Neff et al

Filing 20

ORDER denying 17 Motion for Leave to File; denying 17 Motion for Reconsideration re 16 Order Dismissing Case. Signed by Judge Donald W. Molloy on 11/5/2013. (dle)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MONTANA
MISSOULA DIVISION

DAN NEFF, Personal Representative for
Estate of CHARLES BREEDING, et al.,
Plaintiffs,

CV 13–95–M–DWM

ORDER

vs.
KATHLEEN SEBELIUS, Secretary,
United States Department of Health and
Human Services,
Defendant.
Plaintiffs have filed a motion for leave to move for reconsideration of this
Court’s October 1, 2013 Order (Doc. 16) dismissing this case without prejudice
for lack of subject matter jurisdiction. Plaintiffs contend such relief is warranted
on the grounds that they are foreclosed from participating in the administrative
process and thus a narrow exception outlined in the Ninth Circuit decision Haro v.
Sebelius, Slip Copy No. 11-16606 (9th Cir. Sept. 4, 2013) controls.
Under Rule 59(e) of the Federal Rules of Civil Procedure, a district court
may, in its discretion, alter or amend a judgment “if the district court committed
clear error or made an initial decision that was manifestly unjust.” Zimmerman v.

1

City of Oakland, 255 F.3d 734, 740 (9th Cir. 2001). “A motion for
reconsideration under Rule 59(e) should not be granted, absent highly unusual
circumstances, unless the district court is presented with newly discovered
evidence, committed clear error, or if there is an intervening change in controlling
law.” McDowell v. Calderon, 197 F.3d 1253, 1255 (9th Cir. 1999) (internal
quotation marks and citation omitted). The purpose of Rule 59(e) is to allow the
district court to correct its own errors, sparing the parties and appellate courts the
burden of unnecessary appellate proceedings. See United States v. Dieter, 429
U.S. 6 (1967).
In this Court’s October 1 Order, it determined it lacked subject matter
jurisdiction because jurisdiction was inadequately pled and Plaintiffs failed to
channel their claims through the administrative exhaustion process, 42 U.S.C. §
405(g). Although this Court correctly concluded that Plaintiffs’ claim “arose
under” the Medicare Act, it did not apply a narrow exception that excuses such
exhaustion if the party is foreclosed from participating in the administrative
review process. See Haro, at 26. In their motion, Plaintiffs insist this narrow
exception applies here as they are not beneficiaries under the Medicare Act and
are unable to pursue administrative review.
This situation is not a clear-cut question of an intervening change in
2

controlling law or newly discovered evidence. Rather, the case at issue, Haro,
clarified the facts necessary for meeting an existing exception under the law.1
Pursuant to Haro, a non-beneficiary who has no opportunity to present his
challenge through the administrative process is excepted from the administrative
exhaustion requirements of 42 U.S.C. § 405(g). At 26. The Haro decision,
however, does not change the fact that some non-beneficiaries are still required to
administratively exhaust. See Shalala v. Ill. Council on Long Term Care, Inc., 529
U.S. 1, 20-21 (2000) (regarding an association of nursing homes).
In both their Complaint and Brief in Opposition, Plaintiffs assert they are
non-beneficiaries; however, Plaintiffs have previously failed to assert that they are
ineligible to participate in the administrative review process. The Secretary
actually contends the contrary, citing to the regulations which provide that an
“individual authorized under State law . . . to act on behalf of a beneficiary” is an
authorized representative and has “all of the rights and responsibilities of a
beneficiary . . . throughout the appeals process.” 42 U.S.C. § 405.902. The
Secretary also cites to a portion of the Medicare Manual that states: “If the
beneficiary is deceased, the legal representative of the estate may file an appeal.”
1

As cited in Haro, this exception was first outlined in Illinois Council. See
Haro, at 26; Shalala v. Ill. Council on Long Term Care, Inc., 529 U.S. 1, 19
(2000).
3

Medicare Claims Processing Manual, Ch. 29, 270.1.7. These provisions indicate
that Plaintiffs, as the personal representatives of the estates of certain deceased
beneficiaries, are eligible to participate in the administrative review process.
Furthermore, even if this Court accepted Plaintiffs’ current motion as
sufficient to demonstrate a lack of access to the administrative review process,
such a finding would not overcome the Complaint’s other jurisdictional
inadequacies.
Having reconsidered its dismissal without prejudice for lack of subject
matter jurisdiction, IT IS ORDERED that the Plaintiffs’ motion (Doc. 17) is
DENIED.
Dated this 5th day of November, 2013.

4