Opinion ID: 417775
Heading Depth: 3
Heading Rank: 1

Heading: Part B and McClure

Text: 22 McClure arose out of decisions by hearing officers denying the claims of three individuals seeking reimbursement for their expenditures for certain services under Part B. The claimants contended that the fact that the Secretary provided no review of the decision of the hearing officers denied them due process of law. After a detailed review of the existing procedures, the Supreme Court rejected this contention. 456 U.S. at 200, 102 S.Ct. at 1672. The Court noted that in order to make the administration of Part B more efficient, Congress had authorized the Secretary to contract with private insurance carriers to administer the payment of qualifying claims. Id. at 190, 102 S.Ct. at 1667. Part B claimants submit claims to the carrier for reimbursement for services they have received; the carrier decides initially whether the services were medically necessary, whether the charges are reasonable, and whether the claim is otherwise covered by Part B. Id. at 191, 102 S.Ct. at 1667; see 42 U.S.C. Sec. 1395y(a); 42 C.F.R. Sec. 405.803(b) (1981). 23 A claimant who is dissatisfied with the initial determination has one or more opportunities to appeal. First he is entitled to a review determination, in which he may submit written evidence and arguments of fact and law to a carrier employee other than the initial decision-maker; this employee then reviews the record and the written submissions and either affirms or adjusts the initial determination. See 42 C.F.R. Secs. 405.807-405.812 (1981). If the claimant is still dissatisfied and if the amount in dispute is $100 or more, the claimant has a right to an oral hearing before a hearing officer, appointed by the carrier, who has not previously participated in the case. See 42 U.S.C. Sec. 1395u(b)(3)(C); 42 C.F.R. Secs. 405.820-405.835 (1981); Schweiker v. McClure, supra, 456 U.S. at 191, 102 S.Ct. at 1667. Unless the carrier or the hearing officer decides to reopen the proceeding, the hearing officer's decision is final and binding upon all parties to the hearing .... 42 C.F.R. Sec. 405.835. Neither the statute nor any regulation makes provision for further review of the hearing officer's decision. See United States v. Erika, Inc., 456 U.S. 201, 102 S.Ct. 1650, 72 L.Ed.2d 12 (1982). 24 The Court pointed out that there is a strong presumption in favor of the validity of congressional action, Schweiker v. McClure, supra, 456 U.S. at 200, 102 S.Ct. at 1672, and that the Court had recognized Congress's  'solicitude for fair procedure,'  id. (quoting Califano v. Yamasaki, 442 U.S. 682, 693, 99 S.Ct. 2545, 2553, 61 L.Ed.2d 176 (1973)), and it concluded that the McClure claimants had not shown that the Part B procedures were unfair. 6 25 The Court noted that the district court, in holding that due process required additional review by a government hearing officer, had analyzed the three factors made relevant by Mathews v. Eldridge, 424 U.S. 319, 96 S.Ct. 893, 47 L.Ed.2d 18 (1976), to such a due process inquiry, to wit: 26 First, the private interest that will be affected by the official action; second, the risk of an erroneous deprivation of such interest through the procedures used, and the probable value, if any, of additional or substitute procedural safeguards; and finally, the Government's interest, including the function involved and the fiscal and administrative burdens that the additional or substitute procedural requirement would entail. 27 Id. at 335, 96 S.Ct. at 903. The Supreme Court found that its own analysis of the second Mathews factor led it to the opposite conclusion. Referring to the first and third Mathews factors, the Court assumed the correctness of the district court's view that the private interest in Part B payments was  'considerable,' though 'not quite as precious as the right to receive welfare or social security benefits,'  and the district court's estimate that the additional cost and inconvenience of providing administrative law judges would not be unduly burdensome. Schweiker v. McClure, supra, 456 U.S. at 198, 102 S.Ct. at 1671. As to the second Mathews factor, however, the Supreme Court rejected the district court's views (1) that the existing procedures were constitutionally inadequate because the carriers' hearing officers were not required to have law degrees or other formal training and (2) that more stringent requirements would reduce the risk of erroneous determinations. The Court stated that 28 the record does not support these conclusions. The Secretary has directed carriers to select as a hearing officer 29 an attorney or other qualified individual with the ability to conduct formal hearings and with a general understanding of medical matters and terminology. The [hearing officer] must have a thorough knowledge of the Medicare program and the statutory authority and regulations upon which it is based, as well as rulings, policy statements, and general instructions pertinent to the Medicare Bureau. App., 22, quoting Department of Health and Welfare Services, Medicare Part B Carriers Manual, p. 12-21 (emphasis added). 30 The District Court did not identify any specific deficiencies in the Secretary's selection criteria. By definition, a qualified individual already possessing ability and thorough knowledge would not require further training. The court's further general concern that hearing officers are not required to satisfy any threshold criteria overlooks the Secretary's quoted regulation. 31 Id. at 199, 102 S.Ct. at 1672 (footnote omitted). In sum, the Court concluded that the availability of appellate review by new hearing officers, together with the Secretary's criteria for the selection of these officers, provided sufficient procedural protection.