Date: February 8, 1999
In the Case of:
Metropolitan Methodist Hospital,
Petitioner,
- v. -
Health Care Financing Administration.
Docket No. C-98-440
Decision No. CR574
In this decision, I grant the motion to dismiss filed by the Health Care Financing Administration (HCFA). I have carefully considered the parties' briefs submitted in this matter. In doing so, I issue the following finding of fact and conclusion of law:
I find that neither HCFA's determination of March 26, 1998 nor its May 29, 1998 determination responding to Petitioner's request to HCFA to reconsider its March 26, 1998 determination is the kind of determination over which I have jurisdiction to review under the Social Security Act (Act), section 1866(h) and the applicable regulations at 42 C.F.R. § 498.3(b).
Procedural Background
On September 28, 1998, Petitioner filed a report of its readiness to present evidence for adjudication of the case. At the same time, Petitioner also filed a motion requesting that the above-described matter be stayed for a period of 90 days in order to determine whether jurisdiction lies with the Provider Reimbursement Review Board (PRRB). Petitioner stated that because it appears that this matter might involve both Medicare certification and payment issues, it filed appeals with both the Civil Remedies Division of the Departmental Appeal Board and the PRRB. On September 29, 1998, HCFA filed a motion to dismiss Petitioner' hearing request for lack of jurisdiction, claiming that HCFA's denial of Petitioner's request for exclusion from the prospective payment system does not fall within the categories of "initial determinations" by HCFA subject to an Administrative Law Judge (ALJ) hearing and review under 42 C.F.R. § 498.3(b). On November 16, 1998, I issued an Order to Show Cause directing Petitioner to show cause why this case should not be dismissed for lack of my jurisdiction to hear this matter.
Discussion
Although Petitioner argues otherwise, my authority to hear cases has been specifically articulated. Pursuant to section 1866(h)(1) of the Act--
[A]n institution or agency dissatisfied with a determination by the Secretary that it is not a provider of services or with a determination described in subsection (b)(2) shall be entitled to a hearing thereon by the Secretary (after reasonable notice) to the same extent provided in section 205(b), and to judicial review of the Secretary's final decision after such hearing as is provided in section 205(g).
On October 29, 1993, the Secretary delegated to administrative law judges of the Departmental Appeals Board authority to conduct hearings and issue decisions with respect to cases pursuant to section 1866(h)(1). Statement of Organization, Functions, and Delegations of Authority, 58 Fed. Reg. 58,170 (1993). Moreover, the applicable regulations at 42 C.F.R. Part 498 state that providers and prospective providers have the right to appeal an initial determination or reconsidered determination by HCFA and the regulations set forth with specificity what determinations are considered to be "initial determinations." See 42 C.F.R.
§ 498.5 and 42 C.F.R. § 498.3(b). In the instant case, Petitioner is seeking exemption from the prospective payment system. The hospital at all times was a provider of Medicare services, albeit it had not been granted exemption from the prospective payment system for the rehabilitation unit. Consequently, I agree with HCFA that Petitioner does not fall within the circumstances of section 1866(h)(1) of the Act providing for administrative hearing. In addition, Petitioner does not qualify as a "prospective provider" under the applicable regulations because it was a provider of services under Medicare and therefore, any of the "initial determinations" applying to "prospective providers" under 42 C.F.R. § 498.3(b) are inapplicable here. Moreover, the determination which Petitioner seeks to appeal is not listed as an initial determination subject to my jurisdiction under 42 C.F.R. § 498.3(b). As I indicated in Villa Northwest Restorative Care Center, DAB CR362 (1995), "the regulation at 42 C.F.R. § 498.3(d)(1) specifically provides that any administrative action other than specifically enumerated at 42 C.F.R. §498.3(b) is not an initial determination.(1)" I conclude therefore that this matter involves Petitioner's status under the prospective payment system as either included under that system or exempt from that system. As such, this matter is not an initial determination subject to my review.
Accordingly, I grant HCFA's motion to dismiss and order this matter be dismissed.
Edward D. Steinman
Administrative Law Judge
1. I believe this case is distinguishable from the circumstances presented in Homelife Nursing, Inc., DAB CR417 (1996) where, in a prehearing ruling (February 1, 1995 Ruling Denying HCFA's Motion to Dismiss), I accepted jurisdiction, concluding that HCFA's determination to certify a provider as a subunit, rather than as a branch office as requested by the provider, was subject to my jurisdiction. In that case, while the distinction between the certification of the petitioner as a branch as opposed to a subunit had financial implications, the purpose of the regulatory distinction between the designations in that case was to ensure the health and safety of patients served by the entity. Moreover, in that case, there was an actual survey on which there was a recommendation from the State survey agency and which HCFA reviewed in making its determination to certify the provider as a subunit. In this case, there has been no determination by HCFA to certify or deny certification to Petitioner for its new rehabilitation unit as an excluded unit based on a survey; merely HCFA stated that Petitioner did not apply from exemption from the prospective payment system in enough time to complete all necessary review prior to the end of the provider's cost report period. However, as HCFA explained to Petitioner, it was not precluded from operating the unit as a prospective payment system rehabilitation unit and applying for exemption for the next cost reporting period.