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Administrative Law Keyed to Popper
Schweiker v. McClure
Citation:
456 U.S. 188 (1982)Facts
Medicare Part B is a voluntary, federally subsidized health insurance program covering physician services and outpatient care for individuals 65 or older or disabled. The Secretary of Health and Human Services contracts with private insurance carriers to process claims. When carriers deny claims, beneficiaries can request a “review determination” and, if the amount exceeds $100, an oral hearing before a hearing officer appointed by the carrier. These hearing officers make final, unappealable decisions. Three Medicare beneficiaries (McClure, Shields, and “Doe”) had their claims denied by carrier-appointed hearing officers. They filed a class action lawsuit challenging the constitutionality of this process, arguing that the hearing officers were biased due to their connection with the carriers. The District Court agreed, finding that the process violated due process because hearing officers were financially dependent on carriers and had prior connections to them, creating an impermissible risk of bias.
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