By Michelle L. Oxman, J.D., LL.M.
For the second time, a federal court has dismissed the claims of a supplier of prosthetic eyes that the revocation of her Medicare billing privileges violated her constitutional rights. Again, the court ruled Soc. Sec. Act sec. 205(h) limited its jurisdiction to matters arising under the Social Security Act (SSA) and related regulations. The supplier was granted one final attempt to amend her complaint to conform to the limits of the statute (Hindley v. HHS, February 5, 2016, James, M.).
Initial enrollment. The details of the supplier’s enrollment and the revocation of her billing privileges were previously reported (see Case dismissed after supplier drops only claim surviving jurisdictional bar, December 16, 2015). Essentially, the dispute involved the question of whether permission to operate by appointment only excused the supplier from the requirement to post her hours of operation at her physical address as required by 42 C.F.R. sec. 424.57.
Lengthy litigation. The supplier pursued administrative review at the Departmental. Appeals Board Civil Remedies Division (see Inspections by appointment only, but no one’s home, January 28, 2015) and at the Appellate Division (see Prosthetic eye supplier sees revocation after failing to post hours of operation, March 10, 2015). She then sued in federal court. The previous court decision involved her third attempt to state a claim. In that decision, the court ruled that it could not hear her claims of an unconstitutional taking of property without compensation, denial of due process of law, and gross negligence under the Federal Tort Claims Act because Soc. Sec. Act sec. 205 limited its jurisdiction to issues arising under the SSA.
The current ruling. Despite the court’s ruling, in her Third Amended Complaint, the supplier alleged that the basis for federal jurisdiction was 28 U.S.C. §1331, the existence of a federal question, and made no mention of Soc. Sec. Act sec. 205. Once again, she alleged an unconstitutional taking and deprivation of due process, arguing that the reconsideration proceeding was faulty rather than focusing on the revocation. The court reiterated that the only basis for jurisdiction was the SSA and that it could not hear the claims alleged this complaint. The court noted, however, that the supplier was entitled to judicial review because she had met the requirements for jurisdiction under the SSA by exhausting her administrative remedies. Therefore, it gave her one more chance to submit a complaint under the SSA.
The case is No. 3:15-cv-01973-MEJ.
Attorneys: Reginald Regan Hindley (Reginald R. Hindley, Attorney at Law) for Julie Hindley. Erica Blachman Hitchings, United States Attorney's Office, for Department of Health and Human Services, Carolyn W. Colvin, Centers for Medicare and Medicaid Services and National Supplier Clearinghouse.
Companies: Department of Health and Human Services; Centers for Medicare and Medicaid Services; National Supplier Clearinghouse
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