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Saint Vincent Indianapolis Hospital v. Sebelius

United States District Court, District of Columbia

September 29, 2015



Royce C. Lamberth United States District Judge

Plaintiff Saint Vincent Hospital and Health Care Center, Inc., ("plaintiff') filed suit against Defendant Kathleen Sebelius, Secretary of the Department of Health and Human Services ("defendant"), alleging agency error in limiting the scope of administrative review to issues identified by providers in cost reports under the Medicare program established by Title XVIII of the Social Security Act, as amended. Compl., ECF No. 1. Defendant filed an answer, generally denying all factual allegations and referring the Court to statute and relevant case law for interpretations of legal points raised in the complaint. Answer, ECF No. 11. Plaintiff then filed this motion for Summary Judgment. Mot. Summ. J., ECF No. 17. Defendant filed a cross motion for summary judgment and memorandum in support of summary judgment and in opposition to plaintiffs motion for summary judgment. Cross-Mot. Summ. J., ECF No. 18, Mem. Supp. Mot. Summ. J Opp'n PL's Mot. Summ. J., ECF No. 18-1. Plaintiff then filed a reply in opposition. Reply Opp'n Mot. Summ. J., ECF No. 20. Lastly, defendant filed a reply. Reply Opp'n. Mot. Summ. J. Combined Opp'n. PL's Mot. Summ. J., ECF No. 23.


Plaintiff filed suit appealing the decisions of the Provider Reimbursement Review Board ("PRRB") under 42 U.S.C. § 1395oo. Compl, ECF No. 1. Specifically, plaintiff alleges that the PRRB has improperly limited the scope of administrative review to several issues that plaintiff raised with regard to its fiscal year 1999 Medicare reimbursement. Id. Throughout the administrative appeal process, plaintiff raised six issues[1], the procedural history of which is outlined in the complaint. Id. Ultimately, the PRRB ruled that plaintiff had not adequately established the dissatisfaction element required under § 1395oo(a) for the first three issues. Id. The PRRB further found that the second three issues were not timely added to the appeal and therefore were not preserved for stand-alone appeal. Id.

Plaintiff requests the Court find that plaintiff met the dissatisfaction requirement under § 1395oo(a), that the amount in controversy is $10, 000 or more, that plaintiff timely filed a request for hearing before the PRRB, that plaintiff is entitled to a hearing before the PRRB with respect to the fiscal year 1999 program reimbursement, and that the PRRB has jurisdiction over all issues raised by plaintiff. Id.

Defendant generally and specifically denies all conclusions of law and most statements of fact advanced by plaintiff in its answer. Answer, ECF No. 11. Defendant further asserts that the Court's subject matter jurisdiction is limited to review of any final agency actions within the scope of § 1395oo(f)(1) and that the complaint fails to state a claim upon which relief can be granted. Answer, ECF No. 11 at 1.

Plaintiff then filed its motion for summary judgment in which, pursuant to Fed.R.Civ.P. 56, plaintiff alleges there is no genuine issue of material fact and that plaintiff is therefore entitled to judgment as a matter of law on each of its claims. Mot. Summ. J., ECF No. 17 at 1. Defendant files a cross-motion for summary judgment and her memorandum in support of her cross-motion and in opposition of plaintiff s motion. Cross-Mot. Summ. J., ECF No 18, and Mem. Supp. Mot. Summ. J. Opp'n. PL's Mot. Summ. J., ECF No 18-1. The remaining filings are outlined above. The Court now turns to analyze the matters presented in both parties' motions.


The crux of the matter before the Court surrounds defendant's interpretation of the dissatisfaction provision found in § 1395oo(a). The Court's determination on this point informs and guides the Court in ruling on each party's (cross-)motion for summary judgment. This Court's review of the case at bar is guided by the Administrative Procedures Act ("APA"). 5 U.S.C. §§ 701-706. The Court notes that the APA provides a decidedly narrow standard of review. Mem. Supp. Cross-Mot. Summ. J., ECF No. 18-1 at 12 (citing Southern Co. Servs., Inc. v. FCC, 313 F.3d 574, 580 (DC. Cir. 2002), Hillcrest Riverside, Inc. v. Sebelius, 680 F.Supp.2d 30, 35 (D.D.C. 2010). The Court's analysis under APA provisions requires the two tier analysis outlined in Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., to determine whether defendant's interpretation warrants deference. 467 U.S. 837 (1984). The Court applies the D.C. Circuit's rationale that, "to the extent HHS has based its decision on the language of the Medicare Act itself, we owe deference under Chevron U.S.A. Inc. v. Natural Resources Defense Council, 467 U.S. 837, 843-845 (1984)." Marymount Hosp., Inc. v. Shalala, 19 F.3d 658, 661 (D.C. Cir. 1994).

a. Plaintiff's Motion for Summary Judgment

i. A Medicare Provider's Right to Administrative Hearing

Plaintiff primarily relies upon a provider's right to an administrative hearing under § 1395oo. Mem. Supp. Mot. Summ. J., ECF No. 17-1 at 4-8. Plaintiff asserts that Congress "has clearly established conditions under which a Medicare Provider is entitled to challenge an FI/MAC[2]'s determination of reimbursement." Id. at 4. Plaintiff identifies three criteria to obtain a hearing before the PRRB under § 1395oo(a); dissatisfaction with the total program reimbursement to the provider, the amount in controversy being $10, 000 or more, and the provider filing for a hearing within 180 days after notice. Id. As the Court has identified, the crux of this matter lay in the first criteria related to the dissatisfaction requirement found in § 1395oo(a), although the third criteria is implicated as well.

ii. Dissatisfaction Requirement

Section 1395oo(a) sets forth requirements to be heard before a PRRB. The ...

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