TRAVIA, District Judge.
Plaintiff moves this court for an order, pursuant to Rule 56 of the Federal Rules of Civil Procedure, granting it summary judgment on all the claims set forth in the complaint. Defendants respond by cross-moving for an order dismissing the complaint, pursuant to Rule 12(b)(1) and (6), or in the alternative, for an order granting them summary judgment, pursuant to Rule 56.
Kingsbrook Jewish Medical Center, (hereinafter "Kingsbrook"), has been a participating "provider of services" in the federal program of Health Insurance for the Aged ("Medicare"), Title 42 U. S.C. § 1395 et seq., since the program's inception. Under the provisions of Title 42 U.S.C. § 1395cc, "providers" are required to enter into an agreement with the Secretary of Health, Education and Welfare. (hereinafter "Secretary"), not to directly charge Medicare benefit recipients for services rendered. Pursuant to the plan, the Blue Cross Association was nominated to act as fiscal intermediary for the administration of the program. (See Title 42 U.S.C. § 1395h). Blue Cross delegated its duties as fiscal intermediary for Kingsbrook to defendant Associated Hospital Service of New York, and the Department of Health, Education and Welfare made and continues to make Medicare payments to Kingsbrook through Associated Hospital Service.
Kingsbrook, as a charitable organization and voluntary provider under the Medicare Act, was and is entitled to be paid by the fiscal intermediary, Associated Hospital Service, that sum which represents the "reasonable cost" of those services which it has furnished Medicare beneficiaries. (See Title 42 U.S.C. § 1395f(b)). The "reasonable cost" of such services shall be determined through the means expressed in Title 42 U.S.C. § 1395x(v), subject to the provisions of § 1395e of the same Title.
Plaintiff alleges that during all the periods in issue, including the period from July 1, 1966, the effective date of the Medicare Act, to December 31, 1967, it was a "multiple facility" institution, providing both an acute division and a chronic division, which divisions constituted separate facilities. Further, plaintiff alleges that treating each facility as a separate cost entity satisfies the provisions of § 1395x(v), which stipulates that the costs with respect to individuals covered by the Medicare Act will not be borne by individuals not covered by the Act. It is alleged that during all the periods in issue, plaintiff has made repeated requests to have its costs computed separately for its separate facilities, and that such requests have been uniformly denied.
Plaintiff avers that it was advised on January 27, 1972 by the Secretary that, since "during all of the years" in question plaintiff offered "multiple facilities", it would be reimbursed for the reasonable costs incurred based on multiple facility accounting. However, such reimbursement, plaintiff alleges, was granted only for the period beginning January 1, 1968 and was "erroneously, arbitrarily and illegally refused for the period July 1, 1966 through December 31, 1967."
As a result, plaintiff has commenced this suit, and seeks not only monetary damages from the defendants, but also injunctive relief. At this early stage in the proceedings, both plantiff and defendants have moved for summary judgment, and defendants have additionally moved to dismiss the suit for lack of subject matter jurisdiction.
Defendants argue that the present action is within the doctrine of "sovereign immunity", and that the suit must fail if the Government has not "consented" to be sued. Further, the Government contends that the doctrine of sovereign immunity cannot be circumvented by naming defendants other than the United States Government in the complaint.
In the case of Larson v. Domestic & Foreign Commerce Corp., 337 U.S. 682, 687-688, 69 S.Ct. 1457, 1460, 93 L.Ed. 1628 (1949), the Supreme Court said:
In the case at bar, any relief granted to plaintiff will be relief against the sovereign, for the Medicare Act makes clear that Associated Hospital Service is only a conduit through which the "reasonable costs" expended by the "provider" may be recovered from the Government. The issue in this case, therefore, is simply whether the Government has consented to be sued, by way of review, in the district court after the Secretary allegedly failed to reimburse Kingsbrook for the "reasonable costs" it has expended in providing services for patients under the Medicare Act.
The Medicare Act, Title 42 U.S.C. § 1395 et seq., expressly provides for judicial review in only two types of determinations relevant to a provider of services:
When a determination has been made
(1) that an institution is not qualified to be a provider of services; and
when a determination has been made
(2) that a provider of services agreement should be terminated. See Title 42 U.S.C. § 1395ff, which reads in pertinent part:
Title 42 U.S.C. § 1395cc(b)(2) reads:
No provision of the Medicare Act provides for judicial review of determinations made under the statute which the plaintiff utilizes as a basis for his complaint, Title 42 U.S.C. § 1395f(b). Plaintiff, however, alleges that this court has jurisdiction under Title 28 U. S.C. §§ 2201 and 2202, Title 28 U.S.C. § 1331(a), Title 5 U.S.C. §§ 553, 701-706.
Title 28 U.S.C. §§ 2201-2202 concern themselves with the power of a federal district court to issue declaratory judgments; these sections do not confer jurisdiction where none exists. See Skelly Oil Co. v. Phillips Petroleum Co., 339 U.S. 667, 671-672, 70 S.Ct. 876, 94 L.Ed. 1194 (1950).
Plaintiff next insists that jurisdiction lies in this court by reason of Title 28 U.S.C. § 1331(a), the "federal question" statute. Title 42 U.S.C. § 1395ii, however, reads in pertinent part:
Section 405(h) of Title 42 U.S.C. provides:
As a result, § 405(h) of the Social Security Act, which has been incorporated into the Medicare Act, makes it apparent that Title 28 U.S.C. § 1331(a), the federal question statute, cannot be made the jurisdictional predicate for this action. In this regard, see the case of Schroeder Nursing Care, Inc. v. Mutual of Omaha Ins. Co., 311 F.Supp. 405 (E.D.Wis.1970), wherein Judge Gordon analyzed, among other things, § 405(h), and said:
See also, Kuenstler v. Occidental Life Insurance Co., 292 F.Supp. 532, 537 (C. D.Cal.1968).
This court, however, cannot overlook footnote 9 appended to the decision in Aquavella v. Richardson, 437 F.2d 397 (2d Cir. 1971), which states that, in a similar situation to the case at bar,
In that case, plaintiff providers
If the court intended in its analysis that jurisdiction to review was proper under 28 U.S.C. § 1331, there would have been no need to ascertain whether there was jurisdiction to provide judicial review under the Administrative Procedure Act. As a result, this court is humbly constrained to believe that the Court of Appeals included footnote 9 in its opinion in Aquavella v. Richardson, supra, to denote that it had jurisdiction under § 1331 to decide whether judicial review of the Secretary's decision existed by reason of the APA, and that judicial review of the matter at hand does not lie in this court by reason of Title 28 U.S.C. § 1331.
Lastly, plaintiffs allege that jurisdiction lies in this court pursuant to Title 5 U.S.C. §§ 553, 701-706. Under section 10 of the Administrative Procedure Act, the initial question presented is whether the Medicare Act "precludes judicial review" in these circumstances. In making this inquiry, the "question [should be] phrased in terms of `prohibition' rather than `authorization' because . . . judicial review of a final agency action by an aggrieved person will not be cut off unless there is persuasive reason to believe that such was the purpose of Congress."
In the case of Aquavella v. Richardson, supra, the Court of Appeals for the Second Circuit ruled that the Secretary's decision to suspend payments to a provider of services under the Medicare Act was judicially reviewable, by reason of the Administrative Procedure Act, despite the lack of explicit statutory authority to review the decision within the framework of the Medicare Act.
Title 5 U.S.C. § 702 reads:
While this section of the Administrative Procedure Act embodies a "presumption of judicial review", it must be read consistently with two other sections of the same Act. Title 5 U.S.C. § 701(a) expressly provides that the Act shall not apply when "statutes preclude judicial review", or when "agency action is committed to agency discretion by law." Further, Title 5 U.S.C. § 704 provides for review of "agency action made reviewable by statute and final agency action for which there is no other adequate remedy in a court."
In Aquavella, the Secretary argued that the suspension of payments to a provider was not reviewable because of the Medicare Act's express provision for review only in two specific instances relevant to providers, i. e., (1) when the Secretary has determined that an institution was not qualified to be a provider, and (2) when the Secretary has determined that a provider of services agreement should be terminated.
Furthermore, the Secretary argued that the incorporation of the review provisions
In light of this provision, the Secretary urged that the decision of the Secretary suspending payments could not be reviewed, except as provided in the Medicare Act, for the Medicare Act did not expressly provide for review of a suspension of payments. (See the only available statutory review in Title 42 U. S.C. § 1395ff(c) and § 1395cc(b)(2)). Alternatively, the Secretary argued that the Medicare Act impliedly precludes review of the suspension of payments, because Congress carefully selected the types of Medicare determinations involving extended care facilities to be reviewed, and omitted review of such a decision to suspend payments to a provider.
The court in Aquavella was not persuaded by these arguments, however, for the court was of the opinion that the second sentence of § 405(h) does not preclude review, but simply forbids attempts to review final decisions on the merits by any other means other than those provided for in the Medicare Act. The court went on to say:
As a result, the court was not convinced that the Medicare Act expressly or impliedly precluded suit so as to vitiate the policy of the Administrative Procedure Act, which embodies a "presumption of reviewability."
Lastly, the court ruled that the suspension of payments to the provider of services was "final" agency action within the meaning of Title 5 U.S.C. § 704, for the "careful balancing of the need for effective judicial protection against the need for efficient and responsible administrative action" made the case ripe for review.
Initially, this court must emphasize that the Court of Appeals included a specific disclaimer in its opinion with regard to the issue in this case, i. e., the payment of reimbursable costs to providers:
Secondly, the court did not hold that a congressional intent was "clear(ly) and convincing(ly)"
This court will not be presumptuous and decide whether the suspension of payments to a provider comes within the purview of Title 42 U.S.C. §§ 1395ff(c) and 1395cc(b)(2), which sections call for the judicial review of a Secretary's decision to terminate a provider agreement, for that task has been assigned to another district court by the Court of Appeals.
This court holds that the congressional intent to preclude judicial review of a Secretary's determination regarding reimbursable costs to a provider is "clear and convincing."
Accordingly, the complaint is dismissed for lack of subject matter jurisdiction in this court.
Settle an order on notice in accordance with this decision.
This argument must be viewed in light of the Supreme Court's statement that "judicial review of a final agency action by an aggrieved person will not be cut off unless there is persuasive reason to believe that such was the purpose of Congress." Abbott Laboratories v. Gardner, 387 U.S. 136, 140, 87 S.Ct. 1507, 1510, 18 L.Ed. 2d 681 (1967).