The District Court for the District of Connecticut concluded that the Department of Health and Human Services (HHS) did not violate the Freedom of Information Act (FOIA) in declining a request to search for documents belonging to sponsors of Medicare Advantage Plans under Part C. The Court deemed that HHS had freedom to decide whether Part C contractors were agencies for FOIA purposes. Center for Medicare Advocacy, Inc. v. U.S. Dept. of Health and Human Services, No. 3:10cv645, 2011 WL 2119226 (D.Conn. May 26, 2011). The judge was nominated by President George W. Bush.
In a separate case in the District of Vermont, the Center for Medicare Advocacy (“the Center”) is challenging HHS’s “improvement standard,” under which “Medicare beneficiaries [must] show that treatments will improve their medical conditions—as opposed to simply maintaining them,” and which allegedly “has the effect of denying Medicare coverage to people with chronic illnesses.” The Center has requested that the Centers for Medicaid Services (CMS) at HHS provide information through FOIA about the standard. In addition to its own records, CMS secured and forwarded to the Center records held by contractors involved in paying claims under Medicare Parts A and B, based on the Center’s FOIA request. However, after CMS declined the Center’s request to extend the search to training materials of sponsors of Medicare Advantage Plans under Medicare Part C, the Center filed the instant case in the District of Connecticut.
The instant court held that “FOIA does not obligate the agency to seek out the records of sponsors of Medicare Advantage Plans under Medicare Part C.” Relying on the Supreme Court’s ruling in United States DOJ v. Tax Analysts, 492 U.S. 136, 144-145 (1989), the district court focused on the requirements that “agency records” must be created or obtained by the agency and must be in the agency’s control at the time of the request. The Center did not argue that the records it sought met this test with respect to HHS; instead, it argued that HHS should have updated its regulations to include Medicare Part C contractors as agencies.
The Court rejected the Center’s arguments. First, it observed that FOIA does not require HHS to search for records held by any of its contracting intermediaries, leaving HHS free to interpret what parties are agencies for FOIA purposes. Whereas HHS defines contractors in Parts A and B to be “agencies” for FOIA purposes in a 1987 regulation, it does not consider the Part C insurers with which CMS contracts to be agencies. Second, the Center noted the regulation for Part A and B contractors was written before Part C was enacted; however, the Court found that HHS’ regulations should still be interpreted as not including Part C contractors, since HHS has had sufficient time (since 1997) to amend them. Finally, the Court remarked that the Center’s reference to Part C contractors as “state actors” applies to constitutional law contexts, not to statutory questions such as the meaning of “agency records” under FOIA.