339 F. App'x 261

Isadore KOPSTEIN; Dorothy Kopstein, Appellants v. INDEPENDENCE BLUE CROSS.

No. 09-1232.

United States Court of Appeals, Third Circuit.

Submitted Pursuant to Third Circuit LAR 34.1(a) July 29, 2009.

Opinion filed: July 29, 2009.

Isadore Kopstein, Philadelphia, PA, pro se.

Dorothy Kopstein, Philadelphia, PA, pro se.

Mark J. Dianno, Esq., Jared T. Hay, Esq., Salmon, Ricchezza, Singer & Turchi, Philadelphia, PA, for Independence Blue Cross.

Before: FISHER, JORDAN and VAN ANTWERPEN, Circuit Judges.

OPINION

PER CURIAM.

Isadore and Dorothy Kopstein (“the Kopsteins”) appeal pro se from a District Court order granting a motion by Independence Blue Cross (“IBC”) to dismiss their amended complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). For the reasons that follow, we will affirm the District Court’s order on alternative grounds.

I. Background

The Kopsteins participate in IBC’s “Personal Choice 65,” a program providing el*262derly individuals health insurance and prescription drug benefit coverage through Medicare. In January 2008, the Kopsteins initiated an action against IBC in Philadelphia Municipal Court, concerning IBC’s provision of the Kopsteins’ 2007 Medicare Part D prescription drug coverage.

In their complaint, the Kopsteins argue that IBC intentionally provided misleading information concerning their benefits, in violation of the Medicare Act, IBC’s contract with the Kopsteins, and “some of [IBC’s] own rules.” Specifically, the Kop-steins raise two claims concerning Medicare Part D’s so-called “donut hole” coverage gap1: (1) a claim that IBC “knowingly included the entire cost of their contribution in plaintiffs’ $2,200.00 initial coverage, forcing them to incur expenses of $2,577.00 above what was necessary”; and (2) a claim that IBC “insisted that they pay $3,850.00 while in the coverage gap (donut hole) ... in direct violation of medicare rules that clearly state ‘the most you have to pay out-of-pocket in the coverage gap (donut hole) is $3,051.25.’ ”2 In addition, the Kopsteins argue that IBC negotiated with only one drug chain, Walgreen’s, and the resulting prescription drug prices were not competitive, causing them to incur $1,102.00 in overpayment costs. The Kop-steins seek damages of $4,559.75, plus costs.

IBC removed the case to the United States District Court for the Eastern District of Pennsylvania pursuant to 28 U.S.C. § 1441(a). In the removal notice, IBC argued that the Kopsteins’ complaint “call[s] into question IBC’s compliance with the federally mandated guidelines established by 42 U.S.C.A. § 1395w-101, et seq. and, therefore, plaintiffs’ allegations constitute claims ‘arising under the laws of the United States,’ of which this Court has original jurisdiction under 28 U.S.C. § 1331.... ” Although the Kopsteins sought remand to Municipal Court, the District Court denied their motion. The District Court held that “[t]he rules of Medicare Part D, enacted by Congress as part of the Social Security Act, are federal law. See 42 U.S.C. § 1395w-101 et seq. *263We therefore find that Plaintiffs’ Complaint raises a substantial federal question, bringing this case squarely within the Court’s jurisdiction.” See 28 U.S.C. § 1447.

In August 2008, the Kopsteins moved to amend their complaint to add a claim that IBC retaliated against them for filing their lawsuit. Specifically, they claim that in March 2008, IBC sent the Kopsteins letters threatening to terminate their coverage if they did not timely pay premiums owed on their accounts. The Kopsteins contend that they paid their premiums before the date of IBC’s letters, that they were current on their monthly premiums and always made payment within a few days of the due date,3 and that IBC intentionally delayed posting the payments to their accounts to justify sending the threatening letters. In addition, the Kop-steins claim that IBC improperly denied Mr. Kopstein insurance coverage for emergency room services.

On November 3, 2008, the District Court entered an order granting IBC’s motion to dismiss the Kopsteins’ amended complaint for failure to state a claim upon which relief can be granted.4 See Fed.R.Civ.P. 12(b)(6). Proceeding pro se, the Kopsteins timely filed the instant appeal.5

II. Analysis

We have stated that “every federal appellate court has a special obligation to satisfy itself not only of its own jurisdiction, but also that of the lower courts in a cause under review.” Spring Garden Associates, L.P. v. Resolution Trust Corp., 26 F.3d 412, 415 (3d Cir.1994) (quoting Employers Ins. of Wausau v. Crown Cork & Seal Co., 905 F.2d 42 (3d Cir.1990)). Therefore, although the District Court did not address it, we will consider the issue of subject matter jurisdiction. See, e.g., Dep’t of Pub. Welfare v. Markiewicz, 930 F.2d 262, 266 (3d Cir.1991). We exercise plenary review in determining whether the District Court had subject matter jurisdiction. Nat’l Union Fire Ins. Co. v. City Sav., F.S.B., 28 F.3d 376, 383 (3d Cir.1994).

The District Court concluded that subject matter jurisdiction over the Kopsteins’ claims arose under 42 U.S.C. § 1331. We disagree. Federal question jurisdiction under § 1331 generally is not available for claims arising under the Medicare Act.6 Shalala v. Illinois Council on Long Term Care, Inc., 529 U.S. 1, 11, 120 S.Ct. 1084, 146 L.Ed.2d 1 (2000); 42 U.S.C. § 405(h)7; see also Fanning v. United States, 346 F.3d 386, 401 (3d Cir.2003) (In assessing jurisdiction, “[t]he appropriate inquiry is *264whether the Medicare Act provides both the standing and the substantive basis for their contentions.”).

Rather, “the sole avenue for judicial review” for claims arising under the Medicare Act is through 42 U.S.C. § 405(g).8 See Heckler v. Ringer, 466 U.S. 602, 615, 104 S.Ct. 2013, 80 L.Ed.2d 622 (1984). That section provides that a plaintiff may initiate an action in the District Court only after obtaining a “final decision of the [Secretary of Health and Human Services] made after a hearing.... ” 42 U.S.C. § 405(g). A final agency ruling is therefore “central to the requisite grant of subject-matter jurisdiction” under the Medicare Act. See Weinberger v. Salfi, 422 U.S. 749, 764, 95 S.Ct. 2457, 45 L.Ed.2d 522 (1975).

Accordingly, to proceed in the District Court, the Kopsteins were required to first exhaust the administrative review channels that the Medicare Act expressly contemplates, see Illinois Council on Long Term Care, 529 U.S. at 5, 8, 120 S.Ct. 1084,9 and obtain a final agency ruling subject to judicial review. See 42 U.S.C. §§ 405(g), (h). Because the Kopsteins did not do so, the District Court lacked subject matter jurisdiction over their claims.

The Kopsteins do not dispute that they did not obtain a final agency ruling. Rather, they contend that their particular claims are not of the type that may proceed through the Medicare Act’s administrative review channels. The Kopsteins state that “IBC’s internal administrative procedures are limited to appeals involving quality of care, cleanliness in doctors’ offices, how beneficiaries are treated by doctors, etc.” However, the Kopsteins have provided no support for the argument that administrative review of their particular claims did not exist or was not available, and based upon our review of the record, we cannot reach such a conclusion.

Finally, the Kopsteins’ amended complaint may arguably be read to raise state law causes of action, such as breach of contract, breach of fiduciary duty, or violation of state consumer protection statutes. We do not consider whether the Kopsteins have raised any viable state law cause of action not preempted by, or subject to, the terms of the Medicare Act. See, e.g., Zahl v. Harper, 282 F.3d 204, 211 (3d Cir.2002) (abstaining from exercise of federal jurisdiction under Medicare Act so state court could address state law issues concerning billing fraud); but see Uhm v. Humana Inc., 540 F.3d 980, 991 (9th Cir.2008) (concluding that state law consumer protection claims concerning allegedly deceptive Medicare marketing materials were preempted by the Medicare Act). We merely conclude that, because the Kop-steins’ amended complaint did not raise a cognizable federal cause of action, the District Court also properly dismissed any state law claims. See 28 U.S.C. § 1367(c)(3).

III. Conclusion

We sympathize with the Kopsteins’ obvious frustration in navigating the complexities of the Medicare Part D prescription drug program. However, for the Kop-steins to proceed in federal court, they *265were required to follow the Medicare Act’s administrative review channels and obtain a final agency ruling. See 42 U.S.C. § 405(g), (h); 42 C.F.R. § 423.630©. Because a final agency ruling is a prerequisite to federal jurisdiction over Medicare Act claims, see Weinberger, 422 U.S. at 764, 95 S.Ct. 2457, the District Court properly dismissed the Kopsteins’ amended complaint.

For the foregoing reasons, we will affirm the District Court’s order. The motion for oral argument is denied as moot.

Kopstein v. Independence Blue Cross
339 F. App'x 261

Case Details

Name
Kopstein v. Independence Blue Cross
Decision Date
Jul 29, 2009
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339 F. App'x 261

Jurisdiction
United States

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