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Becerra v. Empire Health Foundation

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Supreme Court of the United States
Becerra v. Empire Health Foundation
Term: 2021
Important Dates
Argued: November 29, 2021
Decided: June 24, 2022
Outcome
Ninth Circuit reversed and case remanded
Vote
5-4
Majority
Elena Kagan • Clarence Thomas • Stephen Breyer • Sonia Sotomayor • Amy Coney Barrett
Dissenting
Chief Justice John Roberts • Samuel Alito • Neil Gorsuch • Brett Kavanaugh

Becerra v. Empire Health Foundation was a U.S. Supreme Court case decided on June 24, 2022, in which the court voted 5-4 to uphold a statutory interpretation by the U.S. Department of Health and Human Services (HHS). The case questioned whether an administrative agency may issue a rule based on an interpretation of a statute that a federal court held was not open to interpretation. The court ruled that HHS had properly interpreted the underlying statute and reversed and remanded the decision of the United States Court of Appeals for the Ninth Circuit.[1][2][3]

The case was argued before the Supreme Court of the United States on November 29, 2021, during the court's October 2021-2022 term.

HIGHLIGHTS
  • The case: The U.S. Department of Health and Human Services (HHS) in 2004 issued a rule changing the way the agency calculated the annual reimbursement rate paid to hospitals by the Medicare program for treating low-income patients. The Ninth Circuit affirmed a district court decision to vacate the HHS rule but held that, while the HHS followed APA rulemaking procedures, the rule was based on an invalid interpretation of the Medicare statute because the court had ruled previously that the relevant part of the law was unambiguous and not open to interpretation.[1] Click here to learn more about the case's background.
  • The issue: The case concerned whether HHS had the authority to change the hospital reimbursement formula when a federal court ruled that the statute was clear regarding how the agency should calculate those payments.
  • The question presented: "Whether the Secretary has permissibly included in a hospital’s Medicare fraction all of the hospital’s patient days of individuals who satisfy the requirements to be entitled to Medicare Part A benefits, regardless of whether Medicare paid the hospital for those particular days."
  • The outcome: The U.S. Supreme Court ruled 5-4 that HHS had properly interpreted the underlying statute and reversed and remanded the decision of the United States Court of Appeals for the Ninth Circuit.[3]


    • The case came on a writ of certiorari to the United States Court of Appeals for the Ninth Circuit. To review the lower court's opinion, click here.

    Why it matters: The case provided an opportunity for the Supreme Court to weigh in on judicial deference. Though Justice Elena Kagan's majority opinion upheld HHS' statutory interpretation, the decision did not cite a specific deference doctrine nor did it discuss judicial deference generally.

    Timeline

    The following timeline details key events in this case:

    • June 24, 2022: The U.S. Supreme Court reversed the decision from the Ninth Circuit and remanded the case for further proceedings.[3]
    • November 29, 2021: The U.S. Supreme Court heard oral argument.
    • July 2, 2021: The U.S. Supreme Court agreed to hear the case.
    • March 19, 2021: The federal government appealed to the U.S. Supreme Court.
    • May 5, 2020: The Ninth Circuit ruled that the HHS rule was illegal.

    Background

    Federal court: Medicare reimbursement rate formula change violated the Administrative Procedure Act

    The U.S. Department of Health and Human Services (HHS) issued a rule changing the way the agency calculated the annual reimbursement rate paid to hospitals by the Medicare program for treating low-income patients. Empire Health Foundation challenged the rule and a federal district court ruled that the rule should be vacated because it did not comply with the rulemaking procedures set by the APA.

    Ninth Circuit: Formula change complied with the APA but misapplied the Medicare statute

    The Ninth Circuit affirmed the district court decision to vacate the HHS rule. However, the Ninth Circuit held that HHS followed APA rulemaking procedures but based the rule on an invalid interpretation of the Medicare statute. The court had interpreted the relevant part of the Medicare statute in an earlier case and found that it was unambiguous and not open to agency interpretation.[1]

    The federal government appealed the Ninth Circuit's ruling to the U.S. Supreme Court. HHS argued that the appeals court was wrong to agree to invalidate its Medicare payment rule. The agency argued that the court misread the Medicare statute and that its ruling conflicted with rulings made by two other courts of appeals.[2]

    Question presented

    The petitioner presented the following questions to the court:

    Question presented:
    “ Whether the Secretary has permissibly included in a hospital’s Medicare fraction all of the hospital’s patient days of individuals who satisfy the requirements to be entitled to Medicare Part A benefits, regardless of whether Medicare paid the hospital for those particular days.[2]

    [4]

    		”

    Oral argument

    Oral arguments were held on November 29, 2021.

    Audio

    Audio of oral argument:[5]



    Transcript

    Transcript of oral argument:[6]

    Outcome

    The court ruled 5-4 that HHS had correctly interpreted the underlying statute in the case. It reversed the Ninth Circuit's ruling and remanded the case for further proceedings. Justice Elena Kagan delivered the opinion of the court, joined by Justices Clarence Thomas, Stephen Breyer, Sonia Sotomayor, and Amy Coney Barrett. Justice Brett Kavanaugh filed a dissenting opinion, joined by Chief Justice John Roberts and Justices Samuel Alito and Neil Gorsuch.[3]

    Opinion

    Opinion of the court

    Justice Elena Kagan delivered the opinion of the court, which found that HHS had properly interpreted the underlying statute when it issued the rule changing how the agency calculated the annual reimbursement rate paid to hospitals by the Medicare program for treating low-income patients:[3]

    “ HHS’s regulation correctly construes the statutory language at issue. The ordinary meaning of the fraction descriptions, as is obvious to any ordinary reader, does not exactly leap off the page. See Catholic Health Initiatives, 718 F. 3d, at 916 (The “language is downright byzantine”). The provisions are technical: They call to mind Justice Frankfurter’s injunction that when a statute is “addressed to specialists, [it] must be read by judges with the minds of the specialists.” Some Reflections on the Reading of Statutes, 47 Colum. L. Rev. 527, 536 (1947). But when read in that suitable way, the fraction descriptions disclose a surprisingly clear meaning—the one chosen by HHS. The text and context support the agency’s reading: HHS has interpreted the words in those provisions to mean just what they mean throughout the Medicare statute. And so too the structure of the DSH provisions supports HHS: Counting everyone who qualifies for Medicare benefits in the Medicare fraction—and no one who qualifies for those benefits in the Medicaid fraction—accords with the statute’s attempt to capture, through two separate measurements, two different segments of a hospital’s low-income patient population.[4] ”
    —Elena Kagan, majority opinion in Becerra v. Empire Health Foundation

    Dissenting opinion

    Justice Brett Kavanaugh filed a dissenting opinion, joined by Chief Justice John Roberts and Justices Samuel Alito and Neil Gorsuch. Kavanaugh argued that HHS had misinterpreted the underlying statute when it issued a rule changing the agency's method of calculating certain Medicare reimbursement rates:

    “ To sum up: A patient was not entitled to have payment made by Medicare “for such days” in the hospital if the patient by statute could not (and thus did not) have payment made by Medicare for those days—for example, because private insurance was already covering the patient’s care, or the patient had exhausted his Medicare benefits. Both statutory text and common sense point to that conclusion. HHS’s contrary interpretation boils down to the proposition that a patient can be simultaneously entitled and disentitled to have payment made by Medicare for a particular day in the hospital. That interpretation does not work. And HHS’s misreading of the statute has significant real-world effects: It financially harms hospitals that serve low-income patients, thereby hamstringing those hospitals’ ability to provide needed care to low-income communities.[4] ”
    —Brett Kavanaugh, dissenting opinion in Becerra v. Empire Health Foundation

    Text of the opinion

    Read the full opinion here.

    October term 2021-2022

    See also: Supreme Court cases, October term 2021-2022

    The Supreme Court began hearing cases for the term on October 4, 2021. The court's yearly term begins on the first Monday in October and lasts until the first Monday in October the following year. The court generally releases the majority of its decisions in mid-June.[7]

    The court agreed to hear 68 cases during its 2021-2022 term.[8] Four cases were dismissed and one case was removed from the argument calendar.[9]

    The court issued decisions in 66 cases during its 2021-2022 term. Three cases were decided without argument. Between 2007 and 2021, SCOTUS released opinions in 1,128 cases, averaging 75 cases per year.


    See also

    External links

    Footnotes

    1. ↑ 1.0 1.1 1.2 Casetext, "Empire Health Found. v. Azar, Opinion," May 5, 2020
    2. ↑ 2.0 2.1 2.2 U.S. Supreme Court, "Becerra v. Empire Health Foundation, Petition for a Writ of Certiorari," March 19, 2021
    3. ↑ 3.0 3.1 3.2 3.3 3.4 United States Supreme Court, "Becerra v. Empire Health Foundation," June 24, 2022
    4. ↑ 4.0 4.1 4.2 Note: This text is quoted verbatim from the original source. Any inconsistencies are attributable to the original source.
    5. ↑ Supreme Court of the United States, "Oral Argument - Audio," accessed November 30, 2021
    6. ↑ Supreme Court of the United States, "Oral Argument - Transcript," accessed November 30, 2021
    7. ↑ SupremeCourt.gov, "The Supreme Court at Work: The Term and Caseload," accessed February 4, 2021
    8. ↑ Consolidated cases are counted as one case for purposes of this number.
    9. ↑ U.S. Supreme Court, "Order List: 593 U.S.," May 17, 2021
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