Lead Opinion
Plaintiffs-Appellants Prime Hospitals
Because Prime Hospitals’ breach of contract claim is fundamentally a suit to enforce a contract and it does not arise under the Medicare Act, we hold that the Court of Federal Claims has exclusive jurisdiction over that claim under the Tucker Act, 28 U.S.C. § 1491. We- also- hold that the Court of Federal Claims does not have jurisdiction, however, over Prime Hospitals’ alternative claims seeking declaratory, injunctive, and mandamus relief. Accordingly, we affirm the district court’s transfer order in-part, reverse-in-part, and remand for further proceedings.
Background
I
The Medicare program, which provides health insurance for the elderly and disabled, is administered by the United States Department of Health <& Humans Services (“HHS”) through its agency, the Center for Medicare & Medicaid Services (“CMS”). 42 U.S.C. §§ 1395 et seq. Medicare Part A covers hospital inpatient services and Medicare Part B сovers outpatient services, including emergency room services for patients who do not require a hospital admission. See id. § 1395d, k. Under both Part A and Part B, providers submit individual claims for .payment to private contractors who make an initial determination as to what payment, if any, should be made on the claim. See id. § 1395ff(a)(l)-(2). A provider dissatisfied with the initial determination can bring a challenge through an administrative appeals process provided under the Medicare Act. See id. § 1395ff(a)-(d).
A provider that obtains a final decision from the Medicare Appeals Council is entitled to judicial review of that decision. Id. §§ 405(g), 1395ff(b)(l)(A). Under § 405(g), the provider may file suit in district court, and the Act mandates that “[n]o findings of fact or decision of the [Secretary] shall be reviewed by any person, tribunal, or governmental agency except as” provided under the Act. Id. §§ 405(h), 1395Ü.
II
Prime Hospitals are sixtеen acute care hospitals that are part of Prime Healthcare Services, Inc. and Prime Healthcare Foundation, a national healthcare system that owns and operates thirty-five for-profit and non-profit hospitals in ten different states. Prime Hospitals provide inpatient hospital services under Medicare Part A to patients covered under the Medicare program.
Prime Hospitals, like other Medicare providers, submit individual claims for payment to private contractors, who make initial reimbursement determinations for the inpatient hospital services provided. Prime Hospitals alleged that, although the private contractors generally processed and paid their individual claims, many of their claims for one-day inpatient stays (known as “short-stay claims”) were subsequently subject to post-payment review and denied. In response, Prime Hospitals appealed the denials of these Medicare short-stay claims through the Medicare administrative appeal process.
Prime Hospitals alleged the audits of short-stay claims were not limited to Prime Hospitals but were part of a larger initiative that resulted in a substantial increase in hospital claim denials. As a result of this increase, Prime Hospitals alleged, CMS became overwhelmed by the number of hospital appeals of inpatient claim denials. Prime Hospitals’ complaint states that these appeals caused “the number of appeals received ... to soar from 1,250 per week in January 2012 to more than 15,000 per week in December 2013. The yearly number of ... appeals more than quintupled from 59,600 appeals in 2011 to 384,151 appeals in 2013.” J.A. 33.
In an effort to reduce the backlog of hospital appeals of Medicare short-stay claim denials and ease the administrative burden for all parties, CMS began offering health care providers the opportunity to resolve their eligible appeals through settlement, In its letter announcing the offer and corresponding settlement parameters, CMS indicated that it was proposing “to make a partial payment (68 percent of the net payable amount of the denied inpatient claim) in exchange for hospitals agreeing to the dismissal of any associated appeals and accepting] the settlement as final administrative and legal resolution of the eligible claims.” J.A. 46. CMS subsequently explained in a letter to Congressman Kevin Brady that
[t]his settlement is intended to ease the administrative burden for all parties. The settlement offers an opportunity for the government to reduce the pending аppeals backlog by resolving a large number of homogeneous claims in a short period of time. In addition, the*989 settlement offers an opportunity for hospitals to obtain payment now for rendered services, rather than waiting a considerable amount of time with the associated risk of not prevailing in the appeals process.
J.A. 166.
Prime Hospitals alleged that, under its settlement offer, CMS agreed to pay all such Medicare short-stay appeal claims if a hospital accepted the offer of partial payment on or before' October 31, 2014, by submitting (1) a spreadsheet of eligible claims to CMS by October 31, 2014, and (2) an executed copy of the CMS administrative settlement agreement. Prime Hospitals also alleged that “[s]ubject to checking the spreadsheets to ensure that the claims were eligible Short-stay Appeal Claims, CMS expressly and unconditionally agreed to execute the settlement agreement and process the eligible claims if the Prime Hospitals accepted its offer by timely submitting the spreadsheet and an executed settlement agreement.” J.A. 34.
In particular, Prime Hospitals pointed to CMS’s settlement agreement where it stated that “[u]pon receipt of an Agreement executed by the Hospital, CMS will determine whether the list of appeals furnished by the Hospital matches CMS’s records at each level of the administrative appeals process,” and, “[i]f so, CMS will execute the Agreement,” and, “[i]f not, CMS and the Hospital will use their best efforts to work together to resolve promptly any discrepancies so that a match is achieved, at which time CMS will execute the Agreement.” J.A. 56; see also J.A. 34.
Prime Hospitals alleged that, on or before October 31, 2014, they accepted CMS’s offer by each submitting a spreadsheet of their eligible Medicare short-stay appeal claims and an executed CMS administrative settlement agreement. Thus, Prime Hospitals contends that once they accepted the offer, under the terms of the settlement agreement, the agency was contractually required to pay them sixty-eight percent of the net payable amount of their 5,079 separate Medicare appeals — a total sum equaling $23,205,245 — in exchange for their agreement that the related appeals would be dismissed.
CMS ultimately refused to allow the Prime Hospitals to participate in the CMS settlement because the agency “ha[d] been made aware of one or more ongoing False Claims Act case(s) or investigation(s) involving the facilities.” J.A. 37. Prime Hospitals alleged that the settlement agreement did not authorize such аn exclusion. Accordingly, Prime Hospitals alleged that CMS failed to execute the settlement agreements as required and breached the agreement by failing to pay “the agreed-upon sum of $23,205,245.” J.A. 35.
Based on these allegations, Prime Hospitals filed a complaint in the district court for breach of contract. In their complaint, Prime Hospitals specifically alleged that: (1) CMS offered them a settlement agreement; (2) Prime Hospitals signed and otherwise accepted the agreement; (3) CMS is estopped from claiming that its signature was required to form a binding contract; (4) CMS agreed to settle Prime Hospitals’ pending Medicare administrative appeals for sixty-eight percent of the net payable amounts of those denied claims in exchange for Prime Hospitals dismissing the appeals and their acceptance of the settlements as a final administrative and legal resolution of the claims; and (5) CMS breached the agreement when it failed to pay plaintiffs the agreed-upon sum ($23,-205,245).
Prime Hospitals also pleaded two other independent and alternative causes of action in their complaint. They alleged that the seven-month delay in deciding to exclude them from CMS’s settlement pro
In Prime Hospitals’ second alternative cause of action, Prime Hospitals requested declaratory and injunctive relief from this scheme because it violated the Medicare Act and their right to procedural and substantive due process. In Prime Hospitals’ third alternative cause of action for- a writ of mandamus, Prime Hospitals requested an order compelling the Secretary to comply with the “clear, indisputable and non-discretionary duty to provide a Medicare appeals process for [Prime Hospitals] to administratively appeal denials of their Medicare, inpatient claims, within specified time frames.” J.A. 43.
The Secretary filed a motion to dismiss the complaint on various grounds, including that the district court lacked subject matter jurisdiction over the hospitals’ breach of contract claim because under the Tucker Act, 28 U.S.C. .§■ 1491, the Court of Federal Claims had exclusive jurisdiction to adjudicate this claim.
The district court issued a written order that denied the Secretary’s motion to dismiss but transferred the case tо the Court of Federal Claims. According to the district court, the Court of Federal Claims has Tucker Act jurisdiction over the Prime Hospitals’ breach of contract cause of action because it involves questions of. contract formation and scope, not questions about Medicare reimbursement law. The district court also concluded that, because Prime Hospitals’ second cause of action seeking declaratory and injunctive relief and third cause of action seeking a writ of mandamus depended on the resolution of the breach of contract claim, those claims also arose under contract law.
We have jurisdiction to review the district court’s decision to transfer Prime Hospitals’ case to the Court of Federal Claims under 28 U.S.C. § 1292(d)(4)(A).
Discussion
Wé review a district court’s decision to transfer a case under the federal transfer statute, 28 U.S.C. § 1631, to the Court of Federal Claims de novo because the district' court’s underlying determination is one of jurisdiction. Acceptance Ins. Co. v. United States,
We first discuss whether the Court of Federal Claims has jurisdiction to adjudiсate Prime Hospitals’ claim for breach of the alleged settlement agreement. This discussion includes two parts: First, although the Court of Federal Claims typically has Tucker Act jurisdiction over any express or implied contract with the United States, the settlement agreement’ at issue here arose from disputes under the Medicare Act, which has its own comprehensive administrative and judicial review scheme. We. must, determine, therefore, whether the Medicare Act preempts Tuck- ’ er Act jurisdiction over the contract claim. We conclude that it does not. Second, because the Medicare Act’s own review scheme, which places jurisdiction in the
We also address the question of whether the Court of Federal Claims has subject matter jurisdiction over Prime Hospitals’ alternative claims seeking declaratory, in-junctive, and mandamus relief from the Secretary’s alleged policy to prevеnt and delay Prime Hospitals from exhausting their administrative remedies. We conclude that it does not. We take each issue in turn.
I
A
The jurisdiction of the Court of Federal Claims is set forth in the Tucker Act, 28 U.S.C. § 1491(a), which states: .
The United States Court of Federal .Claims , shall have jurisdiction to render judgment upon any claim against the United States founded either upon the Constitution, or any Act of Congress or any régulation of an executive department, or upon any express or implied contract with the United States, or for liquidated or unliquidated damages in cases not sounding in tort.
The Tucker Act, however, does not create any substantive right enforceable against the United States. United States v. Testan,
Contract law is one such separate source of law compensable under the Tucker Act. 28 U.S.C. § 1491(a); Higbie v. United States,
The Medicare Act is a non-contractual source of substantive law that mandates compensation to private parties by the Federal Government. See, e.g., Appalachian Reg'l Healthcare, Inc. v. United States,
There is a distinction between such non-contractual claims arising under the Constitution, a statute, or a regulation and those stemming from a contract. Holmes v. United States,
We have addressed this question with respect to a number of settlement agreements arising from disputes under statutes having their own comprehensive review schemes and each time have concluded that the statute’s review scheme does not preclude Tucker Act jurisdiction over those settlement agreements. See, e.g., Cunningham v. United States,
We begin our analysis by reviewing the relevant jurisprudence.
The Supreme Court has identified a distinction between an action on a settlement agreement and one under a law whose alleged violation gave rise to the settlement. Kokkonen v. Guardian Life Ins. Co. of Am.,
In Holmes, this court held that the comprehensive statutory scheme established under Title VII was not a bar to the exercise of Tucker Act jurisdiction in a suit alleging breach of a Title VII settlement agreement.
Likewise, in Massie, this court addressed whether, because the Military Claims Act (MCA) provides a complete and comprehensive statutory scheme pertaining to the payment of military claims, the Court of Federal Claims has jurisdiction over an agreement to pay an MCA claim.
In Cunningham v. United States, this court applied the holding in Holmes to an agreement settling a dispute arising under the Civil Service Reform Act (CSRA) and concluded that the Court of Federal Claims possessed subject matter jurisdiction over the breach of contract claim for money damages.
Following our decisions in this line of cases, although the alleged settlement agreement with CMS arose from disputes under the Medicare Act, Prime Hospitals’ breach of contract claim for money damages against the government falls outside of the Medicare Act’s remedial scheme.
The facts to be determined with respect to Prime Hospitals’ breach of contract suit are also separate from the facts determined in their underlying individual claims for reimbursement. See Kokkonen,
As in Massie and Cunningham, where this court found it dispositive that the claimant had not requested review of the facts or law underlying the initial MCA or CSRA dispute, Prime Hospitals are also not disputing the underlying determinations denying their reimbursement claims. Prime Hospitals have not requested review of, for example, whether the items and services they furnished are reimbursable under the Medicare Act nor have they requested review of what amounts are payable for those items and services. Rather, as in Massie, Prime Hospitals agree with the Secretary’s decision to settle pending Medicare administrative appeals for sixty-
To the extent that Prime Hospitals argue that their contract claim cannot fall outside of the Medicare Act’s remedial scheme because determining the scope of the settlement agreement would require an application of the Medicare Act, we disagree. See Dél-Rio Drilling,
Indeed, Prime • Hospitals describe- the process for determining which claims are eligible for settlement in their complaint as simply “checking the spreadsheets.” J.A. 34. The language of the settlement agreement describes this process as follows: “Upon receipt of an Agreement executed by the Hospital, CMS will determine whether the list of appeals furnished by the Hospital matches CMS’s records at each level of the administrative appeals process.” J.A 56; see also J.A. 34. Whether or not Prime Hospitals are correct that determining the scope of the contract in this manner would require an application of the Medicare Act, that the parties might have to compare spreadsheets to determine whether their records match does not remove jurisdiction from the Court of Federal Claims. As this court held in Del-Rio Drilling, the fact that the court may have to interpret an Act or make other determinations regarding principles of federal law in order to resolve the contract claim does not deprive the Court of Federal Claims of jurisdiction to decide'that claim.
In sum, following this court’s precedent, we hold that Prime Hospitals’ claim for monetary relief against the government alleging breach of their settlement agreement with CMS is fundamentally a suit to enforce a contract and therefore within the Court of Federal Claims’ jurisdiction under the Tucker Act.
B
Having concluded that Tucker Act jurisdiction over .Prime Hospitals’ contract
The Medicare Act’s own comprehensive administrative and judicial review scheme provides the sole avenue for judicial review for all claims “arising under” the Medicare Act. Heckler v. Ringer,
The inquiry in determining whether the Medicare Act’s review scheme bars jurisdiction over a claim is whether the claim at issue “arises under” the Act. Ringer,
The Supreme Court has also held that a claim arises under the Medicare Act when it is “inextricably intertwined” with a claim for benefits. Ringer,
The type of remedy sought is generally not dispositive of whether the claim arises under the Medicare Act. See, e.g., Ringer,
First, the Medicare Act does not provide either the standing оr the substantive basis for the presentation of Prime Hospitals’ claim. Cf. RenCare, Ltd. v. Humana Health Plan of Tex., Inc.,
Unlike Do Sung Uhm where the contract claim was found to arise under the-Medicare Act, in part, because the contract at issue only imposed a duty to comply with the Medicare Act itself,
Unlike the cases upon which Prime Hospitals rely, their alleged injury, cаnnot be remedied through the retroactive payment of Medicare benefits nor can it be remedied through the Act’s administrative review process. See, e.g., Do Sung Uhm,
Second, Prime Hospitals’ breach of contract claim is not inextricably intertwined with their underlying claims for Medicare benefits. Prime Hospitals’ breach of contract claim involves' separate issues and is completely separate from a substantive claim to benefits. See Nichole Med.,
In particular, Prime Hospitals’ breach of contract claim involves issues such as whether .CMS offered a settlement agreement to Prime Hospitals, whether Prime Hospitals and CMS both accepted the settlement agreement, and whether , CMS breached the agreement when it failed to pay Prime Hospitals the agreed-upon sum. These issues are separate from those that would arise in a substantive claim of entitlement to benefits, such as, whether the items and services Prime Hospitals furnished are covered or otherwise reimbursable . under- -the Medicare .Act and what amounts are payable .for those items and services, if any. 42 C.F.R. § 405.902. Importantly, Prime Hospitals do not challenge any such findings as they do not challenge the denials of their underlying individual reimbursement claims. Rather, Prime,. Hospitals have alleged that their claims of entitlement to Medicare benefits are, fully resolved, both administratively and legally, by the settlement agreement, and they seek payment only under the alleged contract.
In support of their argument that then-breach of contract claim arises under the Mеdicare Act, Prime Hospitals centrally rely on Pines Residential Treatment Center, Inc. v. United States,
Pines Residential, an operator of a hospital, entered into a written settlement agreement -with a Medicare Intermediary who agreed to allow a loss of an agreed-upon amount and issue a revised notice of program reimbursement reflecting this allowance. Id. at 1380. The Intermediary then complied with the settlement agreement and issued revised notices reflecting the agreed-upon loss and stating that a check-would be issued if payment were due. Id. Before the Court of Federal Claims, the government provided evidence showing that Pines Residential did not receive any payment because the Intermediary had offset the: agreed-upon loss amount against an overpayment. Brief for Defendant-Appellee at 11, Pines Residential Treatment Ctr.,
Unlike Pines Residential’s settlement agreement, which did not entitle it to payment, here, Prime Hospitals’ alleged settlement agreement entitles them to a total sum in exchange for dismissing their eligible reimbursement appeals. Also unlike Pines where the parties disagreed as to whether the payment owed was properly applied to an overpayment under the applicable Medicare regulations, here, Prime Hospitals and the government only dispute whether or not a contract was formed between Prime Hospitals and CMS. They do not disagree as to, or even discuss, the merits of Prime Hospitals’ individual reimbursement’ claims from which the alleged settlement agreement arose. Thus, unlike Pines, where determining whether any payment was due to Pines Residential would almost exclusively require resolving questions under the Medicare Act, here determining whether Prime Hospitals are entitled to the total sum payment in exchange for dismissing their eligible reimbursement appeals requires an analysis of whéther a contract was formed under contract principles.
In sum, Prime Hospitals’ breach of contract claim does not arise under the Medicare Act because they do not seek reimbursement for services provided tо Medicare beneficiaries. It is contract law, and not the Medicare Act, that provides both the standing and the substantive basis for the presentation of Prime Hospitals’ breach of contract claim. Also, Prime Hospitals’ enforcement of their settlement agreement is not inextricably intertwined with their underlying claims for Medicare benefits because their claim involves separate issues and is completely separate from a substantive claim that they are entitled to benefits.
Prime Hospitals’ breach of contract claim is just that: a. suit to enforce a contract with the government, and it does not arise under the Medicare Act.
II
We turn now to Prime Hospitals’ remaining claims for declaratory, injunctive, and mandamus relief. Prime Hospitals and the government' do not dispute that the Court of Federal Claims does not have jurisdiction to adjudicate these claims. Indeed, the government had not asked the district court to transfer these claims but had sought dismissal on other grounds. We conclude that the Court of Federal Claims lacks jurisdiction over Prime Hospitals’ remaining claims.
The Tucker Act does not generally confer jurisdiction for actions seeking declaratory or injunctive relief. See Richardson v. Morris,
Accordingly, we conclude that the Court of Federal Claims does not have jurisdiction over Prime Hospitals’ remaining claims and we reverse the district court’s order transferring Prime Hospitals’ claims for declaratory, injunctive, and mandamus relief. Cf. United States v. Cty. of Cook, Ill.,
For the foregoing reasons, we hold that the Court of Federal Claims has exclusive jurisdiction under the Tucker Act, 28 U.S.C. § 1491, over Prime Hospitals’ breach of contract claim but does not have jurisdiction over their remaining claims. Accordingly, we affirm the district court’s transfer order with respect to the breach of contract claim but reverse with respect to Prime Hospitals’ remaining claims seeking declaratory, injunctive, and mandamus relief. We remand for further proceedings.
AFFIRMED IN PART, REVERSED IN PART, AND REMANDED
Costs
The parties shall bear their own costs.
Dissenting opinion filed by Circuit Judge NEWMAN.
Notes
. Alvarado Hospital, LLC; Veritas Health Services, Inc.; Prime Healthcare Centinela, LLC; Desert Valley Hospital, Inc.; Prime Healthcare Services — Encino, LLC; Prime Healthcare Huntington Beach, LLC; Prime Healthcare' — La Palma, LLC; Prime Healthcare Services — Garden Grove, LLC; Prime Heаlthcare Services — Lower Bucks, LLC; Prime Healthcare Services — Montclair, LLC;. Prime Healthcare Paradise Valley, LLC; •Prime Healthcare Services — Roxborough, LLC; Prime Healthcare Services — San Dimas, LLC; Prime Healthcare Services — Shasta, LLC; Prime Healthcare Services — Sherman Oaks; LLC; and Prime Healthcare' Anaheim, LLC (collectively, the "Prime Hospitals”).
. Prime Hospitals sufficiently pleaded, for Tucker Act purposes, the requirements for a valid contract with the United States. See J.A. 40-41, 135-40. See also Trauma Serv. Grp. v. United States,
"Jurisdiction ... is not defeated ... by the possibility that the averments might fail to state a cause of action on which petitioners could actually recover.” Do-Well Mach. Shop, Inc. v. United States,
. Moreover, the issue of whether every one of Prime Hospitals' underlying individual claims is an "eligible claim[]” as defined by the settlement agreement is not part of the dispute between the parties. Indeed, Prime Hospitals concede that CMS will determine whether the list of appeals furnished by Prime Hospitals matches CMS’s records only "[a]s-suming that the Prime Hospitals can establish there is a contract” in the first instance. Appellant's Reply Br. 14-15,
Dissenting Opinion
dissenting.
I respectfully dissent from the ruling that thе Medicare Act’s jurisdictional assignment to the district courts does not apply when there is an offer of settlement of a Medicare reimbursement claim. This explicit statutory assignment is not erased if the Medicare administrator offers to settle a Medicare claim. The jurisdictional statute is clear, and precedent has long implemented its terms:
Any individual, after any final decision of the [Secretary of HHS] made after a hearing to which he was a party, irrespective of the amount in controversy, may obtain a review of such decision by a civil action commenced within sixty days after the mailing to him of notice of such decision or within such further time as the [Secretary] may allow. Such action shall be brought in the district court of the United States for the judicial district in which the plaintiff resides, or has his principal place of business, or, if he does not reside or have his principal place of business within any such judicial district, in the United States District Court for the District of Columbia.
42 U.S.C. § 1395ff(b)(l)(A), from the Medicare Act (incorporating 42 U.S.C. § 405(g), from the Social Security Act) (emphasis added). The courts have consistently agreed. In St. Vincent’s Medical Center v. United States, we cited extensive authority concerning the statute:
Because the Medicare Act contains its own comprehensive administrative and judicial review scheme, there is no Tucker Act jurisdiction over Medicare reimbursement claims. Courts have consistently found preemption of Tucker Act jurisdiction where Congress has enacted a precisely drawn, comprehensive and detailed scheme of review in another forum, as in the present case. See, e.g., United States v. Fausto,484 U.S. 439 , 454-55,108 S.Ct. 668 ,98 L.Ed.2d 830 (1988); Harris v. United States,841 F.2d 1097 , 1100-01 (Fed. Cir. 1988); Fiorentino v. United States,607 F.2d 963 , 969-70 (Fed. Cl. 1979). In fact, we recently held in Appalachian Regional Healthcare, Inc. v. United States,999 F.2d 1573 , 1577 (Fed. Cir. 1993) (citations omitted), that “when the Medicare statute specifically provides for review, providers and courts must follow the specified procedures.”
The Tucker Act is displaced ... when a law assertedly imposing monetary liability on the United States contains its own judicial remedies. In that event, the specific remedial scheme establishes the exclusive framework for the liability Congress created under the statute.
Nonetheless, my colleagues endorse the transfer of this action from the district court to the Court of Federal Claims under the Tucker Act, reasoning that the statutory assignment of Medicare jurisdiction does not apply when the issue includes a proposal for settlement of a Medicare claim. However, as precedent has resolved, settlement of a Medicare claim does not remove the statutory Medicare Act jurisdiction. See Pines Residential Treatment Ctr., Inc. v. United States,
The court today ratifies the jurisdictional anomaly proposed by the Medicare administrators at HHS, whereby a denied Medicare claim can be reviewed only in the district court under the Medicare Act, but a proposal to settle a Medicare claim can be reviewed only in the Court of Federal Claims under the Tucker Act. The provisions of the Medicare Act, and precedent of the Supreme Court, the Federal Circuit, the Court of Federal Claims, and the district courts are contrary to the position today of HHS, now endorsed by my colleagues.
These Medicare Act claims relating to “short-stay” hospital costs were proposed for settlement by Medicare administrators
These Medicare reimbursement claims relate to hospital costs for procedures that the Medicare administrators held should have been conducted on an out-patient basis. Thousands of short-stay hospital claims were denied — Prime Hospitals says in an administrative policy shift — and were appealed through the prescribed Medicare administrative process. A large backlog of appeals ensued, and in August 2014 HHS proposed to settle short-stay claims by paying 68 percent of the eligible amounts determined in accordance with a seven-factor test. J.A. 59. An HHS official sent Prime Hospitals a proposed Administrative Agreement stating the settlement conditions; the accompanying letter stated that the “Parties’ obligations under the agreement become binding upon execution of the Administrative Agreement.” J.A. 57.
Prime Hospitals executed the Agreement and provided the requested eligibility information. However, the HHS official then refused to countersign the Agreement, stating that there was an ongoing
Medicare Act reimbursement claims are reviewed under the Medicare Act, not the Tucker Act
Although my colleаgues on this panel appear to recognize that the Medicare Act placed judicial review of Medicare claims exclusively in the district courts, they hold that when there is an issue related to a proposed settlement, only the Court of Federal Claims has jurisdiction. However, the Tucker Act cannot displace the explicit jurisdictional assignment in the Medicare Act.
The Medicare. Act incorporated the judicial review provisions of the Social Security Act.
The Medicare Act and the Social Security Act are explicit that judicial review is placed in the district courts, but is not under 28 U.S.C, § 1331 (federal question jurisdiction) or § 1346 (Little Tucker Act). Both statutes include the same provision:
No findings of fact or decision of the [Secretary] shall be reviewed by any person, tribunal, or governmental agency except as herein provided. No action against the United States, the [Secretary], or any officer or employee thereof shall be brought under section 1331 or 1346 of Title 28 to recover on any claim arising under this subchapter.
42 U.S.C. § 1395Ü (incorporating'42 U.S.C. § 405(h), from' the Social Security Act).
Precedent guides the determination of whether a claim “arises under” the Medicare Act. See Heckler v. Ringer,
The Medicare Act provides both the standing and substantive basis for Prime Hospitals’ claim. The issues are not “separate from those that would arise in a substantive claim of entitlement to benefits.” Maj. Op. 998. The proposed Administrative Agreement contains ongoing obligations of eligibility determinations, not merely an exercise in contract enforcement. The proposed settlement is not simply enforcement of a contracted-for lump sum payment, as the majority describes it. The proposed settlement would require individual review of the eligibility of each claim, before the 68 percent payment would be authorized. Like the claim in Pines Residential, the Prime Hospital settlement proposal is “inextricably intertwined” with the eligibility of each individual claim, measured by “application of the provisions of the Medicare Act.” Pines Residential,
The “Settlement Instructions” state that “CMS is requiring each facility to complete a spreadsheet of claims it believes to be eligible for inclusion.” J.A. 47. This eligibility process is not simply where “parties might have to compare spreadsheets to determine whether their records match,” quoting the panel majority. Maj. Op. 995. Each claim requires review for eligibility, including whether the “claim was not for items/services provided to a Medicare Part C enrollee,” whether “the claim was denied by an entity who conducted review on behalf of CMS,” whether “the claim was denied based on inappropriate patient status,” whether “the denial was timely appealed by the hospital,” and whether “the provider did not receive payment for the services as a Part B claim (‘rebill’).” J.A. 47-8. This is not a “simple” contract enforcement proceeding, as the majority holds. Maj. Op. 995.
The HHS proposal to settle short-stay Medicare claims does not dissolve the settled judicial review provision of the Medicare Act.
The panel majority’s purported authority does not override the Medicare Statute
The HHS and my colleagues have cited purported authority from other statutes and other facts, while ignoring the Medicare statute and direct precedent. For example, in Holmes v. United States,
My colleagues also rely on Massie v. United States,
The panel majority also cites Cunningham v. United States,
The majority cites Del-Rio Drilling Programs, Inc. v. United States,
I take note of the court’s citation of Kokkonen v. Guardian Life Ins. Co. of Am.,
In all of the cases in which contract enforcement was implemented by the Court of Federal Claims, the court relied on the completeness of the contract claim and the absence of continuing agency involvement in the enforcement. In contrast, here the proposed Medicare short-stay claim settlement requires Medicare Act determination of seven factors of eligibility of each claim. These eases do not support elimination of the Medicare Act’s assignment of jurisdiction to the district court.
The Court of Federal Claims, the district courts, and other circuits have recognized the statutory Medicare Act jurisdiction
The Court of Federal Claims has addressed the issue of its jurisdiction, and recognized that it does not have jurisdiction for proposed settlements of Medicare claims. In Bloomington Hosp. v. United
Although plaintiffs describe their claim as a “contract dispute,” the subject matter of the purported underlying contract is wholly based on a Medicare reimbursement dispute. Therefore, notwithstanding this court’s ability to exercise jurisdiction when a settlement agreement or contract with the federal government is at issue, it is clear that plaintiffs are merely seeking a redeter-mination of a continuing Medicare reimbursement dispute. Thus, this court is without jurisdiction because Congress has explicitly provided that Medicare reimbursement disputes are to be heard solely in the district courts.
Id. This ruling comports with those of all other courts, that the Medicare Act assigned these issues to the district courts. The new position of HHS is untenable, and should not be endorsed by this court.
A district court addressed Medicare Act jurisdiction in Caregivers Plus, Inc. v. Thompson,
The panel majority cites RenCare, Ltd. v. Humana Health Plan of Tex., Inc.,
Also informative is Do Sung Uhm v. Humana, Inc.,
The lengthy expеrience with the Social Security Act also guides Medicare Act jurisdiction
The Social Security Act jurisdictional provisions are incorporated into the Medicare Act. We have found no case where a settlement of Social Security benefits was removed from the jurisdiction of the district court.
Conclusion
These holdings, that the Court of Federal Claims does not have jurisdiction of a fully executed Medicare settlement, resolve the question of whether the Court of Federal Claims has jurisdiction of a proposed, non-executed settlement. The Medicare Act dictates the path of judicial review of Medicare claims, whether the review is of a denied claim, or a proposal to settle, a claim. •
Prime Hospitals’ claim arises under the Medicare Act, whether viewed as an appeal of denied reimbursement, or as related to the proposed settlement terms for eligible claims. Precedent reinforces that this case belongs in the district court. From my colleagues’ contrary, conclusion, I respectfully dissent.
. The jurisdictional inquiry is not whether a valid contract was pleaded, but whether the issues in dispute are preempted by the jurisdictional provision of the Medicare Act. It is not disputed that this action arises under the Medicare Act, as the pleadings statе, citing 42 U.S.C. §§ 1395ff(b)(1)(A) and 405(g). J.A. 40. The panel majority now bifurcates this appeal, assigning some aspects of the denied Medicare claims to the Court of Federal Claims, while returning other aspects to the district court; that is, returning the requests for declaratory, injunctive, and mandamus relief regarding adjudication of the denied claims. Aside from valid concerns of judicial economy, these claims relate to the same denied claims and are brought under the same review provisions of the Medicare Act, and Prime Hospitals’ requested remedy is the receipt of compensation for provided services under the proposed Medicare settlement that the government refused to accept or ratify. J.A. 40, 43.
. The court states at its footnote 2 that "the parties do not dispute" that "a government representative ... entered or ratified the agreement.” That is incorrect. This dispute arose because the government representative refused to enter or ratify the proposed settlement agreement. This refusal was explicit, the Medicare representative stating that the Prime Hospitals were no longer able to participate in the proposed settlement because the agency “has been made aware of one or more ongoing False Claims Act сase(s) or investigation(s) involving the facilities.” J.A. 37. The Secretary continues to assert the absence of a valid contract in this appeal. See Appellee’s Br. 9 (stating that "HHS had never signed the settlement agreement, meaning that the government had never assented to the purported deal.”).
. The legislative history of. the Medicare Act shows that Congress considered, and rejected, concurrent jurisdiction in the Court of ■Claims. The rejected provision stated, "The .district courts of the United States shall have original jurisdiction, concurrent- with the Court of Claims,, of any civil action or claim of a carrier, a provided [sic] of services, or a State against the United States founded upon this Act,” H.R. 4351, 89th Cong. § 341 (1965). The clear intent of Congress to place jurisdiction in the district courts, through its repudiation of an attempt to place jurisdiction in the Court of Claims, should be respected.
. The majority states at its footnote 2 that the question before the Court of Federal Claims is whether the proposed settlement agreement meets the Federal Rule 12(b)(6) standard of stating a claim on which relief can be granted, That is not the issue of jurisdiction in this case. The issue is not whether there is an enforceable settlement agreement; the issue is whether the Medicare Act’s assignment of jurisdiction to the district court includes the issues raised on this denial' of reimbursement,