--- title: Court Vacates CMS's 2023 Medicare Part C Rule description: On August 28, 2026, the U.S. District Court for the District of Columbia vacated CMS’s 2023 Rule governing the treatment of Part C days for cost-reporting periods beginning before FY 2014. image: https://public.govdataservices.com/hubfs/Handsome%20lawyer%20in%20the%20law%20library%20at%20the%20university.jpeg --- [Skip to content](https://public.govdataservices.com/the-scoop/court-vacates-cmss-2023-medicare-part-c-rule#main-content) Close - [Services](https://public.govdataservices.com/services-page) - [Medicare DSH](https://public.govdataservices.com/medicare-dsh) - [SSI Realignment](https://govdataservices-21378692.hs-sites.com/medicare-dsh#SSI) - [340B MA Underpayments](https://public.govdataservices.com/340b-medicare-advantage-underpayments) - [Medicare Bad Debt](https://public.govdataservices.com/medicare-bad-debt) - [Worksheet S-10 Uncompensated Care](https://public.govdataservices.com/s-10) - [Transfer DRG](https://public.govdataservices.com/transfer-drg) - [Medicare ID & Shadow Billing](https://public.govdataservices.com/medicare-id-shadow-billing) - [MBI ID Finder](https://public.govdataservices.com/mbi-id-finder) - [MIDaS Insurance ID](https://public.govdataservices.com/midas-insurance-id) - [Annual Wellness Visit](https://public.govdataservices.com/annual-wellness-visit) - [Eligibility & Other Services](https://public.govdataservices.com/eligibility-and-other) - [Bundle & Save](https://public.govdataservices.com/bundle-and-save) - [Demo](https://public.govdataservices.com/demo-diagnostics-review) - Resources - [Links](https://public.govdataservices.com/links) - [Blog](https://public.govdataservices.com/the-scoop) - [Contact Us](https://public.govdataservices.com/contact-us) SEARCH [Client Login](https://www.govdataservices.com/gdswebsite/DesktopDefault.aspx) [![GDSlogo\_avenir\_2](https://public.govdataservices.com/hs-fs/hubfs/GDSlogo_avenir_2.png?width=1194&height=340&name=GDSlogo_avenir_2.png)](https://public.govdataservices.com/) - [Services](https://public.govdataservices.com/services-page) - [Medicare DSH](https://public.govdataservices.com/medicare-dsh) - [SSI Realignment](https://govdataservices-21378692.hs-sites.com/medicare-dsh#SSI) - [340B MA Underpayments](https://public.govdataservices.com/340b-medicare-advantage-underpayments) - [Medicare Bad Debt](https://public.govdataservices.com/medicare-bad-debt) - [Worksheet S-10 Uncompensated Care](https://public.govdataservices.com/s-10) - [Transfer DRG](https://public.govdataservices.com/transfer-drg) - [Medicare ID & Shadow Billing](https://public.govdataservices.com/medicare-id-shadow-billing) - [MBI ID Finder](https://public.govdataservices.com/mbi-id-finder) - [MIDaS Insurance ID](https://public.govdataservices.com/midas-insurance-id) - [Annual Wellness Visit](https://public.govdataservices.com/annual-wellness-visit) - [Eligibility & Other Services](https://public.govdataservices.com/eligibility-and-other) - [Bundle & Save](https://public.govdataservices.com/bundle-and-save) - [Demo](https://public.govdataservices.com/demo-diagnostics-review) - Resources - [Links](https://public.govdataservices.com/links) - [Blog](https://public.govdataservices.com/the-scoop) - [Contact Us](https://public.govdataservices.com/contact-us) [Client Login](https://www.govdataservices.com/gdswebsite/DesktopDefault.aspx) [Chris Cusimano](https://public.govdataservices.com/the-scoop/author/chris-cusimano) Aug 31, 2026, 2:01:05 PM 2 min read # Court Vacates CMS's 2023 Medicare Part C Rule [Previous](https://public.govdataservices.com/the-scoop/cms-ffy-2027-long-term-care-hospital-final-rule) [Next](https://public.govdataservices.com/the-scoop/1115-waiver-day-battle-headed-back-to-fifth-circuit-court) On August 28, 2026, the U.S. District Court for the District of Columbia vacated CMS’s 2023 Rule governing the treatment of Part C days for cost-reporting periods beginning before FY 2014 and remanded the matter to HHS. Montefiore Medical Center v. Kennedy, No. 1:24-cv-01810-LLA (D.D.C. Aug. 28, 2026). From 2025 Win to Vacatur: The court ruled for Montefiore in September 2025, finding the 2023 Rule impermissibly retroactive as well as arbitrary and capricious. The remaining question was remedy. The court has now rejected HHS’s request for relief limited to Montefiore and vacated the 2023 Rule. Montefiore also asked the court to direct HHS to recalculate its FY 2006 DSH payment using the pre-2004 policy and pay applicable interest. The court declined, leaving HHS room on remand to pursue other potentially lawful means of implementing its Part C interpretation, provided any new agency action complies with the Medicare statute's restrictions on retroactivity and the APA. Importantly, the court had previously concluded that HHS's underlying statutory interpretation of the Part C issue was correct; the defects were in the retroactive implementation of that policy through the 2023 Rule. Another Chapter in the Allina History: CMS’s efforts to implement its Part C policy have now included the 2004 Rule vacated in Allina I, the Medicare fractions rejected in Allina II, and the now-vacated 2023 Rule. For hospitals with affected historical Medicare DSH years, this is another important development in a dispute spanning more than two decades. The 2023 Rule is vacated. What HHS does next is the next development to watch. ![avatar](https://public.govdataservices.com/hs-fs/hubfs/chriscusimano.jpg?width=290&name=chriscusimano.jpg) #### [Chris Cusimano](https://public.govdataservices.com/the-scoop/author/chris-cusimano) ## RELATED ARTICLES ### [Chris Cusimano Oct 2, 2025, 5:48:06 PM 1 min read District Court for District of Columbia Rules Retroactive 2023 Part C Rule is Impermissible Case: Montefiore Medical Center v. Robert F. Kennedy, JR. Court: U.S. District Court for the District of Columbia Decision ... Start Reading](https://public.govdataservices.com/the-scoop/district-court-for-district-of-columbia-rules-retroactive-2023-part-c-rule-is-impermissible) ### [Chris Cusimano Sep 25, 2026, 10:26:12 AM 1 min read 1115 Waiver Day Battle Headed Back to Fifth Circuit Court On September 24, HHS filed its notice of appeal to the Fifth Circuit following the Northern District of Texas's July ruling in ... Start Reading](https://public.govdataservices.com/the-scoop/1115-waiver-day-battle-headed-back-to-fifth-circuit-court) ### [Chris Cusimano Sep 3, 2024, 4:00:00 PM 2 min read Medicare DSH: US District Court in TX Vacates 1115 Waiver "Exclusion Rule" Baylor All Saints Medical Center, ET AL. v. Xavier Becerra (“CASE”) was released August 15, 2024 in the United States District ... Start Reading](https://public.govdataservices.com/the-scoop/tx-vacates-1115-waiver-exclusion-rule) [![gds-logo-1](https://public.govdataservices.com/hs-fs/hubfs/gds-logo-1.png?width=500&height=150&name=gds-logo-1.png)](https://public.govdataservices.com/) **Get in Touch** Government Data Services 3200 W. Market St., Ste. 102 Akron, OH 44333-3324 Government Data Services 117 Seaboard Lane, F270 Franklin, TN 37067 Toll Free: (800) 370-7397 Email: [info@govdataservices.com](mailto:info@govdataservices.com) ![soc](https://public.govdataservices.com/hs-fs/hubfs/soc.jpg?width=44&name=soc.jpg)[![digicert](https://public.govdataservices.com/hs-fs/hubfs/digicert.png?width=117&name=digicert.png)](https://seal.digicert.com/seals/popup/?tag=VtfrmabA&url=www.govdataservices.com) © 2026 - Government Data Services LLC. All rights reserved - [Site Use Agreement](https://public.govdataservices.com/terms-of-use) - [Confidentiality and Privacy](https://public.govdataservices.com/privacy) ```json { "@context" : "http://schema.org", "@type" : "Organization", "knowsLanguage" : "en", "name" : "", "url" : "https://public.govdataservices.com/the-scoop/court-vacates-cmss-2023-medicare-part-c-rule" } ``` ```json { "@context" : "http://schema.org", "@type" : "BlogPosting", "abstract" : "On August 28, 2026, the U.S. District Court for the District of Columbia vacated CMS’s 2023 Rule governing the treatment of Part C days for cost-reporting periods beginning before FY 2014.", "author" : { "@type" : "Person", "name" : "Chris Cusimano" }, "dateModified" : "August 31, 2026 6 PM", "datePublished" : "August 31, 2026 6 PM", "headline" : "Court Vacates CMS's 2023 Medicare Part C Rule", "image" : "https://21378692.fs1.hubspotusercontent-na1.net/hubfs/21378692/Handsome%20lawyer%20in%20the%20law%20library%20at%20the%20university.jpeg", "inLanguage" : "en", "keywords" : "[Legal News]", "mainEntityOfPage" : { "@type" : "WebPage" }, "name" : "Court Vacates CMS's 2023 Medicare Part C Rule", "publisher" : { "@type" : "Organization", "logo" : { "@type" : "ImageObject", "url" : "" }, "name" : "" }, "text" : "On August 28, 2026, the U.S. District Court for the District of Columbia vacated CMS’s 2023 Rule governing the treatment of Part C days for cost-reporting periods beginning before FY 2014 and remanded the matter to HHS. Montefiore Medical Center v. Kennedy, No. 1:24-cv-01810-LLA (D.D.C. Aug. 28, 2026). From 2025 Win to Vacatur: The court ruled for Montefiore in September 2025, finding the 2023 Rule impermissibly retroactive as well as arbitrary and capricious. The remaining question was remedy. The court has now rejected HHS’s request for relief limited to Montefiore and vacated the 2023 Rule. Montefiore also asked the court to direct HHS to recalculate its FY 2006 DSH payment using the pre-2004 policy and pay applicable interest. The court declined, leaving HHS room on remand to pursue other potentially lawful means of implementing its Part C interpretation, provided any new agency action complies with the Medicare statute's restrictions on retroactivity and the APA. Importantly, the court had previously concluded that HHS's underlying statutory interpretation of the Part C issue was correct; the defects were in the retroactive implementation of that policy through the 2023 Rule. Another Chapter in the Allina History: CMS’s efforts to implement its Part C policy have now included the 2004 Rule vacated in Allina I, the Medicare fractions rejected in Allina II, and the now-vacated 2023 Rule. For hospitals with affected historical Medicare DSH years, this is another important development in a dispute spanning more than two decades. The 2023 Rule is vacated. What HHS does next is the next development to watch.", "url" : "https://public.govdataservices.com/the-scoop/court-vacates-cmss-2023-medicare-part-c-rule", "wordCount" : "309" } ``` ```json { "@context" : "https://schema.org", "@type" : "BlogPosting", "author" : { "@type" : "Person", "name" : "Chris Cusimano", "url" : "https://public.govdataservices.com/the-scoop/author/chris-cusimano" }, "dateModified" : "2026-08-31T18:09:45.600Z", "datePublished" : "2026-08-31T18:01:05.000Z", "headline" : "Court Vacates CMS's 2023 Medicare Part C Rule", "image" : [ "https://public.govdataservices.com/hubfs/Handsome%20lawyer%20in%20the%20law%20library%20at%20the%20university.jpeg" ], "mainEntityOfPage" : { "@id" : "https://public.govdataservices.com/the-scoop/court-vacates-cmss-2023-medicare-part-c-rule", "@type" : "WebPage" }, "publisher" : { "@type" : "Organization", "logo" : { "@type" : "ImageObject" } } } ```