Velasquez v. O'Malley

Background

Rodolfo Velasquez brought an action under 42 U.S.C. § 405(g) seeking review of matters under the Social Security Act. He identified two issues: a monthly Medicare Part B charge of $330.30 instead of the $173.00 he expected, and what he described as an excessive delay in deciding his administrative appeal. His complaint stated that the administrative appeal remained unresolved.

Exhaustion requirement

The court explained that claims arising under the Medicare Act generally may be reviewed by a federal court only after the claimant exhausts the required administrative remedies and obtains a final decision. Failure to exhaust deprives the court of subject-matter jurisdiction, meaning the court lacks legal authority to decide the case.

Velasquez argued that the delay in resolving his appeal should allow him to bypass the administrative process. The court rejected that argument, stating that the Medicare Act specifically requires exhaustion before judicial review. The court also found that Velasquez had not alleged enough facts to qualify for an exception to exhaustion. In particular, his claim was not wholly separate from a claim for Medicare benefits because he was expressly seeking those benefits.

Ruling

Judge Araceli Martinez-Olguin granted the defendant’s motion to dismiss. Because Velasquez had not exhausted his administrative remedies, the court dismissed the complaint for lack of subject-matter jurisdiction. The court did not reach Velasquez’s claims for damages based on the Administration’s delays in processing his appeal. The opinion does not state whether the dismissal was with or without prejudice.