Heino v. Dept. Of Veterans Affairs

683 F.3d 1372, 2012 WL 2433521, 2012 U.S. App. LEXIS 13284
Court of Appeals for the Federal Circuit·Decided June 28, 2012·No. 2011-7160·Published·Cited by 52 cases

Opinions

WALLACH, Circuit Judge.

William H. Heino, Sr. (“Mr. Heino”) appeals from a judgment of the United [1372]*1372States Court of Appeals for Veterans Claims (“Veterans Court”) affirming a decision by the Board of Veterans’ Appeals (“Board”) denying him a lower copayment for his prescribed medication. Mr. Heino contends that his copayment amount must be reduced because it is more than what the Department of Veterans Affairs (“VA”) pays for his medication and that 38 U.S.C. § 1722A(a)(2) prohibits the VA from charging a copayment in excess of what the VA pays for a veteran’s medication. However, because section 1722A(a)(2) is ambiguous, and because the VA’s copayment regulation, 38 C.F.R. § 17.110, is reasonable in light of the statute, we affirm.

I.

Mr. Heino, a veteran, is prescribed a daily dose of 12.5 milligrams of Atenolol.1 The lowest strength available for the prescription is a 25 milligram tablet, so Mr. Heino’s physician instructed him to split each tablet in half. At the time this case began, Mr. Heino paid a $7 copayment for a 30-day supply of 15 tablets, which he claimed was excessive in light of the fact that some veterans paid the same copayment for twice the medication. On March 13, 2002, Mr. Heino sent a letter to the VA requesting that it adjust his copayment. The VA responded by stating that the copayment “is being applied as it should be.” In February 2004, Mr. Heino again contested his copayment amount to the VA. In a letter dated February 11, 2005, the VA Office of Regional Counsel determined that the $7 copayment was correct under applicable law and regulation. Mr. Heino filed a Notice of Disagreement with the VA’s decision and on December 24, 2008, the Board concluded that the $7 copayment amount was proper.2

Mr. Heino appealed the Board’s decision to the Veterans Court, and the Veterans Court affirmed. Heino v. Shinseki, 24 Vet.App. 367 (2011). Mr. Heino argued that the regulation the VA uses to calculate his copayment amount, 38 C.F.R. § 17.110, conflicts with section 1722A(a)(2), which prohibits the VA from charging a copayment “in excess of the cost to the Secretary for medication,” because the actual cost of his Atenolol prescription was well below $7.3 Contrary to Mr. Heino’s interpretation of the statute, the Veterans Court held that “the cost” referred to in section 1722A(a)(2) could “be interpreted as including the Secretary’s costs in dispensing the medication, i.e., his administrative costs” as well as the VA’s actual cost. Id. at 373. Because the term “the cost” was ambiguous, the Veterans Court reviewed the VA’s copayment regulation, which did not charge Mr. Heino a copayment in excess of the VA’s projected average administrative cost, for reasonableness. Id. The Veterans Court held that given the “regulatory and statutory history, as well as the statutory framework,” [1373]*1373the regulation was valid.4 Id.

Judge Hagel dissented in part and reasoned that the phrase “the cost to the Secretary for medication” in section 1722A(a)(2) is “clear, unambiguous, and cannot be construed as including costs incurred by the Secretary in dispensing the medication.” Id. at 376 (Hagel, J., dissenting). Judge Hagel stated that “[n]owhere in this statutory interplay is there a reference to administrative costs incurred by the Secretary in dispensing the veteran’s 30-day supply of medication, costs that are wholly apart from the cost to the Secretary for the medication itself.” Id. at 377.

Mr. Heino filed a timely notice of appeal to this court. We have jurisdiction over this appeal pursuant to 38 U.S.C. § 7292(a).

II.

To determine whether the VA is correctly charging Mr. Heino, we must interpret 38 U.S.C. § 1722A and determine whether 38 C.F.R. § 17.110 comports with the statute. We will first discuss the law and regulations at issue in this case and then will proceed by examining them under the framework provided in Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984).

A.

What is now section 1722A was initially codified as 38 U.S.C. § 622A by the Omnibus Budget Reconciliation Act of 1990, Pub.L. No. 101-508, § 8012, 104 Stat. 1388 (1990). In 1991 Congress redesignated the law as 38 U.S.C. § 1722A without amending its language. Pub.L. No. 102-83, § 5(a), 105 Stat. 378 (1991). The current section 1722A(a)(l) is substantively the same as the 1990 law, see 38 U.S.C. § 1722A(a)(3) (incorporating the language removed from the original section 622A(a)(l)), and the current section 1722A(a)(2) is identical to the original statute. The current law reads:

(a)(1) Subject to paragraph (2), the Secretary shall require a veteran to pay the United States $2 for each 30-day supply of medication furnished such veteran under this chapter on an outpatient basis for the treatment of a non-service-connected disability or condition. If the amount supplied is less than a 30-day supply, the amount of the charge may not be reduced.
(2) The Secretary may not require a veteran to pay an amount in excess of the cost to the Secretary for medication described in paragraph (1).

38 U.S.C. § 1722A(a)(l)-(2) (emphasis added). In 1999, as part of the Veterans Millennium Health Care and Benefits Act, Pub.L. No. 106-117, § 201, 113 Stat. 1545 (1999), Congress added the current subsection (b) to the statute, which reads:

(b) The Secretary, pursuant to regulations which the Secretary shall prescribe, may—
(1) increase the copayment amount in effect under subsection (a); and
(2) establish a maximum monthly and a maximum annual pharmaceutical copay[1374]*1374ment amount under subsection (a) for veterans .who have multiple outpatient prescriptions.

38 U.S.C. § 1722A(b) (emphasis added). A report from the House Committee on Veterans’ Affairs stated that the VA’s new authority under section 1722A(b) was intended to bring the VA’s benefit program in line with private and other government healthcare providers where individuals carry a larger share of costs. H.R.Rep. No.

Free access — add to your briefcase to read the full text and ask questions with AI

Heino v. Dept. Of Veterans Affairs, 683 F.3d 1372, 2012 WL 2433521, 2012 U.S. App. LEXIS 13284 (Fed. Cir. 2012).

683 F.3d 1372 (Heino v. Dept. Of Veterans Affairs) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

Related

Atilano v. McDonough
12 F.4th 1375 (Federal Circuit, 2021)
Kisor v. McDonough
Federal Circuit, 2021
YC Rubber Co. (North Am.) LLC v. United States
487 F. Supp. 3d 1367 (Court of International Trade, 2020)
Kisor v. Wilkie
969 F.3d 1333 (Federal Circuit, 2020)
Uniloc 2017 LLC v. Hulu, LLC
966 F.3d 1295 (Federal Circuit, 2020)
190814-20106
Board of Veterans' Appeals, 2020
Carr v. Wilkie
961 F.3d 1168 (Federal Circuit, 2020)
Nicely v. United States
Federal Claims, 2020
Autoliv ASP, Inc. v. United States
2019 CIT 154 (Court of International Trade, 2019)
CSC Sugar LLC v. United States
317 F. Supp. 3d 1322 (Court of International Trade, 2018)
11-22 176
Board of Veterans' Appeals, 2018
Gazelle v. Shulkin
868 F.3d 1006 (Federal Circuit, 2017)