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Degnan v. Sebelius

United States District Court, D. Minnesota

July 31, 2013

Charles Degnan, Kenneth McCardle, Virginia Belford, and Dale Erlandson, individually and on behalf of a class, Plaintiffs,
v.
Kathleen Sebelius, Secretary of the Department of Health and Human Services, and Michael Astrue, Commissioner of the Social Security Administration, Defendants

Page 1191

Douglas M. Weems, Esq. and Spencer, Fane, Britt & Browne, LLP, Kansas City, MO, counsel for plaintiffs.

Frederich A.P. Siekert, Esq., Assistant U.S. Attorney, Minneapolis, MN, counsel for defendants.

OPINION

Page 1192

David S. Doty, United States District Judge.

ORDER

This matter is before the court upon the motion to dismiss by defendants Kathleen Sebelius, in her official capacity as Secretary of Health and Human Services, and Carolyn W. Colvin, in her official capacity as Acting Commissioner of the Social Security Administration (SSA). Based on a review of the file, record and proceedings herein, and for the following reasons, the court grants the motion.

BACKGROUND

This Medicare-benefits dispute arises out of an alleged miscalculation of Medicare Part B (Part B) premiums owed by plaintiffs Charles Degnan, Kenneth McCardle, Virginia Belford and Dale Erlandson. Part B is " a voluntary insurance program to provide medical insurance benefits ... for aged and disabled individuals who elect to enroll under [the] program." 42 U.S.C. § 1395j. The program is " financed from premium payments by enrollees together with contributions from funds appropriated by the Federal Government." Id. Plaintiffs, as late enrollees to Part B, must pay an increased premium. Second Am. Compl. ¶ ¶ 4, 34; see 42 U.S.C. § 1395r(b).

In a separate lawsuit in 2009, Degnan brought a putative class-action challenging the Part B late-enrollee premium calculation. See Degnan v. Sebelius, 658 F.Supp.2d 969 (D. Minn. 2009) (Montgomery, J.) [hereinafter Degnan I]. In Degnan I, the court determined that the SSA's calculation of late-enrollment premiums conflicted with the plain language of the Medicare Act. Id. at 986. The court limited its holding to Degnan, however, and declined to award classwide relief. Id. at 988. Thereafter, the SSA recalculated Degnan's Part B premiums for 2004 through 2010 and issued a refund of $759.70. Siekert Decl. Ex. 1.

In the present suit, Degnan asserts that his Part B premiums for 2011 and 2012 reverted to the pre-Degnan I methodology. After plaintiffs filed suit in the instant matter, defendants conceded that Degnan's premiums were incorrectly calculated and adjusted his 2011 and 2012 premiums. Siekert Decl. Ex. 2. Degnan alleges that the new calculation remains incorrect. Second Am. Compl. ¶ 11.

On October 15, 2012, plaintiffs filed a second amended putative class-action complaint, alleging a violation of the Medicare Act. Specifically, plaintiffs argue that the calculation of their late enrollment penalty conflicts with the statutory language of § 1395r(f) of the Medicare Act. Defendants move to dismiss.

DISCUSSION

I. Standard of Review


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