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District Court Grants Motion to Reopen 1979 Case That Enjoined HHS from Disclosing Provider Names in Connection with Annual Medicare Reimbursement Amounts

Friday, October 7, 2011

Florida Med. Ass’n v. Dep’t of Health, Education & Welfare, Case No. 3:78-cv-178-J-34MCR, 2011 BL 248497 (M.D. Fla. Sept. 26, 2011) In 2007, Jennifer Alley, the owner of Real Time Medical Data, L.L.C. (RTMD), sued the U.S. Department of Health and Human Services (HHS) to compel HHS to disclose Medicare claims data which included identifying information about individual providers. The U.S. District Court for the Northern District of Alabama ordered HHS to disclose the claims data but the Eleventh Circuit reversed, based on an injunction issued in 1979 that permanently enjoined HHS from disclosing annual Medicare reimbursement amounts in any manner that would permit the individual idenfitication of Medicare providers. In 2010, Dow Jones & Company, Inc., which was also seeking access to claims data, entered into a settlement agreement with HHS in which HHS agreed to provide Dow Jones with limited access to claims data. In 2011, Dow Jones filed a motion to reopen Florida Med. Ass’n v. Dep’t of Health, Education & Welfare, 479 F. Supp. 1291 (M.D. Fla. 1979), and a motion to intervene in that case in order to vacate the injunction. Dow Jones also sought to file cross-claims and counter claims against HHS. Also in 2011, Alley and RTMD filed a motion to intervene in the 1979 case in order to vacate the Injunction. Alley and RTMD also sought to file cross-claims and counter claims against HHS. The court granted Dow Jones’s motion to reopen the 1979 case and granted the motions to intervene made by Dow Jones, Alley, and RTMD. The court denied the cross-claims and counter-claims made by Dow Jones, Alley, and RTMD after holding that the only appropriate procedural vehicle for seeking vacatur of the Injunction was a motion for relief from a final judgment.

Parties May Intervene in 1979 Case

With no opposition to Dow Jones’s motion to reopen the case, the court turned to the motions to intervene. Jones, Alley, and RTMD moved to intervene and vacate the 1979 injunction. The court explained that, in order to intervene as of right, intervenors must show that (1) their application to intervene was timely; (2) they had an interest relating to the property or transaction which was the subject of the action; (3) they were so situated that disposition of the action, as a practical matter, might impede or impair their ability to protect that interest; and (4) their interest was represented inadequately by the existing parties to the suit. Id. at 16-17. In considering the first element, the court noted initially that the injunction had been in existence for 32 years. Despite this, the court wrote, the intervenors had not been dilatory in seeking to intervene in the 1979 case because it was only in 2009 that the Eleventh Circuit broadly defined the injunction and ruled that any challenge to the injunction must be brought before the court. With regard to the second element, the court first found that the subject matter of the litigation was the injunction. Accordingly, because each of the intervenors had an interest in the release of the claims data in connection their business operations, the court held that the intervenors had established that they had a sufficient interest to challenge the injunction. With regard to the third element, the court found that the intervenors had established that their interests were affected by the injunction when they showed that they were denied access to claims dataFinally, with regard to the fourth element, the court held that the interests of intervenors differed markedly from both FMA and AMA, the original plaintiffs in the 1979 case, and HHS, the original defendant in the 1979 case. According to the court, this fact was made evident, by the fact that none of FMA, AMA, or HHS had sought to have the injunction vacated. Accordingly, after finding that the intervenors satisfied all of the elements of an intervention as of right, the court held that Alley, RTMD, and Dow Jones would be permitted to intervene.

No Counter-Claims and Cross-Claims

Dow Jones argued that because it was entitled to intervention as of right, it was also entitled to assert cross-claims in the 1979 case. In this regard, the court noted that once a court grants intervention, whether as of right or by permission, the intervenor is treated as if it were an original party and has equal standing with the original parties. On the other hand, the court wrote, “an intervenor is admitted to the proceeding as it stands, and in respect of the pending issues, but is not permitted to enlarge those issues or compel an alteration of the nature of the proceeding.” Id. at 24. As a result, the court held, while the intervenors were entitled to be treated as if they were original parties to the 1979 case, even the original parties could not now “start over” and re-litigate old claims or assert new claims. Accordingly, the court concluded that a motion for relief from a final judgment was the only appropriate procedural vehicle left available to Alley, RTMD, and Dow Jones to seek vacatur or modification of the Injunction.The court granted Dow Jones’s motions to reopen and intervene in the 1979 case. The court denied Dow Jones’s proposed cross-claims and counter claims and construed these claims as a motion to vacate or modify the injunction. The court granted Alley’s and RTMD’s motions to intervene in the 1979 case. The court denied Alley’s and RTMD’s proposed cross-claims and counter claims and construed these claims as a motion to vacate or modify the injunction. Disclaimer This document and any discussions set forth herein are for informational purposes only, and should not be construed as legal advice, which has to be addressed to particular facts and circumstances involved in any given situation. Review or use of the document and any discussions does not create an attorney-client relationship with the author or publisher. To the extent that this document may contain suggested provisions, they will require modification to suit a particular transaction, jurisdiction or situation. Please consult with an attorney with the appropriate level of experience if you have any questions. Any tax information contained in the document or discussions is not intended to be used, and cannot be used, for purposes of avoiding penalties imposed under the United States Internal Revenue Code. Any opinions expressed are those of the author. The Bureau of National Affairs, Inc. and its affiliated entities do not take responsibility for the content in this document or discussions and do not make any representation or warranty as to their completeness or accuracy. ©2014 The Bureau of National Affairs, Inc. All rights reserved. Bloomberg Law Reports ® is a registered trademark and service mark of The Bureau of National Affairs, Inc.

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