Trostle v. Centers for Medicare & Medicaid Services
709 F. App'x 736
| 3rd Cir. | 2017Background
- In July 2011 David Trostle received the wrong medication (Lithium Carbonate), suffered severe lithium poisoning, and incurred nearly $100,000 in Medicare-covered hospital costs.
- Trostle sued the pharmacy in March 2013 and notified CMS, which initially asserted a small lien and warned the amount could change for ingestion injuries.
- After Trostle settled the tort claim for $225,000 in July 2014, CMS calculated total Medicare expenditures at over $84,000 and demanded $53,295.14 after fee adjustments.
- Trostle’s counsel challenged the lien by letter (treated as a Request for Redetermination); that request was denied on October 15, 2014.
- Trostle sought reconsideration by a QIC more than 180 days after denial; the QIC dismissed the late request and advised further administrative options (reconsideration of untimeliness or an ALJ appeal), but Trostle did not pursue them and instead filed suit.
- The district court dismissed for lack of subject matter jurisdiction for failure to exhaust Medicare’s administrative remedies; Trostle appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Trostle’s claim "arises under" the Medicare Act such that §405(h) bars federal-question jurisdiction | Trostle: claims are state-law contract/estoppel (CMS misled him about lien amount) and do not arise under Medicare | CMS: dispute is about recovery of Medicare payments and is governed by the Medicare Act and its review scheme | Held: Claim arises under the Medicare Act; §405(h) bars federal-question jurisdiction |
| Whether failure to complete administrative review prevents judicial review | Trostle: alternatively contends no administrative remedies remain so a final decision exists | CMS: Trostle failed to exhaust available administrative remedies and thus lacks a final decision for judicial review | Held: Trostle failed to exhaust; no final decision; district court lacked subject-matter jurisdiction |
Key Cases Cited
- Heckler v. Ringer, 466 U.S. 602 (1984) (judicial review available only after exhaustion of administrative review; definition of "arises under" for Social Security/Medicare context)
- Weinberger v. Salfi, 422 U.S. 749 (1975) (standards for determining when a claim arises under a statute)
- Fanning v. United States, 346 F.3d 386 (3d Cir. 2003) (claims to bar Medicare recoupment arise under the Medicare Act and are subject to §405(h) jurisdictional bar)
- Wilson ex rel. Est. of Wilson v. United States, 405 F.3d 1002 (Fed. Cir. 2005) (illegal-exaction label does not avoid Medicare Act administrative-review requirements)
- Buckner v. Heckler, 804 F.2d 258 (4th Cir. 1986) (whether plaintiff must reimburse Medicare is a question arising under the Medicare Act)