Marietta Memorial Hospital Employee Health Benefit Plan v. DaVita Inc., 596 U.S. ___ (2022)
The employer-sponsored group health plan offers all of its participants the same limited coverage for outpatient dialysis. A dialysis provider sued the plan, citing the Medicare Secondary Payer statute, which makes Medicare a “secondary” payer to an individual’s existing insurance plan for certain medical services, including dialysis, when that plan already covers the same services, 42 U.S.C. 1395y(b)(1)(C), (2), (4). To prevent plans from circumventing their primary-payer obligation for end-stage renal disease treatment, a plan may not differentiate in the benefits it provides between individuals having end-stage renal disease and other individuals based on the existence of end-stage renal disease, the need for renal dialysis, “or in any other manner” and may not take into account that an individual is entitled to or eligible for Medicare due to end-stage renal disease. The Sixth Circuit ruled that the limited payments for dialysis treatment had a disparate impact on individuals with end-stage renal disease.
The Supreme Court reversed. The plan's coverage terms for outpatient dialysis do not violate section 1395y(b)(1)(C) because those terms apply uniformly to all covered individuals. The statute prohibits a plan from differentiating in benefits between individuals with and without end-stage renal disease; it cannot be read to encompass a disparate-impact theory. The statute simply coordinates payments between group health plans and Medicare without dictating any particular level of dialysis coverage. The plan does not “take into account” whether its participants are entitled to or eligible for Medicare.
The Medicare Secondary Payer statute does not authorize disparate-impact liability; a benefits plan that offers all of its participants the same limited coverage for outpatient dialysis does not violate the statute.
SUPREME COURT OF THE UNITED STATES
Syllabus
MARIETTA MEMORIAL HOSPITAL EMPLOYEE HEALTH BENEFIT PLAN et al. v. DaVITA INC. et al.
certiorari to the united states court of appeals for the sixth circuit
No. 20–1641. Argued March 1, 2022—Decided June 21, 2022
Petitioner Marietta Memorial Hospital Employee Health Benefit Plan is an employer-sponsored group health plan that offers all of its participants the same limited coverage for outpatient dialysis. Respondent DaVita—a major provider of dialysis services—sued the Marietta Plan, arguing that the Plan’s limited coverage for outpatient dialysis violated the Medicare Secondary Payer statute. The statute makes Medicare a “secondary” payer to an individual’s existing insurance plan for certain medical services, including dialysis, when that plan already covers the same services. 42 U. S. C. §§1395y(b)(1)(C), (2), (4). To prevent plans from circumventing their primary-payer obligation for end-stage renal disease treatment, the statute imposes two constraints relevant here. First, a plan “may not differentiate in the benefits it provides between individuals having end stage renal disease and other individuals covered by such plan on the basis of the existence of end stage renal disease, the need for renal dialysis, or in any other manner.” §1395y(b)(1)(C)(ii). Second, a plan “may not take into account that an individual is entitled to or eligible for” Medicare due to end-stage renal disease. §1395y(b)(1)(C)(i); see §426–1. The District Court dismissed DaVita’s claims that the Marietta Plan violated both statutory constraints. A divided panel of the U. S. Court of Appeals for the Sixth Circuit reversed. Among other things, the Court of Appeals ruled that the statute authorized disparate-impact liability and that the limited payments for dialysis treatment had a disparate impact on individuals with end-stage renal disease.
Held: Section 1395y(b)(1)(C) does not authorize disparate-impact liability, and the Marietta Plan’s coverage terms for outpatient dialysis do not violate §1395y(b)(1)(C) because those terms apply uniformly to all covered individuals. Pp. 4–7.
(a) Section 1395y(b)(1)(C)(ii) prohibits a plan from differentiating in benefits between individuals with and without end-stage renal disease. Because the Marietta Plan’s terms apply uniformly to individuals with and without end-stage renal disease, the Plan does not “differentiate in the benefits it provides between individuals” with and without end-stage renal disease. DaVita argues that the statute authorizes liability even when a plan limits benefits in a uniform way if the limitation on benefits has a disparate impact on individuals with end-stage renal disease. But the text of the statute cannot be read to encompass a disparate-impact theory. The statutory provision simply coordinates payments between group health plans and Medicare; the statute does not dictate any particular level of dialysis coverage. Pp. 4–7.
(b) DaVita’s contention that a plan that provides limited coverage for outpatient dialysis impermissibly “take[s] into account” the Medicare eligibility of plan participants with end-stage renal disease fails for the same reason. Because the Marietta Plan provides the same outpatient dialysis benefits to all Plan participants, whether or not a participant is entitled to or eligible for Medicare, the Plan cannot be said to “take into account” whether its participants are entitled to or eligible for Medicare. Pp. 7.
978 F.3d 326, reversed and remanded.
Kavanaugh, J., delivered the opinion of the Court, in which Roberts, C. J., and Thomas, Breyer, Alito, Gorsuch, and Barrett JJ., joined. Kagan, J., filed an opinion dissenting in part, in which Sotomayor, J., joined.
JUDGMENT ISSUED |
Judgment REVERSED and case REMANDED. Kavanaugh, J., delivered the opinion of the Court, in which Roberts, C. J., and Thomas, Breyer, Alito, Gorsuch, and Barrett, JJ., joined. Kagan, J., filed an opinion dissenting in part, in which Sotomayor, J., joined. |
Argued. For petitioners: John J. Kulewicz, Columbus, Ohio. For United States, as amicus curiae: Matthew Guarnieri, Assistant to the Solicitor General, Department of Justice, Washington, D. C. For respondents: Seth P. Waxman, Washington, D. C. |
Reply of petitioners Marietta Memorial Hospital Employee Health Benefit Plan, et al. filed. (Distributed) |
Reply of Marietta Memorial Hospital Employee Health Benefit Plan, et al. submitted. |
Motion of the Solicitor General for leave to participate in oral argument as amicus curiae, for divided argument, and for enlargement of time for oral argument GRANTED. |
Letter to Clerk re disclaimer of Davita Inc., et al. submitted. |
Letter of respondents to Clerk regarding disclaimer filed. |
Corrected Proof of Service of National Association for the Advancement of Colored People submitted. |
Corrected proof of service with respect to vrief amicus curiae of National Association for the Advancement of Colored People filed. |
Amicus brief of Kidney Care Council and Renal Healthcare Association submitted. |
Amicus brief of National Association for the Advancement of Colored People submitted. |
Amicus brief of Congressman William Thomas submitted. |
Amicus brief of Thomas A. Scully submitted. |
Amicus brief of Kidney Care Partners submitted. |
Amicus brief of Dialysis Patient Citizens submitted. |
Brief amicus curiae of National Association for the Advancement of Colored People filed. (Distributed) |
Brief amici curiae of Kidney Care Council and Renal Healthcare Association filed. (Distributed) |
Brief amicus curiae of Congressman William Thomas filed. (Distributed) |
Brief amicus curiae of Dialysis Patient Citizens filed. (Distributed) |
Brief amicus curiae of Kidney Care Partners filed. (Distributed) |
Brief amicus curiae of Thomas A. Scully filed. (Distributed) |
Motion of United States for leave to participate in oral argument and for divided argument submitted. |
Motion of the Solicitor General for leave to participate in oral argument as amicus curiae, for divided argument, and for enlargement of time for oral argument filed. |
Brief of Davita Inc., et al. submitted. |
Brief of respondents Davita Inc., et al. filed. (Distributed) |
CIRCULATED |
The record received from the U.S.C.A. 6th Circuit has been electronically filed. |
Amicus brief of Self-Insurance Institute of America, Inc. submitted. |
Brief amicus curiae of United States filed. |
Amicus brief of United States submitted. |
Brief amicus curiae of Self-Insurance Institute of America, Inc. filed. |
Brief amici curiae of Pacific Health Coalition, et al. filed. |
Amicus brief of Pacific Health Coalition submitted. |
Record requested from the U.S.C.A. 6th Circuit. |
Joint Appendix submitted. |
Brief of Marietta Memorial Hospital Employee Health Benefit Plan, et al. submitted. |
Brief of petitioners Marietta Memorial Hospital Employee Health Benefit Plan, et al. filed. |
Joint appendix filed. (Statement of costs filed) |
ARGUMENT SET FOR Tuesday, March 1, 2022. |
Petition GRANTED. |
DISTRIBUTED for Conference of 11/5/2021. |
DISTRIBUTED for Conference of 10/29/2021. |
Reply of petitioners Marietta Memorial Hospital Employee Health Benefit Plan, et al. filed. (Distributed) |
Brief of respondents Davita Inc., et al. in opposition filed. |
Motion to extend the time to file a response is granted and the time is extended to and including September 20, 2021. |
Motion to extend the time to file a response from August 20, 2021 to September 20, 2021, submitted to The Clerk. |
Response Requested. (Due August 20, 2021) |
DISTRIBUTED for Conference of 9/27/2021. |
Waiver of right of respondent Davita Inc., et al. to respond filed. |
Petition for a writ of certiorari filed. (Response due June 24, 2021) |