Nichole Medical Equipment & Supply, Inc. v. Tricenturion, Inc.
694 F.3d 340
3rd Cir.2012Background
- Nichole Medical appeals district court dismissal of suit seeking damages from Medicare contractors TriCenturion and NHIC.
- District court held lack of subject-matter jurisdiction under Medicare Act and failure to state a claim.
- Claim allegations implicate Medicare Act activities: audits, withholdings, and communications about alleged overpayments.
- Contractors acted as Medicare contractors (PSC/MAC) under contract with CMS; actions tied to benefit determinations.
- Plaintiff argues state-law damages survive despite Act; defendants argue official immunity and Act bar.
- Court affirms dismissal; claims arise under the Medicare Act, and contractors enjoy official immunity under the Act.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Do claims arise under the Medicare Act bar jurisdiction? | Nichole Medical argues §405(h) doesn't bar diversity. | Appellees contend claims arise under Act and bar jurisdiction. | Yes; claims arise under Act, jurisdiction barred. |
| Was exhaustion of administrative remedies required before suit? | Exhaustion not applicable to state-law damages. | Exhaustion required for benefits-related claims. | Exhaustion required; district court proper to dismiss. |
| Are TriCenturion and NHIC entitled to official immunity? | Immunity should not cover unlawful conduct. | Discretionary conduct within official duties entitles to immunity. | Yes, official immunity applied; dismissal proper. |
Key Cases Cited
- Bodimetric Health Services, Inc. v. Aetna Life & Casualty, 903 F.2d 480 (7th Cir. 1990) (jurisdictional bar cannot be avoided by collateral damages claims)
- Midland Psychiatric Assocs., Inc. v. United States, 145 F.3d 1000 (8th Cir. 1998) (§405(h) bars review; diversity claims barred when arising under Act)
- Shalala v. Illinois Council on Long Term Care, Inc., 529 U.S. 1 (S. Ct. 2000) (§405(h) exclusive review; administrative exhaustion matters)
- Kaiser v. Blue Cross of Cal., 347 F.3d 1107 (9th Cir. 2003) (claims arise under Act if intertwined with benefits; exhaustion applies)
- Fanning v. United States, 346 F.3d 386 (3d Cir. 2003) (exhaustion and administrative-channel requirements for benefit claims)
- Cathedral Rock of North College v. Shalala, 223 F.3d 354 (6th Cir. 2000) (exhaustion/presentation prerequisite to §405(g) review)