Opinion ID: 409579
Heading Depth: 3
Heading Rank: 1

Heading: Preclusion of Jurisdiction Under Section 405(h)

Text: 19 The Secretary's first argument is based on the premise that section 405(h) precludes federal question jurisdiction over claims for which the Medicare Act provides alternative routes of review. The Secretary then maintains that Appellees could have brought the present action under the provisions of 42 U.S.C. § 1395oo and concludes that jurisdiction under section 1331 is precluded. 28 Although we accept the Secretary's first premise, we are unable to agree with his second. Accordingly, we must reject his conclusion. 20 a. The availability of judicial review under section 1395oo. Section 1395oo was enacted in 1972 to provide for review of an intermediary's decision as to the amount of total program reimbursement due to the provider. 29 Under section 1395oo initial review of the intermediary's decision is made by the Provider Reimbursement Review Board (PRRB). 30 A provider dissatisfied with the PRRB's decision then has the right to obtain judicial review of that decision, or of any reversal, affirmance, or modification thereof by the Secretary, by filing a civil action in federal district court. 31 We conclude, however, that this route to judicial review is unavailable to Appellees in the present case. 21 In Humana this court noted that (c)onsideration by the Provider Reimbursement Review Board ... is (confined) to disputes over the amount properly reimbursable. 32 Appellees' substantive claim does not involve a dispute over the amount payable under the Act, nor does it involve Appellees' eligibility for reimbursement. Indeed, Appellees seek no money at all. They merely challenge the method of reimbursement, a concern that is not cognizable under section 1395oo. 22 The Secretary maintains that Appellees' claims are similar to those which we held were precluded by section 405(h) in Humana and in American Association of Medical Colleges v. Califano (AAMC). 33 However, the claims we found precluded in those cases were fundamentally different from that pressed by Appellees in the present litigation. In Humana the plaintiff challenged regulations limiting the amount of reimbursement, a challenge unmistakenly directed at upsetting on the merits the Secretary's determination on an element of cost-reimbursement. 34 We held that such a substantive challenge was precluded by section 405(h) because Humana's fundamental grievance ... centers on the amount of cost-reimbursement ... a subject amenable to Review Board adjudication. 35 In AAMC a group of Medicare providers challenged a regulation fixing limits on hospital in-patient general routine service costs. 36 We held that the district court did not have federal question jurisdiction because section 405(h) precluded jurisdiction over suits seeking eventual realization of provider-cost reimbursement under the Medicare Act. 37 Thus, in both Humana and AAMC the regulations attacked imposed limits on the amount of reimbursement. The issues raised in those cases were directly related to a claim for reimbursement. Appellees' claim, on the other hand, does not directly concern the amount of reimbursement they will receive. As noted above, it concerns the mode of reimbursement. 23 The Secretary further argues that the only reason Appellees are challenging the instruction is that they fear they will incur compliance costs that will not be fully reimbursed, and that therefore, the substantive claim is one seeking eventual realization of provider-cost reimbursement. However, regardless of the Appellees' motivation for bringing this suit, reimbursement is not its ultimate goal. Appellees seek to enjoin the Secretary from changing the method of processing payment claims. Granting the requested relief will not enable Appellees to receive larger reimbursements. As the district court recognized, Appellees do not seek any type of eventual monetary recovery on a reimbursement claim by this action. 38 24 Finally, the Secretary argues that if claims such as the Appellees' were not previously encompassed by the section 1395oo review provisions, they were brought under that section by a 1980 amendment to the Medicare Act. The 1980 amendment allows a provider to obtain judicial review of any action of the fiscal intermediary which involves a question of law or regulations relevant to the matters in controversy whenever the (PRRB) determines ... that it is without authority to decide the question. 39 The Secretary contends that the amendment evidences Congress' intent that claims related in any way to reimbursement disputes be challenged pursuant to section 1395oo rather than under section 1331. However, the legislative history behind the amendment reveals that it was not intended to broaden the scope of issues judicially reviewable under section 1395oo. 40 The 1980 amendment merely permits expedited judicial review of certain issues arising in reimbursement disputes otherwise reviewable under the statute. As explained above, the present claim cannot be characterized as a reimbursement dispute. Therefore, the 1980 amendment does not alter the justiciability of this claim under section 1395oo. 25 Because there is no alternative form of judicial review available to Appellees under the Medicare Act, the Secretary's first argument would appear to fail. However, because that argument is premised on the assumption that section 405(h) precludes only those claims for which the Medicare Act provides an alternative form of judicial review, the Secretary's conclusion would still be correct if section 405(h) barred claims arising under the Medicare Act for which no alternative form of judicial review is available. Thus, we must next determine the scope of section 405(h)'s preclusion. 41 26 b. The scope of section 405(h). In Weinberger v. Salfi 42 the Supreme Court held that section 405(h) precluded the exercise of federal question jurisdiction over a constitutional challenge to various provisions of the Social Security Act. However, the Court found that the challenge could be brought under a separate provision of the Social Security Act, 43 thereby implying that the result might have been different had no alternative form of judicial review been available. 44 Since Salfi the various courts of appeal have grappled with the issue of whether section 405(h) precludes federal question jurisdiction when no alternative form of judicial review is available. 45 Every court that has considered the issue has agreed that section 405(h) should be read so as to permit some avenue of judicial review for constitutional claims. 46 However, the result has not been so harmonious when the same courts have considered the effect of section 405(h) on otherwise non-reviewable statutory claims. 27 Three circuit courts have held that section 405(h) precludes all federal courts from exercising jurisdiction over claims arising under the Medicare Act even when no alternative form of judicial review is available. 47 Two courts of appeals have held that section 405(h) precludes the exercise of federal question jurisdiction over claims for which no alternative form of judicial review is available, but only after concluding that the Court of Claims had jurisdiction over such claims. 48 Finally, two circuit courts, the Sixth and the Second, along with the Court of Claims, have held that section 405(h) is not a bar to claims arising under the Medicare Act when there is no alternative form of judicial review available. 49 We agree with the district court that the view espoused by the Sixth and Second Circuits and the Court of Claims is the correct one. 28 We start with the well established principle that an agency bears a heavy burden of overcoming the strong presumption that Congress did not mean to prohibit all judicial review of an agency decision. 50 Thus, only upon a showing of 'clear and convincing evidence' of a contrary legislative intent should the courts restrict access to judicial review. 51 We conclude that the Secretary has failed to meet this heavy burden. 29 First, the Secretary has cited no legislative history which indicates that Congress intended to preclude jurisdiction over claims for which there was no alternative form of judicial review. Indeed, section 405(h) was incorporated into the Medicare Act only to the extent it was applicable. 52 (T)he entire thrust of the section is to prevent claimants who seek judicial review of their claims for benefits from bypassing the specific procedural requirements provided by Congress in the various acts. 53 Thus, (t)he subsection does not have a meaningful application in a case where no statutory review mechanism is available. 54 30 Second, precluding review of claims like the present one does not further the policy which led Congress to incorporate section 405(h) into the Medicare Act. As the Eighth Circuit noted, Congress adopted section 405(h) because permitting 31 (j)udicial review of the amount of all Medicare payments would bring the courts into the complex interplay between physician and hospital in ascertaining the appropriate medical charges for technical services .... These charges are subject to extensive and complicated statutory guidelines and regulations.... Determining the proper amount of these charges is a matter peculiarly suited to determination by a specialized agency. 55 32 These concerns are not present when actions like the present one are brought to challenge secretarial action unrelated to reimbursement disputes. 56 Finding no clear and convincing evidence to the contrary, we conclude that Congress, by incorporating section 405(h) into the Medicare Act to the extent applicable, did not intend to preclude judicial review of claims for which no alternative form of judicial review was available. Accordingly, we reject the Secretary's argument that section 405(h) precludes jurisdiction in the present case.