Is Bankruptcy A Game-Changer for Embattled Providers?

April 15, 2016

In a panel discussion at the Institute on Medicare & Medicaid Payment Conference  sponsored by the American Health Lawyers Association held in Baltimore on April 15, 2016, at the Baltimore Marriott Waterfront Hotel titled “Is Bankruptcy A Game-Changer for Embattled Providers?”, Otterbourg partner and former Chief Judge of the U.S. Bankruptcy Court for the Eastern District of New York, Melanie Cyganowski, together with the Hon. Nancy H. Lord, United States Bankruptcy Judge for Eastern District of New York, Samuel R. Maizel of Dentons LLP, Karen Cordry, Bankruptcy and Special Counsel at the National Association of Attorneys General and Judy W. Strobos, United States Department of Health and Human Services, discussed a wide range of issues confronted by the those in the business of providing health care, including:

  • Medicare can stop payments to a provider and take years to resolve the dispute – Can filing a bankruptcy case allow a Medicare or Medicaid provider to avoid having to exhaust the administrative appeals process and get a resolution more quickly?
  • Medicare argues that the Medicare Provider Agreement is not a contract except in bankruptcy cases, where it argues that the provider agreement is a contract – why the difference?   Does it make sense?  And if it isn’t a contract, does it mean that the provider agreement can be sold like a license, and free and clear of Medicare or Medicaid’s overpayment and/or fraud claims against the provider?
  • What about fraud cases?   Does filing bankruptcy mean anything difference with regard to resolving a Medicare or Medicaid fraud based claim dispute?
  • It can take years to adjudicate a Medicare or Medicaid payment dispute – can a provider file bankruptcy and move to estimate a Medicare and/or Medicaid claim for the purpose of deciding how much it owes to Medicare and/or Medicaid and get it decided in the bankruptcy court much more quickly?