Stuart M. Gerson, Member of the Firm in the Litigation and Health Care & Life Sciences practices, in the firm’s Washington, DC, and New York offices, was quoted in Law360 Healthcare Authority, in “HHS Hospital Pay Formula at High Court: 4 Things to Know,” by Mark Payne. (Read the full version – subscription required.)

Following is an excerpt:

With Americans focused on a presidential election unlike any in U.S. history, all's forgiven if you're not up on the latest healthcare case at the U.S. Supreme Court.

The justices on Nov. 5 will consider whether low-income patients receiving Supplemental Security Income should be counted in a federal formula determining how hospitals treating poor patients receive billions in special Medicare payments.

The complicated case stems from hospitals' allegation that the U.S. Department of Health and Human Services has misinterpreted a payment formula for disproportionate-share hospitals — otherwise known as DSH, or "dish."

The calculation is a key factor in how much "safety net" hospitals receive based on how many patients are eligible for federal assistance. Industry groups say it's costing hospitals nationally about $1.5 billion annually. …

Agency Deference and Loper Bright 

In the Empire Health case, a district court judge granted summary judgment to the government after applying Chevron Deference, finding HHS's interpretation of SSI benefits to be a so-called cash payment consistent with federal law.

Legal precedent around agency interpretation of statutes shifted radically in June, when the high court overturned Chevron deference in the Loper Bright decision.

In its Advocate Christ briefing, the government argues the Loper Bright decision favors the preservation of the government's decades-old interpretation of the statute. Advocate Christ argues that Congress put the courts in charge of statutory interpretation, not federal agencies.

Stuart Gerson of Epstein Becker Green, a former acting attorney general under President Bill Clinton, predicted that the justices aren't likely to draw on the Loper decision to analyze the agency's interpretation of the DSH formula.

"This is a case of, in essence, just interpreting what it is that Congress required," Gerson said. "There's no question of ambiguity in the agency's ability to set reimbursement rates, and so the question here is whether, under the Administrative Procedure Act, or some other way of reading this, the agency has acted in an arbitrary, capricious way."

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