## Facts

- Ben Goodman, a Medicare Part B beneficiary, had a progressive speech impediment.
- In February 1985, Goodman’s physician recommended a magnetic resonance imaging procedure (MRI) to determine the cause of his condition.
- Goodman obtained the MRI and sought $675 in reimbursement from his Medicare Part B carrier.
- The carrier denied the claim because MRIs were not covered under Medicare Part B as of February 1985.
- A carrier hearing officer upheld the denial, concluding the governing regulation did not permit coverage and the officer lacked authority to approve benefits retroactively.
- Goodman did not dispute the carrier’s application of the regulation; he challenged the regulation’s validity under the Medicare statute.

## Issues

1. Whether the court had subject-matter jurisdiction under 42 U.S.C. § 405(g) to review the final administrative decision denying Medicare Part B reimbursement.
2. Whether the Secretary’s regulation excluding MRIs from Medicare Part B coverage in February 1985 conflicted with the Medicare Act’s “reasonable and necessary” standard and the statute’s non-interference with medical practice.

## Decision

- The court granted judgment on the pleadings for the Secretary and denied Goodman’s cross-motion for summary judgment.
- The court treated the carrier hearing officer’s decision as reviewable within the statutory limits on judicial review applicable to Part B disputes.
- On the merits, the court upheld the regulation excluding MRIs prior to the Secretary’s affirmative coverage recognition.
- The court rejected the argument that the regulation imposed an unlawful “irrebuttable presumption” against medical necessity.
- The court held that denying reimbursement did not interfere with medical practice because it regulated payment, not physicians’ treatment decisions.

## Legal Principles

- Medicare Part B reimburses only for items and services that satisfy the statutory “reasonable and necessary” standard as implemented through the Secretary’s regulations and coverage determinations.
- The Secretary may define coverage categories and the timing of coverage for new or emerging technologies through reasonable regulations consistent with the statute.
- A categorical exclusion from coverage for a procedure not yet approved for reimbursement may be a permissible implementation of the “reasonable and necessary” standard.
- The Medicare Act’s non-interference concept does not bar coverage rules that affect reimbursement while leaving medical decision-making to clinicians.

## Conclusion

The court upheld the Secretary’s Medicare Part B regulation excluding MRIs before formal approval and sustained the denial of reimbursement for Goodman’s February 1985 MRI because the rule was a lawful coverage determination within the Secretary’s statutory authority and did not impermissibly interfere with medical practice.


Goodman v. Sullivan, 712 F. Supp. 334 (S.D.N.Y. 1989)