Largest Settlement in Medicare’s History Finalized

A final settlement was executed in April 2012 of an Akin Gump-led challenge to Medicare’s calculation of a budget neutrality adjustment to the Medicare payment rate for inpatient hospital services that, in January 2011, had resulted in a favorable decision from the United States Court of Appeals for the D.C. Circuit in Cape Cod Hospital v. Sebelius.

Following that decision, in June 2011, Akin Gump spearheaded settlement negotiations on behalf of 700 client hospitals with respect to appeals on the same issue for thousands of fiscal years from 2000 through 2011.  In addition, other hospitals, not represented by the firm, were benefitted through participation in similar settlements that were made available to them, on a global basis, following the blueprint established in the settlement negotiations for the firm’s 700 hospital clients, including the hospitals in the lead case.  The total settlement amount for all hospitals nationally is reportedly in excess of $4 billion and is by far the largest settlement of its kind in the history of the Medicare program.