Friedberg v. Schweiker

• Decision Date: 16 November 1983
• Docket Number: No. 83-5122,83-5122
• Parties: , Medicare&Medicaid Gu 33,478 Ruth FRIEDBERG, Executrix of the Estate of Miriam Crane v. Richard S. SCHWEIKER, Secretary of Health and Human Services.
• Court: U.S. Court of Appeals — Third Circuit

Page 445

721 F.2d 445

3 Soc.Sec.Rep.Ser. 247, Medicare&Medicaid Gu 33,478

Ruth FRIEDBERG, Executrix of the Estate of Miriam Crane v. Richard S. SCHWEIKER, Secretary of Health and Human Services.

No. 83-5122.

United States Court of Appeals, Third Circuit.

Argued Nov. 3, 1983.

Decided Nov. 16, 1983.

W. Hunt Dumont, U.S. Atty., Jerome B. Simandle, Asst. U.S. Atty., Trenton, N.J., Juan A. del Real, Gen. Counsel, Annette Blum, Regional Atty., Region II, Washington, D.C., Holly A. Clarke, Asst. Regional Atty., Barbara Lewis Spivak (argued), U.S. Dept. of Health and Human Services, New York City, for appellant.

Robert P. Beakley (argued), Atlantic City, N.J., for appellee.

Before ALDISERT, HUNTER and WEIS, Circuit Judges.

OPINION OF THE COURT

PER CURIAM.

This appeal by the Secretary of Health and Human Services, from a judgment of the district court, presents an issue of first impression in the courts of appeals. We are required to decide whether a "spell of illness," as defined by 42 U.S.C. Sec. 1395x(a) of the Medicare Act continues when a person is receiving only custodial care in a "skilled nursing facility." The Secretary contends that so long as an individual resides in a skilled nursing facility he or she is considered an inpatient regardless of the type of care the individual needs and receives. The district court, on the other hand, determined that there is a distinction between custodial care and skilled nursing care, and that, under Sec. 1395x(a), one is deemed a nursing home inpatient only when receiving skilled nursing care. We find the district court reasoning persuasive and accept the analysis by District Judge Stanley S. Brotman, as set forth in the appendix to this opinion.

The judgment of the district court will be affirmed.

APPENDIX

BROTMAN, District Judge.

This is an action brought by plaintiff, Ruth Friedberg, Executrix of the Estate of Miriam Crane, pursuant to Sec. 205(g) of the Social Security Act (hereinafter, the "Act"), 42 U.S.C. Sec. 405(g), for a review of a final determination of the U.S. Secretary of Health & Human Services (hereinafter, the "Secretary") denying plaintiff additional payment of hospital insurance benefits under Title XVII of the Act, 42 U.S.C. Sec. 1395c et seq., and refusing to classify Miriam Crane's hospitalizations at the Atlantic City Medical Center (hereinafter "ACMC") during periods after July 8, 1977 as new "spell[s] of illness" as that term is defined in 42 U.S.C. Sec. 1395x(a).

In the administrative proceedings in this case, the Administrative Law Judge (hereinafter, the "ALJ") considered the case de novo and determined on March 16, 1981 that Miriam Crane was not entitled to Medicare benefits for stays at the ACMC hospital after July 8, 1977 because Mrs. Crane from November 1, 1974 to July 8, 1977 had utilized the 150 days of entitlement to benefits for one benefit period ("spell of illness"). Upon affirmance by the Appeals Council, the ALJ's determination became the final decision of the Secretary from which plaintiff now appeals to this court.

Plaintiff alleges that the Secretary made an incorrect decision of the applicable law in determining whether or not Mrs. Crane was entitled to a spell of illness subsequent to July 8, 1977. Specifically, claimant's position is that Mrs. Crane's spell of illness ended after she resided at the skilled nursing facility for 60 consecutive days without receiving skilled nursing care and receiving only custodial care. This type of care, claimant contends, is not sufficient to constitute an "inpatient" status at a skilled nursing facility. The Bureau of Health Insurance (now known as the Health Care Financing Administration of the Social Security Administration) takes the position, however, that according to 42 U.S.C. Sec. 1395x(a), the section which defines spell of illness, an individual who resides in a skilled nursing facility is considered an "inpatient" regardless of the type of care the individual needs and receives.

A review of the record in this case indicates that Miriam Crane had been a resident of Linwood Convalescent Center ("LCC"), Linwood, New Jersey since November 30, 1974. Mrs. Crane had no other residence during the period between this date and the date of her death, and had registered to vote from that address. During the time Mrs. Crane resided at LCC she was admitted to ACMC for treatment of various illnesses and injuries on seven separate occasions. ¹

The Social Security Administration denied payment of ACMC bills subsequent to July 8, 1977 on the grounds that Mrs. Crane had utilized the full 150 benefit days available to her for each benefit period, i.e. per "spell of illness". A new benefit period had not begun and the one beginning on November 1, 1974 still continued because claimant had not lost inpatient status at a hospital or skilled nursing facility for 60 consecutive days, as required by Section 1861 of the Act, 42 U.S.C. Sec. 1395x(a). ACMC continues to bill the estate of Miriam Crane in the amount of $9,335.40.

At the hearing before the ALJ on January 6, 1981, Lois B. Hutton, R.N., an employee of LCC, testified that she had known Mrs. Crane since her admission to LCC in November, 1974. Stating that she was familiar with the Medicare regulations making the distinction between skilled nursing care and custodial care, Mrs. Hutton testified that Mrs. Crane had received skilled nursing care only on two occasions, from November 30, 1974 to February 17, 1975 and from November 9, 1975 to November 29, 1975. The remainder of the time Mrs. Crane was a resident of LCC she received only custodial care.

Medical reports submitted by Doctors Gleason and Naame indicate that Mrs. Crane's various hospitalizations at ACMC were all for separate and distinct medical conditions with the exception of the admission of January 23, 1977 when the hip prosthesis was replaced.

It should be noted that the role of the district court in reviewing determinations made by the Secretary is limited; the Act specifies that the "findings of the Secretary as to any fact, if supported by substantial evidence, shall be conclusive...." 42 U.S.C. Sec. 405(g). However, "even if the Secretary's factual findings are supported by substantial evidence, this court may review whether the administrative determination was made upon correct legal standards." Curtin v. Harris, 508 F.Supp. 791, 793 (D.N.J.1981) (citations omitted). Accordingly, the issue before this court is whether the Secretary, in making his findings, applied the correct legal standards to the facts presented. Although this court recognizes that the position of the Social Security Administration should be given substantial weight, the judiciary is the final interpreter of the Social Security Act. Gerstman v. Secretary of H.E.W., 432 F.Supp. 636, 638 (W.D.N.Y.1977); see Social Security Board v. Nierotko, 327 U.S. 358, 368-69, 66 S.Ct. 637, 642-43, 90 L.Ed. 718 (1946).

Under the Medicare Act, insurance coverage is provided to an individual for "inpatient hospital services for up to 150 days during any spell of illness minus 1 day for each day of inpatient hospital services in excess of 90 received during any preceding spell of illness..." 42 U.S.C. Sec. 1395d(a)(1). Once the 150 days of coverage are utilized, a new "spell of illness" must begin before additional coverage is provided. The term "spell of illness" is defined in 42 U.S.C. Sec. 1395x(a) which provides The term "spell of illness" with respect to any individual means a period of consecutive days

(1) beginning with the first day (not included in a previous spell of illness) (A) on which such individual is furnished inpatient hospital services or extended care services, and (B) which occurs in a month for which he is entitled to benefits under part A, and

(2) ending with the close of the first period of 60 consecutive days thereafter on each of which he is neither an inpatient of a hospital nor an inpatient of a skilled nursing facility.

The issue of whether an individual's status as an "inpatient" continues as long as that individual is physically present in the facility irrespective of the fact that he or she is not receiving any skilled nursing care covered by Medicare, raises a question of first impression for this court. There appears to be no controlling Circuit Court of Appeals decisions and the District courts that have addressed this question are split on the issue. Supporting the position advanced by claimant are Levine v. Secretary of H.E.W., 529 F.Supp. 333 (W.D.N.Y.1981); Eisman v. Mathews, 428 F.Supp. 877 (D.Md.1977); Gerstman v. Secretary of H.E.W., 432 F.Supp. 636 (W.D.N.Y.1977). Decisions to the contrary are Stoner v. Califano, 458 F.Supp. 781 (E.D.Mich.1978); Brown v. Richardson, 367 F.Supp. 377 (W.D.Pa.1973).

The Social Security Act should be liberally construed so as to effectuate Congress' intention to provide coverage for medical expenses for all qualifying individuals. Eisman at 880, quoting Rowe v. Finch, 427 F.2d 417, 419 (4th Cir.1970). In order to insure the financial soundness of the Medicare program, a precise limitation on the available coverage is arguably necessary. The purpose of the limitation embodied in the requirement that an individual must not be an inpatient for 60 consecutive days in order for a new spell of illness to accrue is, therefore, based on financial considerations. As explained by Secretary Anthony Celebrezze, "the basic purpose of this bill is not to take care of long-term chronic illness. We are not covering that at all." Testimony of Anthony J. Celebrezze, Secretary of Health, Education and Welfare, before the Committee of Finance, United States Senate, Eighty-ninth Congress, First Session on H.R. 6675, p. 182.

The position advanced by claimant in this case is not inconsistent with the above-mentioned purpose of the 60 day requirement. Miriam Crane was not suffering from any long-term chronic illness. As Doctors Gleason and Naame stated,...