Marietta Memorial Hospital Employee Health Benefit Plan v. DaVita Inc.

In this 2022 case, the U.S. Supreme Court reviewed whether the Marietta Memorial Hospital Employee Health Benefit Plan violated the Medicare Secondary Payer Act by allegedly discriminating against patients with end-stage renal disease. DaVita, a dialysis provider, argued the plan's low reimbursement rates for outpatient dialysis and its coverage limits effectively distinguished ESRD beneficiaries from others. The Court held 7-2 that the plan's uniform terms—applying the same deductibles, coinsurance, and out-of-network rules to all—did not violate the statute. The decision reversed the Sixth Circuit and established that a health plan may structure dialysis benefits without triggering MSPA liability as long as the provisions are neutral on their face.

The Supreme Court reversed the appellate court decision, ruling 7-2 in favor of the Marietta Memorial Hospital plan. Justice Kavanaugh wrote the majority opinion, joined by Chief Justice Roberts and Justices Thomas, Alito, Gorsuch, Barrett, and Breyer. Justices Kagan and Sotomayor dissented. The Court held that the plan's neutral design did not impermissibly single out ESRD patients.

Whether a group health plan's uniform outpatient dialysis benefit design, which provides lower reimbursement for out-of-network dialysis, violates the Medicare Secondary Payer Act's prohibition on a plan "differentiating" between individuals with end-stage renal disease and other covered individuals.

The ruling clarified the boundaries of the Medicare Secondary Payer Act, giving employer-sponsored health plans greater certainty in designing dialysis benefits. It confirmed that uniform, facially neutral reimbursement policies do not constitute illegal discrimination, even if they disproportionately affect ESRD patients. The decision limited dialysis providers' ability to challenge standard plan provisions and underscored the importance of plan uniformity under federal health insurance law.