## Facts

- Miriam Crane, a Medicare Part A beneficiary, had multiple hospitalizations and periods of residence in a skilled nursing facility (SNF).
- Medicare Part A limits inpatient hospital coverage per “spell of illness,” which begins with inpatient admission to a hospital or extended care facility and ends after 60 consecutive days when the beneficiary is not an inpatient of such a facility.
- The Secretary treated Crane as an “inpatient” for the entire time she resided in the SNF, regardless of whether she received skilled nursing care or only custodial care.
- An ALJ determined that Crane’s benefit period ran continuously from November 1, 1974 to July 8, 1977, exhausting the 150 covered hospital days for a single spell of illness, and denied benefits for hospital stays after July 8, 1977.
- The district court reversed, finding that during certain SNF periods Crane received only custodial care; those periods did not constitute inpatient status for purposes of the spell-of-illness calculation, so later hospitalizations qualified as new spells of illness.
- The Secretary appealed to the Third Circuit.

## Issues

1. Whether, under 42 U.S.C. § 1395x(a), a Medicare “spell of illness” continues while a beneficiary resides in an SNF but receives only custodial (non-skilled) care.
2. Whether “inpatient” status in an SNF for spell-of-illness purposes turns on physical residence in the facility or on receipt of skilled nursing (extended care) services.

## Decision

- The Third Circuit affirmed the district court.
- The court held that SNF residence accompanied only by custodial care does not constitute being an “inpatient” for purposes of 42 U.S.C. § 1395x(a).
- Because custodial-only periods do not maintain inpatient status, the spell of illness can end after 60 consecutive days without inpatient hospital or skilled nursing facility care.
- Crane’s post–July 8, 1977 hospitalizations were to be treated as occurring in new spells of illness, allowing additional Medicare Part A benefits.

## Legal Principles

- A Medicare “spell of illness” under 42 U.S.C. § 1395x(a) is measured by inpatient status in a hospital or extended care facility and ends after 60 consecutive days without such inpatient status.
- For spell-of-illness calculations, a beneficiary is an inpatient in an SNF only when receiving skilled nursing (extended care) services, not merely by residing in the facility.
- An agency interpretation that treats any SNF residence as continuous inpatient status, without regard to the level of care actually furnished, is inconsistent with the statutory definition and cannot control.

## Conclusion

The court ruled that custodial-only residence in a skilled nursing facility does not extend a Medicare spell of illness; inpatient status in an SNF depends on receipt of skilled nursing care, permitting new benefit periods when the statutory 60-day break is met.


Friedberg v. Schweiker, 721 F.2d 445 (3d Cir. 1983)