Hogan Lovells helps hospitals fend off US$600M cut to Medicare providers

Washington D.C., 20 September 2019 – International law firm Hogan Lovells represented the American Hospital Association, the Association of American Medical Colleges, and three individual hospitals in their successful effort to fend off a rule that would have cut more than US$600 million to Medicare providers of outpatient hospital services between 2019 and 2020.

The District Court for the District of Columbia agreed with our clients that the Centers for Medicare & Medicaid Services had acted outside its legal authority when it attempted to cut payment rates for clinic visits without increasing payments commensurately for other outpatient hospital services.

The court ruled that while CMS can either make budget-neutral relative adjustments or make generally applicable reductions to the total amount Medicare pays for outpatient services, the agency cannot do both and effectively “pick and choose what to pay for.”

“We are delighted to have achieved such a terrific result for our clients, and for the nation’s hospitals who have been profoundly harmed by this unlawful rule,” said Cate Stetson, co-director of Hogan Lovells’ appellate practice.

The winning team in this case, American Hospital Association v. Azar, No. 18-2841-RMC (D.D.C.), was led by partners Stetson, Sheree Kanner, and Susan Cook.


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