Medicare, Medicaid and Insolvency Handbook: Jurisdiction, Payment, and Enforcement
Gargotta, Craig A
If the 1980s was a decade of real estate busts and precipitous drops in oil prices, the late ’90s was a period of great uncertainty for health care providers and bankruptcy attorneys. After Congress passed the Balanced Budget Act of 1997-which altered the manner in which health care providers were paid – health care providers scrambled to decipher what remedies were available for them to stave off elimination by the federal government through the use of collection devices such as recoupment, suspension and civil monetary penalties.
As is the case with bankruptcy law, what appeared decided in a nonbankruptcy context such as Medicare law was ripe for reconsideration in bankruptcy court. Health care providers and their counsel learned to challenge long-standing case law regarding jurisdiction and administrative exhaustion – whether a provider agreement remained an executory agreement in bankruptcy, and whether recoupment, setoff and suspension against providers was a violation of the automatic stay.
The authors of this book are former assistant regional counsel with the Office of General Counsel for the Department of Health and Human Services, and the book is no mere exercise into the vagaries of health care and bankruptcy law. Rather, their monograph is an authoritative foray into the intricate intersection between health care and bankruptcy law. The text is logically organized and presented in a direct, concise manner. The discussions on both health care and bankruptcy matters are sufficiently detailed to provide analysis useful to the reader, but not so complex as to render the discussion oblique and cumbersome.
The book is written from a government perspective. Moreover, if the authors were pressed to answer how they perceive themselves, they would most likely answer that they are health care lawyers first, bankruptcy lawyers second. As such, a review of the book suggests that the book is slightly tilted toward explaining Medicare concepts as opposed to delving into the nuances of bankruptcy practice. One of the book’s many achievements is to explain the federal government’s position on a multitude of issues, notably the government’s long-standing insistence that jurisdictional issues regarding administrative exhaustion are defined by §405 of the Social Security Act and not §§1331 and 1334 of Title 28. Further, the authors acknowledge the varied treatment the litigating components of the federal government take on treatment of Medicare contracts in bankruptcy.
The book is well-organized and comprehensive, and the reader is not distracted by an overuse of footnotes. The glossary of (primarily) health care terms is an excellent introduction to the book. The book starts with background chapters on basic Medicare law that are written in an interesting and informative manner. I have not had the occasion to litigate Medicare cases recently, and found the discussion on The Medicare Prescription Drug, Improvement and Modernization Act of 2003 -which made numerous changes to Part A and B of Medicare-informative and useful. The authors discuss only the most relevant cases to a particular issue and offer concrete advice on how a particular issue has played out in the courts. The analysis provided in each section logically builds upon prior discussions but can be read independently in researching a topic. Clearly, the monograph could be used by the reader in starting and answering legal research.
The chapter on “Bankruptcy Basics,” while helpful to the novice bankruptcy lawyer, will likely be too elementary for the experienced bankruptcy lawyer. Moreover, in an effort to be comprehensive, the authors include a discussion on chapter 13, which is not applicable to a Medicare debtor other than health care professionals, presumably in the student loan context.
The authors cover the gambit of health care issues in bankruptcy cases. As one would expect, there is a thorough discussion of the jurisdictional interplay of both Medicare and bankruptcy law. The most relevant cases are discussed in chronological order with due recognition as to the development of case law dealing with administrative exhaustion. Further, the authors explain the concept of recoupment both in the bankruptcy and health care context. Recoupment issues are appropriately addressed with due recognition as to why the United States pursues recoupment as opposed to filing a proof of claim in bankruptcy. The authors also explain the limitations on the transfer of provider agreements and sale of Medicare receivables.
Government attorneys will find the discussion on Office of Inspector General exclusion cases a welcome addition to any government attorney’s arsenal of knowledge. Exclusion cases offer a myriad of troublesome issues for any lawyer to consider. Further, the discussion and synthesis of cases on suspension is particularly cogent given the changes to BAPCPA. The authors consider the effect of confirmation and discharge on the federal government’s right of recoupment and setoff. The authors then analyze whether recoupment and setoff survive confirmation if not expressly retained in a plan and whether these rights remain viable after discharge under applicable nonbankruptcy law.
One of the more intriguing aspects of the book is the discussion regarding using civil monetary penalties for quality-of-care violations in nursing homes. Although still somewhat in its infancy, this is a proactive measure that the DOJ has been considering to eradicate quality-of-care issues in nursing homes. Moreover, it is one of the areas where the federal government has both investigative and litigative resources to pursue remedial and monetary remedies. There is also a useful survey of sovereign immunity issues and cases as they relate to state and federal government practice.
The book concludes with a brief overview of BAPCPA as it relates to health care issues. The authors accurately touch upon those changes to the Code that have resulted in adjustment to bankruptcy health care cases. They also offer a cursory discussion of the major changes to the Code. This discussion, although somewhat limited, makes the entire book even more timely for its ability to incorporate the new law into the discussion. There is also included an “Epigram” that discusses the impact of the Eastern District of Pennsylvania’s jurisprudence on bankruptcy health care cases. The authors use the Easten District of Pennsylvania as a microcosm of the development of many of the issues faced in these types of cases by analyzing 10 decisions out of the district.
In sum, Medicare, Medicaid and Insolvency Handbook: Jurisdiction, Payment, and Enforcement would be an excellent addition to any law library involving an insolvency or health care practice. With a text of 502 pages, it is a useful, learned treatise on Medicare and bankruptcy law.
Rodney A. Johnson
John Aloysius Cogan Jr.
(American Health Lawyers Association, 2006)
Craig A. Gargotta1
Assistant U.S. Attorney (W.D. Texas)
About the Author
Craig Gargotta is an Assistant U, S. Attorney for the Western District of Texas and has been an ABI contributing editor for 13 years.
1 The views expressed in this article are Mr, Gargotta’s and do not necessarily reflect the views of the Department of Justice or Department of Health and Human Services.
Copyright American Bankruptcy Institute Apr 2006
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