Justia Health Law Opinion Summaries

Pharmacy benefit managers (PBMs) reimburse pharmacies for the cost of drugs covered by prescription-drug plans by administering maximum allowable cost (MAC) lists. In 2015, Arkansas passed Act 900, which requires PBMs to reimburse Arkansas pharmacies at a price at least equal to the pharmacy’s wholesale cost, to update their MAC lists when drug wholesale prices increase, and to provide pharmacies an appeal procedure to challenge MAC reimbursement rates, Ark. Code 17–92–507(c). Arkansas pharmacies may refuse to sell a drug if the reimbursement rate is lower than its acquisition cost. PCMA, representing PBMs, sued, alleging that Act 900 is preempted by the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1144(a).Reversing the Eighth Circuit, the Supreme Court held that Act 900 is not preempted by ERISA. ERISA preempts state laws that “relate to” a covered employee benefit plan. A state law relates to an ERISA plan if it has a connection with or reference to such a plan. State rate regulations that merely increase costs or alter incentives for ERISA plans without forcing plans to adopt any particular scheme of substantive coverage are not preempted. Act 900 is a form of cost regulation that does not dictate plan choices. Act 900 does not “refer to” ERISA; it regulates PBMs whether or not the plans they service fall within ERISA’s coverage. Allowing pharmacies to decline to dispense a prescription if the PBM’s reimbursement will be less than the pharmacy’s cost of acquisition does not interfere with central matters of plan administration. The responsibility for offering the pharmacy a below-acquisition reimbursement lies first with the PBM. Any “operational inefficiencies” caused by Act 900 are insufficient to trigger ERISA preemption, even if they cause plans to limit benefits or charge higher rates. View "Rutledge v. Pharmaceutical Care Management Association" on Justia Law

Plaintiffs, individuals living with HIV/AIDS who have employer-sponsored health plans, and who rely on those plans to obtain prescription drugs, filed suit alleging that CVS's program violates the anti-discrimination provisions of the Affordable Care Act (ACA), the Americans with Disabilities Act (ADA), and the California Unruh Civil Rights Act (Unruh Act); denies them benefits to which they are entitled under the Employee Retirement Security Act (ERISA); and violates California's Unfair Competition Law (UCL). The district court granted defendants' motion to dismiss.The Ninth Circuit held that Section 1557 of the ACA does not create a healthcare-specific anti-discrimination standard that allowed plaintiffs to choose standards from a menu provided by other anti-discrimination statutes. Because plaintiffs claim discrimination on the basis of their disability, to state a claim for a Section 1557 violation, they must allege facts adequate to state a claim under Section 504 of the Rehabilitation Act. Applying the section 504 framework, the panel concluded that plaintiffs adequately alleged that they were denied meaningful access to their prescription drug benefit under their employer-sponsored health plans because the program prevents them from receiving effective treatment for HIV/AIDS. Therefore, plaintiffs have stated a claim for disability discrimination under the ACA.However, plaintiffs have failed to establish a claim of disability discrimination under the ADA, because they have not plausibly alleged that their benefit plan is a place of public accommodation. Finally, the panel upheld the district court's denial of plaintiffs' claims under ERISA and their cause of action under California's Unfair Competition Law. The panel affirmed in part, vacated in part, and remanded. View "Doe v. CVS Pharmacy, Inc." on Justia Law

Plaintiff Anna Sandoval-Ryan signed admission documents on behalf of her brother, Jesus Sandoval, following his admission to Sacramento Post-Acute (Post- Acute), a skilled nursing facility owned by Oleander Holdings, LLC (Oleander) and Plum Healthcare Group, LLC (Plum Healthcare). Among the documents plaintiff signed were two agreements to arbitrate claims arising out of the facility’s care for Sandoval. Sandoval’s condition deteriorated while being cared for at the facility, and he was transferred to a hospital where he later died. Plaintiff sued defendants Post-Acute, Oleander, and Plum Healthcare in superior court; she brought claims on her own behalf and on behalf of Sandoval. Defendants moved to compel arbitration of plaintiff’s claims. The trial court denied the motion on the basis the agreements were invalid because they were secured by fraud, undue influence, and duress. Defendants appealed the trial court’s ruling, contending the parties agreed to allow the arbitrator to decide threshold questions of arbitrability, and the trial court erred by deciding the issue instead. Absent clear and unmistakable language delegating threshold arbitrability issues to the arbitrator, the Court of Appeal concluded defendants’ claim lacked merit. View "Sandoval-Ryan v. Oleander Holdings" on Justia Law

Dr. Korban and his medical practice Delta, practice diagnostic and interventional cardiology. In 2007, Dr. Deming filed a qui tam action under the False Claims Act (FCA), 31 U.S.C. 3729(a)(1)(A)–(C), (G) against Korban, Jackson Regional Hospital, and other Tennessee hospitals, alleging “blatant overutilization of cardiac medical services.” The United States intervened and settled the case for cardiac procedures performed in 2004-2012. Korban entered into an Integrity Agreement with the Office of Inspector General, effective 2013-2016 that was publicly available and required an Independent Review Organization. The U.S. Department of Justice issued a press release that detailed the exposed fraudulent scheme and outlined the terms of Korban’s settlement. In 2015, Jackson Regional agreed to a $510,000 settlement. The Justice Department and Jackson both issued press releases.In 2017, Dr. Maur, a cardiologist who began working for Delta in 2016, alleged that Korban was again performing “unnecessary angioplasty and stenting” and “unnecessary cardiology testing,” paid for in part by Medicare. In addition to Korban and Jackson, Maur sued Jackson’s corporate parent, Tennova, Dyersburg Medical Center, and Tennova’s corporate parent, Community Health Systems. The United States declined to intervene. The district court dismissed, citing the FCA’s public-disclosure bar, 31 U.S.C. 3730(e)(4). The Sixth Circuit affirmed. Maur’s allegations are “substantially the same” as those exposed in a prior qui tam action and Maur is not an “original source” as defined in the FCA. View "Maur v. Hage-Korban" on Justia Law

Dennis Borden, individually and as father and next friend of his son J.B. (minor), appealed the dismissal of his defamation, negligence, wantonness and wilfulness claims against Bobby Malone and Malone's counseling clinic, B.L. Malone and Associates, Inc. Borden and his then-wife, Kathy Smith, received marriage counseling from Malone at the clinic. Borden filed for divorce in 2010. The complaint here alleged that in the divorce proceedings Malone "served in the role of custody evaluator" and recommended to the court that Smith be given sole custody of J.B. Instead of following Malone's recommendation, the court awarded Borden and Smith joint custody. The divorce was finalized in 2012. In 2019, Smith petitioned for modification of custody, seeking sole custody of the child. Borden opposed the petition, alleging that "during the pendency of an adversarial custody dispute involving litigation," Malone began seeing J.B. for counseling at Smith's behest without Borden's consent. J.B. allegedly related to Malone in counseling sessions many deeply personal statements concerning the child's relationship with Borden. Borden's complaint alleged that Malone made numerous defamatory statements in a letter to Smith's custody attorney, that was eventually presented as evidence in the custody hearing (the letter was stricken from evidence because that court ruled the counselor-patient privilege applied). After review, the Alabama Supreme Court reversed the trial court's dismissal of defamation claims to the extent it precluded Borden from maintaining his claim that Malone and the clinic bore some culpability for the dissemination of the letter beyond those who had a direct or close relationship to the custody-modification proceeding. Furthermore, the trial court's dismissal of the count alleging negligence/wantonness/wilfulness was reversed to the extent that it precluded claims based on a breach of confidentiality on behalf of J.B., which were not foreclosed by the litigation privilege. The trial court's dismissal of the claims asserted in that count as to Borden was affirmed. View "Borden v. Malone" on Justia Law

DaVita filed suit alleging that the Amy's Kitchen Employee Benefit Health Plan's dialysis provisions violate the Medicare as Secondary Payer provisions (MSP) of the Social Security Act, the Employee Retirement Income Security Act of 1974 (ERISA), and state law. The district court dismissed the federal claims and declined to exercise supplemental jurisdiction over the state-law claims.Reviewing de novo, the Ninth Circuit affirmed and agreed with the district court's conclusion that the Plan does not violate the MSP because it reimburses at the same rate for all dialysis services, regardless of underlying diagnosis and regardless of Medicare eligibility. The panel also held that DaVita may not bring equitable claims on behalf of Patient 1 under ERISA, because the assignment form the patient signed did not encompass an assignment of equitable claims. View "DaVita Inc. v. Amy's Kitchen, Inc." on Justia Law

DaVita filed suit under the private cause of action under the Medicare Secondary Payer provisions (MSP), alleging that defendants reduced the payment amount for Patient 1's dialysis because of Medicare eligibility as soon as Patient 1 became eligible for Medicare, without waiting the mandatory thirty months. But the reduced payment amount remained greater than the Medicare rate, so Medicare never made any secondary payments. The district court dismissed the complaint, holding that the MSP's private cause of action is available only when Medicare has made a payment.Reviewing de novo, the Ninth Circuit held that the district court erroneously dismissed the complaint on that ground. The panel explained that the statutory text, congressional purpose, and regulatory clues make clear that Congress did not intend payment by Medicare to be a prerequisite to bringing a private cause of action under the MSP. The private cause of action encompasses situations in which a primary plan impermissibly takes Medicare eligibility into account too soon, even if Medicare has not made any payments. Accordingly, the panel vacated in large part and remanded for further proceedings. The panel affirmed the district court's dismissal with respect to the 10-month period after Patient 1 dropped coverage under Virginia Mason's Plan. View "DaVita, Inc. v. Virginia Mason Memorial Hospital" on Justia Law

Plaintiffs filed a negligence action based upon the alleged acts of defendants when one of the plaintiffs was staying in a hospital after surgery and received a burn from spilled hot water. The district granted defendants' motion to strike plaintiffs' witness list and defendants' motion for summary judgment. Plaintiffs appealed and the Court of Civil Appeals. After its review, the Oklahoma Supreme Court held the trial court erred in granting summary judgment striking the list of trial witnesses when plaintiffs were not provided time to respond to the motion to strike as granted by District Court Rule 4. Judgment was reversed and the matter remanded for further proceedings. View "Shawreb v. SSM Health Care of Oklahoma" on Justia Law

Alleging debilitating pain in her back, legs, and hands, Zoch sought disability insurance benefits, 42 U.S.C. 413, 423. An ALJ denied the application, finding that, based on the opinions of three of her four treating physicians, a consulting physician, and the objective medical evidence, she could perform sedentary work.The district court and Seventh Circuit affirmed, rejecting Zoch’s arguments that the ALJ improperly discounted her assertions and an opinion by a physician who relied on those assertions. Substantial evidence supports the ALJ’s decision. Zoch’s testimony of incapacitating pain conflicted with the objective medical evidence, including normal test results: lumbar MRI, wrist x-rays, range of motion, straight-leg raising, strength in extremities, and pressure on her nerves. Zoch’s testimony that she usually walked with a cane conflicted with the doctors’ reports that at all but one appointment she walked normally. Zoch’s testimony that she could not raise her arms or bend over to dress conflicted with a doctor’s observation that Zoch could comfortably bend over to touch her fingertips to her knees. Zoch’s hearing testimony that she could not perform the usual activities of daily living was inconsistent with her assertions in her application. View "Zoch v. Saul" on Justia Law

The en banc court held that 42 U.S.C. 1396a(a)(23) does not give Medicaid patients a right to challenge, under 42 U.S.C. 1983, a State's determination that a health care provider is not "qualified" within the meaning of section 1396a(a)(23). The en banc court vacated the preliminary injunction issued by the district court prohibiting the termination of the Providers' Medicaid provider agreements.The Providers provide family planning and other health services to Medicaid patients, and each of the Providers is a member of Planned Parenthood. This case stemmed from a pro-life organization's release of video recordings of conversations at Planned Parenthood (PP) Gulf Coast headquarters. The videos depict two individuals posing as representatives from a fetal tissue procurement company discussing the possibility of a research partnership with PP Gulf Coast. The release of the videos prompted congressional investigations, which ultimately led to the OIG sending each Provider a Notice of Termination of its respective Medicaid provider agreement. The Providers and Individual Plaintiffs filed suit alleging that the terminations violated rights conferred by section 1396a(a)(23) and sought relief under section 1983.The en banc court held that the Individual Plaintiffs may not bring a section 1983 suit to contest the State's determination that the Providers were not "qualified" providers within the meaning of section 1396a(a)(23). The en banc court rested its decision primarily on two independent bases: (1) the Supreme Court's decision in O'Bannon v. Town Court Nursing Center, 447 U.S. 773 (1980), and (2) the text and structure of section 1396a(a)(23), which does not unambiguously provide that a Medicaid patient may contest a State's determination that a particular provider is not "qualified." Rather, the court held that whether a provider is "qualified" within the meaning of section 1396a(a)(23) is a matter to be resolved between the State (or the federal government) and the provider. In so holding, the en banc court overruled Planned Parenthood of Gulf Coast, Inc. v. Gee, 862 F.3d 445 (5th Cir. 2017), which held that a state agency or actor cannot legitimately find that a Medicaid provider is not "qualified" unless under state or federal law the provider would be unqualified to provide treatment or services to the general public, including Medicaid patients who paid for the care or services with private funds. View "Planned Parenthood of Greater Texas Family Planning and Preventative Health Services, Inc. v. Kauffman" on Justia Law