Federal Court Orders Medicare To Cover Knee Joint Stimulation Device

On July 28, 2010, the United States District Court for the Western District of Washington ordered the Secretary of Health and Human Services to pay certain claims for an electrical joint stimulation device, known as the BIO-1000, used in treating osteoarthritis of the knee. The plaintiff, a medical device distributor, challenged final adverse Medicare Part B coverage determinations in federal court on the basis that the Secretary's denial of payment was arbitrary, capricious and not based on substantial evidence. The court agreed, finding that the Secretary had improperly disregarded the FDA's determinations of safety and efficacy and medical literature supporting the efficacy of the device. The court also found that the Secretary's inconsistent coverage decisions with respect to the BIO-1000 were not entitled to deference, as the Secretary offered no basis for differentiating between claims denied and claims paid.

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