Spotlight On Medicare Jurisdiction Issues In Bankruptcy

Law360, New York (July 17, 2015, 11:24 AM EDT) -- On June 26, 2015, the U.S. District Court for the Middle District of Florida issued an opinion on consolidated appeals arising from the Bayou Shores SNF LLC bankruptcy case with potentially broad implications for health care bankruptcy cases. At the heart of the dispute before the district court was whether the bankruptcy court had jurisdiction to enjoin the termination of, and subsequently authorize the assumption of, certain Medicare and Medicaid provider agreements. As discussed below, the district court held the Medicare jurisdictional bar set forth in 42 U.S.C. §405(h) precluded the bankruptcy court from taking any action with respect to the provider agreements. This case highlights some of the challenges a health care facility or provider may face in using bankruptcy as a tool to prevent the termination of its provider agreements....

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