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Schweiker v. McClure
 | |
| Schweiker v. McClure | |
| Reference: 456 U.S. 188 | |
| Term: 1982 | |
| Important Dates | |
| Argued: March 1, 1982 Decided: April 20, 1980 | |
| Outcome | |
| United States District Court for the Northern District of California overruled | |
| Majority | |
| Chief Justice Warren Burger • Harry Blackmun • William Brennan • Thurgood Marshall • Sandra Day O'Connor • Lewis Powell • John Paul Stevens • William Rehnquist • Byron White | |
| Concurring | |
| None | |
| Dissenting | |
| None | |
Schweiker v. McClure is a 1982 United States Supreme Court case involving procedural due process standards in administrative adjudication. Procedural due process encompasses the government's obligation, under the Fifth and Fourteenth Amendments, to ensure that legal procedures are carried out in a fair and just manner.[1] The U.S. Supreme Court overturned the ruling of the United States District Court for the Northern District of California, holding that the adjudication did not violate due process requirements.[2]
Why it matters: This ruling allowed the use of privately employed hearing officers as a proper type of administrative judge in administrative adjudication. Also it stated that the agency may rely on a private entity to decide what qualifications are appropriate for an administrative judge.[3] These two findings allow Congress to give private parties a narrow scope of state backed authority.[4]
Background
| Administrative State |
|---|
|
| Five Pillars of the Administrative State |
| • Judicial deference • Nondelegation • Executive control • Procedural rights • Agency dynamics |
| Click here for more coverage of the administrative state on Ballotpedia |
Part B of the Medicare program under the Social Security Act provided federally subsidized insurance to cover certain types of health care. It authorized the secretary of Health and Human Services to contract with private insurance carriers to administer the payment of Part B claims. If the insurance carrier refused on the secretary's behalf to pay a portion of a claim, the claimant was entitled to an adjudication in writing. For applications of $100 or more, a still-dissatisfied claimant could demand an oral hearing held by an administrative judge chosen by the insurance carrier. Neither the statute nor the regulations allowed for review of the administrative judge’s decision.[2]
Claimants McClure, Shields, and Doe sued the secretary of Health and Human Services, Schweiker, after administrative judges rendered decisions against them, challenging the constitutionality of the administrative hearings. The district court held that the hearing procedures violated appellees' rights to due process. Schweiker appealed.[2]
Oral argument
Oral arguments were held on March 1, 1982. The case was decided on April 20, 1982.[2]
Outcome
The Supreme Court decided unanimously in favor of Schweiker the secretary of Health and Human Services. The opinion of the court was written by Justice Lewis Powell.[2]
Opinions
Opinion of the court
The district court ruled the adjudication was unconstitutional under two tests. The Supreme Court found the adjudication satisfied due process and was constitutional using the same two tests the district court.
Impartial judge test
First, the court considered if the administrative judges were partial to the insurance carriers who appointed them. The court established the importance of an impartial judge, and how a plaintiff may show partiality.
| “ | due process demands impartiality on the part of those who function in judicial or quasi-judicial capacities... [The court] must start, however, from the presumption that the hearing officers who decide Part B claims are unbiased. This presumption can be rebutted by a showing of conflict of interest or some other specific reason for disqualification. But the burden of establishing a disqualifying interest rests on the party making the assertion.[2][5] | ” |
The court found that there was no basis for finding that the administrative judges were bias. Because the facts established that all insurance claims and administrative judges were paid in federal funds, the court found the insurance carriers did not have a pecuniary interest in appointing these judges. Also, the court found the secretary of Health and Human Services’ compliance requirements that contractually bound the insurance carriers were sufficient to make administrative judges impartial.[2]
Qualified judge test
Second, the court considered the claims of procedural due process under the Mathews v. Eldridge test, which gives courts flexibility when deciding the requirements of procedural due process.[1] Here, the court focused on what constitutes a qualified judge.
| “ | a ‘qualified’ individual already possessing ‘ability’ and ‘thorough knowledge’ would not require further training...the District Court apparently gave no weight to the qualifications of hearing officers about whom there is information in the record. Their qualifications tend to undermine, rather than to support, the contention that accuracy of Part B decisionmaking may suffer by reason of insurance carrier appointment of unqualified hearing officers.[2][5] | ” |
The court found that the insurance carrier appointed administrative judges who were properly qualified.[2]
Impact
The case helped establish due process requirements for adjudication by solidifying the principle that a trier of fact must be impartial and demonstrated two ways of finding partiality based on pecuniary interest or prior involvement.[3][6]
Administrative law scholar Paul Verkuil wrote that the decision "effectively contradicted established notions of decider formality by not only privatizing the deciders but also placing them beyond the exclusive control of the legal profession.“[3] Supporting the court’s reasoning, administrative law scholar Harold Bruff argued that the case allows the government to “seek a process that optimally balances accuracy and cost. Such a balance is a peculiarly executive function, and as Eldridge emphasizes, the agency's choice of process is entitled to deference by a court weighing the dictates of due process.”[7]
Although Medicare Part B claims were no longer decided under this system as of August 2018, this case remains the foundation for determining the fairness of administrative hearings.[8]
See also
- Adjudication
- administrative judge
- Administrative law
- Supreme Court of the United States
- History of the Supreme Court
External links
- Full text of case syllabus and opinions (Justia)
- Supreme Court of the United States
- Search Google News for this topic
Footnotes
- ↑ 1.0 1.1 Legal Information Institute, "Due Process," accessed July 29, 2018
- ↑ 2.0 2.1 2.2 2.3 2.4 2.5 2.6 2.7 2.8 2.9 “Schweiker v. McClure, 456 U.S. 188 (1982)”, Justia, accessed July 30, 2018
- ↑ 3.0 3.1 3.2 Verkuil, Paul. “Reflections upon the federal administrative judiciary.” UCLA Law Review 39(5). (1992):1341-1364.
- ↑ Krent, Harold. “Federal power, non-federal actors: The ramifications of free enterprise fund.” Fordham Law Review 79(6).(2011): 2425-2454.
- ↑ 5.0 5.1 Note: This text is quoted verbatim from the original source. Any inconsistencies are attributable to the original source.
- ↑ 4 Stein, J. & Mitchell, G. (2018). Administrative Law Newark, NJ: Mathew Bender & Co. (§32.01)
- ↑ Bruff, Harold. “Public Programs, Private Deciders: The Constitutionality of Arbitration in Federal Programs.” Texas Law Review 61. (1989):441-497.
- ↑ Eastern District Court of New York, Diagnostic Cardioline Monitoring of N.Y., Inc. v. Shalala, June 26, 2000
