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Nature of Suit Code: 151
Nature of Suit: Overpayments under the Medicare Act
Cause of Action: 

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* Pursuant to 5TH CIR. R. 47.5, the Court has determined that

this opinion should not be published and is not precedent except

under the limited circumstances set forth in 5TH CIR. R. 47.5.4.

United States Court of Appeals

Fifth Circuit

F I L E D

January 30, 2004

Charles R. Fulbruge III

Clerk

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

_____________________

No. 03-50201

_____________________

BIG BEND HOSPITAL CORP., doing business as

Big Bend Regional Hospital Medical Center,

Plaintiff-Appellant,

versus

TOMMY G. THOMPSON, SECRETARY, DEPARTMENT

OF HEALTH & HUMAN SERVICES,

Defendant-Appellee.

__________________________________________________________________

Appeal from the United States District Court

for the Western District of Texas 

USDC No. P-02-CV-30

_________________________________________________________________

Before JOLLY, HIGGINBOTHAM, and DeMOSS, Circuit Judges.

PER CURIAM:*

Big Bend Hospital Corporation (“Big Bend”) appeals the

district court’s grant of summary judgment in favor of the

Secretary of the Department of Health and Human Services (the

“Secretary” of “HHS”). Big Bend contends that the HHS Departmental

Appeals Board (“DAB”) incorrectly determined February 3, 2000, to

be the effective date of participation in the Medicare program, and

that the Administrative Law Judge (“ALJ”) improperly denied Big

Bend an in-person administrative hearing to contest the accuracy of

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1The current versions of the relevant statutes and regulations

are the same as those in effect at the time of the operative facts

of this case.

2

this date. We hold that the effective date determination was

supported by substantial evidence and that the DAB applied the

appropriate legal standard under the relevant statutes and

regulations. We further hold that an evidentiary hearing would

have been futile. We therefore AFFIRM the summary judgment.

I

In 1999, Big Bend applied to participate in the Medicare

program, which is administered by the Centers for Medicare and

Medicaid Services (“CMS”), an HHS agency. Medicare regulations

require CMS to enter into agreements with state survey agencies,

which make recommendations to CMS as to whether surveyed facilities

are Medicare compliant and deserve certification. 42 C.F.R. §

488.10 (2004).1 CMS has such an agreement with the Texas

Department of Health (“TDH”).

TDH completed an initial certification survey on October 7,

1999 (“October 7 Survey”), and, after concluding that Big Bend

failed to meet multiple conditions, recommended that CMS deny Big

Bend’s application. Three weeks later, TDH conducted a second

certification survey (“October 27 Survey”), found Big Bend in

compliance, and recommended approval of Big Bend’s application.

CMS, apparently skeptical that the deficiencies noted in the

October 7 Survey could have been rectified so quickly, made an

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unannounced visit to Big Bend to conduct another survey (“December

7 Survey”). The federal surveyors found serious deficiencies,

similar to the deficiencies noted in the October 7 Survey, but

before the survey was completed Big Bend officials asked CMS to end

the survey. Chief Executive Officer David Conejo then submitted a

“formal request to withdraw” from the survey process (“December 7

Letter”). CMS confirmed Big Bend’s withdrawal in writing

(“December 20 Letter”), and informed Big Bend that it could reapply

for certification at any time. Neither Conejo nor any other Big

Bend official objected to CMS’ characterization of the December 7

Letter as a withdrawal from the certification process.

In early January 2000, Conejo notified CMS that Big Bend would

be prepared for a survey by January 12, and requested a new survey

at that time. On February 3, Big Bend was re-surveyed by a team of

officials from TDH and CMS (“February 3 Survey”), who concluded

that Big Bend complied with Medicare requirements and recommended

certification. CMS accepted the recommendation and certified Big

Bend for Medicare participation effective February 3, 2000.

Big Bend, wishing to claim Medicare reimbursements for

services rendered before February 3, disagreed with the

certification date. It contended that the proper date was October

27, 1999, when TDH surveyors originally had recommended

certification. CMS denied Big Bend’s request for reconsideration.

After denying an in-person hearing, the ALJ ruled that, by both

withdrawing from the December 7 Survey (which, if successful, would

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have had the effect of validating the October 27 Survey) and asking

for a new “certification” survey, Big Bend had abandoned its claim

to an effective date of October 27. The DAB affirmed the ALJ’s

decision, concluding that, whatever Big Bend’s intent may have

been, the December 7 Letter legally constituted a withdrawal from

the certification process.

Invoking the judicial review provision of the Medicare Act, 42

U.S.C. § 1395cc(h)(1) (2004), Big Bend appealed the DAB’s decision

to the district court, which granted summary judgment to the

Secretary. Big Bend filed a timely notice of appeal.

II

We review grants of summary judgment de novo, applying the

same standards as the district court. Hall v. Gillman, Inc., 81

F.3d 35, 36-37 (5th Cir. 1996). Notwithstanding the various

subsidiary arguments made by Big Bend, our review is limited to a

determination as to whether DAB’s findings of fact are supported by

substantial evidence and whether the DAB applied the proper legal

standards in reaching its decision. 42 U.S.C. § 405(g) (2004);

Estate of Morris v. Shalala, 207 F.3d 744, 745 (5th Cir. 2000).

The ALJ’s conclusion, adopted by the DAB, that the December 7

Letter constituted a withdrawal from the certification process

conducted in October 1999 is supported by substantial evidence

(which concededly may be subject to more than one plausible

interpretation), including Big Bend’s failure to object to the

December 20 Letter and Conejo’s request for a new certification

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2We have defined “substantial evidence” as “such relevant

evidence as a reasonable mind might accept to support a conclusion.

It is more than a mere scintilla and less than a preponderance.”

Harris v. Apfel, 209 F.3d 413, 417 (5th Cir. 2000) (citations and

internal quotation marks omitted).

3Federal courts generally defer to the Secretary’s

interpretation of Medicare legislation and its implementing

regulations, unless the interpretation is “plainly erroneous or

inconsistent” with that statutory authority. Harris Cty. Hosp.

Dist. v. Shalala, 64 F.3d 220, 221 (5th Cir. 1995).

5

survey in January 2000.2 The legal conclusion drawn from this

evidence -- that Big Bend was effectively certified on the date

that the second certification process was successfully completed,

February 3, 2000 -- is simply not inconsistent with or contrary to

the Medicare statute, 42 U.S.C. § 1395 et seq. (2004), and its

accompanying regulations, 42 C.F.R. § 488 et seq. (2004).3 As

such, we uphold the DAB’s determination of the effective date of

Big Bend’s participation in the Medicare program.

Further, the evidence that Big Bend would submit at an

evidentiary hearing (the essence of which is that Big Bend was in

compliance as of October 27 and that, in any event, Conejo did not

intend to withdraw Big Bend from the certification process on

December 7) is irrelevant if the December 7 Letter constitutes a

withdrawal from the October 1999 certification process. We have

upheld the DAB’s conclusion as to the legal effect of the December

7 Letter, and thus it follows that an evidentiary hearing clearly

would have been an empty formalism and a waste of administrative

resources. We hold, therefore, that the DAB correctly interpreted

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4Our sister circuits have also held that an agency’s appellate

process may either deny a hearing request or grant summary judgment

to the agency when the appellant cannot demonstrate, by relevant

evidence, the existence of a genuine issue of material fact to be

resolved during the hearing. See, e.g., J.D. v. Pawlet Sch. Dist.,

224 F.3d 60, 68-69 (2d Cir. 2000); P.R. Aqueduct & Sewer Auth. v.

EPA, 35 F.3d 600, 606 (1st Cir. 1994); Travers v. Shalala, 20 F.3d

993, 998 (9th Cir. 1994); Veg-Mix, Inc. v. U.S. Dept. of Agric.,

832 F.2d 601, 607 (D.C. Cir. 1987).

6

its regulations as not requiring such a hearing. Cf. Weinberger v.

Hynson, Westcott & Dunning, Inc., 412 U.S. 609, 617 (1973)

(reaching the same conclusion with respect to FDA regulations);

Panhandle Producers & Royalty Owners Ass’n v. Econ. Regulatory

Admin., 847 F.2d 1168, 1178 (5th Cir. 1988) (Department of Energy

regulations).4

III

Accordingly, the judgment of the district court is

AFFIRMED.

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