed Medicare for services performed by hospital interns and residents supervised by teaching physicians. (Greater New York Hospital Association v. U.S., DC SNY, No. 98-CIV-2741, filed April 16.)

According to GNYHA General Counsel Susan C. Waltman, her group is challenging the IG’s argument that New York teaching hospitals had received official "clear guidance" from Medicare regarding the rules for reimbursing teaching physicians.

For instance, the government argues reimbursement articles contained in the carrier newsletters provided enough necessary and clear guidance for teaching facilities to follow, says Waltman.

However, GNYHA counters that these newsletters are only informal internal carrier publications — and not official government instructions and explanations of mandatory Medicare billing procedures.

As such, hospitals and physicians should have not been expected to treat their contents as formal policy pronouncements.