Opinion ID: 454901
Heading Depth: 1
Heading Rank: 3

Heading: the therapeutic value of the educational services

Text: 9 The PRRB determined that the educational services in question are not an integral part of the therapy modality. 3 This finding is not supported by substantial evidence. The only evidence presented to the Board about the nature of the services was the testimony of Dr. Moore. According to Dr. Moore, the educational services are as much a part of therapy as are other routine covered services such as group therapy and recreational therapy. Like other forms of treatment, they are integrated into each child's individualized treatment program. An assessment of a child's intellectual development and a scholastic achievement evaluation are made when he or she is admitted to the hospital, and a plan for the educational component becomes an official part of the multi-disciplinary treatment plan supervised by the treating physician. Entrance to an educational program is by doctor's order, and progress is documented on the patient's medical chart. The hospitals consider the educational services, which are supervised by the hospitals' medical staffs rather than the local school boards, as clinical services. 10 The Secretary does not argue that Dr. Moore is not a qualified expert. Nor did she present any experts of her own. Throughout the proceedings, the Secretary has contended that education is not treatment, but she has failed to provide any evidence--testimonial or documentary--to support this contention. The Secretary relies instead on a section of the Provider Reimbursement Manual that contains her own interpretation of the Medicare regulations. The Manual provides: 11 Vocational and Scholastic Training Expense-- 12 The costs attributable to vocational, scholastic, or similarly oriented training activities conducted by providers on behalf of patients are not allowable costs. For example, costs incurred by a psychiatric facility in operating an elementary or secondary school for patients are unallowable costs. 13 Medicare Health Insurance Manual No. 15 Sec. 2104.5 (Rev.199 April 1978). 14 As the Secretary concedes, the manual provision is not evidence. Moreover, we see no reason why we should accept her opinion, as expressed in the manual provision, rather than that of the medical expert. Defining what is necessary medical treatment does not appear to be one of those areas in which the Secretary has sufficient expertise that we should give unbridled deference to her interpretation. Cf. Advanced Health Systems, 510 F.Supp. at 968-69 (alcoholism expert's opinion of what services were related to treatment, rather than the Secretary's interpretation of regulation, considered determinative in Medicare reimbursement case). Outside of the Medicare context, in related areas, courts have concluded that physicians, not administrative agencies, have responsibility for determining what constitutes necessary medical treatment. See Beal v. Doe, 432 U.S. 438, 445 n. 9, 97 S.Ct. 2366, 2371 n. 9, 53 L.Ed.2d 464 (1977) (physicians decide which abortions are medically necessary and therefore reimbursable under Medicaid); Pinneke v. Preisser, 623 F.2d 546, 550 (8th Cir.1980) (The decision of whether or not certain treatment or a particular type of surgery is 'medically necessary,' [and therefore reimbursable under Medicaid] rests with the individual recipient's physician and not with clerical personnel or government officials.). In the Social Security disability-compensation context, the ALJ can reject the opinion of the claimant's physician on the ultimate issue of disability only by presenting clear and convincing reasons for doing so. Coats v. Heckler, 733 F.2d 1338, 1340 (9th Cir.1984); Montijo v. Secretary of Health and Human Services, 729 F.2d 599, 601 (9th Cir.1984). 15 In a recent case in this circuit the Secretary relied on a similar method of litigating a Medicare reimbursement issue, and was equally unsuccessful. In Villa View Community Hospital, Inc. v. Heckler, 720 F.2d 1086 (9th Cir.1983), the Secretary failed to present any evidence to support her contention that generally accepted accounting principles prohibited the amortization of the costs in question. Id. at 1094. Instead she attacked the credibility of the provider's expert witnesses. We refused to affirm an unsupported finding by the Secretary when the only evidence in the record supported the provider. Id.; see also Saint Mary, 718 F.2d at 473 (once hospitals presented evidence that Secretary failed to pay for necessary and appropriate services, Secretary had burden of presenting rebuttal evidence). In this case, the Secretary does not even attack Dr. Moore's credibility; she merely disagrees with his conclusions. Once again, we find the Secretary's mode of argument wholly unpersuasive. 16 Furthermore, in order to participate in the Medicare program Vista Hill is required to provide the educational services at issue. The Medicare regulations specify that a psychiatric hospital must meet the accrediation requirements of the Joint Commission for the Accreditation of Hospitals (JCAH) to qualify for reimbursement. 42 C.F.R. Sec. 405.1036(a) (1984). JCAH requires that psychiatric facilities provide hospitalized children with appropriate, individually tailored educational services of the sort provided here. See Joint Commission on Accreditation of Hospitals, Accreditation Manual for Psychiatric Facilities Serving Children and Adolescents 71-72 (1983) [hereinafter cited as JCAH Manual ]. Accordingly, if Vista Hill did not provide the services, it would not qualify as a Medicare provider. Generally, whenever a hospital expenditure is required either for the hospital to operate, or for the hospital to be qualified as a Medicare service provider, the costs are reimbursable. See, e.g., Annie M. Warner Hospital v. Harris, 639 F.2d 961, 963 (3d Cir.1981) (dues payments necessary to secure continued insurance coverage, without which hospital could not legally operate, are a reimbursable cost); Moody Nursing Home, Inc. v. United States, 621 F.2d 399, 400 (Ct.Cl.1980) (costs of utilization review plan, without which skilled nursing home could not qualify as a Medicare provider, are apportionable costs under Medicare); cf. Walter O. Boswell Memorial Hospital v. Heckler, 749 F.2d 788, 798-800 (D.C.Cir.1984) (questioning the exclusion of malpractice insurance costs from apportionment as routine costs in light of the fact that malpractice insurance is required). 17 The JCAH standards mandating educational services, as well as Dr. Moore's testimony, make it clear that the services provided by Vista Hill are related to treatment. In addition to discussing the academic achievement goals of such services, the JCAH standards note both the therapeutic considerations involved in providing them and the therapeutic objectives they serve. JCAH Manual, supra p. 9, at 71. According to the legislative history of the Medicare Act itself, the reason hospitals are required to comply with JCAH requirements is to ensure that providers will satisfy professionally established treatment norms. See S.Rep. No. 404, 89th Cong., 1st Sess. 29, reprinted in 1965 U.S.Code Cong. & Ad.News. 1943, 1970. 18 Because psychiatric treatment for children must, medically and legally, include the type of educational services provided by Vista Hill, the costs of those services are necessary and proper. There is no evidence to support the PRRB's conclusion that they are not related to treatment. To the extent the Board's determination is based on its conclusion that the educational services are not an integral part of the therapy modality, we find it to be arbitrary and capricious. Thus, we cannot affirm the PRRB's denial of reimbursement on the first ground on which it relied in reaching its decision. 19