National Gerimedical Hospital and Gerontology Center v. Blue Cross of Kansas City

PETITIONER: National Gerimedical Hospital and Gerontology Center
RESPONDENT: Blue Cross of Kansas City
LOCATION: Home of George Summers

DOCKET NO.: 80-802
DECIDED BY: Burger Court (1975-1981)
LOWER COURT: United States Court of Appeals for the Eighth Circuit

CITATION: 452 US 378 (1981)
ARGUED: Apr 29, 1981
DECIDED: Jun 15, 1981

ADVOCATES:
Carl Weissburg - for the Federation of American Hospitals as amicus curiae
Erwin N. Griswold - on behalf of the Petitioner
Joshua F. Greenberg - on behalf of the Respondents
J. Mark Waxman - for the Federation of American Hospitals as amicus curiae
Wade H. McCree, Jr. - on behalf of the united states as amicus curiae

Facts of the case

Question

Media for National Gerimedical Hospital and Gerontology Center v. Blue Cross of Kansas City

Audio Transcription for Oral Argument - April 29, 1981 in National Gerimedical Hospital and Gerontology Center v. Blue Cross of Kansas City

Warren E. Burger:

We'll hear arguments next in National Gerimedical Hospital v. Blue Cross of Kansas City.

Mr. Griswold.

Erwin N. Griswold:

May it please the Court:

This is an antitrust case in the health care area.

The issue turns on the construction of the National Health Planning and Resource Development Act of 1974.

No constitutional question is involved.

The statute is long and diffuse.

The respondents rely on 28 fairly general words in the statute as the basis for their contention that they have implied immunity from the antitrust laws.

We contend that there is no room for such a construction.

The district court accepted the implied immunity argument and granted summary judgment for the respondents.

That judgment was affirmed by the Court of Appeals for the 8th Circuit and this Court granted certiorari to review that decision.

The question arises on these facts.

National Gerimedical Hospital is a fully accredited general acute care community hospital which opened in October, 1978.

It has been continuously licensed by the Missouri Division of Health, that is, the state agency, since September, 1977, and has been fully certified for Medicare and Medicaid by the Department of Health and Human Services, as it now is, since its opening.

It did not receive a certificate of need from any Missouri state agency because Missouri had no certificate of need requirement, when it was built.

The respondents are Blue Cross of Kansas City and Blue Cross Association, both of which market and sell prepaid health reimbursement plans to the public and make contracts with health care providers to administer the plans.

Several other persons are also named as nondefendant coconspirators.

Prior to its opening the petitioner sought to make a participating agreement with Blue Cross.

A participating hospital receives direct reimbursement of 100 percent for covered services rendered to individual Blue Cross members.

If the hospital is not granted participation, then Blue Cross pays no more than 80 percent of the cost of the services and it makes the payment directly to the subscriber and not to the hospital.

A lack of participating hospital status discourages Blue Cross subscribers and their doctors from seeking service at National Gerimedical and places the hospital at a substantial competitive disadvantage.

William H. Rehnquist:

But in a sense it would place the consumer in the long run at an advantage, would it not, in that a lot of unneeded medical facilities would not be built?

Erwin N. Griswold:

That may or may not be the case.

The question is whether there is any statutory authorization, state or federal, for restricting the construction of this hospital.

And it is, as I have said, Missouri had no certificate of need legislation at the relevant time here.

There was nothing illegal or inappropriate about the building of this hospital, and the question really is whether Congress by passing this statute has authorized private groups to enforce that approach to the question of the cost of medical care which you have suggested, and our position is that Congress has made no such authorization.

Byron R. White:

Mr. Griswold, does the state even now have a statewide planning agency?

Erwin N. Griswold:

Yes.

The state now has a statewide planning agency.

Byron R. White:

When did that come into being?