The opinion of the court was delivered by: WEXLER
Plaintiff brings this action pursuant to Sections 205(g) and 1869(b) of the Social Security Act ("Act"), as amended, 42 U.S.C. Sections 405(g), 1395ff(b), to review the final determination of the Secretary of Health and Human Services ("Secretary") denying plaintiff reimbursement for 100 days of care in a skilled nursing facility under Title XVIII of the Social Security Act, 42 U.S.C. Section 1395, et seq. Plaintiff and defendant cross-move for judgment on the pleadings pursuant to Rule 12(c) Fed.R.Civ.P.
On February 12, 1981, Mrs. Alice Kuebler was transferred from Eastern Long Island Hospital to San Simeon by the Sound Nursing Home ("San Simeon"), a skilled nursing facility. Plaintiff was notified that her care at San Simeon would not be covered by Medicare as it was custodial in nature. On reconsideration this determination was upheld. A hearing was held at plaintiff's request on June 15, 1982. After de novo consideration the Administrative Law Judge found Mrs. Kuebler not entitled to reimbursement under Medicare Part A, 42 U.S.C. Section 1395d(a)(2), for her confinement at San Simeon, holding her care there to be "custodial" and not requiring skilled nursing. The Appeals Council upheld the ALJ's determination. The Council's decision became the final decision of the Secretary on October 19, 1982.
At the time of her admission to San Simeon, plaintiff was 71 years old. She was admitted directly from the hospital after six days of confinement there occasioned by a fall at her home. Plaintiff's treating physician, Dr. Arnold Urist, strongly recommended that plaintiff's husband, Reverend Kuebler, place his wife in a nursing home and certified her need for continuing skilled nursing care on February 12, 1981. On February 16, 1981, plaintiff was evaluated by the Utilization Review Committee ("URC") of the nursing home, which also certified her need for continuing skilled nursing care. In two subsequent evaluations the URC determined there was continued need for skilled nursing care.
On admission to San Simeon plaintiff's diagnosis was kyphoses, osteoporsis, a possible compression fracture of the L-4 vertebra and concommitant lowback syndrome, progressive cerebral arteriosclerosis with brain atrophy, a urinary tract infection, early Parkinson's disease and chronic depressive reaction by history. Plaintiff suffered from periods of confusion during which she did not recognize her husband (Tr. p. 45) and did not know her name (Tr. p. 77). She also had episodes of agitated, assaultive and abusive behavior and a history of wandering about, both at her home and at San Simeon. Such wandering occasioned the fall that caused the back injury.
During the hospital stay, Dr. Paul Ross, attending orthopedist, diagnosed the compression fracture after viewing x-rays. Previously, on March 18, 1980, plaintiff had undergone a brain scan and Dr. Daniel Patrick McCarthy diagnosed the brain atrophy. In addition, the plaintiff had a history of chronic depression. Darvacet (for pain), Dalmane (for insomnia) and vitamins were prescribed for plaintiff. Haldol, a psychotropic drug, was prescribed as needed to control agitation. The plaintiff was evaluated to be in unstable condition with a need for daily observation and modification of dosage in connection with administration of the Haldol.
At the outset the Court notes that three principles applicable to the case at hand have been established by district courts reviewing a denial of medicare benefits for skilled nursing facility care. The first is that the Court's review of the Secretary's determination is not limited to the substantial evidence standard, but extends to a review of the Secretary's interpretation of the law. The second is that the correct legal standard for determining Medicare coverage is consideration of the patient's condition as a whole. The third is that where there is no directly conflicting evidence the treating physician's opinion must be given great weight.
The Secretary contends that Mrs. Kuebler's care at San Simeon was purely "custodial", as defined in 42 C.F.R. Section 405.126-28, and did not require a skilled nursing facility, hence she is ineligible for reimbursement under Medicare Part A. Under the regulations custodial care is defined as administrating routine medication, routine care of incontinence, assistance in dressing, eating and going to the toilet, and exercise supervision not done by a physical therapist. 42 C.F.R. Section 405.127(d). The courts have interpreted custodial care to be care that can be provided by a lay person without special skills and not requiring or entailing the continued attention of trained or skilled personnel. Reading v. Richardson, 339 F. Supp. 295, 300 (E.D.Mo.1972). Such custodial care is excluded from Medicare payments. 42 U.S.C. Section 1395y(a)(9). The Secretary contends that by a strict reading of the regulations Mrs. Kuebler's care falls squarely within the definition of custodial care excluded from Medicare payments.
The Secretary urges on this Court the standard of review articulated in the statute, 42 U.S.C. Section 405(g), and in Richardson v. Perales, 402 U.S. 389, 28 L. Ed. 2d 842, 91 S. Ct. 1420 (1971), limiting the scope of the district court's review to a determination of whether the Secretary's findings of fact are supported by substantial evidence on the record. Findings that are so supported are deemed conclusive. The Secretary, however, ignores another well-established standard by which the district court can review the Secretary's determination. For while the district court may be compelled to accept the Secretary's supported findings of fact, it is not bound to accept the Secretary's conclusions of law, her interpretation of the law, or her application of an incorrect legal standard. Klofta v. Mathews, 418 F. Supp. 1139 (E.D.Wis.1976); Breeden v. Weinberger, 377 F. Supp. 734 (M.D.La.1974); Schoultz v. Weinberger, 375 F. Supp. 929 (E.D.Wis.1974); Ridgely v. Secretary of H.E.W., 345 F. Supp. 983 (D.Md.1972), aff'd 475 F.2d 1222 (4th Cir.1973); Reading v. Richardson, 339 F. Supp. 295, 297 (E.D.Mo.1972); Sowell v. Richardson, 319 F. Supp. 689 (D.S.C.1970). In the case at hand the Secretary contends that her examination in light of the regulations of the treatment and services rendered by San Simeon is the correct standard for determining the nature of Mrs. Kuebler's care.
The courts, however, have on numerous occasions rejected this analysis. Klofta v. Mathews, 418 F. Supp. at 1142 (and cases cited therein). In reviewing the interpretation and application of the Act the courts have consistently held that the legal standard for determining the need for skilled nursing care is not an analysis of services provided but consideration of the patient's condition as a whole. Klofta v. Mathews, 418 F. Supp. at 1143; Hayner v. Weinberger, 382 F. Supp. 762, 766 (E.D.N.Y.1974); Ridgely v. Secretary HEW, 345 F. Supp. at 988; Sowell v. Richardson, 319 F. Supp. at 692. This standard is based on a benevolent legislative purpose. "The legislation which created health insurance for the aged is remedial and therefore to be construed liberally. . . . Neither the courts nor the Secretary should, in the interest [of] minimizing costs so interpret ...