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April 9, 1991


The opinion of the court was delivered by: Nealon, District Judge.


The Hill-Burton Act, 42 U.S.C. § 291 et seq., (hereinafter Hill-Burton or the Act), requires medical facilities that are recipients of its funds to assure a reasonable amount of uncompensated services, determined by a formula based on a percentage of operating costs or of federal assistance provided, to patients who are deemed unable to pay according to prescribed income guidelines.*fn1 In this action, plaintiff seeks generally to enforce the "assurances" of uncompensated services made by Moses Taylor Hospital (hereinafter Hospital) under the Act and, in particular, to obtain personal relief from medical costs incurred by her husband. Presently before the court is defendant's motion to dismiss all counts in the complaint of the above-captioned case for failure to state a claim upon which relief may be granted pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. For the reasons that follow, the court will grant defendant's motion to dismiss plaintiff's Second, Third, Fourth, Fifth and Sixth Causes of action, and deny defendant's motion to dismiss plaintiff's First Cause of Action.


A. Facts

In September of 1984, Kenneth V. White, the deceased husband of plaintiff, was hospitalized at the defendant Hospital and incurred medical bills totaling $217,321.00 before his death.*fn2 Plaintiff avers that the Hospital, contrary to the regulations promulgated by the Secretary of Health and Human Services (hereinafter Secretary), notified neither her husband nor herself, and failed to post notices of the availability of uncompensated services to those patients who were eligible and sought such services.*fn3

Because plaintiff did not pay the medical bills, the Hospital instituted a collection action against her, as administratrix of her husband's estate, in the Court of Common Pleas of Lackawanna County. Due to plaintiff's failure to respond to the action in County Court, a judgment was entered against her for $217,321.00. Plaintiff complains, throughout this process, that she possessed inadequate resources to pay expenses owed to the Hospital, that she was unaware of any potential free or reduced cost medical services, and that the Hospital failed to provide notices detailing the availability of Hill-Burton funds or to provide written notice to her of those same funds in violation of 42 C.F.R. § 124.504.*fn4

After the default judgment was entered, plaintiff learned of the availability of the free or reduced cost health care and applied to the Hospital for relief. The Hospital allegedly denied those funds to her and additionally failed to provide a written determination of her eligibility as required by 42 C.F.R. § 124.507.*fn5

B. Procedural History

In April of 1989, plaintiff filed a complaint with the Secretary against the Hospital for failing to comply with its Hill-Burton obligations. See document 1 of record, Exhibit A. On July 19, 1989, the Assistant Surgeon General for the United States Department of Health and Human Services informed plaintiff that her complaint was dismissed, but that "[u]nder section 1627 of the Public Health Service Act (42 U.S.C. § 300s-6) after a complaint has been dismissed, the person who filed the complaint may bring a private right of action in court to effectuate compliance by the facility with the regulations." Document 10 of record, Exhibit A; see also document 1 of record at ¶ 23.*fn6

On May 8, 1989, plaintiff obtained a stay of the collection proceedings in the Court of Common Pleas. On November 3, 1989, plaintiff initiated this instant suit, on her own behalf and as personal representative of the Estate of Kenneth V. White, to compel Moses Taylor to abide by their obligation to provide free or low cost medical care to eligible individuals. In her complaint, plaintiff, in addition to seeking punitive damages, posits six causes of action: (1) violation of the Hill-Burton Act; (2) denial of due process under the Fifth and Fourteenth Amendments of the United States Constitution; (3) breach of contract; (4) denial of equal protection under the Fifth and Fourteenth Amendments; (5) violation of the Pennsylvania Unfair Trade Practices and Consumer Protection Law 73 Pa.Stat.Ann. § 201, et seq.; and (6) violation of the Civil Rights Act, 42 U.S.C. § 1983 (Section 1983).*fn7 See document 1 of record. On February 28, 1990, defendant filed its motion to dismiss together with a supporting brief. See documents 6 & 7 of record. After plaintiff and defendant filed their respective briefs in support of and opposition to the pending motion, the court held several hearings and conferences. During the last hearing in late December, 1990, the court extended defendant additional time to conduct further research and to submit any additional briefs. The court has been informed that no further submissions will be forthcoming which would affect this motion. All documents necessary for consideration of the present motion are before the court. Accordingly, the motion is now ripe for disposition.


On a motion to dismiss for failure to state a claim upon which relief can be granted, the burden of proof lies with the moving parties. Johnsrud v. Carter, 620 F.2d 29, 33 (3d Cir. 1980). The court, in ruling upon a Rule 12(b)(6) motion, must accept all well-pleaded allegations of the complaint as true and construe them in a light most favorable to the non-moving parties. Scheuer v. Rhodes, 416 U.S. 232, 236, 94 S.Ct. 1683, 1686, 40 L.Ed.2d 90 (1974); Truhe v. Rupell, 641 F. Supp. 57, 58 (M.D. Pa. 1985) (Rambo, J.). The motion should be granted only if "it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Hosp. Bldg. Co. v. Trustees of Rex Hosp., 425 U.S. 738, 746, 96 S.Ct. 1848, 1853, 48 L.Ed.2d 338 (1976) (quoting Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 101-02, 2 L.Ed.2d 80 (1957)).

A. Federal Claims

1) Hill-Burton Claim

A brief background outlining the origin of the Hill-Burton Act and the ensuing adoption of regulations implementing the Act may be instructive.*fn8 Congress, in 1946, enacted Title VI of the Public Health Service Act, commonly known as the HillBurton Act. Generally, the Act was intended to address problems with the adequacy and distribution of health service facilities by means of a program of grants-in-aid to the States. See Statement of Senator Hill, in Hearings on S. 191 before the Senate Comm. on Education and Labor, 79th Cong., 1st Sess. 6-9 (1945). The expressed purpose of the Act, aside from stimulating the development of new or improved medical facilities and promoting research, was:

  to assist the several States in the carrying out
  of their programs for the construction and
  modernization of such public or other nonprofit
  community hospitals and other medical facilities
  as may be necessary, in conjunction with existing
  facilities, to furnish adequate hospital, clinic,
  or similar services to all their people. . . .

42 U.S.C. § 291(a). A State wishing to participate in this program and receive federal assistance was required to submit a plan to the Surgeon General*fn9 (now the Secretary of Health and Human Services), for his approval. 42 U.S.C. § 291d.

Most importantly to the issues presented in this litigation, the Hill-Burton act required that:

  The Surgeon General . . . shall by general
  regulations prescribe —
    (e) that the State plan shall provide for
    adequate hospitals, and other facilities for
    which aid under this part is available, for all
    persons residing in the State, and adequate
    hospitals (and such other facilities) to
    furnish needed services for persons unable to
    pay therefor. Such regulations may also require
    that before approval of an application for a
    project is recommended by a State agency to the
    Surgeon General for approval under this part,
    assurance shall be received by the state from
    the applicant that (1) the facility or portion
    thereof to be constructed or modernized will be
    made available to all persons residing in the
    territorial area of the applicant; and (2)
    there will be made available in the facility or
    portion thereof to be constructed or modernized
    a reasonable volume of services to persons
    unable to pay therefor, but an exception shall
    be made if such a requirement is not feasible
    from a financial viewpoint.

42 U.S.C. § 291c(e). The second of the two "assurances " — requiring a state plan to furnish necessary services to persons unable to pay — is the one implicated in this case. Under Section 291c(e), the Surgeon General could require as a condition of approval that the State give an "assurance" that there be made available a reasonable volume of services to persons unable to pay.

The regulations issued pursuant to enforcing these "assurances" essentially mirrored the language of the statute for nearly thirty years. See American Hosp. Ass'n v. Schweiker, 721 F.2d 170, 173 (7th Cir. 1983), cert. denied, 466 U.S. 958, 104 S.Ct. 2169, 80 L.Ed.2d 553 (1984) (citing 42 C.F.R. §§ 52.61-53.63 (Supp. 1947)). Despite the "uncompensated care assurance" requirement, hospitals receiving the federal aid routinely ignored their responsibility to provide charitable care. Id. In response to this reluctance by hospitals, the Secretary in 1972 issued regulations which contained more definite standards to determine compliance with the "assurance" obligations. See 42 C.F.R. §§ 53.111, 53.113 (1974). Moreover, in 1975, Congress passed Title XVI of the Public Service Act, 42 U.S.C. § 300q et seq., which mandates, rather than permits, regulations enforcing the "assurances". See 42 U.S.C. § 300s-1(b)(1)(K). Further, Section 300s-6 firmed up the enforcement mechanism of the Hill-Burton Act, stating:

    The Secretary shall investigate and ascertain,
  on a periodic basis, with respect to each entity
  which is receiving financial assistance under
  this subchapter or which has received financial
  assistance under subchapter IV of this chapter or
  this subchapter, the extent of compliance by such
  entity with the assurances required to be made at
  the time such assistance was received. If the
  Secretary finds that such an entity has failed to
  comply with any such assurance, the Secretary
  shall report such noncompliance to the health
  systems agency for the health service area in
  which such entity is located and the State health
  planning and development agency of the State in
  which the entity is located and shall take any
  action authorized by law (including an action for
  specific performance brought by the Attorney
  General upon request of the Secretary) which will
  effect compliance by the entity with such
  assurances. An action to effectuate compliance
  with any such assurance may be brought by a
  person other than the Secretary only if a
  complaint has been filed by such person with the
  Secretary and the Secretary has dismissed such
  complaint or the Attorney General has not brought
  a civil action for compliance with such assurance
  within six months after the date on which the
  complaint was filed with the Secretary.

This statutory provision transferred the primary investigatory and enforcement power to the Secretary in order to better effectuate compliance by hospitals with their "assurance" to provide uncompensated services. The Secretary then promulgated stricter regulations in response to Title XVI. See 44 Fed.Reg. 29372-29410 (1979). Specifically relevant for this suit, a more stringent enforcement section was created which evolved into the regulations found in 42 C.F.R. §§ 124.511 & 124.512.*fn10

While it is readily obvious that an explicit "private action" does exist under Section 124.511 to effect compliance with the assurances, it is not equally obvious as to the extent of the remedy a person may seek through that "private action". There exists some case law holding that a person cannot sue the Secretary directly in order to compel him to enforce the regulations. See, e.g., Gillis v. United States Department of Health and Human Services, 759 F.2d 565 (6th Cir. 1985); Davis v. Ball Memorial Hosp. Ass'n, 640 F.2d 30 (7th Cir. 1980). Here, however, plaintiff is not seeking such relief but, instead, has initiated a suit directly against the Hospital.*fn11 This action raises two significant questions for our purposes: (1) Does plaintiff have a "private action" that encompasses personal relief; and (2) Does compliance by the Hospital require providing individual remedies under the ...

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