SIIA Litigation Update

SIIA Supports Legal Challenge to Business Practices Harmful to Self-Insured Employers

December 24, 2019 – The Self-Insurance Institute of America, Inc. (SIIA) has once again supported federal litigation with significant implications for self-insured employers and their business partners. The association partnered with the Pacific Health Coalition in filing an amicus brief this week in support of Amy's Kitchen, Inc. and its Employee Health Benefits Plan in DaVita, Inc. v. Amy's Kitchen.

This case is currently on appeal to the federal Ninth Circuit and is one of a set of cases filed by DaVita challenging self-insured health plans' use of dialysis cost containment strategies under the Medicare Secondary Payor Act ("MSP"). Dialysis Patient Citizens ("DPC"), a dialysis advocacy organization, has filed an amicus brief in support of DaVita. Pacific Health Coalition is an association of self-insured plans based in the Pacific Northwest.

Why This Case is Important
Dialysis provider charges to self-insured plans are typically very high, many times greater than the providers' actual costs or their charges to Medicare. The providers openly state that they use private plan payments to fund their very substantial profits, but their charges can cause serious plan solvency issues if not controlled.

This case is important to the self-insurance industry because DaVita and DPC are arguing that the MSP prohibits plans from applying any conditions to dialysis benefits which do not apply to other covered services. If this argument is accepted plans will lose the right to differentiate dialysis benefits to control their costs. Moreover, this is the leading case of the set filed by DaVita on these issues so it will therefore be influential in subsequent court decisions.

For More Information
The full SIIA amicus brief can be accessed by clicking here. Watch for additional exclusive SIIA reporting on this important case as developments happen.