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Schweiker v. McClure | 456 U.S. 188 (1982)

Due process often requires a hearing before the government may deny a claim for federal benefits. Does such a hearing have to be conducted by a government official? That’s the question in Schweiker versus McClure.

The Social Security Act created the Medicare program, which was administered by the secretary of the Department of Health and Human Services. Medicare Part B provided medical insurance coverage for people sixty five and older or disabled. More than twenty seven million people participated in Medicare Part B.

To increase the program’s efficiency, Congress authorized the secretary to contract with private insurance companies to administer Part B benefit claims. The federal government paid the insurers’ costs to administer the claims, and all claims were paid from federal funds. The insurers reviewed and paid approved claims according to a detailed process.

A claimant whose claim was denied had the right to a hearing before a hearing officer appointed by the insurer. Federal funds paid the hearing officers’ salaries. Some hearing officers were current or former employees of the insurers. The secretary required hearing officers to be qualified to conduct formal hearings and to have a thorough knowledge of the Medicare program and its governing statutes and regulations. After receiving evidence and hearing arguments, a hearing officer rendered a written decision based on the record. Neither the statute nor the governing regulations provided for a further appeal of the hearing officer’s decision.

After a hearing officer denied William McClure’s claim, McClure sued Richard Schweiker, who was the health and human services secretary at the time. McClure alleged that the Part B hearing procedures denied him due process. The district court granted summary judgment for McClure, concluding that the lack of further review of the hearing officer’s decision violated McClure’s due process rights. The district court ordered that McClure be given a full hearing before an administrative law judge from the Social Security Administration. Schweiker appealed to the United States Supreme Court.

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