Court Opinion

ID: 8907974
Source: CourtListenerOpinion
Date Created: 2022-11-27 02:10:16.00797+00
Date Added: 2024-06-11T17:08:20.579595
License: Public Domain

SEITZ, Chief Judge,
dissenting.
Judge Aldisert’s opinion relies on the majority opinion filed today in Klein v. Califano, 586 F.2d 250 (3d Cir. 1978). In this dissent, therefore, I primarily address the reasoning in Klein, with some reference to the concurring opinion herein.
Klein holds that due process requires that residents of an intermediate health care facility be given an opportunity for a hearing before decertification of that facility. Initially, the Klein majority postulates that HEW’s regulations grant residents a “property right” not to be transferred without cause. As its minor premise, the majority asserts that an initial administrative decision to decertify an institution is tantamount to an order to transfer. We are to deduce, then, that Medicaid residents are constitutionally entitled to an opportunity to participate in the proceedings that may lead to an initial decertification. I cannot agree either with the majority’s premises or with its conclusion.
The majority recognizes, as it must, that due process would place procedural constraints on HEW only if the residents’ interests in continued occupancy enjoy the stature of “property.” An independent source, here the Medicaid law and regulations, must create the “underlying substantive interest” that is to be accorded this stature; federal constitutional law then determines whether that interest “rises to the level of a ‘legitimate claim of entitlement’ protected by due process.” Memphis Light, Gas & Water Division v. Craft, 436 U.S. 1, 9, 98 S.Ct. 1554, 1560, 56 L.Ed.2d 30 (1978).
The majority finds that continued residency in the nursing home of one’s choice absent specific cause for transfer is an underlying substantive interest created by three Medicaid provisions. Under the first, 42 U.S.C. § 1396a(a)(23), a Medicaid recipient may obtain medical care “from any institution . . . qualified to perform the service or services required.” Clearly, what the majority characterizes as a recipient’s right to obtain medical care from a “freely selected provider” is limited to a choice among institutions which have been determined by the Secretary to be “qualified.” Next, the majority’s reliance on 45 C.F.R. § 205.10(a)(5), ensuring a notice and hearing to a recipient whose benefits are suspended, reduced, discontinued or terminated, is obviously misplaced. As the ma*296jority itself notes, the decertification of these facilities did not reduce or suspend the residents’ rights to continued benefits.
Finally, the majority relies upon 45 C.F.R. § 249.12(a)(l)(ii)(B)(4),1 which establishes as one requirement for an institution’s certification that each resident admitted to that institution be “transferred or discharged only for medical reasons or for his welfare or that of other patients, or for nonpayment for his stay.” The majority reads this provision as a limitation on the Secretary’s power to interrupt a recipient’s residence at a particular institution. Clearly, however, this provision is a standard of conduct imposed by the Secretary upon the provider. Violation of this standard is one of many grounds for decertifying the offending institution. See 45 C.F.R. §§ 249.-38(a)(2), 249.10(b)(15). The provision creates no “substantive interest” in the residents vis-a-vis the Secretary.
Moving to its minor premise, the majority postulates that a decision to decertify is tantamount to a decision to transfer individual residents. Practically, of course, this may be a consequence in most cases, at least where an institution fails to remedy its insufficiencies. Analytically, however, the two decisions are different. Decertification focuses on the institution’s noncompliance with HEW’s standards. The majority does not and cannot contend that recipients have a right to remain in an institution that the Secretary has found, by appropriate procedures, to be in substantial noncompliance with the standards. “Transfer trauma,” although a legitimate concern for some residents, is necessarily subordinate to the threat posed to all residents by substandard conditions.
Thus, a careful reading of the provisions cited by the majority reveals that neither statutes nor regulations grant the residents of an intermediate health care facility a “substantive interest” in decertification proceedings brought by the Secretary; hence, the residents have no constitutionally protected property right in uninterrupted occupancy.
The concurring opinion in this case concedes that “[t]aken alone, the interest created by each of [these provisions] might be dismissed as not rising to the level of a cognizable property interest.” Nonetheless, we are asked to agglomerate these “three distinct points” into a “landscape of a ‘legitimate claim of entitlement.’ ” Each of the provisions governs an isolated and inapposite aspect of the program’s administration. Their effect as a whole, then, cannot be greater than the sum of their parts. Nor is such infirmity rehabilitated by expressions of concern, in which I join, for the welfare of patients generally.
There is nothing harsh or unrealistic about the scope of present statutory and administrative procedures governing decertification. Significantly, a decertification of a non-complying facility does not terminate or otherwise prejudice the rights of the residents to continued Medicaid benefits. Their benefits will be paid so long as they reside in an intermediate health care facility that complies with federal standards. This important fact immediately distinguishes the cases, employed by the majority in Klein, in which the individual involved suffered possible direct prejudice to some substantive liberty or property interest.2
Furthermore, and of substantial significance, there is resident input in the survey that must precede an initial decertification. We may take judicial notice of a document entitled “Long Term Care Facilities Surveyor’s Orientation Manual” published in September 1976 by the Pennsylvania Department of Health. On pages III 8-9 of the Manual, in a section entitled “Survey Methodology,” the Manual notes that an on-site survey “generally involves” inter*297views with residents. On page III — 7 the Manual suggests that the surveyor at times may have to assume the role of “patient advocate.”
A nursing home is not even initially terminated until elaborate proceedings conducted by professionals have resulted in a determination that the institution is not complying substantially with the provisions of its agreement with the Secretary. Here, the survey team consisted of two registered nurses, a dietician, and an equal opportunity development specialist. See Town Court v. Beal, 586 F.2d 266 (3d Cir. 1978).
While the Medicaid program itself has been enacted for the benefit of the residents, the survey proceedings are necessarily concerned with the applicable conditions of participation as set forth in the regulations. One should not lose sight of the fact, however, that the ongoing monitoring of participating health care facilities is primarily designed to protect the health and safety of the residents.
In many cases residents would not be in physical or medical condition to participate even minimally in a decertification hearing. Indeed, it is not clear what duties the majority in Klein would impose upon the Secretary where senile or incompetent residents are incapable of representing their own interests. Furthermore, since all such facilities must be surveyed annually, it is evident that the majority’s position would require that residents be afforded “due process” rights in all surveys and, presumably, in judicial review of their sufficiency.
The provider, of course, has a vested interest in “defending” his institution during any survey and so may be expected to adduce the best case for continued certification. Furthermore, he is the one who can correct deficiencies and thus avoid a termination.
Both the law and the facts dictate the conclusion that the mandated initial termination procedures do not deprive these residents of due process.
I would affirm the order of the district court refusing to extend portions of the preliminary injunction (No. 77-2222) and I would reverse the order of the district court continuing in effect part of the preliminary injunction (No. 77-2444).
ROSENN and JAMES HUNTER, III, Circuit Judges, join in this dissent.

. 45 C.F.R. § 249 (1976) has been recodified at 42 C.F.R. § 449 (1977). In conformity with the majority opinion all citations to that section will be to the earlier codification.

. Memphis Light, Gas & Water Division v. Craft, 436 U.S. 1, 98 S.Ct. 1554, 56 L.Ed.2d 30 (1978); Arnett v. Kennedy, 416 U.S. 134, 94 S.Ct. 1633, 40 L.Ed.2d 15 (1974); Perry v. Sindermann, 408 U.S. 593, 92 S.Ct. 2694, 33 L.Ed.2d 570 (1972); Board of Regents v. Roth, 408 U.S. 564, 92 S.Ct. 2701, 33 L.Ed.2d 548 (1972).