CMS Appeals the Injunction Halting the Nursing Home Arbitration Ban—Where Will it Go From Here?

Angie SzumlinskiUncategorized

CMS Appeals the Injunction Halting the Nursing Home Arbitration Ban—Where Will it Go From Here?

1/17/2017 by Sean Sullivan  
Few things have had the post-acute care industry on the edge of their seats like the ban on arbitration agreements and the subsequent injunction preventing its application. On January 5, 2017, CMS filed a Notice of Appeal with the district court that granted the injunction. From there, the case moves to the federal Fifth Circuit Court of Appeals in New Orleans for a decision. The implications are immense, as discussed in previous articles.

Because the Mississippi district court’s November 7, 2016, order granted a preliminary injunction against the federal government, it had 60 days to file a notice of appeal. A preliminary injunction is not technically an appealable “final judgment.” However, with a ruling on the merits, many cases are effectively won or lost at the preliminary injunction stage. So, interlocutory appeals after an order granting or denying a preliminary injunction are specifically allowed as a right under the U.S. Code. Unlike an appeal of a final judgment, though, the district court retains jurisdiction over the case and is free to move forward with other phases of the case. In a high-profile case with wide-ranging implications like this one, however, the district court is unlikely to take any significant actions without a resolution on the legality of CMS’ nursing home arbitration ban. In fact, days after the appeal was noticed, the government requested, and the district court granted, a stay on January 9, 2017, halting the case at the district court level pending a decision on the appeal.

On January 10, 2017, the Fifth Circuit Court of Appeals in New Orleans docketed the appeal. After the appeal is docketed with the circuit court of appeals, the appellant, or in this case, Sylvia Burwell and Andy Slavitt acting on behalf of the federal government, has 14 days to file a statement naming the parties that the attorney appealing represents on appeal. Then, after the appellate court clerk receives the record on appeal, the parties are notified of the filing date and given a timeline in a briefing order.

Though the timeline may be extended by a motion of either party, the government’s brief must be filed within 40 days after the record is filed. Then, the American Health Care Association and other appellees will have 30 days to file their brief. The government may file a reply brief within 14 days of the appellees’ brief. Amicus curiae briefs—arguments from other interested parties who are not named parties to the case—may be filed within 7 days after the brief is filed for the party that they support. Due to the importance of this case, expect multiple amicus briefs on all sides by many of the same parties who filed comments to the original CMS proposed rule (see this 
previous article for details on some of the comments submitted) and amicus briefs in the district court.

If, as expected, the parties request oral argument and that request is approved, then the clerk will schedule a hearing and notify the parties. The hearing will likely take place within a few months of the brief filing. The parties are usually given 20 minutes each to argue by a local rule, but that may be extended (although extensions are “sparingly permitted”). After a hearing, there is no time limit for the circuit court to issue a decision, but most cases are decided within 11 months from filing the notice of appeal. Given the significance of this injunction and CMS’s proposed nursing home arbitration ban, expect a decision on the earlier side, perhaps summer or fall 2017.

However, with so much at stake for both parties, that is unlikely to be the end of the road. The losing party has 90 days after entry of judgement by the Fifth Circuit Court of Appeals, or a denial of a petition for a rehearing, to petition for a writ of certiorari to the U.S. Supreme Court. It remains to be seen, however, how adamant the incoming appointees to lead the Department of Health and Human Services and CMS, Rep. Tom Price and Seema Verma, respectively, will be in pursuing the nursing home arbitration ban.