Willowood of Great Barrington, Inc. v. Sebelius

• Decision Date: 28 July 2009
• Docket Number: C.A. No. 08-CV-30076-MAP.
• Parties: WILLOWOOD OF GREAT BARRINGTON, INC., d/b/a fairview commons, et al., Plaintiff v. Kathleen SEBELIUS, Secretary, U.S. Department of Health and Human Services,<SMALL><SUP>1</SUP></SMALL> Defendant.
• Court: U.S. District Court — District of Massachusetts

638 F.Supp.2d 98

WILLOWOOD OF GREAT BARRINGTON, INC., d/b/a fairview commons, et al., Plaintiff v. Kathleen SEBELIUS, Secretary, U.S. Department of Health and Human Services,¹ Defendant.

C.A. No. 08-CV-30076-MAP.

United States District Court, D. Massachusetts.

July 28, 2009.

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

Kenneth A. Behar, Gary A. Rosenberg, Rochelle H. Zapol, Behar & Kalman, Boston, MA, for Plaintiffs.

Scott Risner, U.S. Department of Justice, Washington, DC, for Defendant.

MEMORANDUM AND ORDER RE: REPORT AND RECOMMENDATION WITH REGARD TO CROSS MOTIONS FOR SUMMARY JUDGMENT

(Dkt. Nos. 13, 23 & 30)

PONSOR, District Judge.

This is an action for review of a decision by the Medicare Appeals Council, which upheld decisions by an administrative law judge denying payment for certain tests conducted by Plaintiff during the month of October 2005. The parties filed cross motions for summary judgment that were referred to Magistrate Judge Kenneth P. Neiman for report and recommendation.

On June 30, 2009, Judge Neiman issued his Report and Recommendation, to the effect that Plaintiff's motion should be denied and Defendant's motion should be allowed. The conclusion of the Report and Recommendation admonished the parties at n. 7 that objections to the Report and Recommendation must be filed within ten days of receipt. No objection has been filed by either party.

The Magistrate Judge's lengthy and detailed memorandum makes discussion of the substance of the motions unnecessary. Suffice to say that Judge Neiman's analysis is well supported by the facts and law, and further, that the failure of either party to file an objection precludes further review.

For the foregoing reasons, upon de novo review, the court hereby ADOPTS the Report and Recommendation (Dkt. No. 30). Based upon this, the court hereby DENIES Plaintiff's motion (Dkt. No. 13) and ALLOWS Defendant's motion (Dkt. No. 23). The clerk is ordered to enter a judgment for Defendant. This case may now be closed.

It is So Ordered.

REPORT AND RECOMMENDATION WITH REGARD TO CROSS MOTIONS FOR SUMMARY JUDGMENT (Document Nos. 13 and 23)

NEIMAN, United States Magistrate Judge.

This case, brought against the Secretary of the United States Department of Health and Human Services (hereinafter "Defendant"), concerns the potential reimbursement under Part B of the federal Medicare program for one month of blood glucose laboratory tests performed on twelve patients by three skilled nursing facilities (hereinafter "Plaintiffs"). Plaintiffs' complaint seeks judicial review of a February 19, 2008 decision by the Medicare Appeals Council ("MAC")—which upheld August 9, 2007 decisions by an administrative law judge—denying payment for such tests during the month of October, 2005. The purported reason for the denials was that the patients' attending physicians were not promptly notified of the results of each test before the physicians ordered subsequent tests. Plaintiffs assert that prompt physician notification of the blood glucose tests in October of 2005 was not required by federal law and, hence, that both the administrative law judge and the MAC erred in determining otherwise; Defendant argues that such physician notification was required.

The parties have filed cross-motions for summary judgment which, in turn, have been referred to this court for a report and recommendation. See 28 U.S.C. § 636(b)(1)(B). For the reasons set forth below, the court will recommend that Plaintiffs' motion for summary judgment be denied and that Defendant's cross-motion be allowed.

I. STANDARDS OF REVIEW

"Summary judgment is warranted `if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.'" Uncle Henry's, Inc. v. Plaut Consulting Co., 399 F.3d 33, 41 (1st Cir.2005) (quoting Fed. R. Civ. Pro. 56(c)). Generally speaking, cross-motions for summary judgment do not alter the basic summary judgment standard, but require the court to determine whether either party deserves judgment as a matter of law on facts that are not disputed. Adria Int'l Group, Inc. v. Ferre Dev., Inc., 241 F.3d 103, 107 (1st Cir.2001).

The instant case, however, is before the court under the jurisdictional provision of 42 U.S.C. § 1395ff(b)(1)(A), which incorporates 42 U.S.C. § 405(g) and allows for judicial review, pursuant to the Administrative Procedures Act ("APA"), of a final decision of Defendant with respect to benefits under Medicare Part B.² "Because the APA standard affords great deference to agency decisionmaking and because [Defendant]'s action is presumed valid, judicial review, even at the summary judgment stage, is narrow." Associated Fisheries of Maine, Inc. v. Daley, 127 F.3d 104, 109 (1st Cir.1997) (citing, inter alia, Citizens to Preserve Overton Park v. Volpe, 401 U.S. 402, 415-16, 91 S.Ct. 814, 28 L.Ed.2d 136 (1971)). At bottom, "[Defendant]'s decision may be overturned only if `it is arbitrary, capricious, an abuse of discretion, unsupported by substantial evidence, or contrary to law.'" Currier v. Thompson, 369 F.Supp.2d 65, 68 (D.Me. 2005) (quoting Chipman v. Shalala, 90 F.3d 421, 422 (10th Cir.1996)).

II. BACKGROUND

Because this case arises under section 1395ff(b)(1)(A), the court's factual review is limited to the administrative record. See Landers v. Leavitt, 2006 WL 2560297, at *3 (D.Conn. Sep. 1, 2006) (citing Mathews v. Weber, 423 U.S. 261, 263, 270, 96 S.Ct. 549, 46 L.Ed.2d 483 (1976) (holding that under 42 U.S.C. § 405(g), the "court may consider only the pleadings and administrative record" and "neither party may put any additional evidence before the district court")), aff'd, 545 F.3d 98 (2d Cir.2008). Accordingly, the following undisputed facts from the administrative record are taken from the Statement of Material Facts of Record as to Which Plaintiffs Contend There is no Genuine Issue to be Tried (Document No. 15, hereinafter "Pls.' Facts") and Defendant's Statement of Material Facts not in Dispute (Document No. 25, hereinafter "Def.'s Facts"). Several additional undisputed facts, also taken from the administrative record, are addressed in the discussion section below.

Diabetes mellitus is a chronic metabolic disease in which the body does not produce or properly store insulin, the hormone needed to convert sugar, starches and other foods into energy to sustain daily life. (Pls.' Facts ¶ 8.) An unstable diabetic (more commonly referred to as a "brittle diabetic") is one whose blood glucose level often swings from too high (hyperglycemia) to too low (hypoglycemia) and vice versa. (Id.) As a result, blood glucose testing is important for brittle diabetics such as the twelve patients involved in this case. (See id. ¶¶ 10-11.)

Plaintiffs, three skilled nursing facilities, are non-profit affiliates of Berkshire Health Systems. (Id. ¶ 6.) During October of 2005, each attending physician for the twelve patients issued a patient-specific order authorizing at least twice-daily blood glucose testing. (Id. ¶¶ 14, 17; Def.'s Facts ¶ 1.) These orders—called "sliding scale" orders—consisted of the physician directing Plaintiffs' nurses to do three things: (1) take a test-reading of the patient's blood glucose via the finger-stick method (using a hand-held device designed for home use), (2) administer a specific dose of insulin on-the-spot, and (3) report to the physician any "aberrant" result, i.e., one that was below or above the scale set forth in the order. (See Pls.' Facts ¶¶ 19, 22; Def.'s Facts ¶¶ 2-3.)

It is undisputed that no physician performed any part of the testing or was present for any single test. (Def.'s ¶ 2.) The parties also agree that non-aberrant results—i.e., those falling within acceptable ranges—were simply recorded on the patients' charts without the physicians being notified, promptly or otherwise. (Id. ¶ 3.) To be sure, the results were available for the physicians to review at their next routine visits. (Id.) There is no indication, however, that any of the results were regularly reviewed by the physicians. (Id.)

In late 2005 and into 2006, a Medicare fiscal intermediary, Mutual of Omaha, denied Plaintiffs' claims for reimbursement for the October 2005 blood glucose tests administered under the physicians' sliding-scale orders. (Pls.' Facts ¶ 1.) The denials were then upheld by Maximus Federal Services ("Maximus"), a Medicare contractor. (Id. ¶¶ 1-2.) Plaintiffs timely appealed Maximus's determinations to an administrative law judge (hereinafter "the ALJ") for a January 17, 2007 evidentiary hearing. (Id. ¶¶ 1, 3.)

Pursuant to an agreement by the parties, the evidentiary hearing dealt with only five of the twelve beneficiaries, three selected by Plaintiffs and two selected by the ALJ. (Id. ¶¶ 2-3.) The parties further agreed that the hearing results in the five cases would apply to all twelve patients. (Id. ¶ 2.) At the hearing, Plaintiffs presented three witnesses: an attending physician for one of the five beneficiaries, a second physician expert witness, and a Medicare billing expert. (Id. ¶ 3.) In addition, Plaintiffs filed exhibits and the ALJ compiled an administrative record which consisted of documents submitted by Mutual of Omaha. (Id.)

By decisions dated August 9, 2007, described more fully below, the ALJ denied Plaintiffs' reimbursement claims. (Id. ¶ 4.) The ALJ concluded as follows:

In sum, the Beneficiary's test results were not promptly reported to the physician.

Therefore, pursuant to Medicare policy, the test results were not used by the ordering physician in such a way as to qualify for reimbursement.... Based on the foregoing considerations, the undersigned ALJ finds that the Beneficiary's blood glucose testing, furnished from October 1, 2005 and October 31, 2005, was not reasonable and necessary. ...

(Document No. 6, the...