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Glassman v. Azar

United States District Court, E.D. California

July 8, 2019

LINDA GLASSMAN, Plaintiff,
v.
ALEX M. AZAR, II, in his official capacity as Secretary of the Department of Health and Human Services, Defendant.

          MEMORANDUM DECISION AND ORDER DENYING PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT AND GRANTING DEFENDANT'S MOTION FOR SUMMARY JUDGMENT (ECF NOS. 16, 17)

          LAWRENCE J. O'NEILL, UNITED STATES CHIEF DISTRICT JUDGE

         I. INTRODUCTION

         Plaintiff Linda Glassman seeks review of a May 9, 2018, decision of the Department of Health and Human Services' (“DHS”) Medicare Appeals Council denying reimbursement for the cost of air ambulance transport from Maui, Hawaii, to Fresno, California. ECF No. 1. In February 2019, Defendant Alex M. Azar-sued here in his official capacity as the Secretary of DHS (“Secretary”)-and Plaintiff each filed Motions for Summary Judgment. ECF Nos. 16, 17. Replies from Plaintiff and Defendant were filed in March 2019. ECF Nos. 18, 19. The motions were taken under submission on the papers pursuant to Local Rule 230(g). ECF No. 20. For the following reasons, Plaintiff's Motion for Summary Judgment is DENIED and Defendant's Motion for Summary Judgment is GRANTED.

         II. BACKGROUND

         On May 26, 2017, Plaintiff slipped and fell while on vacation in Maui, Hawaii. Administrative Record (“AR”), ECF No. 15-1, at 17. An ambulance transported her 40 miles to Maui Memorial Medical Center Outpatient Clinic. Id. She was diagnosed with a shattered left kneecap, fractured left femur, fractured left pelvis, dislocated left hip, and dislocated left rectus muscles. Id. Plaintiff asserts that she was given medical advice to return home to Fresno to have her surgery done by a hip and knee specialist who could also oversee her rehabilitation and post-operative care. AR 13-14. Plaintiff's son garnered bids from three air ambulance companies. AR 18. Plaintiff selected the lowest of the three bids and paid approximately $50, 000 by wire transfer. Id.

         Plaintiff's spouse submitted a claim for reimbursement to Medicare for the cost of transportation on June 16, 2017. AR 85. On June 28, 2017, the Medicare contractor denied coverage for Plaintiff's Medicare claim. AR 79, 81. The Medicare program provides for five levels of appeal of an initial determination: 1) redetermination; 2) reconsideration; 3) an Administrative Law Judge (“ALJ”) hearing; 4) a Medicare Appeal Council (“MAC”) hearing; and 5) judicial review in a United States District Court. 42 U.S.C. §§ 1395ff(a)(1)-(d)(2); 42 C.F.R. §§ 405.940-.1136. Plaintiff requested redetermination, which also resulted in a decision of no coverage on August 17, 2017. AR 63. Plaintiff sought reconsideration and was again denied coverage on October 31, 2017. AR 50. Plaintiff requested a decision by an ALJ based on the evidence in the record, waving a hearing. AR 17. The ALJ also denied coverage on January 18, 2018. AR 26. Plaintiff appealed to the MAC, who adopted the ALJ's decision denying coverage on May 9, 2018. AR 7. This final decision from the MAC is the official decision of the Secretary. 42 C.F.R. § 405.1136(d). This exhausts Plaintiff's administrative remedies and permits her to seek judicial review. 42 C.F.R. § 405.1136(a).

         III. STANDARD OF DECISION

         A beneficiary may seek judicial review of an unsatisfactory determination regarding their Medicare benefits so long as they first exhaust the administrative appeals process. 42 U.S.C. § 1395ff(b)(2)(C); 42 C.F.R. § 405.1136. Judicial review of an exhausted Medicare claim dispute is governed by the Administrative Procedure Act, 5 U.S.C. §§ 701-706, which provides that an agency's decision “will be affirmed unless it is arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with the law.” Int'l Rehab. Scis. Inc. v. Sebelius, 688 F.3d 994, 1000 (9th Cir. 2012) (explaining review standard established by 5 U.S.C. § 706) (internal quotation marks omitted). The findings are conclusive if they are supported by “substantial evidence, ” which is defined to mean “such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.” Id. An agency's determination can be overturned as arbitrary and capricious if:

[T]he agency relied on factors which Congress had not intended it to consider, entirely failed to consider an important aspect of the problem, offered an explanation for its decision that runs counter to the evidence before the agency, or is so implausible that it could not be ascribed to a difference in view or the product of agency expertise.

Nat'l Ass'n of Home Builders v. Defenders of Wildlife, 551 U.S. 644, 645 (2007) (internal quotation marks omitted).

         IV. ANALYSIS

         The burden of proving each element of a Medicare claim lies with the beneficiary by a preponderance of the evidence, which must be satisfied through the submission of sufficient competent evidence in accordance with Medicare rules. See Sections 1814(a)(1), 1815(b), and 1833(e) of the Social Security Act; 42 C.F.R. § 424.5(a)(6), 42 C.F.R. § 405.1018, 42 C.F.R. § 405.1028, and 42 C.F.R. § 405.1030. Payment is contingent upon the beneficiary meeting their burden of proof. In the Case of Custom Healthcare, No. M-11-1771, 2012 WL 1671506, at *2 (H.H.S. MAC Mar. 2, 2012).

         A. The Secretary's Determination to Deny Payment Due to Regulations Limiting Coverage to Transport to the Nearest Appropriate Facility

         Ambulance services are only covered by Medicare if they meet regulatory requirements. 42 U.S.C. § 1395x(s)(7). In this case coverage was denied by the MAC based on 42 C.F.R. § 410.40(e)(1), which provides that ambulance transportation is only covered “[f]rom any point of origin to the nearest [facility] that is capable of furnishing the required level and type of care.” AR 5. See also Downing v. Dep't of Health and Human Servs., No. 1:12-CV-22, 2013 WL 1281795, at *3 (N.D. Ind. Mar. 6, 2013) (supporting a decision denying coverage pursuant to § 410.40(e)(1) because the destination was not the proper type of facility); In the Case of Eagle Med, No. M-12-1937, 2012 WL 10067674, at *2-3 (H.H.S. MAC, Nov. 8, 2012) (denying coverage for transport beyond the nearest appropriate facility). This rule is further clarified in the Medicare Benefit Policy Manual[1], 100-02, Chapter 10, Section 20, item #5, which says that if the patient is not transported to the nearest appropriate facility, Medicare will make partial payment, but only the amount that would have been payable had the patient been transported to the nearest appropriate facility. An “appropriate facility” is defined in accordance with 42 C.F.R. § 410.40(e)(1) by the Medicare ...


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