Ohio Hospital Ass'n v. Heckler

654 F. Supp. 729, 1986 U.S. Dist. LEXIS 29122, 17 Soc. Serv. Rev. 182
CourtDistrict Court, S.D. Ohio
DecidedFebruary 20, 1986
DocketNo. C-2-84-1925
StatusPublished

This text of 654 F. Supp. 729 (Ohio Hospital Ass'n v. Heckler) is published on Counsel Stack Legal Research, covering District Court, S.D. Ohio primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Ohio Hospital Ass'n v. Heckler, 654 F. Supp. 729, 1986 U.S. Dist. LEXIS 29122, 17 Soc. Serv. Rev. 182 (S.D. Ohio 1986).

Opinion

OPINION AND ORDER

KINNEARY, District Judge.

This matter comes before the Court to consider the motion of the defendants to dismiss and the motion of the plaintiffs for summary judgment.

The plaintiffs in this action are the Ohio Hospital Association and eight hospitals that are providers of hospital-based skilled nursing facility services. The defendants are Otis Bowen, Secretary of Health and Human Services; Carolyne Davis, Administrator of the Health Care Financing Administration; and James L. Miller, Director of the Office of Management.1 Jurisdiction of this Court is grounded upon 28 U.S.C. §§ 1331 and 1361. Complaint, 112.2

According to the complaint, prior to 1982, the amount of reimbursement of providers of skilled nursing care facilities services was calculated separately for freestanding skilled nursing facilities and hospital-based skilled nursing care facilities. Plaintiffs refer to this method of computation as a “dual reimbursement limit methodology.” Id., ¶ 10. In 1982, the Social Security Act was amended by the Tax Equity and Fiscal Responsibility Act of 1982 to require the Secretary to establish a single reimbursement limit for providers of both hospital-based and free-standing skilled nursing care facilities. This single limit was to be effective on or after October 1, 1982. Id., ¶ 11. Regulations were subsequently pub[730]*730lished in the Federal Register to implement this change in the law.

However, further amendments to the Social Security Act in 1983 changed the effective date of the single reimbursement limit method from October 1, 1982 to October 1, 1983. As a result, the dual reimbursement limits continued in effect until October 1, 1983. Subsequently, yet another change was made in the law. In the Deficit Reduction Act of 1984, Congress amended the Social Security Act to mandate again a dual reimbursement limit method. Complaint ¶ 14.

Plaintiffs complain that the defendants have arbitrarily and capriciously failed to implement the statutory changes made in 1983 and 1984 by failing to repeal the single reimbursement limit regulations published in the Federal Register in 1982, and by failing to promulgate regulations implementing the dual reimbursement limits method. Id., If 15. Plaintiffs further allege that defendants have arbitrarily and capriciously failed to reimburse providers of hospital-based skilled nursing facility services at the required dual rates. Id., If 16. As a result, plaintiffs state, they have suffered and will continue to suffer financial injury because they are not being reimbursed at the higher rate. Plaintiffs seek declaratory relief and a mandamus compelling the defendants to promulgate regulations implementing dual reimbursement limits.

The Medicare Act sets forth a procedure for administrative resolution of disputes over reimbursement and judicial review of these administrative actions. Reimbursement of a provider by the Secretary is accomplished through a “fiscal intermediary,” an agency that is under contract with the Secretary to handle reimbursements. 42 U.S.C. § 1395h. A claim for reimbursement by a provider is first made to the fiscal intermediary, which investigates the claim and issues an initial determination of the amount of reimbursement, known as a “Notice of Program Reimbursement.” A provider who is dissatisfied with the determination of the fiscal intermediary, or who has not received a timely determination despite filing the required reports, may appeal to the Provider Reimbursement Review Board (“PRRB”). 42 U.S.C. § 1395oo (a). Finally, the decision of the PRRB may be reviewed by the Administrator of the Health Care Financing Administration. The decision of the PRRB, or the Administrator if she has intervened, is then subject to review in district court. 42 U.S.C. § 1359oo(f). Judicial review is governed by the provisions of the Administrative Procedure Act for review of administrative action. 42 U.S.C. § 1359oo (f)(1). Defendants contend that plaintiffs cannot bring this case as an original action, but must first present their claim to the PRRB and then seek review in this Court.

In support of this contention, plaintiffs rely upon certain provisions of the Medicare statute pertaining to judicial review. The Medicare statute incorporates by reference the provisions pertaining to judicial review of Federal Old Age, Survivors and Disability Insurance Benefits. 42 U.S.C. § 1395Ü. Specifically incorporated is the following provision:

The findings and decision of the Secretary after a hearing shall be binding upon all individuals who were parties to such hearing. No findings of fact or decision of the Secretary shall be reviewed by any person, tribunal, or governmental agency except as herein provided. No action against the United States, the Secretary, or any officer or employee thereof shall be brought under section 1331 or 1346 of Title 28 on any claim arising under this subchapter.

42 U.S.C. § 405(h). Although this statutory provision refers to “individuals,” it is applicable to service providers. Good Samaritan Medical Center v. Secretary of Health and Human Services, 776 F.2d 594, 597 n. 6 (6th Cir.1985). Defendants contend that this provision bars plaintiffs’ action in this Court and, consequently, that this Court should dismiss plaintiffs’ complaint for want of jurisdiction.

[731]*731In Heckler v. Ringer, 466 U.S. 602, 104 S.Ct. 2013, 80 L.Ed.2d 622 (1984), the Su-. preme Court wrote:

The third sentence of 42 U.S.C. § 405(h), made applicable to the Medicare Act by 42 U.S.C. § 1395Ü, provides that 405(g), to the exclusion of 28 U.S.C. § 1331, is the sole avenue for judicial review for all “claim[s] arising under” the Medicare Act.

Id. at 614, 104 S.Ct. at 2021, quoting Weinberger v. Salfi, 422 U.S. 749, 760-761, 95 S.Ct. 2457, 2464-2465, 45 L.Ed.2d 522 (1975). Thus, the Court continued, the sole question in determining whether § 405(h) bars federal question jurisdiction is whether the claim arises under the statute.

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Bluebook (online)
654 F. Supp. 729, 1986 U.S. Dist. LEXIS 29122, 17 Soc. Serv. Rev. 182, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ohio-hospital-assn-v-heckler-ohsd-1986.