If you're a veteran and you've used third-party insurance to partially cover the cost of a trip to the local emergency room, the Department of Veterans Affairs has probably refused to reimburse you for the remaining expenses.

Not anymore, according to a Sept. 9 ruling by the Court of Appeals for Veterans Claims, which said the VA has been wrongly denying reimbursements for non-VA hospital care and now must pay out up to $6.5 billion in claims.

For decades, such a class action win was impossible at the CAVC due to a 1991 court decision that found the court's jurisdiction was limited to handling appeals on an individual basis.

But after a string of recent court rulings overturned that decision, the CAVC began granting class action status in June. This month's ruling marks the second ever class certification of veterans at the CAVC, providing relief to up to 600,000 veterans who were either wrongly denied reimbursement or misled about their eligibility for it.

Bart Stichman, executive director of the National Veterans Legal Services Program, said the decision could be the "biggest win" veterans have ever had in court.

"The court's decision rights a terrible injustice, and its order ensures that veterans who were unjustly denied reimbursement for critical emergency treatment at non-VA facilities will finally be reimbursed," he said.

William J. Schmitz, national commander-in-chief of the Veterans of Foreign Wars, applauded the ruling in a statement. He pointed out that when someone makes a phone call to the VA, the first thing the agency says is "to hang up and dial 911 if it's an emergency."

"So the VA must reimburse the actual cost of emergency medical care, regardless of whether the veteran has secondary insurance or not," he said. "VA Secretary Robert Wilkie must make these veterans financially whole again [and] correct its policies and practices regarding non-VA emergency room billing immediately."

This decision, however, is not the first time the CAVC has explicitly told the VA to stop forcing veterans with third-party health insurance to pay for expenses that veterans without health insurance would get refunded.

The court said essentially the same thing in 2016, in the case of Richard Staab, an Air Force veteran who was denied reimbursement for $48,000 in emergency care costs because he'd used secondary insurance to cover part of the bill.

That ruling cited a 2010 law called the Emergency Care Fairness Act in finding that Congress intended for the VA to step in as a "secondary payer" when other insurers covered only a portion of the cost of a veteran's emergency treatment.

But when the VA issued a new regulation purporting to assure compliance with the Staab decision, it also expanded the category of expenses that would not merit reimbursement — which originally included "any copayment or similar payment" — to also include deductibles and coinsurance.

That subtle expansion, according to CAVC Judge William S. Greenberg's Sept. 9 opinion, "excluded from reimbursement nearly every type of expense a veteran could have incurred if he or she had insurance covering the non-emergency VA medical service at issue."

"The VA adopted a regulation that functionally creates a world indistinguishable from the world Staab authoritatively held impermissible under the statute," he said. "It's difficult to conceive how an agency could believe that adopting a regulation that mimics the result a federal court held to be unlawful is somehow appropriate when the statute at issue has not changed."

After issuing the controversial regulation in January 2018, the VA ended a post-Staab moratorium on adjudicating claims and got back to work. One of the claims it handled was that of Amanda Wolfe, a Coast Guard veteran who, because the nearest VA provider was over three hours away, underwent an emergency appendectomy at a non-VA hospital in September 2016.

Her employer-sponsored health care paid for most of the $22,000-plus surgery, leaving her to pay a little more than $2,500 out of pocket. Under the new regulation, the VA denied her request for reimbursement, saying that her out-of-pocket expenses fell under the deductibles and coinsurance exclusion.

She sued and went on to become the lead plaintiff in this month's certified class, later being joined by Peter Boerschinger, a Navy veteran who received emergency treatment in April 2018 for congestive heart failure. The nearest VA provider had no room for him, so he went to a non-VA hospital.

There, his health insurance covered everything except $1,340, but when he sought reimbursement, the VA sent him a denial letter solely on the grounds that he had health insurance in the first place.

"In other words, the agency was telling veterans that the law was exactly opposite to what a federal court had held the law to be," the judge said in this month's ruling. "Who knows how many veterans relied on such a misrepresentation — for that is what it was — in deciding not to appeal VA decisions that denied reimbursement for non-VA emergency medical care."

The ruling said the VA has to come up with a plan for reimbursing the wrongly denied claims and notifying those who received misleading letters by Oct. 24.

A spokesperson for the VA told Law360 that the department "is aware of this decision and reviewing it" but declined to answer questions about the likelihood of an appeal.

But based on the VA's previous appeal of Staab, Stichman knows the fight may not be over yet.

"I've seen them appeal cases that I didn't want them to appeal, and I've seen them comply with court decisions when they're convinced those cases don't stand a chance on appeal," Stichman said.

Either way, challenges lie ahead when it comes to enforcing the decision.

Stichman is angling to force the VA to reveal the list of veterans who it has sent misleading letters to, so the NVLSP can make sure everyone covered by the ruling gets their fair share.

"They know the names and we don't," he said. "At this point, it makes monitoring somewhat difficult."

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