Big Bend Hospital Corp. v. Thompson , 88 F. App'x 4 ( 2004 )

United States Court of Appeals
Fifth Circuit
F I L E D
IN THE UNITED STATES COURT OF APPEALS
January 30, 2004
FOR THE FIFTH CIRCUIT
_____________________ Charles R. Fulbruge III
Clerk
No. 03-50201
_____________________
BIG BEND HOSPITAL CORP., doing business as
Big Bend Regional Hospital Medical Center,
Plaintiff-Appellant,
versus
TOMMY G. THOMPSON, SECRETARY, DEPARTMENT
OF HEALTH & HUMAN SERVICES,
Defendant-Appellee.
__________________________________________________________________
Appeal from the United States District Court
for the Western District of Texas
USDC No. P-02-CV-30
_________________________________________________________________
Before JOLLY, HIGGINBOTHAM, and DeMOSS, Circuit Judges.
PER CURIAM:*
Big Bend Hospital Corporation (“Big Bend”) appeals the
district court’s grant of summary judgment in favor of the
Secretary of the Department of Health and Human Services (the
“Secretary” of “HHS”). Big Bend contends that the HHS Departmental
Appeals Board (“DAB”) incorrectly determined February 3, 2000, to
be the effective date of participation in the Medicare program, and
that the Administrative Law Judge (“ALJ”) improperly denied Big
Bend an in-person administrative hearing to contest the accuracy of
*
Pursuant to 5TH CIR. R. 47.5, the Court has determined that
this opinion should not be published and is not precedent except
under the limited circumstances set forth in 5TH CIR. R. 47.5.4.
this date. We hold that the effective date determination was
supported by substantial evidence and that the DAB applied the
appropriate legal standard under the relevant statutes and
regulations. We further hold that an evidentiary hearing would
have been futile. We therefore AFFIRM the summary judgment.
I
In 1999, Big Bend applied to participate in the Medicare
program, which is administered by the Centers for Medicare and
Medicaid Services (“CMS”), an HHS agency. Medicare regulations
require CMS to enter into agreements with state survey agencies,
which make recommendations to CMS as to whether surveyed facilities
are Medicare compliant and deserve certification. 42 C.F.R. §
488.10 (2004).1 CMS has such an agreement with the Texas
Department of Health (“TDH”).
TDH completed an initial certification survey on October 7,
1999 (“October 7 Survey”), and, after concluding that Big Bend
failed to meet multiple conditions, recommended that CMS deny Big
Bend’s application. Three weeks later, TDH conducted a second
certification survey (“October 27 Survey”), found Big Bend in
compliance, and recommended approval of Big Bend’s application.
CMS, apparently skeptical that the deficiencies noted in the
October 7 Survey could have been rectified so quickly, made an
1
The current versions of the relevant statutes and regulations
are the same as those in effect at the time of the operative facts
of this case.
2
unannounced visit to Big Bend to conduct another survey (“December
7 Survey”). The federal surveyors found serious deficiencies,
similar to the deficiencies noted in the October 7 Survey, but
before the survey was completed Big Bend officials asked CMS to end
the survey. Chief Executive Officer David Conejo then submitted a
“formal request to withdraw” from the survey process (“December 7
Letter”). CMS confirmed Big Bend’s withdrawal in writing
(“December 20 Letter”), and informed Big Bend that it could reapply
for certification at any time. Neither Conejo nor any other Big
Bend official objected to CMS’ characterization of the December 7
Letter as a withdrawal from the certification process.
In early January 2000, Conejo notified CMS that Big Bend would
be prepared for a survey by January 12, and requested a new survey
at that time. On February 3, Big Bend was re-surveyed by a team of
officials from TDH and CMS (“February 3 Survey”), who concluded
that Big Bend complied with Medicare requirements and recommended
certification. CMS accepted the recommendation and certified Big
Bend for Medicare participation effective February 3, 2000.
Big Bend, wishing to claim Medicare reimbursements for
services rendered before February 3, disagreed with the
certification date. It contended that the proper date was October
27, 1999, when TDH surveyors originally had recommended
certification. CMS denied Big Bend’s request for reconsideration.
After denying an in-person hearing, the ALJ ruled that, by both
withdrawing from the December 7 Survey (which, if successful, would
3
have had the effect of validating the October 27 Survey) and asking
for a new “certification” survey, Big Bend had abandoned its claim
to an effective date of October 27. The DAB affirmed the ALJ’s
decision, concluding that, whatever Big Bend’s intent may have
been, the December 7 Letter legally constituted a withdrawal from
the certification process.
Invoking the judicial review provision of the Medicare Act, 42
U.S.C. § 1395cc(h)(1) (2004), Big Bend appealed the DAB’s decision
to the district court, which granted summary judgment to the
Secretary. Big Bend filed a timely notice of appeal.
II
We review grants of summary judgment de novo, applying the
same standards as the district court. Hall v. Gillman, Inc., 81
F.3d 35, 36-37 (5th Cir. 1996). Notwithstanding the various
subsidiary arguments made by Big Bend, our review is limited to a
determination as to whether DAB’s findings of fact are supported by
substantial evidence and whether the DAB applied the proper legal
standards in reaching its decision. 42 U.S.C. § 405(g) (2004);
Estate of Morris v. Shalala, 207 F.3d 744, 745 (5th Cir. 2000).
The ALJ’s conclusion, adopted by the DAB, that the December 7
Letter constituted a withdrawal from the certification process
conducted in October 1999 is supported by substantial evidence
(which concededly may be subject to more than one plausible
interpretation), including Big Bend’s failure to object to the
December 20 Letter and Conejo’s request for a new certification
4
survey in January 2000.2 The legal conclusion drawn from this
evidence -- that Big Bend was effectively certified on the date
that the second certification process was successfully completed,
February 3, 2000 -- is simply not inconsistent with or contrary to
the Medicare statute, 42 U.S.C. § 1395 et seq. (2004), and its
accompanying regulations, 42 C.F.R. § 488 et seq. (2004).3 As
such, we uphold the DAB’s determination of the effective date of
Big Bend’s participation in the Medicare program.
Further, the evidence that Big Bend would submit at an
evidentiary hearing (the essence of which is that Big Bend was in
compliance as of October 27 and that, in any event, Conejo did not
intend to withdraw Big Bend from the certification process on
December 7) is irrelevant if the December 7 Letter constitutes a
withdrawal from the October 1999 certification process. We have
upheld the DAB’s conclusion as to the legal effect of the December
7 Letter, and thus it follows that an evidentiary hearing clearly
would have been an empty formalism and a waste of administrative
resources. We hold, therefore, that the DAB correctly interpreted
2
We have defined “substantial evidence” as “such relevant
evidence as a reasonable mind might accept to support a conclusion.
It is more than a mere scintilla and less than a preponderance.”
Harris v. Apfel, 209 F.3d 413, 417 (5th Cir. 2000) (citations and
internal quotation marks omitted).
3
Federal courts generally defer to the Secretary’s
interpretation of Medicare legislation and its implementing
regulations, unless the interpretation is “plainly erroneous or
inconsistent” with that statutory authority. Harris Cty. Hosp.
Dist. v. Shalala, 64 F.3d 220, 221 (5th Cir. 1995).
5
its regulations as not requiring such a hearing. Cf. Weinberger v.
Hynson, Westcott & Dunning, Inc., 412 U.S. 609, 617 (1973)
(reaching the same conclusion with respect to FDA regulations);
Panhandle Producers & Royalty Owners Ass’n v. Econ. Regulatory
Admin., 847 F.2d 1168, 1178 (5th Cir. 1988) (Department of Energy
regulations).4
III
Accordingly, the judgment of the district court is
AFFIRMED.
4
Our sister circuits have also held that an agency’s appellate
process may either deny a hearing request or grant summary judgment
to the agency when the appellant cannot demonstrate, by relevant
evidence, the existence of a genuine issue of material fact to be
resolved during the hearing. See, e.g., J.D. v. Pawlet Sch. Dist.,
224 F.3d 60, 68-69 (2d Cir. 2000); P.R. Aqueduct & Sewer Auth. v.
EPA, 35 F.3d 600, 606 (1st Cir. 1994); Travers v. Shalala, 20 F.3d
993, 998 (9th Cir. 1994); Veg-Mix, Inc. v. U.S. Dept. of Agric.,
832 F.2d 601, 607 (D.C. Cir. 1987).
6