Background
In 2008, Congress directed the Secretary of Health and Human Services to implement a single payment system for renal dialysis services under Medicare. In 2010, the Centers for Medicare and Medicaid Services defined renal dialysis services to include oral-only drugs. In 2024, the agency identified XPHOZAH, an oral-only drug manufactured by Ardelyx, as a renal dialysis service covered by the new payment system starting January 1, 2025. Ardelyx challenged the rule and the identification of XPHOZAH, arguing the actions were arbitrary and capricious and exceeded statutory authority.
The court’s reasoning
The court determined that a statutory bar to judicial review in 42 U.S.C. Section 1395rr(b)(14)(G) precluded review of the agency’s actions only if those actions qualified as an identification of renal dialysis services. The court found that the CMS’s inclusion of oral-only drugs fell within the statutory definition of renal dialysis services under 42 U.S.C. Section 1395rr(b)(14)(B)(iii). The court held that the phrase ‘furnished for the treatment of end stage renal disease’ encompasses drugs that treat conditions closely associated with ESRD, such as hyperphosphatemia. Consequently, the court lacked authority to review whether the agency’s decision was arbitrary or capricious.
We agree and affirm the dismissal of Ardelyx’s complaint.
Opinion for the Court filed by Senior Circuit Judge GINSBURG
What it means going forward
The CMS’s identification of XPHOZAH as a renal dialysis service remains in effect, and the drug is included in the bundled payment for renal dialysis services starting January 1, 2025.