Professional Documents
Culture Documents
Harry M. Kechijian v. Joseph A. Califano, JR., Etc., 621 F.2d 1, 1st Cir. (1980)
Harry M. Kechijian v. Joseph A. Califano, JR., Etc., 621 F.2d 1, 1st Cir. (1980)
Harry M. Kechijian v. Joseph A. Califano, JR., Etc., 621 F.2d 1, 1st Cir. (1980)
2d 1
Edward L. Gnys, Jr., Providence, R. I., with whom Robert W. Smith, and
Gunning, LaFazia & Gnys, Inc., Providence, R. I., were on brief, and argument
that existence for plaintiff, appellant.
Lawrence E. Burstein, Asst. Regional Atty., Dept. of Health, Ed., and Welfare,
Boston, Mass., with whom Paul F. Murray, U. S. Atty., and Robert L.
Gammell, Asst. U. S. Atty., Providence, R. I., were on brief, for defendants,
appellees.
Blue Shield notified plaintiff in writing on April 10, 1972 there would be a
temporary delay in processing his pending Medicare claims while they were
being assessed for utilization and medical necessity. Blue Shield sought the
advisory opinion of the State Peer Review Committee (Committee) of the
Rhode Island Medical Society of the medical issues involved in plaintiff's
Medicare claims, and referred certain cases to the Committee for its findings
and recommendation. On May 25, 1972 plaintiff was requested to attend a
meeting of the Committee, and to bring with him medical records of cases
referred to the Committee by Blue Shield. Plaintiff appeared with his records at
the informal meeting held May 30, 1972, and thereafter on June 8, 1972 he was
advised in writing that evidence had been found of overutilization and
misutilization by him of certain specified "medications questioned by the
Medicare carrier". Plaintiff was notified of his right to appeal the determination,
but no appeal was taken. On January 1, 1973 plaintiff decided to withdraw
from participation in the Medicare program by declining to accept Medicare
assignments from patients, effective March 3, 1973.
issue on appeal.
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The Medicare statute is complicated, and provides for judicial review only in
limited specific instances. It does not explicitly provide judicial review for
determination of reimbursement disputes over a beneficiary's claim, or of a
physician's claim as assignee, under Part B. Cervoni v. Secretary of HEW, 581
F.2d 1010, 1015 (1st Cir. 1978); Szekely v. Florida Medical Ass'n, 517 F.2d
345, 348 (5th Cir. 1975), cert. denied, 425 U.S. 960, 96 S.Ct. 1742, 48 L.Ed.2d
205 (1976). Judicial review would involve the courts in the complex and
detailed task of "ascertaining the appropriate medical charges for technical
services based on facts which vary from community to community. . . .
Determining the proper amount of these charges is a matter peculiarly suited to
determination by a specialized agency". St. Louis Univ. v. Blue Cross Hosp.
Service, 537 F.2d 283, 289 (8th Cir.), cert. denied, 429 U.S. 977, 97 S.Ct. 484,
50 L.Ed.2d 584 (1976). The Act and the regulations which the Secretary is
authorized to prescribe provide a particular administrative scheme covering
disputes arising from requests for payment of claims assigned to physicians.4
Plaintiff's claim for reimbursements is not explicitly included in judicial review
provisions of the Act. To vindicate his claim he has invoked jurisdiction under
28 U.S.C. 1331. But federal question jurisdiction, 28 U.S.C. 1331, over
substantive Medicare reimbursement disputes is barred by section 205(h) of the
Social Security Act, 42 U.S.C. 405(h),5 made applicable to the Medicare Act
by 42 U.S.C. 1395ii. See Hospital San Jorge, Inc. v. Secretary of HEW, 598
F.2d 684 (1st Cir. 1979); Rhode Island Hospital v. Califano, 585 F.2d 1153 (1st
Cir. 1978); Cervoni v. Secretary of HEW, supra.
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Plaintiff argues that because his challenge to the defendants' withholding of his
claims presented a colorable constitutional due process issue, federal question
jurisdiction was not barred by section 405(h) in the district court. In Hospital
San Jorge, Inc., supra, we recognized that a "possible exception" to the
jurisdictional bar of section 405(h) to federal question jurisdiction "might arise
where a . . . reimbursement dispute presented a colorable constitutional claim
Although plaintiff did not receive payment of any claim for reimbursement
after February 1972, he was made aware on or about April 10, 1972 that
payment of his claims might be in dispute, and in June 1972 that payment might
well be in jeopardy. We are informed by plaintiff's January 8, 1974 letter that
he "accepted the decision" of the State Peer Review Committee, but we are not
told of the "workable basis with the Rhode Island Blue Cross (sic)" that he
"believe(d) . . . (he) arrived at". When he made request for payment in writing
in January 1974, he was notified that Blue Shield determined he had been
overpaid by Medicare, for reasons stemming from the 1972 determination of
the Committee, and that this determination was subject to administrative review
and a hearing, at his request.
13
Plaintiff argues that the withholding of his claims for reimbursements deprived
him of a constitutionally protected property interest without due process of law.
His interest in the claims is that of assignee only of the beneficiary's claim
under Part B of the Act, and he is not himself a beneficiary. Section 1395j.
Even assuming plaintiff has a protected property interest, but cf. Cervoni, supra
at 1018, he does not show that the withholding, if erroneous, results in
irrevocable harm, or damage that could not be compensated by payment of the
claims subsequently. This is not a case where "full relief cannot be obtained at
a (post-termination) hearing". Mathews v. Eldridge, 424 U.S. 319, 331, 96 S.Ct.
893, 900, 47 L.Ed.2d 18 (1976). No adequate reasons have been advanced that
convince us that in these circumstances the administrative procedures are unfair
or unreliable and that additional procedural safeguards are necessary. See
Mathews v. Eldridge, supra at 343, 96 S.Ct. at 907; Goldberg v. Kelly, 397
U.S. 254, 263, 90 S.Ct. 1011, 1018, 25 L.Ed.2d 287 (1970). Here, the
prescribed administrative procedures provide for effective review after the
initial withholding of reimbursement payments, and the right to an evidentiary
hearing before the decision on overpayment becomes final. We do not see on
this record a colorable question of due process deficiency raised against the
existing procedures.
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The plaintiff finally argues that his payments were "suspended" by defendants, 7
and that defendants failed to follow the procedures required by the Medicare
Act and the regulations before payments can be legally suspended. Defendants
admit they withheld payments in an amount equivalent to Medicare
overpayments made to plaintiff, but they have not conceded that any payments
due plaintiff were "suspended". Under the Social Security Amendments of
1972, the Secretary was authorized to terminate or suspend payments, under
certain conditions,8 to a person furnishing Medicare Part B health and medical
services to a beneficiary ". . . upon such reasonable notice to the public and to
the person furnishing the services involved as may be specified in regulations .
. .". Section 1395y(d)(2). The amendment authorizing suspension of payments
became effective October 30, 1972, and the regulations9 on May 27, 1972.
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(1).
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Affirmed.
In his letter plaintiff stated, inter alia, "As a result of my appearance and
hearing at the Rhode Island Medical Society by the State Peer Review
Committee, and the agreement of the Committee, I accepted the decision. I
believe that I arrived at a workable basis with the Rhode Island Blue Cross (sic)
which is the Medicare carrier"
In Weinberger v. Salfi, 422 U.S. 749, 95 S.Ct. 2457, 45 L.Ed.2d 522 (1975),
the Supreme Court found that the third sentence of section 405(h) "preclude(d)
resort to federal-question jurisdiction for the adjudication of appellees'
constitutional (challenges)". Id. at 761, 95 S.Ct. at 2465. However, the Court
was there faced with claims for benefits where the Social Security Act did
provide specific procedures, 42 U.S.C. 405(g), for an administrative process
culminating with judicial review. Totally barring judicial consideration of a
constitutional claim raises troublesome constitutional problems. This circuit has
not yet addressed that question. Hospital San Jorge, Inc. v. Secretary of HEW,
598 F.2d 684 (1st Cir. 1979)
In his brief plaintiff cites 42 U.S.C. 1395u as the applicable section of the Act
concerning suspensions, but there is naught in that section of the power of the
Secretary to suspend. As appears in footnote 8, infra, the applicable section is
1395y(d)
42
C.F.R. 405.370
(a) Payments otherwise authorized to be made to . . . suppliers of services in
accordance with . . . Subpart B of this Part 405 . . . may be suspended . . . by . .
. a carrier when:
(1) The . . . carrier has determined that the . . . supplier . . . has been overpaid
under Title XVIII of the Social Security Act, or
(2) The . . . carrier has reliable evidence . . . that such overpayment exists or
that the payments to be made may not be correct.
(b) A suspension shall be put into effect only after the provisions in 405.371
and 405.372 have been complied with and the . . . carrier has determined that
the suspension of payments, in whole or in part, is needed to protect the
program against financial loss.
42
C.F.R. 405.371
(a) General. Whenever the . . . carrier has determined that a suspension of
payments . . . should be put into effect . . . , the . . . carrier shall notify the . . .
supplier of its intention to suspend payments, in whole or in part, and the
reasons for making such suspension. The . . . supplier will be given the
opportunity to submit any statement . . . as to why the suspension shall not be
put into effect . . . .
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C.F.R. 405.372
When . . . the . . . supplier submits a statement, the . . . carrier shall consider
such statement (including any pertinent evidence submitted), together with any
other material . . . , and make a determination as to whether the facts justify a
suspension . . . . If the . . . carrier determines that a suspension should go into
effect, written notice . . . will be sent to the . . . supplier. Such notice will
contain . . . findings on the conditions upon which the suspension was based,
and an explanatory statement for the final decision.
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