On April 18, 2014, California Clinical Laboratory Association (“CCLA”) and “Jane Doe” (collectively, “Plaintiffs”) filed a lawsuit against HHS for equitable relief in the United States District Court for the District of Columbia captioned California Clinical Laboratory Association et al v. Secretary of Department of Health And Human Services, Case No. 1:14cv673.  Plaintiffs’ Complaint alleges that Medicare Local Coverage Determinations (“LCDs”), developed by Medicare Administrative Contractors (“MACs”), deprive Medicare beneficiaries of physician-ordered “critically necessary clinical laboratory services.” 

CCLA is nonprofit California trade association whose members include national, regional, and local laboratories.  Plaintiff Jane Doe is an 82-year-old Medicare beneficiary who suffers from chronic conditions requiring various prescription drugs.  Plaintiffs challenge the LCD policies as “legally invalid and ultra vires” for the following reasons:

  • They are an unconstitutional delegation of regulatory policymaking authority to private entities;  
  • They are not being promulgated pursuant to the rulemaking requirements of the Administrative Procedure Act;
  • MACs are basing the LCDs on criteria that are not permitted to be considered by MACs when determining whether particular services are reasonable and necessary under 42 U.S.C. § 1395y(a)(1);
  • HHS has failed to implement proper statutory procedures, causing inconsistent treatment of Medicare beneficiaries; and
  • Laboratories are being denied a “meaningful opportunity” to appeal the application of LCDs to their services.

The Complaint calls for an order declaring the LCD process and the resulting LCDs invalid and unenforceable, as well as an order enjoining HHS, including the MACs, from developing and applying any LCDs for clinical laboratory services, “until and unless the violations of the law at issue are corrected and an appropriate and legal process for developing and implementing LCDs is implemented.”

The full Complaint can be found here.