594 F.2d 993 (4th Cir. 1979), 78-1317, Cleveland Memorial Hospital, Inc. v. Califano

Docket Nº:78-1317.
Citation:594 F.2d 993
Party Name:CLEVELAND MEMORIAL HOSPITAL, INC., Grace Hospital Inc., Rutherford Hospital, Inc., and Nash General Hospital, Inc., Appellees, v. Joseph A. CALIFANO, Jr., Secretary of HEW, Blue Cross and Blue Shield of NC, Blue Cross Association, Provider Reimbursement Review Board, and Arthur P.Owens, Chairman of the Provider Reimbursement Review Board, Appellant
Case Date:March 30, 1979
Court:United States Courts of Appeals, Court of Appeals for the Fourth Circuit
 
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Page 993

594 F.2d 993 (4th Cir. 1979)

CLEVELAND MEMORIAL HOSPITAL, INC., Grace Hospital Inc.,

Rutherford Hospital, Inc., and Nash General

Hospital, Inc., Appellees,

v.

Joseph A. CALIFANO, Jr., Secretary of HEW, Blue Cross and

Blue Shield of NC, Blue Cross Association, Provider

Reimbursement Review Board, and Arthur P.Owens, Chairman of

the Provider Reimbursement Review Board, Appellants.

No. 78-1317.

United States Court of Appeals, Fourth Circuit

March 30, 1979

Argued Feb. 7, 1979.

Michael Jay Singer, Civil Division, Appellate Section, Dept. of Justice Washington, D. C. (Barbara Allen Babcock, Asst. Atty. Gen., Washington, D. C., George M. Anderson, U. S. Atty., Raleigh, N. C., Robert E. Kopp and Judith S. Feigin, Civil Division, Appellate Section, Department of Justice, Washington, D. C., on brief), for appellants.

John T. Williamson, Raleigh, N. C. (Maupin, Taylor & Ellis, P. A., Raleigh, N. C., on brief), for appellees.

Before WINTER, BUTZNER and HALL, Circuit Judges.

K. K. HALL, Circuit Judge:

The single issue presented in this appeal is whether a group of medical care providers, appealing the denial of reimbursement under the Medicare program, may aggregate more than one cost report from each group member to meet the jurisdictional amount for group appeals to the Provider Reimbursement Review Board. The district court held that such aggregation is permitted under Title XVIII of the Social Security Act, 42 U.S.C. § 1395Oo (b). We affirm.

STATUTORY BACKGROUND

Title XVIII of the Social Security Act, 42 U.S.C. § 1395 Et seq., established the Medicare program which provides, among other things, health insurance for hospital and related post-hospital costs of persons aged 65 or over. Under this program certified "providers of services" 1 do not charge Medicare beneficiaries directly, but rather are reimbursed from the Medicare trust fund for all reasonable costs of providing services to those beneficiaries, either by the Secretary of H.E.W. directly or through a

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public or private organization called a "fiscal intermediary" which serves as the Secretary's agent.

Each provider is reimbursed at least monthly on an interim basis, subject to later adjustment. At the end of the provider's fiscal year it submits a cost report for that year. The Secretary or fiscal intermediary later determines by audit the actual amount of reimbursement to which the provider is entitled for the year, and gives the provider a "notice of program reimbursement". This determination may be reopened and amended at any time during the three years following the notice of reimbursement. If there is a difference between the reimbursement determined to be due for a cost period (on the basis of either an initial audit or a redetermination) and the payments already made to the provider for that period, an appropriate adjustment is made in subsequent payments to the provider in order to recoup or repay the difference.

A provider dissatisfied with a reimbursement determination by its intermediary may request a hearing by the intermediary if the amount of reimbursement in controversy is at least $1,000 but less than $10,000. 2 The intermediary's hearing decision is not subject to administrative or judicial review.

In 1972, Congress created the Provider Reimbursement Review Board to provide an independent reviewing body for certain intermediary decisions. The conditions for review by the Board, which form the basis for this appeal, are set out in 42 U.S.C. § 1395Oo, as follows:

§ 1395Oo. Provider Reimbursement Review Board-Establishment.

(a) Any provider of services which has filed a required cost report within the time specified in regulations may obtain a hearing with respect to such cost report by a Provider Reimbursement Review Board . . . if

(1) such provider

(A) is dissatisfied with a final...

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