Regional Home Health Care, Inc v. Xavier Becerra ( 2021 )

United States Court of Appeals
For the Eighth Circuit
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No. 20-3239
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Regional Home Health Care, Inc.
lllllllllllllllllllllPlaintiff - Appellant
v.
Xavier Becerra, Secretary of the United States Department of Health and Human
Services;1 NCI Information Systems, Inc., an NCI Company, doing business as
AdvanceMed Corporation; Does 1-10
lllllllllllllllllllllDefendants - Appellees
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Appeal from United States District Court
for the Southern District of Iowa - Eastern
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Submitted: September 22, 2021
Filed: December 6, 2021
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Before SHEPHERD, WOLLMAN, and KOBES, Circuit Judges.
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WOLLMAN, Circuit Judge.
1
Secretary Becerra is automatically substituted for his predecessor under
Federal Rule of Appellate Procedure 43(c)(2).
Regional Home Health Care, Inc. (Regional), was certified to receive
reimbursement for services under the Medicare Act, 42 U.S.C. § 1395, et seq., and
derived almost all of its revenue from reimbursement for home health care services
rendered to Medicare patients in rural Lee County, Iowa. The Centers for Medicare
and Medicaid Services (CMS) suspended Medicare payments to Regional on January
31, 2018, during an investigation into whether Regional had been overpaid. Regional
suffered dire financial hardship due to the suspension and closed its business by May
2018.
The suspension was lifted in July 2018, upon completion of the investigation.
CMS determined that it had overpaid Regional more than $1.26 million, which CMS
demanded be repaid. Regional did not challenge this overpayment determination in
the administrative appeals process set forth in the Medicare Act and related
regulations. See 42 U.S.C. § 1395ff. Regional instead filed suit in June 2019 against
the Secretary of the Department of Health and Human Services and Medicare
contractor NCI Information Systems, Inc. (AdvanceMed).2
Regional sought a declaration that the defendants’ procedures “in suspending
Regional’s Medicare payments and forcing Regional out of business” without notice,
a hearing, or an opportunity to appeal violated its Fifth Amendment rights to
procedural and substantive due process. The district court3 dismissed Regional’s
declaratory judgment claims for lack of subject matter jurisdiction.
2
CMS is part of the Department of Health and Human Services. Regional does
not dispute that CMS and AdvanceMed followed the payment-suspension procedures
set forth in the Medicare regulations. See 42 C.F.R. §§ 405.371–.375.
3
The Honorable Stephanie M. Rose, United States District Judge for the
Southern District of Iowa.
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We conclude that no “actual controversy” exists between Regional and the
defendants within the meaning of the Declaratory Judgment Act. See 28 U.S.C.
§ 2201(a). Having abandoned any claim for damages, Regional seeks nothing more
than a judicial pronouncement that its constitutional rights were violated. This
lawsuit thus does not present “a substantial controversy, between parties having
adverse legal interests, of sufficient immediacy and reality to warrant the issuance of
a declaratory judgment.” See Md. Cas. Co. v. Pac. Coal & Oil Co., 312 U.S. 270, 273
(1941).
In all civil litigation, the judicial decree is not the end but the means. At
the end of the rainbow lies not a judgment, but some action (or cessation
of action) by the defendant that the judgment produces—the payment of
damages, or some specific performance, or the termination of some
conduct. Redress is sought through the court, but from the defendant.
This is no less true of a declaratory judgment suit than of any other
action. The real value of the judicial pronouncement—what makes it a
proper judicial resolution of a “case or controversy” rather than an
advisory opinion—is the settling of some dispute which affects the
behavior of the defendant towards the plaintiff.
Hewitt v. Helms, 482 U.S. 755, 761 (1987).
A declaration that Regional’s rights were violated will not affect the
Secretary’s or AdvanceMed’s behavior toward Regional, because Regional has
closed, the suspension has been lifted, and Regional did not appeal the overpayment
determination. Regional’s relationship with the defendants has effectively ended.
The possibility of Regional re-establishing a business that is certified to receive
Medicare reimbursements, again submitting documentation insufficient to meet
Medicare requirements for billed services, and again having Medicare payments
suspended (allegedly in violation of Regional’s constitutional rights) is too
“conjectural or hypothetical” to pose a “real and immediate threat of injury” sufficient
to confer jurisdiction in federal court. See City of L.A. v. Lyons, 461 U.S. 95, 102,
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103 (1983) (cleaned up); Brazil v. Ark. Dep’t of Hum. Servs., 892 F.3d 957, 960 (8th
Cir. 2018) (plaintiff’s claim for prospective injunctive relief moot because she was
“under no ‘real and immediate’ threat of future retaliation”).
The judgment is affirmed.
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