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and This is where the president puts his energy and legal efforts-go after poor old people when your computer screws up!
WASHINGTON, Sept. 28 — A federal judge on Thursday ordered the Bush administration to halt its effort to collect $50 million from 230,000 Medicare beneficiaries who had received erroneous refunds of premiums paid for prescription drug coverage. He said many of them might qualify for waivers because repayment would cause hardship.
The judge, Henry H. Kennedy Jr. of Federal District Court here, said Dr. Mark B. McClellan, administrator of the Centers for Medicare and Medicaid Services, must immediately send a notice to every one of the 230,000 beneficiaries, stating that each has a right under federal law to request such waivers.
Federal officials had previously told beneficiaries to return the money by Saturday, Sept. 30. Judge Kennedy said the administration could not enforce that demand unless it first gave beneficiaries an opportunity to seek an exemption.
If a beneficiary requests a waiver, the government cannot try to recoup the money until the secretary of health and human services rules on the request, Judge Kennedy said in issuing a preliminary injunction sought by the plaintiffs. The plaintiffs include the Action Alliance of Senior Citizens, based in Philadelphia, and Gray Panthers, a national organization for older Americans.
Judge Kennedy said that any money already paid to the government “must be immediately returned to the beneficiaries so that they may decide whether to request waiver.”
Peter L. Ashkenaz, a spokesman for the Medicare agency, said government lawyers had not decided whether to appeal the decision. Mr. Ashkenaz said the government would do everything possible to ensure that beneficiaries continued to receive drug coverage “with the least inconvenience possible.”
Mr. Deford said beneficiaries were entitled to notice of their rights because of the Fifth Amendment to the Constitution, which states that no person shall be “deprived of life, liberty, or property, without due process of law.” The administration’s refusal to provide such notice violates the Constitution, as well as the Medicare law and regulations, he said.
The Medicare law says the government shall not recover an overpayment if the beneficiary was without fault and if it would be “against equity and good conscience” for the government to recover the money.
Dr. McClellan has, in effect, acknowledged that the beneficiaries are without fault, saying the mistake occurred because of “an error in Medicare computer systems.”
At the court hearing, lawyers for Dr. McClellan and Michael O. Leavitt, the secretary of health and human services, argued that Medicare beneficiaries had no right to a waiver and therefore no right to be informed that they could fight the demand for repayment.
The erroneous refunds averaged $215 a person, and none exceeded $800, federal officials said.
Beneficiaries “have been unjustly enriched,” Marcus H. Christ Jr., a lawyer from the Department of Health and Human Services, told the court. “Nothing in the Medicare program allows them to keep that money.”
One plaintiff, Lucy C. Loveall of Franklin, Ky., pays for drug coverage by having premiums withheld from her Social Security checks. She received $161.70 from the government, representing a refund for seven months of premiums. Ms. Loveall, 65, said she could not afford to repay the money because she and her husband had total income of $2,214 a month and total monthly expenses of $3,067.
The poorest Medicare beneficiaries do not have to pay premiums for drug coverage. But Mr. Deford said that many of those who did pay premiums had relatively low incomes. About half of beneficiaries have annual incomes less than twice the poverty level, he said. The poverty level is $9,800 for an individual.
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