471 U.S. 524 (1985), 83-2136, Connecticut Department of Income Maintenance v. Heckler

Docket Nº:No. 83-2136
Citation:471 U.S. 524, 105 S.Ct. 2210, 85 L.Ed.2d 577, 53 U.S.L.W. 4558
Party Name:Connecticut Department of Income Maintenance v. Heckler
Case Date:May 20, 1985
Court:United States Supreme Court
 
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Page 524

471 U.S. 524 (1985)

105 S.Ct. 2210, 85 L.Ed.2d 577, 53 U.S.L.W. 4558

Connecticut Department of Income Maintenance

v.

Heckler

No. 83-2136

United States Supreme Court

May 20, 1985

Argued March 27, 1985

CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE

SECOND CIRCUIT

Syllabus

The Medicaid Act does not cover services performed for patients between the ages of 21 and 65 in an "institution for mental diseases" (IMD). In the absence of a statutory definition, the Secretary of Health and Human Services (Secretary) has promulgated a regulation defining an IMD as "an institution that is primarily engaged in providing diagnosis, treatment or care of persons with mental diseases," and providing that whether an institution is an IMD is determined by its "overall character." The Middletown Haven Rest Home in Connecticut is an "intermediate care facility" (ICF) that provides care for persons with mental illness as well as other diseases. Between January, 1977, and September, 1979, Connecticut paid Middletown Haven for services it provided to Medicaid eligible patients, including those between the ages of 21 and 65 who had been transferred there from [105 S.Ct. 2211] state mental hospitals. Under the Medicaid program, the State received federal reimbursement for those payments. At the completion of an audit by the Department of Health and Human Services, the State was notified that the federal reimbursement was not allowable because Middletown Haven had been identified as an IMD. On administrative review, the Department's Grant Appeals Board upheld the disallowance. The State then filed an action in Federal District Court, which set aside the disallowance, but the Court of Appeals reversed.

Held: An ICF may be an IMD, and the terms are not mutually exclusive. The Act's express authorization for coverage of services performed for individuals 65 or over uses language that plainly indicates that a hospital, a skilled nursing facility, or an ICF may be an IMD. Moreover, the Secretary's interpretation of the Act comports with the Act's plain language. And the legislative history does not reveal any clear expression of contrary congressional intent. Pp. 528-538.

731 F.2d 1052, affirmed.

STEVENS, J., delivered the opinion for a unanimous Court.

Page 525

STEVENS, J., lead opinion

JUSTICE STEVENS delivered the opinion of the Court.

Services performed for patients between the ages of 21 and 65 in an "institution for mental diseases" (IMD) are not covered by the Medicaid Act. The Secretary of Health and Human Services has adopted a definition of that term that is broad enough to encompass an "intermediate care facility" (ICF). The Middletown Haven Rest Home is an ICF that provides care for persons with mental illness as well as other diseases. The narrow question presented by this case is whether Middletown Haven is an IMD within the meaning of the Act. The broader question is whether the Secretary's definition of an IMD, which permits an ICF to be classified as an IMD, is consistent with the intent of Congress.

During the period between January, 1977, and September, 1979, the State of Connecticut paid Middletown Haven for the services it provided to Medicaid eligible patients, including

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those between the ages of 21 and 65 who had been transferred to Middletown Haven from state mental hospitals. Under the Medicaid program, the State received federal reimbursement of $1,634,655 for those payments.

After receiving information that Connecticut was discharging large numbers of mental patients from state mental institutions into ICFs and skilled nursing facilities, and after numerous meetings with state officials, the Department of Health and Human Services selected Middletown Haven, which is certified by the State as an ICF, for review and audit. The Department believed that the State was receiving federal financial aid in violation of applicable regulations that prohibited aid to IMDs.

Middletown Haven is a privately owned, 180-bed facility that is licensed by the Connecticut State Department of Health as a "Rest Home with Nursing Supervision" with authority "to care for persons with certain psychiatric conditions."1 During the years 1977-1979 over 77% of its patients suffered from a major mental illness, and over half of its patients were transferees from state mental hospitals.2 Middletown Haven employed a professional staff, including three psychiatrists, that specialized in the care of the mentally ill;3 they viewed it as a psychiatric facility.4 In sum, there was ample evidence for the review [105 S.Ct. 2212] team's conclusion that Middletown was "primarily engaged" in providing diagnostic

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treatment and care for persons with mental diseases within the meaning of the applicable regulations.5

After the completion of its audit, the Department gave notice to the State that the federal reimbursement of $1,634,655 was not allowable because Middletown Haven had been identified as an IMD and because payments for services to the mentally ill between the ages of 21 and 65 in IMDs were not eligible for federal financial participation.6 The State's

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request for administrative review of the disallowance decision was consolidated with similar requests by the States of Illinois, Minnesota, and California. The Department's Grant Appeals Board upheld the disallowance.7

The State then obtained judicial review by filing this action.8 The United States District Court for the District of Connecticut held that the Secretary's decision was not supported by the statute, and set aside the disallowance. Connecticut v. Schweiker, 557 F.Supp. 1077 (1983). The Court of Appeals for the Second Circuit reversed, 731 F.2d 1052 (1984), expressly rejecting the contrary reasoning of the Eighth Circuit. See Minnesota v. Heckler, 718 F.2d 852 (1983). The square conflict on an important question of statutory construction prompted us to grant certiorari. 469 U.S. 929 (1984).

Connecticut contends that the same institution cannot be both an "institution for mental diseases" and an "intermediate care facility"; in other words, IMDs and ICFs are mutually exclusive categories. Because the Secretary acknowledges that Middletown Haven is an ICF, the State concludes that it cannot be an IMD. In our view, however, the State's position is foreclosed by the plain language of the statute, by the Secretary's reasonable and longstanding interpretation of the Act, and by the Act's legislative history. We therefore affirm.

I

In 1965, Congress authorized the Medicaid program by adding Title XIX to [105 S.Ct. 2213] the Social Security Act;9 the program was established "for the purpose of providing federal financial

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assistance to States that choose to reimburse certain costs of medical treatment for needy persons."10 The program offers the financial assistance to States that submit and have approved by the Secretary plans for "medical assistance."11 In its present form, the Act authorizes reimbursement for 18 categories of medical assistance.12

For three types of covered medical services -- inpatient hospital services, skilled nursing facilities services, and, most importantly, intermediate care facility services -- the definition contains an express exception for services performed in IMDs.13 The thrice-repeated exclusion demonstrates that Congress did not intend the ICF and IMD categories to be mutually exclusive; if Congress had intended separate categories, the IMD exclusion from services in other types of facilities would be unnecessary and illogical.

Other provisions of the Act make it clear that services performed for the mentally ill may be covered, provided the services are performed in a hospital, a skilled nursing facility, or an ICF that is not an IMD. Thus, the definition of an ICF expressly describes persons "who because of their mental or

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physical condition" require institutional care but do not need the level of services provided by a skilled nursing facility or a hospital.14 And § 1396d(a)(18)(B) prohibits medical assistance for services to individuals under 65 who are patients in IMDs, while another provision, § 1396d(a)(14), also allows such payments for

inpatient hospital services, skilled nursing facility services, and intermediate care facility services for individuals 65 years of age or over in an institution for mental diseases.

To accept the State's interpretation would render the language of § 1396d(a)(14) unnecessary, and would render lifeless Congress' approval of ICF services for persons 65 or over in IMDs.15

[105 S.Ct. 2214] Thus, there is ample textual support for the conclusion that an ICF may be an IMD.

II

In the absence of a statutory definition of the term "institution for mental diseases," it is appropriate to consider the Secretary's interpretation of that term.16

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The Secretary's initial definition was provided shortly after the Medicaid program was enacted in 1965. It stated:

Any individual who has not attained 65 years of age and is a patient in an institution for . . . mental diseases; i.e., an institution whose overall character is that of a facility established and maintained primarily for the care and treatment of individuals with . . . mental diseases (whether or not it is licensed).17

(Emphasis added.) A few years later, the Secretary promulgated the following:

Whether an institution is one for . . . mental diseases will be determined by whether its overall character is that of a facility established and maintained primarily for the care and treatment of individuals with . . . mental diseases...

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