‘This Battle Is Far From Over’: Federal Court Dismisses NAHC’s Lawsuit Against CMS
Home Health Care News | By Joyce Famakinwa
Last summer, the National Association for Home Care & Hospice (NAHC) made waves when it filed a lawsuit against the Centers for Medicare & Medicaid Services (CMS) and the U.S. Department of Health and Human Services (HHS) over Medicare home health payment calculations.
Last week, a federal court in Washington D.C., dismissed NAHC’s lawsuit against CMS and HHS.
The lawsuit claimed that CMS and HHS utilized an “invalid” methodology to decide payment, and that recent home health payment cuts were unlawful.
“The primary claim in our lawsuit is that the methodology violated the plain language of the Medicare law,” NAHC wrote in its latest report.
CMS implemented a 3.925% rate reduction for 2023, and a 2.89% one for 2024.
On April 26, the U.S. District Court for the District of Columbia ruled that NAHC skipped an agency review process prior to suing.
“The Court ruling addresses a combination of the NAHC arguments and the defenses presented by the U.S. Department of Justice on behalf of CMS,” NAHC wrote. “DOJ argued that the Court did not have the power to hear any challenges to the PDGM budget neutrality adjustment methodology, that NAHC failed to exhaust all administrative appeal steps, and that the challenged methodology was in compliance with the law.”
Still, NAHC noted that the Court ruled in its favor on something it considers a crucial element of the case.
“[The court rejected] DOJ’s argument that all judicial review was precluded on anything related to the PDGM system,” NAHC wrote. “The Court specifically held that NAHC could challenge the budget neutrality adjustment methodology once administrative remedies are exhausted. Of further note, the Court did not rule on or evaluate the merits of the NAHC claim that the methodology violated Medicare law.”
Last year, the Biden administration asked a federal judge to throw out NAHC’s lawsuit against CMS and HHS.
Looking ahead, NAHC is considering its next move. One of the things the organization is thinking about is appealing the court’s ruling on exhaustion of administrative appeals.
Pursuing a request for expedited judicial review with CMS is also on the table. If a judicial review is expedited, NAHC plans to refine its lawsuit.
“The Court did not rule on the merits of NAHC’s claims that it had violated Medicare laws,” NAHC wrote. “As such, a lawsuit can be pursued once the administrative steps are completed.”
Ultimately, NAHC President William A. Dombi believes that the lawsuit dismissal is a stumbling block, but one that the organization will prevail over.
“We are disappointed with the court’s ruling. However, it is a minor setback that we can readily overcome,” Dombi said in the report. “Often justice delayed is justice denied. Here, we will have our day in court. This battle is far from over.”
In addition to his role as president, Dombi also served as legal counsel to NAHC. |
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Investigation Finds Home Care Agency Failed to Protect Visiting Nurse Who Died in Willimantic
NBC Connecticut | By Angela Fortuna
A federal investigation following the death of a Connecticut visiting nurse found that the home care agency she worked for did not provide enough safeguards to protect her.
The Department of Labor's Occupational Safety and Health Administration found that Elara Caring, one of the nation's largest home-based care providers, failed to protect Joyce Grayson, who was killed on Oct. 28, 2023.
Michael Reese, the man accused of killing Grayson, has been charged with murder. Grayson, a visiting nurse, had an appointment with Reese at his residence, a halfway house for sex offenders in Willimantic.
Around 2 p.m., Willimantic police received a call asking them to check on Grayson after she missed several patient appointments. The caller said Reese was Grayson’s first appointment of the day and there had been no contact with her since early that morning.
Police eventually found Grayson's body in the padlocked basement of the Chapman Street home, and they found her cell phone in a bucket of liquid in the bathtub, according to the arrest warrant.
Grayson died of compression of the neck and her death was ruled a homicide, according to authorities.
Federal OSHA officials found that on the day of Grayson's death, and at times prior, Elara Caring "exposed home healthcare employees to workplace violence from patients who exhibited aggressive behavior and were known to pose a risk to others."
Jordan Health Care Inc. and New England Home Care Inc., who both did business as Elara Caring, have been cited for willful violation under the agency's general duty clause, officials said.
Feds cited the home care agency for "not developing and implementing adequate measures to protect employees from the ongoing serious hazard of workplace violence." Elara Caring was also cited for not providing work-related injury and illness records to OSHA within four business hours, as required by law.
The home care agency will have to pay over $163,000 in proposed penalties…
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FTC Votes to Ban Noncompete Agreements
The Hill | By Taylor Giorno
The Federal Trade Commission (FTC) voted 3-2 on Tuesday to ban noncompete agreements that prevent tens of millions of employees from working for competitors or starting a competing business after they leave a job.
From fast food workers to CEOs, the FTC estimates 18 percent of the U.S. workforce is covered by noncompete agreements — about 30 million people.
The final rule would ban new noncompete agreements for all workers and require companies to let current and past employees know they won’t enforce them. Companies will also have to throw out existing noncompete agreements for most employees, although in a change from the original proposal, the agreements may remain in effect for senior executives.
“It is so profoundly unfree and unfair for people to be stuck in jobs they want to leave, not because they lacked better alternatives, but because noncompetes preclude another firm from fairly competing for their labor, requiring workers instead to leave their industries or their homes to make ends,” FTC Commissioner Rebecca Slaughter (D) said in prepared remarks.
The new rule is slated to go into effect 120 days after it’s published in the Federal Register. But its future is uncertain, as pro-business groups opposing the rule are expected to take legal action to block its implementation.
Business groups say noncompete agreements are critical for protecting proprietary information and intellectual property, although the rule would not ban other methods for protecting that information, including nondisclosure and confidentiality agreements. They also question the agency’s authority to issue the blanket, retroactive ban.
Congress has not given the agency explicit authority to ban noncompetes, although there have been several bipartisan bills introduced to reform noncompete agreements, including the Workforce Mobility Act sponsored by Sens. Chris Murphy (D-Conn.), Todd Young (R-Ind.), Tim Kaine (D-Va.) and Kevin Cramer (R-N.D.), and the Freedom to Compete Act sponsored by Sens. Marco Rubio (R-Fla.) and Maggie Hassan (D-N.H.).
The U.S. Chamber of Commerce, the largest pro-business lobbying group in the country, has said it will sue to block the rule.
Chamber President and CEO Suzanne Clark called the FTC vote to ban noncompetes “a blatant power grab that will undermine American businesses’ ability to remain competitive.”
“This decision sets a dangerous precedent for government micromanagement of business and can harm employers, workers, and our economy,” Clark said. “The Chamber will sue the FTC to block this unnecessary and unlawful rule and put other agencies on notice that such overreach will not go unchecked.”…
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Noncompete Ban Could Make ‘No-Poach’ Agreements Harder to Enforce: Polsinelli
McKnights Home Care | By Adam Healy
The Federal Trade Commission’s ban on noncompete agreements threatens to undermine common tactics used by home care agencies to prevent client poaching, experts at law firm Polsinelli warned during a recent webinar.
The rule does not explicitly forbid documents such as nondisclosure agreements (NDAs) and no-poach agreements, which are often used by home care and hospice providers. However, FTC included a “functional equivalence” test to measure whether such provisions would in practice act as a noncompete, Polsinelli’s attorneys noted. As a result, these kinds of contractual provisions could be undone if they are applied too broadly.
“If you have an NDA that’s so broad that it would be seen as the functional equivalent of a non compete, you may have trouble,” Polsinelli attorney Scott Gilbert said during the webinar Tuesday. “If you have a super-broad NDA, it may not be enforceable.”
Furthermore, the FTC could throw out any contract provision that applies to workers after their employment has ended, explained Polsinelli shareholder Emma Scheuring. This includes no-poach clauses that prohibit caregivers from being hired directly by their patients after their employment by a home care agency ends.
“If you’re asking your caregivers not to go work for their clients — your clients — after they stop working for you, that’s a noncompete under the rule,” Scheuring said. “Anything that says, ‘Employee, once you leave working for me, you can’t go work for XYZ,’ that’s going to be problematic under the rule.”
Other types of contractual obligations, including direct-hire clauses, were not addressed directly in the FTC’s rulemaking. But experts have previously stated that the use of these kinds of provisions may also be limited once the rule goes into effect.
Broad application
Against many providers’ wishes, FTC did not grant a blanket exemption for healthcare businesses. This means that for-profit home care, home health and hospice providers are subject to FTC’s ban, Polsinelli’s experts said.
And while the FTC generally does not have jurisdiction over nonprofit entities, the agency indicated in the rule’s comment section that it intends to look more closely at whether some businesses actually qualify as nonprofits. If “presented with an appropriate test case,” the agency may try to assert its jurisdiction on a nonprofit engaged in “relatively commercial activities,” according to law firm JD Supra.
Meanwhile, the Internal Revenue Service also recently suggested that it would be investigating whether some entities fit their nonprofit status, according to Gilbert.
“It wouldn’t surprise us at all to see collaboration between the FTC and the IRS in evaluating [whether a business is truly not-for-profit],” Gilbert said…
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Breaking: DOL Final Overtime Rule Increases Minimum Salary Threshold for Exemption
The National Law Review | Ny Kelly K. Ballentine of ArentFox Schiff LLP
Effective July 1, employers must pay employees a salary of at least $844 per week (equivalent to $43,888 per year) to qualify for the Executive, Administrative, Professional, Outside Sales, and Computer Employees exemptions from minimum wage and overtime under the Fair Labor Standards Act (FLSA).
As we have previously reported, this change comes as part of the US Department of Labor’s (DOL) highly anticipated final rule on standard salary levels, which it announced on April 23. The final rule also increases the Highly Compensated Employee exemption total annual compensation threshold to a minimum of $132,964 per year, including at least $844 per week paid on a salary or fee basis, and further includes a mechanism providing for future updates to these earnings thresholds to reflect current earnings data.
Looking to next year, employers should be prepared for another increase on January 1, 2025, which raises the standard salary level to $1,128 per week (equivalent to $58,656 per year) and the Highly Compensated Employee total annual compensation threshold to $151,164 per year, including at least $1,128 per week paid on salary or fee basis. Beginning on July 1, 2027, and every three years thereafter, the final rule empowers the DOL to make future updates to the pay thresholds to reflect current earnings data.
For context, the current rule (effective before July 1) requires a salary minimum of $684 per week (equivalent to $35,568 per year) for the Executive, Administrative, Professional, Outside Sales, and Computer Employees exemptions, and $107,432 per year for the Highly Compensated Employee exemption. Employers are reminded that an employee must meet the minimum salary threshold under both the FLSA and any state statutory scheme to qualify for exemption.
Companies should evaluate their current compensation practices and employee classifications to avoid violations of the FLSA’s minimum wage and overtime regulations and associated penalties, |
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