American Hospital Association v. Alex Azar, II

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United States Court of Appeals FOR THE DISTRICT OF COLUMBIA CIRCUIT Argued October 15, 2020 Decided December 29, 2020 No. 20-5193 AMERICAN HOSPITAL ASSOCIATION , ET AL., APPELLANTS v. ALEX M. AZAR, II, IN HIS OFFICIAL CAPACITY AS SECRETARY OF HEALTH AND HUMAN SERVICES, APPELLEE Appeal from the United States District Court for the District of Columbia (No. 1:19-cv-03619) Lisa S. Blatt argued the cause for appellants. With her on the briefs was Whitney D. Hermandorfer. Chad I. Golder was on the brief for amici curiae Forty State Hospital Associations in support of appellants. Benjamin G. Shatz was on the brief for amicus curiae Healthcare Financial Management Association in support of appellants. Daryl L. Joseffer, Tara S. Morrissey, Jeffrey S. Bucholtz, and Joel McElvain were on the brief for amicus curiae 2 Chamber of Commerce of the United States of America in support of appellants. Courtney L. Dixon, Attorney, U.S. Department of Justice, argued the cause for appellee. With her on the brief were Ethan P. Davis, Acting Assistant Attorney General, Scott R. McIntosh, Attorney, Robert P. Charrow, General Counsel, U.S. Department of Health & Human Services, Brenna E. Jenny, Deputy General Counsel & Chief Legal Officer-CMS. Robert Henneke and Jeffrey M. Harris were on the brief for amici curiae Texas Public Policy Foundation, et al. in support of appellee. Before: TATEL and GARLAND* , Circuit Judges, and EDWARDS, Senior Circuit Judge. Opinion for the Court filed by Circuit Judge TATEL. TATEL, Circuit Judge: As part of the Affordable Care Act, Congress required hospitals to make public “a list” of “standard charges” in accordance with guidelines developed by the Secretary of Health and Human Services. 42 U.S.C. § 300gg-18(e). By rule, the Secretary defined “standard charges” to include prices that hospitals charge insurers. The American Hospital Association and others challenge the rule, arguing that it violates the statute, the Administrative Procedure Act, and the First Amendment. For the reasons set forth in this opinion, we affirm the district court’s grant of summary judgment to the Secretary. * Judge Garland was a member of the panel at the time this case was argued but did not participate in the final disposition of the case. 3 I. Understanding the issues before us requires an explanation of how hospitals charge for their services. In short, their charges look nothing like hotel room rates or car prices. Rather, hospitals charge different amounts for the same item or service depending on who is paying. Three different groups pay hospitals for care: patients, insurers, and the federal and state governments (for Medicare and Medicaid). The first group, “self-pay” patients, pay directly for their care because they have no insurance, receive elective or out-of-network care, or believe that paying directly is cheaper than relying on insurance. Self-pay patients account for fewer than 10 percent of all patients. Price Transparency Requirements for Hospitals to Make Standard Charges Public (Price Transparency Requirements), 84 Fed. Reg. 65,524, 65,542 (Nov. 27, 2019). Hospitals generally charge these patients rates specified in what …

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