A federal trial court has issued what could be the final decision in a long-running dispute between a large dialysis provider and a group health plan that classified all dialysis providers as “out-of-network,” resulting in a lower reimbursement rate for dialysis providers than for providers of other medical services.

The U.S. Supreme Court ruled in 2022 that the plan did not violate the Medicare Secondary Payer (MSP) rules by limiting coverage for outpatient dialysis, even though the treatment is used almost exclusively for patients with end-stage renal disease (ESRD). The case was sent back to the trial court, which dismissed the provider’s MSP claim in accordance with the Supreme Court’s ruling. However, the court did not dismiss a separate allegation that the employer, as plan sponsor, discriminated against participants with ESRD in violation of HIPAA’s health status nondiscrimination rules by eliminating network coverage for dialysis and exposing the participants to higher costs. The court also declined to dismiss the provider’s claim for benefits under ERISA § 502, to the extent it was based on the alleged HIPAA violation.

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