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`Case No.
`MAC Docket No. M-17-2922
`ALJ Appeal No. 1-1056003206
`
`Case 4:21-cv-11350-MFL-CI ECF No. 1, PageID.1 Filed 06/09/21 Page 1 of 7
`
`
`
`UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF MICHIGAN
`SOUTHERN DIVISION
`
`
`
`Plaintiff,
`
`GENERAL MEDICINE, P.C.,
`A Michigan professional corporation,
`
`
`
`-vs-
`
`
`
`XAVIER BECERRA, in his official capacity
`as Secretary of the U.S. Department of
`Health and Human Services,
`
`Defendant.
`
`_____________________________________/
`Barry M. Rosenbaum (P26487)
`David Hansma (P71056)
`Attorneys for Plaintiff
`2000 Town Center, Suite 1500
`Southfield, MI 48075
`(248) 353-7620
`_____________________________________/
`
`
`COMPLAINT
`
`NOW COMES Plaintiff General Medicine, P.C., by and through its
`
`
`
`attorneys, Seyburn, Kahn, P.C., and states the following:
`
`1.
`
`Plaintiff General Medicine, P.C.
`
`is a Michigan professional
`
`corporation with its principal office located in the City of Novi, County of
`
`Oakland, in the Eastern District of Michigan of the United States District Court.
`
`{01670973.DOC }
`
`

`

`Case 4:21-cv-11350-MFL-CI ECF No. 1, PageID.2 Filed 06/09/21 Page 2 of 7
`
`
`
`2.
`
`Defendant Xavier Becerra is the current Secretary of the Department
`
`of Health and Human Services.
`
`3.
`
`Jurisdiction is based upon 42 U.S.C. §405(g) providing for judicial
`
`review of the final decision of the Secretary made after a hearing.
`
`4.
`
`Venue is based upon 42 C.F.R. §405.1136(b) because Plaintiff has its
`
`principal place of business in the Eastern District of Michigan.
`
`5.
`
`6.
`
`The amount in controversy exceeds the sum of $800,000.00.
`
`The review is sought from a final decision of the Medicare Appeals
`
`Council (“MAC”) dated May 7, 2021 and received on May 22, 2021; a copy of
`
`which is attached hereto as Exhibit A.
`
`7.
`
`Plaintiff is a post-hospitalist company that employs board-certified
`
`physicians and nurse practitioners who specialize in the care of patients residing in
`
`post-acute, long-term care and assisted living facilities.
`
`8.
`
`In 2010, the Centers for Medicare and Medicaid Services (CMS)
`
`conducted a post-payment audit of claims submitted by Plaintiff to Medicare for
`
`payment for services rendered to patients covered by Medicare.
`
`9.
`
`The services were rendered to residents of long-term care facilities
`
`located in Louisiana in 2004-2006.
`
`10. Most of the services were rendered in the months before, during and
`
`immediately after the disaster of Hurricane Katrina that devastated parts of
`
`{01670973.DOC }
`
`2
`
`

`

`Case 4:21-cv-11350-MFL-CI ECF No. 1, PageID.3 Filed 06/09/21 Page 3 of 7
`
`
`
`Louisiana.
`
`11. CMS selected 90 claims at random and determined that Plaintiff had
`
`been overpaid on most of the claims.
`
`12. CMS then extrapolated the statistical sampling of the overpaid claims
`
`which resulted in an overpayment demand amount of $804,653.00.
`
`13. Plaintiff, in its own right and not on behalf of any beneficiary,
`
`appealed the overpayment determination through the Medicare administrative
`
`appeal process, culminating in a Request for Hearing before an Administrative
`
`Law Judge (ALJ) filed on November 11, 2010.
`
`14. One of Plaintiff’s primary defenses to the overpayment determination
`
`was that payment for the services rendered prior to and during Hurricane Katrina
`
`should not have been denied under a CMS policy that relaxed normal Medicare
`
`requirements for payments, due to the destruction caused by the storm to facilities
`
`and records kept therein.
`
`15. On September 1, 2011, the ALJ conducted a hearing on Plaintiff’s
`
`appeal of the overpayment determination, as to 73 of the claims that were still
`
`unfavorable to Plaintiff.
`
`16. The ALJ discovered that not all of the claims had been reviewed by
`
`the CMS Medicare Qualified Independent Contractor (QIC), so those claims were
`
`remanded to the QIC and no further testimony or argument was presented to the
`
`{01670973.DOC }
`
`3
`
`

`

`Case 4:21-cv-11350-MFL-CI ECF No. 1, PageID.4 Filed 06/09/21 Page 4 of 7
`
`
`
`ALJ pending the QIC’s decision on the remand order.
`
`17. On December 5, 2013, more than two years after the remand, the ALJ
`
`notified Plaintiff in writing that its Request for Hearing was defective because
`
`Plaintiff had failed to send a copy of the Request for Hearing to each of the
`
`seventy-three (73) residents of the facilities to whom Plaintiff had rendered
`
`medical services some seven to nine years earlier.
`
`18. The ALJ stated that 42 C.F.R. §405.1014(b)(2) required Plaintiff to
`
`send copies of the Request to all of the other “parties” to the appeal, and that the 73
`
`beneficiaries were “parties” to the appeal.
`
`19. The ALJ ordered Plaintiff to present proof that each of the 73
`
`beneficiaries was sent a copy of the Request within 60 days or the appeal may be
`
`dismissed (See Exhibit B attached hereto).
`
`20. On December 13, 2013, Plaintiff sent a letter to the ALJ arguing that
`
`the beneficiaries were not “parties” to the appeal under the definitions provided in
`
`the Medicare regulations, and citing a prior decision of the Medicare Appeals
`
`Council which supported Plaintiff’s position, as well as the fact that CMS had not
`
`treated the beneficiaries as “parties” in the earlier appeals (See Exhibit C attached
`
`hereto).
`
`21.
`
`In Plaintiff’s response, Plaintiff also requested that that ALJ advise
`
`Plaintiff if it disagreed with Plaintiff’s position.
`
`{01670973.DOC }
`
`4
`
`

`

`Case 4:21-cv-11350-MFL-CI ECF No. 1, PageID.5 Filed 06/09/21 Page 5 of 7
`
`
`
`22. On September 28, 2016, nearly three years later, and more than five
`
`years from the date that Plaintiff filed its Request for Hearing, and 10 to 12 years
`
`after the services were rendered, the ALJ dismissed Plaintiff’s appeal for failure to
`
`serve the 73 beneficiaries (See Exhibit D attached hereto).
`
`23. On November 29, 2016, Plaintiff filed a timely appeal of the ALJ’s
`
`dismissal to the Medicare Appeals Council (MAC).
`
`24.
`
`In its appeal, Plaintiff argued the following:
`
`a.
`
`the beneficiaries are not “parties” to the appeal as defined by
`
`the Medicare regulations because Plaintiff was appealing on its
`
`own behalf as the provider and not on behalf of the
`
`beneficiaries, and they were not required to be served with the
`
`Request for Hearing to the ALJ;
`
`b.
`
`if the beneficiaries were “parties”, then the QIC would have
`
`been required to serve them with its decision, which it did not
`
`do;
`
`c.
`
`the MAC had previously held in an unrelated case that a failure
`
`to notify beneficiaries who have no interest in overpayment
`
`cases is not a basis for dismissal; and
`
`d.
`
`any notice, even if required by the regulations, was rendered
`
`meaningless by the delay of seven to nine years between the
`
`{01670973.DOC }
`
`5
`
`

`

`Case 4:21-cv-11350-MFL-CI ECF No. 1, PageID.6 Filed 06/09/21 Page 6 of 7
`
`
`
`date that services were provided and the date when the ALJ
`
`raised the issue.
`
`25. On May 7, 2021, the MAC issued its order denying Plaintiff’s appeal,
`
`simply stating, without any analysis, that beneficiaries are parties to an appeal
`
`under 42 C.F.R. § 405.1014(b)(2), and that a failure to serve them with copies of
`
`the Request is grounds for dismissal of the appeal (Exhibit A).
`
`26. The ALJ erred in dismissing Plaintiff’s Request for Hearing and the
`
`MAC erred in denying Plaintiff’s Request for Review for the following reasons:
`
`a.
`
`Because Plaintiff is a provider of services who was assessed an
`
`overpayment, Plaintiff is the only party to the appeal pursuant
`
`to 42 C.F.R. § 405.1014(b)(2) and 42 C.F.R. § 405.906(a) and
`
`(b);
`
`b.
`
`The beneficiaries who received the services did not file a claim
`
`nor did Plaintiff file a claim for payment on their behalf;
`
`Plaintiff’s claim was its own claim to appeal the overpayment
`
`determination;
`
`c.
`
`The beneficiaries were not served by the QIC with copies of the
`
`QIC decision because they were not parties pursuant to 42
`
`C.F.R. § 405.906(b);
`
`d.
`
`Because the beneficiaries were not parties to the appeal as
`
`{01670973.DOC }
`
`6
`
`

`

`Case 4:21-cv-11350-MFL-CI ECF No. 1, PageID.7 Filed 06/09/21 Page 7 of 7
`
`
`
`defined above, Plaintiff was not required to send each of them a
`
`copy of the Request for Hearing nor provide proof of having
`
`done so to the ALJ; and
`
`e.
`
`The ALJ abused her discretion in not permitting Plaintiff an
`
`opportunity to serve the beneficiaries, despite Plaintiff’s request
`
`to be immediately advised if she disagreed with Plaintiff’s
`
`argument.
`
`27. Because the decision of the MAC is a final decision following a
`
`hearing before the ALJ, Plaintiff is entitled to judicial review of the MAC decision
`
`pursuant to 42 U.S.C. §§405(g).
`
`
`
`WHEREFORE, Plaintiff requests that this Honorable Court vacate the
`
`decision of the Medicare Appeals Council and remand this matter to the ALJ to
`
`complete the hearing on Plaintiff’s appeal of the overpayment determination.
`
`Respectfully submitted,
`
`SEYBURN & KAHN, P.C.
`
`By:/s/ Barry M. Rosenbaum (P26487)
`Barry M. Rosenbaum (P26487)
`David F. Hansma (P71056)
`Attorneys for Plaintiff
`2000 Town Center, Suite 1500
`Southfield, MI 48075-1195
`(248) 353-7620
`brosenbaum@seyburn.com
`
`
`
`
`
`Dated: June 9, 2021
`
`
`
`
`
`{01670973.DOC }
`
`7
`
`

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