McMahon v. Califano, Civ. A. No. 78-1053-G.

• Decision Date: 21 September 1979
• Docket Number: Civ. A. No. 78-1053-G.
• Citation: 476 F. Supp. 978
• Parties: John McMAHON, on behalf of Mary McMahon, Plaintiff, v. Joseph A. CALIFANO, Jr., Secretary of Health, Education and Welfare, Defendant.
• Court: U.S. District Court — District of Massachusetts

476 F. Supp. 978

John McMAHON, on behalf of Mary McMahon, Plaintiff, v. Joseph A. CALIFANO, Jr., Secretary of Health, Education and Welfare, Defendant.

Civ. A. No. 78-1053-G.

United States District Court, D. Massachusetts.

September 21, 1979.

John J. Ford, Neighborhood Legal Services, Lynn, Mass., for plaintiff.

Bruce A. Singal, Asst. U.S. Atty., Boston, Mass., for defendant.

MEMORANDUM OF DECISION DENYING DISMISSAL

GARRITY, District Judge.

This case involves a challenge to the application of Title XVIII of the Social Security Act governing Medicare benefits, 42 U.S.C. §§ 1395 et seq. Plaintiff, on behalf of his now deceased wife, seeks an order compelling the Secretary of the Department of Health, Education and Welfare (the "Secretary") to provide plaintiff with the payments for nursing home services that his deceased wife received at Pilgrim House-at-Peabody Nursing Home ("Pilgrim House") and to issue regulations allowing payments to those erroneously placed in a noncertified portion of a facility but who otherwise receive Medicare-covered nursing services. Furthermore, plaintiff seeks a declaratory judgment stating that the Secretary's policy, which denies payments for skilled nursing services received solely because such services were provided to a beneficiary occupying a noncertified bed, violates the Medicare statute, the Equal Protection clause and the Due Process clause of the United States Constitution.

The amended complaint alleges jurisdiction under 28 U.S.C. § 1361, the Federal Mandamus Statute; 28 U.S.C. § 1331, Federal Question Jurisdiction; and 42 U.S.C. § 405(g), incorporated by reference in 42 U.S.C. § 1395ff, the Social Security Act. Plaintiff has consented to defendant's motion to dismiss Blue Cross as a party defendant, which motion was granted. Presently before this court for decision is defendant's amended motion to dismiss for lack of subject matter jurisdiction and failure to state a claim upon which relief can be granted. Briefs were filed both before and after hearing oral arguments.

Factual Background

Essentially, the facts in this case are not in dispute. On May 7, 1976 plaintiff's wife, now deceased, suffered a massive cardiovascular accident and was admitted to the Lynn Hospital. On June 1, 1976 she was transferred to the Louise Caroline Nursing Home and remained there until July 8, 1976, at which time she was admitted to the Shaughnessy Chronic Disease/Rehabilitation Hospital in Salem. At all times, plaintiff's deceased was a Medicare-eligible patient. However, on August 30, 1976 a letter to plaintiff from the Shaughnessy Hospital informed him that the Hospital's Utilization Review Committee¹ had determined that his wife's level of care at that institution rendered her ineligible for Medicare benefits and that she would no longer be reimbursed after September 2, 1976. Plaintiff moved his wife to the Pilgrim House on September 3, 1976.

Upon her admission, the Pilgrim House, relying on the determination of the Shaughnessy Hospital's Utilization Review Committee and her slow recovery, placed plaintiff's wife in a wing of the nursing home not certified for Medicare patients. It appears that plaintiff felt his wife was in need of and eligible for covered Medicare services at that time. While at the Pilgrim House the plaintiff's wife received extensive speech and physical therapy which was certified as medically necessary by her attending physician. In addition, she began a program of bladder training on September 28, 1976 and required a catheter when first admitted. Plaintiff applied to the fiscal intermediary, Blue Cross, for Medicare benefits and was refused. Upon reconsideration of his claim, Blue Cross stated that the claim was not reimbursable because plaintiff's wife was placed in a noncertified portion of the nursing home. Plaintiff then requested and received a hearing before an Administrative Law Judge, arguing that Pilgrim House's ineligibility determination was incorrect. The Administrative Law Judge also, held that plaintiff's wife was not entitled to benefits because she occupied a bed in an uncertified wing of the nursing home. He refused to review the correctness of the eligibility determination itself. Plaintiff appealed, and the decision was affirmed. Having exhausted his administrative remedies, plaintiff now seeks review in this court.

Statutory Framework

It may be helpful first to outline the relevant statutory framework. The Medicare program is divided into two parts: Part A, the section applicable to this case, reimburses inpatient hospital and post-hospital extended care services, while Part B establishes a system of supplementary insurance funded by individual contributions. Under the Medicare Act, a patient is entitled to have payments made on his behalf for "post-hospital extended care services for up to 100 days during any spell of illness", 42 U.S.C. § 1395d(a)(2), if a variety of conditions are met. First, the services received must be "post-hospital" services, which generally means services "furnished an individual after transfer from a hospital in which he was an inpatient for not less than 3 consecutive days before his discharge.. ." 42 U.S.C. § 1395x(i). Second, the services received must be "extended care services". Such services include nursing care, bed and board, physical, occupational, or speech therapy, drugs, medical services, and other services necessary to the health of the patient involved. Furthermore, to constitute "extended care services" the above must be furnished to an inpatient of a "skilled nursing facility" by the "skilled nursing facility." 42 U.S.C. § 1395x(h). Accordingly, the third prerequisite of Medicare eligibility in this instance is that one be an inpatient of a "skilled nursing facility." Under 42 U.S.C. § 1395x(j) an institution (or a distinct part thereof) qualifies as a skilled nursing facility if it provides a variety of services and further, if it has a "transfer agreement" in effect with one or more hospitals having agreements in effect under section 1395cc.² This is designed to insure that patients are not charged for covered items. Finally, payment will be made only to those providers who fulfill the conditions of 42 U.S.C. § 1395f requiring among other items, a written request from the beneficiary for payment in such form as the Secretary has prescribed, a physician's certification of the services required and, with respect to patients receiving post-hospital extended care services, that no finding has been made pursuant to a system of utilization review that further services are not medically necessary. Hence only those skilled nursing facilities which meet the conditions of section 1395f and which are covered by an agreement as provided in section 1395cc(a) may receive Medicare payments. It is undisputed that the wing of the Pilgrim House to which plaintiff's wife was assigned was not covered by an agreement, and for this reason plaintiff's application for benefits was refused.

Jurisdiction

The plaintiff asserts jurisdiction under 42 U.S.C. § 405(g) as incorporated by 42 U.S.C. § 1395ff of the Social Security Act; 28 U.S.C. § 1361, the Federal Mandamus Statute; and 28 U.S.C. § 1331, federal question jurisdiction. We find that this court does not have jurisdiction under the relevant provisions of the Social Security Act. However, in our opinion, mandamus jurisdiction is proper. The availability of federal question jurisdiction in cases involving the Social Security Act is far from clear. Weinberger v. Salfi, 1975, 422 U.S. 749, 95 S.Ct. 2457, 45 L.Ed.2d 522; Johnson v. Robison, 1974, 415 U.S. 361, 94 S.Ct. 1160, 39 L.Ed.2d 389, and Cervoni v. Secretary of Health, Education & Welfare, 1 Cir. 1978, 581 F.2d 1010. Since mandamus jurisdiction is available in this instance, we shall leave entering the jurisdictional maze of section 1331 and its interaction with section 405(h) of the Social Security Act for another day.

The Medicare Act, section 1395ff(b)(1)(C) of Title 42, grants an individual dissatisfied with a determination as to the amount of benefits under Part A of the Act, the opportunity for a hearing under 42 U.S.C. § 405(b), and the right to judicial review of the Secretary's final decision as is provided in 42 U.S.C. § 405(g). In cases involving determinations of the amount of benefits under Part A, however, judicial review is not available "if the amount in controversy is less than $1000." 42 U.S.C. § 1395ff(b)(2). The total amount of benefits at stake for the 33 day non-reimbursed period in the instant case is only $759.³ Therefore, jurisdiction does not lie under the Medicare Act since plaintiff has failed to satisfy the jurisdictional amount.

Mandamus jurisdiction is bestowed upon the district courts by section 1361 of Title 28, which states that "the district courts shall have original jurisdiction of any action in the nature of mandamus to compel an officer or employee of the United States or any agency thereof to perform a duty owed to the plaintiff." Courts generally require the presence of three factors before the writ will issue: "(1) a clear right in the plaintiff to the relief sought; (2) a plainly defined and peremptory duty on the part of the defendant to do the act in question; and (3) no other adequate remedy available." Lovallo v. Froehlke, 2 Cir. 1972, 468 F.2d 340, 343; Caswell v. Califano, D.Me.1977, 435 F.Supp. 127, affirmed, 1 Cir. 1978, 583 F.2d 9. However, commentators argue, and courts have agreed, that the appearance of some discretion on the part of the officer involved is not determinative of whether mandamus lies. Rather, the applicable statute, its legislative history, regulations promulgated pursuant to its terms and any other relevant aids must be considered also in determining the scope of discretion the officer enjoyed, and accordingly, whether that discretion was abused. Chaudoin v. Atkinson, 3 Cir. 1974, 494 F.2d 1323; Byse and Fiocca, Section 1361...