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June 26, 1989


The opinion of the court was delivered by: REED, JR.

 This is an action brought pursuant to Title XIX of the Social Security Act, 42 U.S.C. §§ 1396-1396i, and the regulations promulgated thereunder, commonly known as the Medicaid Program. Plaintiffs allege inter alia that defendant, owner and operator of the Rosemont Manor Nursing Home where Mrs. Arlene Chalfin was a patient from November to December 1986, violated the Social Security Act by discharging Mrs. Chalfin against her will and without the proper justification. *fn1" Jurisdiction is founded upon diversity, 28 U.S.C. § 1332. *fn2"

 Before the court is the motion of the defendant Beverly Enterprises to dismiss counts I, II, III, IV, and VII of the complaint as to all the plaintiffs, and to dismiss count V with respect to Harry Chalfin, Richard Chalfin, Alan Chalfin and Susan Chalfin-Dughi, and the cross motion of the plaintiffs for summary judgment on their contract claim (count VI). *fn3" For the reasons set forth below, the motion of the defendant will be granted as to counts I, II, III, IV and V, granted in part and denied in part as to count VII, and plaintiffs' cross motion for summary judgment will be denied.


 Factual Background

 Plaintiff, Arlene Chalfin, was admitted on or about November 11, 1986 to the Rosemont Manor Nursing Home which is owned and operated by the defendant, Beverly Enterprises, Inc. The plaintiff was, and still is, suffering from Alzheimer's Disease, and at the time of her admission was recovering from a seizure which caused multiple fractures. As a result of those injuries, Mrs. Chalfin was unable to ambulate at that time. Plaintiff was admitted to defendant's facility as a private patient. *fn4"

 Plaintiffs contend that after they declined to place Mrs. Chalfin in a different facility, "Rosemont's administrator began a pattern of harassment designed to coerce the family to seek out another facility." The alleged harassment included verbal abuse of the family, refusing to permit the family from being involved in their spouse and mother's care, refusing to permit the family to touch her and attempting to evict plaintiff on the day before Thanksgiving. As a result of this attempt to evict her, the plaintiffs filed a complaint with the Department of Health.

 The defendant denies that any harassment or discrimination ever took place at Rosemont and asserts that it only attempted to discharge Mrs. Chalfin on November 22nd after the Director of Nursing discovered Mrs. Chalfin's husband, a dentist, performing a dental procedure on his wife without prior permission or notice to anyone on the Rosemont staff. As a result, defendant contends that it was concerned that it could not adequately care for Mrs. Chalfin under these conditions and therefore issued her and her family a 30-day notice to relocate. Following a meeting with the Chalfins and the Rosemont Administrator on November 24th, the 30-day notice was withdrawn. Subsequently, the plaintiffs withdrew their pending complaint with the Department of Health.

 On the evening of December 19, 1986, Mrs. Chalfin was transferred to Bryn Mawr Hospital. The defendant asserts that the reason Mrs. Chalfin was transferred was because her medical condition worsened and she was transferred with the approval of her treating physician. Plaintiffs contend that Mrs. Chalfin's treating physician, Dr. Rowland, never actually consented to and approved the transfer as he was not on call at that time and that a different doctor covering for him actually ordered the transfer. Plaintiffs assert that Dr. Rowland signed the discharge summary only after the fact and never approved the transfer prior to her admission to the hospital.

 Plaintiffs state that following the transfer, after Dr. Chalfin inquired about holding the bed, Rosemont's administrator advised him to collect the balance of the funds which had been paid through December. Defendant contends that it was because of Mrs. Chalfin's serious medical condition that it advised the plaintiffs that Rosemont could no longer care for Mrs. Chalfin.

 The present litigation ensued, with Mrs. Chalfin and her family filing a seven count complaint seeking damages under Title XIX of the Social Security Act, 42 U.S.C. § 1396-1396i (1982 & Supp. IV 1986), the Pennsylvania Health Care Facilities Act, 35 Pa. Stat. Ann. §§ 448.101-448.904 (Purdon Supp. 1989), the Pennsylvania Unfair Trade Practices and Consumer Protection Law, 73 Pa. Stat. Ann. §§ 201-1-201-9.2 (Purdon 1971 & Supp. 1989), and state law breach of contract and intentional infliction of emotional distress claims.




 Medicaid is a joint federal-state program organized under Title XIX of the Social Security Act, 42 U.S.C. §§ 1396-1396i and the regulations promulgated thereunder, providing medical assistance benefits to qualified recipients through the recipient's state. The bill was "designed to liberalize the Federal law under which states operate their medical assistance programs so as to make medical services for the needy more generally available." S. Rep. No. 404, 89th Cong., 1st Sess., reprinted in 1965 U.S. Code Cong. & Admin. News 1943, 2014.

 In accordance with Title XIX, the federal government reimburses qualifying states for a portion of expenditures made by such states for certain medical care and services provided to eligible recipients by qualified providers. An individual is entitled to Medicaid if she fulfills the criteria established by the state in which she lives. In order for a state to qualify for federal reimbursements, the state must establish an approved state plan for medical assistance which meets established federal guidelines. Accordingly, although states are in no way obligated to participate in the program, if a state chooses to participate, it must comply with federal regulations. See Roberson v. Wood, 464 F. Supp. 983, 984 (E.D. Ill. 1979); Fuzie v. Manor Care, Inc., 461 F. Supp. 689, 693 (N.D. Ohio 1977).

 Each participating state maintains the primary responsibility for implementing the Medicaid Program, for determining recipient eligibility for participation, and for ensuring that "care and services under the plan will be determined, and such care will be provided, in a manner consistent with simplicity of administration and the best interests of the recipients." 42 U.S.C. § 1396a(a)(19) (1982). Generally, states, rather than providing medical assistance directly, enter into provider agreements for a term of years with state-certified health care facilities who are willing to act as health care providers. This term is usually automatically renewed unless the health care provider is either decertified for failing to satisfy state requirements or voluntarily terminates the arrangement. See Bumpus v. Clark, 681 F.2d 679, 682 (9th Cir. 1982), withdrawn as moot, 702 F.2d 826 (9th Cir. 1983).

 Implied Right of Action

 The primary issue in this case and the linchpin upon which it turns, is whether a private right of action may be implied under Title XIX of the Social Security Act, 42 U.S.C. §§ 1396-1396i (1982 & Supp. IV 1986). While the issue is one of first impression in this circuit, several district courts and one court of appeals have had occasion to expressly confront this issue and have reached different conclusions. Compare Stewart v. Bernstein, 769 F.2d 1088, 1093 (5th Cir. 1985) (private right of action may not be implied under the statute); Wagner v. Sheltz, 471 F. Supp. 903, 910 (D. Conn. 1979) (same); Fuzie v. Manor Care, Inc., 461 F. Supp. 689, 697 (N.D. Ohio 1977) (same) with Roberson v. Wood, 464 F. Supp. 983, 989 (E.D. Ill. 1979) (recognizing an implied private right of action under the statute); Berry v. First Healthcare Corporation, Medicare & Medicaid Guide (CCH) P28,693 (D.N.H. Oct. 26, 1977) (same). Because I find no evidence that Congress intended to create a private right of action under the statute, *fn5" and because it is well established that "the federal judiciary will not engraft a remedy on a statute, no matter how salutary, that Congress did not intend to provide," California v. Sierra Club, 451 U.S. 287, 297, 68 L. Ed. 2d 101, 101 S. Ct. 1775 (1981), I hold that plaintiffs may not maintain a private action under Title XIX of the Social Security Act.

 The test used to determine whether a private right of action may be implied from a federal statute was articulated by the Supreme Court in Cort v. Ash, 422 U.S. 66, 45 L. Ed. 2d 26, 95 S. Ct. 2080 (1975). "The question . . . is one of statutory construction, and the key to the inquiry is the intent of the legislature." Plucinski v. I.A.M. National Pension Fund, 875 F.2d 1052, 1055 (3d Cir. 1989) (citing Northwest Airlines, Inc. v. Transport Workers Union of America, 451 U.S. 77, 91, 67 L. Ed. 2d 750, 101 S. Ct. 1571 (1981)). See also Barron v. Nightingale Roofing, Inc., 842 F.2d 20, 21 (1st Cir. 1988). The four inquiries Cort established are: (1) "Is the plaintiff 'one of the class for whose especial benefit the statute was enacted' . . . that is, does the statute create a federal right in favor of the plaintiff?" Cort, 422 U.S. at 78 (quoting, in part, Texas & Pacific Railroad Co. v. Rigsby, 241 U.S. 33, 39, 60 L. Ed. 874, 36 S. Ct. 482 (1916)). (2) "Is there any indication of legislative intent, explicit or implicit, either to create such a remedy or to deny one?" Id. (3) "Is it consistent with the underlying purposes of the legislative scheme to imply such a remedy for the plaintiff?" Id. (4) "Is the cause of action one traditionally relegated to state law, in an area basically the concern of the States, so that it would be inappropriate to infer a cause of action based solely on federal law?" Id.

 The first court to confront the issue of whether an implied right of action may be implied under Title XIX of the Social Security Act was Fuzie v. Manor Care, Inc., 461 F. Supp. 689 (N.D. Ohio 1977). In Fuzie, a Medicaid recipient resident at a private nursing facility brought suit against the owner and operator of such facility in an attempt to enforce the provisions of certain regulations promulgated by the Secretary of Health Education & Welfare under the Medicaid Program. Plaintiff in Fuzie asserted that the defendant had engaged in a systematic program of transferring or discharging from its facility all patients who are Medicaid recipients with the exception of those who became eligible for Medicaid subsequent to exhausting their assets as private patients. As a result, the plaintiff in Fuzie contended that the transfers or discharges were being effected for other than medical reasons.

 Using the Cort criteria, Fuzie found that a private right of action may not be implied from the legislative scheme of Title XIX and therefore should not be judicially created. Id. at 696-97. Under the first prong of the Cort test, the court found that the plaintiff, a Medicaid recipient, was among the class of persons for whose benefit the legislation was enacted, but found that "the plaintiff [did] not possess an absolute right not to be transferred." Id. at 696. The Fuzie court then determined, under the second prong of the Cort inquiry, that "the Medicaid Act and the regulations contemplate administrative rather than judicial enforcement of the legislation's requirements," id., and therefore that the second part of the Cort test mandated that no private right of action should be implied. Fuzie, evaluating the third requirement of Cort to determine whether it was consistent with the underlying purpose of the particular legislative scheme to imply such a remedy, found that the creation of a private remedy in this situation "would disrupt the implementation of the Medicaid Program." Id. Finally, the court found that there were sufficient state remedies available to the plaintiff and that "the creation of a federal right of action will disserve the administrative nature of the Medicaid program, whereas committing the plaintiff to her state remedies is consistent with the primary state implementation of the program."

 The only court of appeals to consider this issue has held that Title XIX does not provide for a private right of action. In Stewart v. Bernstein, 769 F.2d 1088 (5th Cir. 1985), the Fifth Circuit reviewed a district court's finding that Congress did not intend to create a judicially enforceable cause of action between Medicaid residents and their private nursing homes and reasoned that there was "nothing in either the statute or the legislative history which would suggest that Congress intended to create such a remedy." Id. at 1092. The court held that absent any direct evidence of congressional intent, no federal cause of action existed against the private nursing home. Id. at 1093. Moreover, the court found that "the Act contemplates certain kinds of judicial enforcement to secure certain kinds of individual rights; it does not envision suit by a recipient against her private provider of services." Id. at 1094 (footnote omitted).

 Plaintiffs argue that Stewart does not provide persuasive support for the instant case because a "doctrine" exists in the Fifth Circuit which precludes a court from using a federal regulation as a means of engrafting a private right of action. Plaintiffs position is based on the following language found in a footnote in Stewart :

The only "rights" cited by appellant appear in the federal regulations and protect, among other things, a patient's ability to refuse medication, to be transferred for good cause, and to receive adequate notice and pre-transfer preparation. 42 C.F.R. § 405.1121(k); see also id. § 442.311 (ICF patients' bill of rights). As we note below, these regulatory rights are enforceable by means other than a civil suit under the Medicaid Act against a private provider of services. In any event, the federal regulations cannot themselves create a cause of action; this is a job for the legislature.

 Stewart, 769 F.2d at 1092-93 n. 6. Contrary to plaintiffs suggestion, however, far from being an aberration in the Fifth Circuit, it is in fact a well established tenet of statutory construction expressly adopted by the United States Supreme Court that "the rulemaking power granted to an administrative agency charged with the administration of a federal statute is not the power to make law. Rather, it is 'the power to adopt regulations to carry into effect the will of Congress as expressed by the statute.'" Ernst & Ernst v. Hochfelder, 425 U.S. 185, 213-14, 47 L. Ed. 2d 668, 96 S. Ct. 1375 (1976) (quoting, in part, Dixon v. United States, 381 U.S. 68, 74, 14 L. Ed. 2d 223, 85 S. Ct. 1301 (1965) and Manhattan General Equipment Co. v. Commissioner, 297 U.S. 129, 134, 80 L. Ed. 528, 56 S. Ct. 397 (1936)), reh'g denied, 425 U.S. 986, 96 S. Ct. 2194, 48 L. Ed. 2d 811 (1976). See also Touche Ross & Co. v. Redington, 442 U.S. 560, 577 n. 18, 61 L. Ed. 2d 82, 99 S. Ct. 2479 (1979) (language of statute and not the rules must control). Thus, it is axiomatic that "[a] rule or regulation promulgated under the authority of a federal statute cannot alone provide the source of an implied right of action if the specific language of the statute ...

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