Appeal from a summary judgment entered in the United States District Court for the Eastern District of New York (Leonard D. Wexler, Judge), denying the United States Department of Health and Human Services access to certain medical records maintained by defendant University Hospital. Affirmed. Judge Winter dissents in a separate opinion.
Winter and Pratt, Circuit Judges, and Metzner, District Judge.*fn*
This expedited appeal presents the question whether Section 504 of the Rehabilitation Act of 1973, as amended, 29 U.S.C. § 794 (Supp. V 1981), and one of its implementing regulations, 45 C.F.R. § 84.61 (1982) (incorporating 45 C.F.R. § 80.6(c) (1982)), authorize the United States Department of Health and Human Services (HHS) to obtain access to medical records maintained by defendant University Hospital concerning a seriously deformed newborn infant, identified only as Baby Jane Doe, whose parents have refused to consent to certain surgical procedures necessary to prolong the infant's life. The United States District Court for the Eastern District of New York (Leonard D. Wexler, Judge) 575 F. Supp. 607 ruled that HHS was not entitled to the records and entered summary judgment in favor of University Hospital. For the reasons set forth below, we affirm.
Baby Jane Doe was born on October 11, 1983 at St. Charles Hospital in Port Jefferson, New York. She was suffering from multiple birth defects, the most serious of which were myelomeningocele, commonly known as spina bifida, a condition in which the spinal cord and membranes that envelop it are exposed; microcephaly, an abnormally small head; and hydrocephalus, a condition characterized by an accumulation of fluid in the cranial vault. In addition, she exhibited a "weak face", which prevents the infant from closing her eyes or making a full suck with her tongue; a malformed brain stem; upper extremity spasticity; and a thumb entirely within her fist.
As a result of the spina bifida, the baby's rectal, bladder, leg, and sensory functions were impaired. Due to the combination of microcephaly and hydrocephalus, there was an extremely high risk that the child would be so severely retarded that she could never interact with her environment or with other people.
At the direction of the first pediatric neurosurgeon to examine her, the baby was immediately transferred to University Hospital for dual surgery to correct her spina bifida and hydrocephalus. Essentially, this would entail excising a sac of fluid and nerve endings on the spine and closing the opening, and implanting a shunt to relieve pressure caused by fluid build-up in the cranial cavity. The record indicates that these dual, corrective surgical procedures were likely to prolong the infant's life, but would not improve many of her handicapping conditions, including her anticipated mental retardation.
After consulting with several physicians, nurses, religious advisors, a social worker, and members of their family, the parents of the baby decided to forego the corrective surgery. Instead, they opted for a "conservative" medical treatment consisting of good nutrition, the administration of antibiotics, and the dressing of the baby's exposed spinal sac.
Litigation surrounding Baby Jane Doe began on October 16, when A. Lawrence Washburn, Jr., a Vermont attorney unrelated to the child and her family, commenced a proceeding in New York State Supreme Court seeking appointment of a guardian ad litem for the child and an order directing University Hospital to perform the corrective surgery. The court appointed William E. Weber as guardian ad litem and held an evidentiary hearing on October 19 and 20 to determine whether Baby Jane Doe was "in need of immediate surgical procedures to preserve her life". Following the hearing, at which University Hospital and the parents of the child were represented, the court concluded that surgery was necessary and ordered that it be performed.
One day later the Appellate Division of the New York Supreme Court reversed the decision of the trial court and dismissed the proceeding. The Appellate Division found that the "concededly concerned and loving parents have made an informed, intelligent, and reasonable determination based upon and supported by responsible medical authority." As the court elaborated:
The record confirms that the failure to perform the surgery will not place the infant in imminent danger of death, although surgery might significantly reduce the risk of infection. On the other hand, successful results could also be achieved with antibiotic therapy. Further, while the mortality rate is higher where conservative medical treatment is used, in this particular case the surgical procedures also involved a great risk of depriving the infant of what little function remains in her legs, and would also result in recurring urinary tract and possibly kidney infections, skin infections and edemas of the limbs.
Thus, the Appellate Division determined that the parents' decision was in the best interest of the infant and that there was, therefore, no basis for judicial intervention.
On October 28, the New York Court of Appeals affirmed the decision of the Appellate Division, relying on different grounds. Since the petitioner had no direct interest in or relationship to any party and had failed to contact the State Department of Social Services, which has primary responsibility under New York law for initiating child neglect proceedings, and since the trial court also had failed to seek that department's investigative assistance, the Court of Appeals found "no precedent or authority" for the proceeding. Accordingly, the Court of Appeals ruled that the trial court had abused its discretion by permitting the proceeding to go forward.
While the state court proceedings were still in progress, the federal government entered the picture. On October 19, HHS received a complaint from an unidentified "private citizen" that Baby Jane Doe was being discriminatorily denied medically indicated treatment on the basis of her handicaps. HHS referred the complaint to the New York State Child Protection Services, the state agency specifically responsible for investigating suspected incidents of child abuse, mistreatment, and neglect. On November 7, that agency concluded that there was no cause for state intervention.
Meanwhile, HHS obtained a copy of the record of the state court proceedings, which contained the child's medical records through October 19. The record was forwarded to and personally reviewed by the Surgeon General of the United States, who determined, among other things, that:
An appropriate determination concerning whether the current care of Infant Jane Doe is within the bounds of legitimate medical judgment, rather than based solely on a handicapping condition which is not a medical contraindication to surgical treatment, cannot be made without immediate access to, and careful review of, current medical records and other sources of information within the possession or control of the hospital.
Beginning on October 22, HHS repeatedly requested University Hospital to make available for inspection all of Baby Jane Doe's medical records since October 19. HHS based its authority to conduct an investigation on section 504 of the Rehabilitation Act, which provides in pertinent part that "no otherwise qualified handicapped individual * * * shall, solely by reason of his handicap, * * * be subjected to discrimination under any program or activity receiving Federal financial assistance * *". HHS further relied on 45 C.F.R. § 80.6(c), as incorporated by 45 C.F.R. § 84.61, which states:
(c) Access to sources of information. Each recipient [of Federal financial assistance] shall permit access by the responsible Department official or his designee during normal business hours to such of its books, records, accounts, and other sources of information, and its facilities as may be pertinent to ascertain compliance with this part. * * * Asserted considerations of privacy or confidentiality may not operate to bar the Department from evaluating or seeking to enforce compliance with this part. * *
University Hospital refused to honor HHS's requests, basing its decision in part on the refusal of the parents to release the records and in part on "serious concerns both as to the Department's jurisdiction and the procedures the Department has employed in initiating an inquiry."
The government then brought this action on November 2, alleging that University Hospital had violated section 504 and 45 C.F.R. § 80.6(c) by refusing to allow HHS access to information concerning the medical care and hospital services being rendered to Baby Jane Doe. After the parents had intervened as defendants, and after the district court had granted the government's request to expedite the proceedings, both the hospital and the parents moved to dismiss the complaint, arguing, among other things, that (1) congress did not intend section 504 to reach decisions regarding health care services provided to infants; (2) section 504 imposes no affirmative treatment obligations on the hospital beyond providing handicapped persons equal access to its facilities, which the hospital had done; (3) medicare and medicaid reimbursements do not constitute "Federal financial assistance" within the meaning of section 504; (4) Baby Jane Doe's medical records were protected from disclosure by both her and her parents' federal constitutional privacy rights; and (5) the failure of the federal government to intervene in the state court proceedings barred the instant action under the doctrine of laches. Among the papers submitted in support of these motions was the entire record of the state court proceedings.
The government cross-moved for summary judgment, contending that HHS was entitled to the requested records because (1) the hospital's neonatal unit was a "recipient" of "Federal financial assistance" in the form of medicaid and (2) under 45 C.F.R. § 80.6(c) any such "recipient" was required to allow HHS access to information necessary to the discharge of the agency's statutory obligation to insure compliance with section 504.
Following oral argument on November 17, during which the government conceded that it had found no evidence of discrimination in the records covering the period through October 19, the district court ruled that defendants were entitled to summary judgment. The court first rejected defendants' claims that (1) the suit was barred by laches; (2) access to the records was barred by New York's physician-patient evidentiary privilege; and (3) medicare and medicaid do not constitute "Federal financial assistance" within the meaning of section 504. Further, the court ruled that the entire hospital, not just its neonatal unit, was the "program or activity" covered by the statute.
Noting that 45 C.F.R. § 80.6(c) requires recipients of federal funds to provide HHS "access to such records 'as may be pertinent to ascertain compliance with '" section 504, the district court next reasoned that "if a recipient of federal financial assistance is clearly not violating [section 504] by discriminating against handicapped persons, the Department of Health and Human Services may not obtain access to the records of such recipient * * *". The court then turned to what it considered the central question: "whether, from the papers submitted to the Court, it can be clearly determined that the defendant University Hospital has not violated the statute by discriminating against a handicapped person." Emphasizing that the hospital "has at all times been willing to perform the surgical procedures in question", but "lacks the legal right to perform such procedures" in the absence of parental consent, the court concluded that the hospital "failed to perform the surgical procedures in question, not because Baby Jane Doe is handicapped, but because her parents have refused to consent to such procedures." Thus, in the court's view, "the failure of the defendant University Hospital to perform the surgical procedures cannot possibly be regarded as a violation of the Rehabilitation Act."
In any case, the court went on, "the decision of the parents to refuse consent to the surgical procedures was a reasonable one based on due consideration of the medical options available and on a genuine concern for the best interests of the child." According to the court, this precluded any possibility of liability on the part of the hospital.
On appeal, the government, supported by various amici, argues that the district court erroneously required HHS "to make an advance evidentiary showing on the ultimate issue of unlawful conduct as a condition to securing the very materials necessary to reach a determination on that issue". In any event, the government contends, the district court's finding that no discrimination occurred could only have applied to the period up to October 19. Because "medical decisionmaking is a dynamic process", the government claims that whatever the circumstances before October 19, the possibility remains that changes in the baby's conditions after that date would render the hospital's conduct discriminatory under section 504.
The government's principal argument, however, is that the district court erred in concluding that the parents' refusal to consent to surgery conclusively established the hospital's nondiscrimination and thus insulated the hospital from liability under section 504. In this regard, the government claims, for the first time on appeal, that the requested records were necessary to determine whether the failure of the hospital to seek a state court order overriding the parents' decision and compelling surgery was itself a violation of the nondiscrimination requirements of section 504.
Defendants, on the other hand, together with the various amici who support their position, not only defend the district court's decision on its own terms, but also argue that section 504 provides no authority for this action, because (1) medicare and medicaid do not constitute "Federal financial assistance" within the meaning of the statute and (2) congress did not intend that section 504 serve as the basis for federal intervention in medical decisionmaking. In addition, defendants renew their argument that access to the records is barred by New York's physician-patient privilege and the federal constitutional privacy rights of Baby Jane Doe and her parents. Finally, defendants argue that in light of the state court proceedings, this court should deny the federal government access to the records as a matter of equity, comity, and federalism.
As a preliminary matter, we briefly address the general standards governing a request by an investigating administrative agency such as HHS for the records of an institution such as University Hospital. An administrative agency is entitled to access to information "not plainly incompetent or irrelevant to any lawful purpose of the [agency] in the discharge of [its] duties ". Endicott Johnson Corp. v. Perkins, 317 U.S. 501, 509, 87 L. Ed. 424, 63 S. Ct. 339 (1943); see United States v. Morton Salt Co., 338 U.S. 632, 641-43, 94 L. Ed. 401, 70 S. Ct. 357 (1950); Oklahoma Press Publishing Co. v. Walling, 327 U.S. 186, 208-14, 90 L. Ed. 614, 66 S. Ct. 494 (1946); SEC v. Brigadoon Scotch Distributing Co., 480 F.2d 1047, 1052-55 (2d Cir. 1973), cert. denied, 415 U.S. 915, 94 S. Ct. 1410, 39 L. Ed. 2d 469 (1974); see generally 1 K. Davis, Administrative Law Treatise § 4.1 et seq. (2d ed. 1978). "So long as an agency establishes that an investigation 'will be conducted pursuant to a legitimate purpose, that the inquiry may be relevant to the purpose, that the information sought is not already within [its] possession, and that the administrative steps required * * * have been followed, ' no showing of probable cause need be made to the district court unless a statute indicates otherwise." SEC v. Wall Street Transcript Corp., 422 F.2d 1371, 1375 (2d Cir.) (citations omitted), cert. denied, 398 U.S. 958, 26 L. Ed. 2d 542, 90 S. Ct. 2170 (1970). Thus, if the district court meant what at one point it seemed to say -- that the government was required to establish some evidence of unlawful discrimination as a condition to obtaining the requested records -- it increased the burdens placed on the government by applicable precedents.
At the same time, however, and closer to the thrust of the district court's decision as we read it, an agency is not entitled to information sought in connection with an investigation that "overreaches the authority Congress has given". Oklahoma Press Publishing Co. v. Walling, 327 U.S. at 217. As we recognized in United States v. Cabrini Medical Center, 639 F.2d 908, 910 (2d Cir. 1981), a case also involving section 504, there is "no point in permitting the Government to institute an investigation with its attendant inconvenience, expense, and annoyance if there is and can be no authority for undertaking it." These concerns are particularly acute in a case like the one at bar, where the demand for information arguably implicates constitutionally protected rights, cf. Carey v. Population Services International, 431 U.S. 678, 684-85, 52 L. Ed. 2d 675, 97 S. Ct. 2010 (1977); Whalen v. Roe, 429 U.S. 589, 598-604, 51 L. Ed. 2d 64, 97 S. Ct. 869 (1977); Roe v. Wade, 410 U.S. 113, 152-53, 35 L. Ed. 2d 147, 93 S. Ct. 705 (1973); Griswold v. Connecticut, 381 U.S. 479, 484, 14 L. Ed. 2d 510, 85 S. Ct. 1678 (1965); compare Pierce v. Society of Sisters, 268 U.S. 510, 535, 69 L. Ed. 1070, 45 S. Ct. 571 (1925) with Prince v. Massachusetts, 321 U.S. 158, 164-71, 88 L. Ed. 645, 64 S. Ct. 438 (1944), and also represents an unprecedented exercise of the agency's investigative powers. Under these circumstances, it is incumbent upon this court to exercise particular care in assuring itself that the subject matter of the investigation is within the agency's statutory jurisdiction. Federal Election Commission v. Machinists Non-Partisan Political League, 210 U.S. App. D.C. 267, 655 F.2d 380, 385-90 (D.C. Cir.), cert. denied, 454 U.S. 897, 70 L. Ed. 2d 213, 102 S. Ct. 397 (1981); Federal Election Commission v. Florida For Kennedy Committee, 681 F.2d 1281, 1283-86 (11th Cir. 1982).
Thus, while the philosophical, social, and ethical implications of this case may be far-reaching, the precise issue presented for our review is one of statutory construction: Did congress intend section 504 to reach the conduct HHS seeks to investigate? If the investigation is within the scope of section 504, then HHS is entitled to access to Baby Jane Doe's medical records (unless they are protected from disclosure by some statutory or constitutional provision). On the other hand, if the investigation is beyond the scope of section 504, then the district court properly denied access.
To focus more sharply on this central issue, it is first necessary to examine the theory upon which the government predicates its request for the records under section 504. The theory rests on two premises. First, the government draws a distinction between decisionmaking based on a "bona fide medical judgment", which without definition it concedes to be beyond the reach of section 504, and decisionmaking based solely on an individual's handicap, which it argues is covered by section 504. Second, the government identifies Baby Jane Doe's microcephaly, which the record indicates will result in severe mental retardation, as the handicapping condition. From these premises, the government reasons that if a newborn infant suffering from spina bifida and hydrocephalus, but not microcephaly, would receive treatment or services that differ from those provided to an infant suffering from all three defects, or alternatively, if the hospital would seek a state court order compelling surgery in the former case, but not in the latter, then a violation of section 504 would have been established. Without the requested records, the government concludes, it is impossible to determine whether any such unlawful discrimination has occurred here, at least after October 19.
In evaluating whether this theory entitles the government to the requested records, we initially assume, without deciding, that the district judge properly determined both that the hospital was a recipient of "Federal financial assistance" within the meaning of the statute, and that the "program or activity" to which the statute applies, if at all, is the entire hospital. Were we forced to confront these unsettled questions, see United States v. Baylor University Medical Center, 711 F.2d 38, 40 (5th Cir. 1983), staying 564 F. Supp. 1495 (N.D. Tex. 1983) ("whether Medicare and Medicaid payments constitute federal financial assistance within the meaning of the Rehabilitation Act is a serious legal question that could have a broad impact upon federal/state relations"); Grove City College v. Bell, 687 F.2d 684, 700 (3d Cir. 1982) (under the "program or activity" limitation of Title IX of the Education Amendments of 1972, "where the Federal government furnishes indirect or non-earmarked aid to an institution, * * * the institution itself must be the 'program'"), cert. granted, 459 U.S. 1199, 103 S. Ct. 1181, 75 L. Ed. 2d 429 (1983), argued Nov. 29, 1983, see 464 U.S. 1005, 104 S. Ct. 521, 78 L. Ed. 2d 706, 52 U.S.L.W. 3433 (1983), summary judgment could not properly be granted in favor of either side at this juncture. Far from being undisputed, many of the material facts bearing on those issues have simply not been developed in the record. For example, the record does not reveal the total amount of federal medicare and medicaid funds the hospital has received, directly or indirectly, or more importantly, how those funds are allocated among the various "programs" or "activities" that the hospital may conduct. Indeed, the record is devoid of evidence even as to how the hospital is organized, either internally or as part of a network of state-affiliated institutions.
In support of its position that the hospital's neonatal intensive care unit is the operative "program or activity" (a position which the district court did not adopt), the government did submit an affidavit of an HHS official asserting that University Hospital "received $5,317,912 (gross) in Medicaid reimbursement from October 1, 1982 to November 7, 1983 for one thousand eight hundred and nineteen (1,819) neo-natal billings. The Federal share of this amount is $2,250,285." However, this affidavit alone hardly affords a sufficient basis upon which to determine as a matter of law how the program-specificity requirement of section 504 should be applied here, particularly in light of the potential inconsistency, raised at oral argument, between the positions taken by the federal government in this case and in the Grove City College case currently pending in the Supreme Court. As both the opinion of the Third Circuit in Grove City College, 687 F.2d at 688-89 & nn. 6-9, and the brief submitted by the government to the Supreme Court in challenging that decision, Brief for Respondents at 3-5, Grove City College v. Bell, No. 82-792, aptly illustrate in the closely analogous context of Title IX, the issue of program-specificity cannot be properly analyzed in the abstract, but instead requires a concrete set of facts. The same is ...