Opinion ID: 490603
Heading Depth: 2
Heading Rank: 1

Heading: Special Care Unit

Text: 14 42 C.F.R. Sec. 405.452(d)(10) (1978) determines whether the IMCU should be reimbursed as a special care unit. At all times relevant to the case the regulation provided as follows: 15 To be considered an intensive care unit, coronary care unit, or other special care inpatient hospital unit, the unit must be in a hospital, must be one in which the care required is extraordinary and on a concentrated and continuous basis and must be physically identifiable as separate from general patient care areas. There shall be specific written policies for each of such designated units which include, but are not limited to burn, coronary care, pulmonary care, trauma, and intensive care units but exclude postoperative recovery rooms, postanesthesia recovery rooms, or maternity labor rooms. 16 Id. The parties agree that the only requirement in dispute is whether the care provided by the IMCU is extraordinary and on a concentrated and continuous basis. 17 In 1977, the Secretary revised PRM Sec. 2202.7 to clarify the agency's position regarding the proper classification of subintensive units. 3 The Secretary contends that the facility in question must be compared to the categories of facilities enumerated in the regulations (burn, coronary, pulmonary care, trauma, and intensive care). If the facility in question is not comparable to the enumerated facilities, then it cannot qualify as a special care unit even though the facility renders care over and above the care that is rendered in a routine area. According to the Secretary's revised manual provision, a critical factor in this comparison is the level of nursing care provided by the facility seeking special care unit status. If the number of nursing hours per patient day for the facility in question are substantially lower than the number of nursing hours per patient day for a recognized special care unit (ICU or CCU), then the facility will not qualify as a special care unit. 18 We note that the issue surrounding the Secretary's interpretation is one of first impression in our court. The issue, however, is no stranger to other circuits. See St. Elizabeth Hosp. v. Bowen, 797 F.2d 449, 452 (7th Cir.1986); Butler County Memorial Hosp. v. Heckler, 780 F.2d 352, 355 (3d Cir.1985); Carraway Methodist Medical Center v. Heckler, 753 F.2d 1006, 1008-09 (11th Cir.1985); NKC, Inc. v. Secretary of Health & Human Services, 747 F.2d 1100, 1101 (6th Cir.1984), cert. denied, 471 U.S. 1016, 105 S.Ct. 2019, 85 L.Ed.2d 301 (1985); St. Elizabeth's Hosp. v. Secretary of Health & Human Services, 746 F.2d 918, 919 (1st Cir.1984) (per curiam); Lexington County Hosp. v. Schweiker, 740 F.2d 287, 289-90 (4th Cir.1984); Villa View Community Hosp. v. Heckler, 728 F.2d 539, 539-40 (D.C.Cir.1984) (per curiam); Sun Towers, Inc. v. Schweiker, 694 F.2d 1036, 1037 (5th Cir.1983). 19 We determine that the Secretary was entitled to revise PRM Sec. 2202.7 because the regulation is ambiguous. First, the terms extraordinary    concentrated and continuous encompass a variety of meanings. For example, the dictionary defines extraordinary as beyond what is usual, regular, common, or customary    [or] exceptional to a very marked extent. Webster's Third New Int'l Dictionary (unabridged) 807 (1967). 20 The Secretary maintains that extraordinary as used in the regulation refers to the latter meaning. Under the Secretary's approach, the level of care provided in the general routine patient care area is the usual, regular, and common level of care. To qualify as a special care unit, the Secretary contends that the level of care must be more than merely above that which is usual or common, it must be exceptional to a very marked extent. ICUs and CCUs provide such a level of exceptional care. Thus, the Secretary maintains it is necessary to compare the level of care in units seeking special care unit status to the level of care provided in an ICU or CCU to see whether the level of care provided is extraordinary    and on a concentrated and continuous basis. 21 Second, changes that had occurred in the medical industry highlighted the ambiguity in the regulation. The growth of health care services providing gradations of care instead of only intensive and general care necessitated a clarification of the regulation. We are not alone in ruling the regulation ambiguous because of changes in the health care industry. See Carraway Methodist Medical Center, 753 F.2d at 1010. 22 The Secretary's interpretation of an ambiguous regulation must still meet the test of reasonableness. See Columbus Community Hosp., 614 F.2d at 187. The Secretary's interpretation that hospital units seeking special care status must provide a level of care comparable to the level of care provided in recognized special care units is reasonable. See Butler County Memorial, 780 F.2d at 356-57; St. Elizabeth's Hosp., 746 F.2d at 919; John Muir Memorial Hosp. v. Schweiker, 664 F.2d 1337, 1338-39 (9th Cir.1981); White Memorial Medical Center v. Schweiker, 640 F.2d 1126, 1129 (9th Cir.1981). 23 The Hospital also argues that the Secretary's interpretation is inconsistent with the regulation. We disagree. First, the regulation does not expressly prohibit comparisons between hospital units seeking special care status and recognized units. Second, the regulation suggests that ICUs and CCUs are merely specific types of special care units themselves. Comparing recognized special care units to units seeking special care status is wholly consistent with the thrust of the regulation. 24 The Hospital next contends that revised PRM Sec. 2202.7 constituted a substantive change in the regulation. The Hospital argues that the manual revision effectively amended the regulation, and, therefore, a change was made in contravention of the rule-making process of the Administrative Procedure Act, 5 U.S.C. Sec. 553 (1982). 25 The Hospital's contention is without merit. First, provisions in the Provider Reimbursement Manual and amendments thereto are interpretive rules, not subject to the rule-making process of section 553. Columbus Community Hosp., 614 F.2d at 187; John Muir Memorial Hosp., 664 F.2d at 1339. Second, the Secretary issued the revised manual provision in response to changes that had occurred in the medical industry. Under this circumstance, the Secretary's action does not constitute a substantive change merely because he issues an interpretation of existing regulations that negatively affects the Hospital. 26 As to the application of PRM Sec. 2202.7, substantial evidence on the record as a whole supports the Secretary's determination that the Hospital's IMCU is not a special care unit. Although the level of care provided in the IMCU is greater than the level provided in a routine care unit, it is considerably less than that provided in an ICU or CCU. The Hospital's own evidence shows that the nurse-to-patient ratio and the number of nursing hours per patient for the IMCU are significantly less than the same figures for either the ICU or CCU. Written Hospital policy regarding the IMCU states that the unit's purpose is to provide care to patients who no longer require intensive care. Almost every measure of the level of care indicates that the IMCU does not provide the same kind of care as an intensive care unit. 27 Finally, the Hospital argues that by denying the IMCU special care unit status, the Secretary is unlawfully shifting Medicare costs to non-Medicare patients because the difference between the IMCU's utilization rate (59%) and the utilization rate for the routine care area (34.8%) will mean less reimbursement. 4 The Ninth Circuit rejected a similar argument as having no merit. See John Muir Memorial Hosp., 664 F.2d at 1339. If the Hospital's argument prevails, no cost could ever be disallowed because the cost could shift to non-Medicare patients. See St. Elizabeth's Hosp., 797 F.2d at 455. Because the Secretary reasonably determined that the IMCU did not qualify for reimbursement as a special care unit, his decision did not contravene the prohibition on cost-shifting. Accordingly, we affirm the district court's decision concerning the special care unit.