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BROWN v. RICHARDSON

May 27, 1975

Harry V. BROWN, Jr., for Harry V. Brown, Sr., Plaintiff,
v.
Elliot L. RICHARDSON, Secretary of Health, Education and Welfare, Defendant


McCune, District Judge.


The opinion of the court was delivered by: MCCUNE

McCUNE, District Judge.

 Defendant's motion for summary judgment requires that we determine whether the Social Security Administration, an administrative agency of the United States Government, can be estopped to deny payment of benefits, when payment would work a result inconsistent with the substantive provisions of the Social Security Act. At issue is the liability of the Administration for the cost of in-patient hospital services furnished to plaintiff's father by the Jameson Memorial Hospital from January 13, 1970, until his death on April 26, 1970.

 I

 Background

 Plaintiff, a son of the deceased, initiated this action pursuant to §§ 1869(b) and 205(g) of the Act, 42 U.S.C. §§ 1395ff(b)(1)(C) and 405(g) to seek review of the final decision of the Secretary of Health, Education and Welfare (the Secretary) denying his claim for health insurance benefits under § 1812(a)(1) of the Act's "medicare" provisions, 42 U.S.C. § 1395d(a)(1). As initially presented, plaintiff contended that his father had commenced a new "spell of illness" under § 1861(a)(1) of the Act, 42 U.S.C. § 1395x(a)(1) upon his admission to the hospital on January 13, 1970, and was, therefore, entitled to benefits under the Act.

 In our opinion of December 5, 1973, we rejected that argument and held that plaintiff was not entitled to the contested benefits under the substantive provisions of the Act. At that time, however, we denied defendant's motion for summary judgment and remanded the case to the Secretary for consideration of the estoppel question which had been raised at the first argument and which is now before us, plaintiff having appealed from the Secretary's additional findings. *fn1"

 Plaintiff contends that under the facts presented here defendant should be estopped to deny payment of the contested benefits. We will summarize the facts upon which plaintiff's claim is based.

 From April, 1968, until his death, plaintiff's father was continuously institutionalized in either a nursing home or a hospital. Plaintiff claims that throughout this prolonged period of institutional care, he and members of his family were led to believe that they would be notified of the status of deceased's health insurance benefits by the Administration. This belief was founded upon a statement contained in a pamphlet prepared and distributed by the Commissioner of Social Security entitled "Your Medicare Handbook." On page 7 of that pamphlet it states:

 
"Hospital Insurance-Part A of Medicare
 
You Get a Personal Record of Benefits Used.
 
You don't have to bother about trying to keep track of how many 'days' or 'visits' you use in each period. The notice you receive from the Social Security Administration after you have used any hospital insurance benefits will tell you how many benefit 'days' and 'visits' you have left in that benefit period." *fn2"

 While the deceased had used his hospital benefits on several occasions after April 7, 1968, the Administration did not send any notice to the plaintiff or any member of his family concerning the status of deceased's benefits from April 7, 1968, until March 6, 1970, *fn3" almost two months after deceased was readmitted to the hospital, despite the fact his benefits had been exhausted prior to January 13, 1970. Plaintiff claims that this failure to give the notices as described in the medicare handbook lulled him into a false sense of security. Therefore, plaintiff argues that the Secretary should be estopped to deny payment of the contested benefits.

 At a hearing conducted before an Administrative Law Judge, Don Brown, plaintiff's brother testified:

 
"[I] absolutely had no knowledge that his benefit period was used up and to the best of my knowledge there was no notification on the part of the Social Security Administration that his benefits had been used to the extent where he had overdrawn *fn4" and used his benefits and also to the point where (benefits for) the last stay in the hospital were denied because of the government's contention that he had used up all his benefits periods . . . . I am sure it would have changed things had we been notified that we were incurring a debt of this magnitude through the hospital . . . . I am sure had we known this size of a bill was going to be run up, that we would have examined to see if there was private individuals who had homes that, who would have rendered the kind of service that we had intended him to get at Golden Hill (nursing home) through private sources at a much less [sic] economical rate and also it would have been in a position to extend his benefit period." Tr. 44-46.

 Pursuant to our order, the Secretary, acting through the Appeals Council, answered those questions as follows:

 
(1) The authority to issue the pamphlet "Your Medicare Handbook" derives from and is implicit in the responsibility for the administration of the Social Security program. The program depends on informed participation by the public. Therefore it is necessary as Congress has repeatedly recognized through budgetary appropriations for the Commissioner to publish informational materials that seek to advise the public in ...

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