American Hospital Assoc. v. Azar, No. 19-5352 (D.C. Cir. 2020)Annotate this Case
In these consolidated actions, a group of hospitals challenged HHS's rate reduction for off-campus provider-based departments (PBDs) falls outside of the agency's statutory authority. The district court agreed and set aside the regulation.
Applying Chevron deference, the DC Circuit reversed and held that HHS's regulation rests on a reasonable interpretation of its statutory authority to adopt volume-control methods. In this case, Congress did not unambiguously forbid the agency from doing so and the agency reasonably read 42 U.S.C. 1395l(t)(2)(F) to allow a service specific, non-budget-neutral reimbursement cut in the circumstances the court considered here.