The opinion of the court was delivered by: Magistrate Judge Bissoon*fn1
This is an appeal from the final decision of the Secretary of the Department of Health and Human Services ("Secretary") denying Medicare coverage under Part C of the Medicare Program for care provided to Wanda Papciak ("Plaintiff"), between July 10 through July 19, 2008. The administrative law judge (the "ALJ") found that Plaintiff did not require Medicare-covered skilled nursing services. The Medicare Appeal Counsel ("MAC") affirmed. Plaintiff contends that the decision denying coverage is not supported by substantial evidence in the record. Conversely, the Secretary asserts that the decision is supported by substantial evidence. The parties filed cross-motions for summary judgment pursuant to Rule 56(c) of the Federal Rules of Civil Procedure. For the reasons that follow, the Court will deny the Secretary's motion for summary judgment and will grant Plaintiff's motion for summary judgment and will remand the case for instruction to award Plaintiff benefits.
At the time of the Secretary's decision, Plaintiff was 81 years old and had undergone a hip replacement surgery on April 28, 2008. Plaintiff received twenty days of therapy and was discharged to her home for home health care on May 22, 2008. Subsequently, Plaintiff developed a urinary tract infection and she was readmitted to the hospital. On June 3, 2008, Plaintiff was discharged by Dr. Tuchinda to ManorCare to receive skilled nursing care, physical therapy and occupational therapy. R. at 174, 225. Upon Plaintiff's admission to ManorCare, Plaintiff was unable to ambulate and could not use her walker due to numbness of her hands due to what was later diagnosed as carpal tunnel syndrome. R. at 279, 503, 686. Plaintiff also had a history of cellulitis, anemia, cholecystectomy, chronic atrial fibrillation, hypertension, anxiety and depression. R. at 506, 686.
Plaintiff received therapy five days a week; however, she made slow progress during her stay. R. at 295, 298. Plaintiff's therapy included physical and occupational therapy, treatment, self care, therapeutic exercises and therapeutic activities. Her initial treatment was primarily for ambulation. R. at 286, 295. Medicare paid for the skilled care Plaintiff received from June 3 through July 9, 2008. It was determined, however, that effective July 10, 2008, Plaintiff no longer needed skilled care because Plaintiff had made only minimal progress in some areas, had regressed in other areas, and had been determined to have met her maximum potential for her physical and occupational therapy. R. at 287, 300. As a result, Medicare denied payment from July 10 through July 19 because Plaintiff was only receiving "custodial care," not the skilled nursing services required for Medicare coverage.
Subsequent to Plaintiff's treatment at ManorCare, Plaintiff was admitted to the UPMC South Side Emergency Room as an inpatient for a possible infection and generalized weakness.
R. at 369. After three days in the hospital, she was transferred to a different facility, Baldwin Health Center. R. at 369, 657. At the new location, she was given physical therapy treatment.
R. at 363. The treating physician determined that she would benefit from continued occupational therapy treatment. Id. This assessment proved to be accurate and she met three of her goals prior to discharge on August 21, 2008. R. at 355. Her physical therapist also expressed that she had good recovery potential. R. at 353.
Plaintiff appealed the decision denying coverage and the appeal was subsequently denied by Quality Insights of PA on July 9, 2008. R. at 194-196. On November 13, 2008, the ALJ held a telephonic hearing, and on November 20, 2008, the ALJ issued a decision denying Plaintiff Medicare coverage. R. at 77-83; 638-696. Plaintiff appealed that decision to the MAC. On August 6, 2008, the MAC upheld the ALJ's decision. R. at 1-7. The MAC decision is the final decision of the Secretary. 42 C.F.R. § 405.730. Therefore, Plaintiff has exhausted her administrative remedies and now seeks relief from this court.
Judicial review of the Secretary's denial of Medicare coverage is proper pursuant to 42 U.S.C. § 405(g). The role of this Court on judicial review is to determine whether there is substantial evidence in the administrative record to support the Secretary's final decision. Any findings of fact made by the ALJ must be accepted as conclusive, provided that they are supported by substantial evidence. 42 U.S.C. § 405(g).
Substantial evidence has been defined as "such relevant evidence as a reasonable mind might accept as adequate to support a conclusion." Richardson v. Perales, 402 U.S. 389, 401 (1971) (quoting Consolidated Edison Co v. NLRB, 305 U.S. 197, 229 (1938)). The district court's function is to determine whether the record, as a whole, contains substantial evidence to support the Secretary's findings. See Adorno v. Shalala, 40 F.3d 43, 46 (3d Cir. 1994) (citing Richardson, 402 U.S. at 401). In making his determination, the ALJ must consider all relevant evidence in the record and provide some indication of the evidence he rejected and why he rejected it. Id. at 48; see also Cotter v. Harris, 642 F.2d 700, 704 (3d Cir. 1981).
Furthermore, the Court also must determine whether the Secretary applied the proper legal standard in denying Medicare benefits. Beckett v. Leavitt, 555 F. Supp. 2d 521, 526 (E.D. Pa. 2006); see also Gartmann v. Secretary of HHS, 633 F. Supp. 671, 681 (E.D.N.Y. 1986) ("A reviewing court, therefore, is compelled to accept the Secretary's supported findings of fact. A court, however, is not bound by the Secretary's conclusions or interpretations of law, or an application of an incorrect legal standard.") (citing Kuebler v. Secretary of HHS, 579 F. Supp. 1436, 1438 (E.D.N.Y. 1984); Sokoloff v. Richardson, 383 F. Supp. 234, 236 (E.D.N.Y. 1973); Ridgely v. Secretary, 345 F. Supp. 983, 988 (D. Md. 1972)).
During the time period in question, Plaintiff was insured by Keystone Health Plan West / Highmark Security Blue, a Medicare Advantage plan. Medicare Advantage plans are required to cover the same medical services that Medicare would cover. 42 C.F.R. § 422.101. One of the exclusions of coverage from Medicare is for expenses considered to be "custodial care." 42 U.S.C. § 1395y(a)(9). The regulations state that "custodial care is any care that does not meet the requirements for coverage as ...