Hall v. Sebelius

• Decision Date: 16 March 2011
• Docket Number: Civil Action No. 08–1715 (RMC).
• Citation: 770 F.Supp.2d 61
• Parties: Brian HALL, et al., Plaintiffs,v.Kathleen SEBELIUS, Secretary, Department of Health and Human Services, et al., Defendants.
• Court: U.S. District Court — District of Columbia

770 F.Supp.2d 61

Brian HALL, et al., Plaintiffs,

v.Kathleen SEBELIUS, Secretary, Department of Health and Human Services, et al., Defendants.

Civil Action No. 08–1715 (RMC).

United States District Court, District of Columbia.

March 16, 2011.

Frank M. Northam, Webster, Chamberlain & Bean, Washington, DC, Kent Masterson Brown, Law Offices of Kent Masterson Brown, Lexington, KY, for Plaintiffs.Peter Bryce, Brian G. Kennedy, U.S. Department of Justice, Washington, DC, for Defendants.

MEMORANDUM OPINION

ROSEMARY M. COLLYER, District Judge.

Plaintiffs are retired Federal employees who have reached age 65 and have applied for, and are receiving, Social Security Retirement benefits. As a result, they are “entitled” to Medicare Part A, coverage. They do not, however, want Medicare coverage. And the only avenue provided to Plaintiffs to un-entitle themselves is to cease receiving Social Security Retirement benefits—and to repay all such benefits already received. Plaintiffs declaim that such a requirement is contrary to the Social Security Act, of which Medicare is a part. The Court concludes that Plaintiffs' claims are without merit.

Medicare costs are skyrocketing and may bankrupt us all; nonetheless, participation in Medicare Part A (for hospital insurance) is statutorily mandated for retirees who are 65 years old or older and are receiving Social Security Retirement (so-called ‘old age’) benefits. Whether Congress intended this result in 1965 or whether it is good fiscal and public policy in 2011 cannot gainsay the language of the statute and the regulations. Accordingly, summary judgment will be entered for Defendants.

I. FACTS

Plaintiffs Brian Hall, John Kraus, and Richard Armey share the following characteristics:

• They are retired from Federal employment and have attained the age of 65.

• They applied for, and are receiving, Social Security Retirement benefits.

• They are entitled to benefits under Medicare Part A.

• They had previously been enrolled in health plans under the Federal Employees Health Benefit (FEHB) program and wish to continue that coverage in full.

• They do not want to be covered by Medicare Part A and want to disenroll from Medicare Part A.

• They want to continue receiving their monthly Social Security Retirement benefits.

These facts are all undisputed and, for purposes of resolving this dispute, are the only facts that pertain.

II. LEGAL STANDARDS

A. Summary Judgment

Under Rule 56 of the Federal Rules of Civil Procedure, summary judgment must be granted when “the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to a judgment as a matter of law.” Fed.R.Civ.P. 56(c); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986); Diamond v. Atwood, 43 F.3d 1538, 1540 (D.C.Cir.1995). Moreover, summary judgment is properly granted against a party that “after adequate time for discovery and upon motion ... fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial.” Celotex Corp., 477 U.S. at 322, 106 S.Ct. 2548. To determine which facts are “material,” a court must look to the substantive law on which each claim rests. Anderson, 477 U.S. at 248, 106 S.Ct. 2505 (1986). A “genuine issue” is one whose resolution could establish an element of a claim or defense and, therefore, affect the outcome of the action. Id.; Celotex, 477 U.S. at 322, 106 S.Ct. 2548.

In ruling on a motion for summary judgment, the court must draw all justifiable inferences in the nonmoving party's favor and accept the nonmoving party's evidence as true. Anderson, 477 U.S. at 255, 106 S.Ct. 2505. A nonmoving party, however, must establish more than “the mere existence of a scintilla of evidence” in support of its position. Id. at 252, 106 S.Ct. 2505. To prevail on a motion for summary judgment, the moving party must show that the nonmoving party “fail[ed] to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial.” Celotex, 477 U.S. at 322, 106 S.Ct. 2548. By pointing to the absence of evidence proffered by the nonmoving party, a moving party may succeed on summary judgment. Id. In addition, the nonmoving party may not rely solely on allegations or conclusory statements. Greene v. Dalton, 164 F.3d 671, 675 (D.C.Cir.1999). Rather, the nonmoving party must present specific facts that would enable a reasonable jury to find in its favor. Greene, 164 F.3d at 675. If the evidence “is merely colorable, or is not significantly probative, summary judgment may be granted.” Anderson, 477 U.S. at 249–50, 106 S.Ct. 2505 (citations omitted).

B. Standing

If a plaintiff cannot meet the constitutional requirement of standing, courts lack jurisdiction to reach the merits of the case. See Steel Co. v. Citizens for a Better Env't, 523 U.S. 83, 101, 118 S.Ct. 1003, 140 L.Ed.2d 210 (1998); Grand Council of the Crees v. FERC, 198 F.3d 950, 954 (D.C.Cir.2000). To have Article III standing, a plaintiff must establish: “(1) [he] has suffered an ‘injury in fact’ that is (a) concrete and particularized and (b) actual or imminent, not conjectural or hypothetical; (2) the injury is fairly traceable to the challenged action of the defendant; and (3) it is likely, as opposed to merely speculative, that the injury will be redressed by a favorable decision.” Friends of the Earth, Inc. v. Laidlaw Envtl. Servs., 528 U.S. 167, 180–81, 120 S.Ct. 693, 145 L.Ed.2d 610 (2000) (citing Lujan v. Defenders of Wildlife, 504 U.S. 555, 560–61, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992)).

III. ANALYSIS

While the Court finds that Plaintiffs have standing with which to bring this lawsuit, they cannot survive summary judgment because the statutory scheme dictates that Medicare Part A is mandatory for those individuals who are 65 years old and are receiving Social Security Retirement benefits.

A. Standing Exists

Messrs. Kraus, Armey, and Hall have applied for and are receiving monthly Social Security Retirement benefits and wish to continue to do so; however, they wish to opt-out of Medicare Part A for various personal, financial, and other reasons. Defendants argue Plaintiffs have no standing to sue. As the Court found in Iyengar v. Barnhart,

[I]n order [ ] for plaintiffs to establish their standing to sue, they need not eliminate all doubt as to whether the challenged action ... caused [their injury].... Rather, plaintiffs must show only (1) a substantial probability that [their injury] was or is being caused by the [defendant's] policy, and (2) a reasonable likelihood that eliminating that policy will [redress that injury].

233 F.Supp.2d 5, 10 (D.D.C.2002). Plaintiffs' alleged injury is being forced to either (1) have inferior insurance foisted upon them, thereby precluding their ability to be covered by superior insurance; or (2) receive their superior non-Medicare Part A insurance at the cost of relinquishing their Social Security Retirement benefits, and re-paying past benefits received. Plaintiffs ask the Court to remedy this injury by invalidating the internal regulations that dictate this untenable choice—internal regulations which Plaintiffs claim are in contravention of the Social Security Act and the Medicare Act. Assuming this to be the case, the Court would have the power to invalidate those contravening regulations, thereby providing Plaintiffs with the redress they request.

The Secretary extolls the benefits of Medicare Part A and suggests that Plaintiffs would agree they are not truly injured if they were to learn more about Medicare, perhaps through discovery. See, e.g., Defs.' Statement of Genuine Issues of Material Fact with Respect to Pls.' Mot. for Summ. J. [Dkt. # 41] ¶ 35. Plaintiffs politely decline. The parties use a lot of ink disputing whether Plaintiffs' desire to avoid Medicare Part A is sensible. This is not an issue the Court needs to address. Plaintiffs have standing because they cannot avoid Medicare without forgoing Social Security Retirement benefits; they argue that there is no statutory tie between the two. This dispute constitutes a case or controversy without regard to why Plaintiffs prefer other insurance coverage. As such, Plaintiffs have standing to bring this lawsuit.

B. The Social Security and Medicare Statutory Scheme

The Medicare Act, which is enacted at Title XVIII of the Social Security Act and codified at 42 U.S.C. § 1395 et seq., establishes a program of health insurance for the elderly and disabled. Medicare Part A, often called “Hospital Insurance” or “HI,” covers services furnished by hospitals and other institutional providers. 42 U.S.C. §§ 1395c–1395i–5. Entitlement to Medicare Part A benefits occurs automatically for individuals who turn 65 and are “entitled” to monthly Social Security Retirement benefits under 42 U.S.C. § 402. See 42 U.S.C. § 426(a) (“Every individual who ... has attained the age of 65, and is entitled to monthly [Social Security benefits] under [42 U.S.C. § 402] of this title ... shall be entitled to hospital insurance benefits under Part A of [this chapter] ....”).¹ By contrast, Medicare Part B, which provides supplemental medical insurance benefits for certain medical and health care services not otherwise covered under Medicare Part A, including physician services, is an optional program to which individuals are not automatically entitled. Individuals entitled to Part A must pay for Medicare Part B and may choose to opt out of Part B. See 42 U.S.C. §§ 1395j– 1395w–5. This distinction—between the mandatory nature of Part A and the optional nature of Part B—has been specifically recognized by the Supreme Court: “This optional coverage ...