Justia Public Benefits Opinion SummariesArticles Posted in Supreme Court of Mississippi
Methodist Specialty Care Center v. Mississippi Division of Medicaid
Methodist Specialty Care Center was the only nursing facility for the severely disabled (NFSD) in Mississippi. NFSDs generally incur higher costs than other nursing facilities, and because of this, Methodist received a percentage adjustment to its new-bed-value (NBV) calculation when the Mississippi Division of Medicaid (DOM) determined how much it should reimburse Methodist for its property costs through the DOM’s fair-rental system. A NBV was intended to reflect what it would cost to put a new bed into service in a nursing facility today. Methodist had received a NBV adjustment of 328.178 percent added to the standard NBV every year since it opened in 2004 until State Plan Amendment (SPA) 15-004 was enacted. During the 2014 Regular Session, the Mississippi Legislature passed House Bill 1275, which authorized the DOM to update and revise several provisions within the State Plan; one such amendment changed Methodist's adjustment rate, and made the facility experience a substantial decrease in its NBV, while all other nursing facilities in the state received increases. Methodist appealed the DOM’s changes to its NBV that were enacted in SPA 15-004. After a hearing, an Administrative Hearing Officer (AHO) upheld the decreased percentage adjustment to Methodist’s NBV, but also determined the DOM had miscalculated Methodist’s NBV adjustment. The DOM had planned to calculate Methodist’s adjustment as 175 percent of the base NBV, but the AHO found that Methodist’s adjusted NBV should be calculated in the same manner as it was calculated preamendment - by taking 175 percent of the standard NBV and adding that value to the standard NBV. Methodist still felt aggrieved because its NBV adjustment rate had not been restored to the preamendment rate. Methodist appealed the DOM’s final decision to the Chancery Court. When the chancellor affirmed the DOM’s final decision, Methodist appealed to the Mississippi Supreme Court. After review, the Supreme Court found the DOM’s final decision was supported by substantial evidence, was not arbitrary or capricious, did not violate Methodist’s constitutional or statutory rights and that the DOM was acting within its power in reaching and adopting its final decision. View "Methodist Specialty Care Center v. Mississippi Division of Medicaid" on Justia Law
Mississippi Division of Medicaid v. Windsor Place Nursing Center, Inc. et al.
The Mississippi Division of Medicaid (DOM) appealed a chancery court judgment ordering the DOM to reverse the adjustments for “Legend Drug” costs reported by Windsor Place Nursing Center, Inc., d/b/a Windsor Place Nursing & Rehab Center (Windsor) and Billdora Senior Care, Lexington Manor Senior Care, and Magnolia Senior Care (collectively Senior Care). The chancery court found that legend drug expenses incurred by these providers were properly reported on each of their Long Term Care (LTC) cost reports as an allowable cost and should have been taken into account the by DOM in determining the per diem rates for each provider. The DOM contends that its decision to disallow the legend drug expenses claimed by the providers in their required cost report for reporting years 2005, 2007, and 2008 was supported by substantial evidence, was not arbitrary or capricious, and was within its authority to decide. Therefore, the chancery court’s order must be reversed and the DOM’s decision must be reinstated. The Mississippi Supreme Court agreed with the DOM. "No where in the controlling statutes, the state plan, or Medicaid’s policy do we see language that lends itself to a construction taken by the providers that all prescription drug costs “not covered” by the Medicaid drug program means drug costs 'not paid for' by Medicaid. ... While the DOM may have failed to catch this in the past, legend drugs covered by Medicaid’s Drug Program are subject to direct reimbursement from Medicaid to the dispensing pharmacist, and constitute a non-allowable cost for the provider’s pier diem reimbursement report. And any action taken to the contrary by Medicaid is a violation of its rules and regulations." View "Mississippi Division of Medicaid v. Windsor Place Nursing Center, Inc. et al." on Justia Law
Mississippi True v. Dzielak et al.
An unsuccessful bidder on managed-care contracts for MississippiCAN, the state’s managed-care program, argued that the Division of Medicaid and its executive director violated multiple statutes and regulations in procuring the contracts. Mississippi True appealed the decision of the chancery court affirming the Division of Medicaid’s award of the contracts to three other companies and the chancery court’s order denying its motion to sever and transfer its damages claims to circuit court. The Mississippi Supreme Court "thoroughly reviewed the voluminous record" and concluded that Mississippi True has failed to prove any basis for reversal. "The decision of the DOM was supported by substantial evidence, was not arbitrary or capricious, was not beyond the DOM’s power to make, and did not violate Mississippi True’s statutory or constitutional rights." View "Mississippi True v. Dzielak et al." on Justia Law
Central Mississippi Medical Center v. Mississippi Division of Medicaid
Central Mississippi Medical Center (CMMC) appealed a Chancery Court decision denying its appeal of a Division of Medicaid (DOM) hearing. The DOM had determined that CMMC owed it $1.226 million due to overpayment. The Mississippi Supreme Court recently decided a reimbursement dispute involving the DOM, Crossgates River Oaks Hosp. v. Miss. Div. of Medicaid, 240 So. 3d 385 (Miss. 2018). In Crossgates, the hospitals prevailed because the DOM had failed to adhere to the Medicare State Plan Agreement. Applying the same legal principles to this case, the Supreme Court ruled the DOM prevailed because the DOM adhered to the Plan. The chancellor found sufficient evidence to support the DOM’s decision, decreed that it was neither arbitrary nor capricious, and decreed that it did not exceed the DOM’s authority or violate any of CMMC’s statutory or constitutional rights. View "Central Mississippi Medical Center v. Mississippi Division of Medicaid" on Justia Law
Genesis Hospice Care, LLC v. Mississippi Division of Medicaid
Genesis Hospice LLC provided outpatient hospice care to Medicaid beneficiaries in the Mississippi Delta. Claims Genesis submitted outside the norm, prompting a Mississippi Division of Medicaid audit. A statistical sample of 75 of the 808 billed claims were reviewed, and of that 75, 68 claims were not substantiated by the patients’ records and thus not eligible for payment. The auditing physicians specifically found that the patient records for the 68 rejected claims lacked sufficient documentation to support the given terminal-illness diagnosis and/or lacked documentation of disease progression. Medicaid’s statistician extrapolated that 68 of 75 unsupported claims represented a total overpayment of $1,941,285 for the 808 claims Genesis billed during the relevant time period. And Medicaid demanded Genesis repay this amount. Medicaid’s decision has been affirmed in an administrative appeal before Medicaid and by the Hinds County Chancery Court, sitting as an appellate court. On further appeal to the Mississippi Supreme Court, Genesis essentially argued Medicaid unfairly imposed documentation requirements not found in the federal or state Medicaid regulations. Genesis insisted the only requirement was a physician’s certification that in his or her subjective clinical judgment the patient was terminally ill, which Genesis provided. The Supreme Court found the regulations were clear: a physician’s certification of terminal illness is indeed required, but so is documentation that substantiates the physician’s certification. Because Genesis’ records failed to support 90 percent of its hospice claims, Medicaid had the administrative discretion to demand these unsupported claims be repaid. Therefore, the Supreme Court affirmed. View "Genesis Hospice Care, LLC v. Mississippi Division of Medicaid" on Justia Law
Mississippi v. Walgreen Co.
This matter stemmed from a lawsuit filed by the State of Mississippi against the defendant pharmacies. The State alleged deceptive trade practices and fraudulent reporting of inflated “usual and customary” prices in the defendant’s reimbursement requests to the Mississippi Department of Medicaid. The State argued that Walgreens, CVS, and Fred’s pharmacies purposefully misrepresented these prices to obtain higher prescription drug reimbursements from the State. Finding that the circuit court was better equipped to preside over this action, the DeSoto County Chancery Court transferred the matter to the DeSoto County Circuit Court in response to the defendants’ request. Aggrieved, the State timely filed an interlocutory appeal disputing the chancellor’s decision to transfer the case. After a thorough review of the parties’ positions, the Mississippi Supreme Court found that though the chancery court properly could have retained the action, the chancellor correctly used his discretion to transfer the case, allowing the issues to proceed in front of a circuit-court jury. As a result, the Supreme Court affirmed the chancellor’s decision. View "Mississippi v. Walgreen Co." on Justia Law
Memorial Hospital at Gulfport v. Dzielak
Memorial Hospital at Gulfport and Singing River Health System (“Hospitals”) sought judicial review of a June 24, 2016 administrative decision which found the Division of Medicaid’s (“DOM’s”) 2014 Fiscal Year Methodology “correctly interprets statutes and regulations and is neither arbitrary or capricious.” The chancellor affirmed the decision of DOM. Finding no evidence in the record before it that DOM failed to comply with Sections 43-13-117 and 43-13-145 in allocating and distributing supplemental payments to Mississippi hospitals, the Mississippi Supreme Court affirmed. View "Memorial Hospital at Gulfport v. Dzielak" on Justia Law
Crossgates River Oaks Hospital v. Mississippi Division of Medicaid
Twelve Medicaid-participating hospitals (“Hospitals”) challenged the Department of Medicaid’s (“DOM’s”) recalculation of their Medicaid outpatient rates for fiscal year 2001. The chancery court affirmed the opinion of the DOM, finding that “DOM interpreted its own regulation – the State Plan, which is its contract with the federal government and which it is required to follow to receive federal funds to require Medicaid to calculate the cost to charge ratio by using Medicare Methodology, which at that time was using a blended rate.” The Mississippi Supreme Court found the plain language of Attachment 4.19-B of the State Plan provided a cost-to-charge-ratio formula for calculating outpatient rates. Laboratory and radiology charges were to be excluded from this formula, because they were reimbursed on a fee-for-service basis. DOM’s inclusion of radiology and laboratory services in the charges and substitution of costs with Medicare blended payment amounts was a clear violation of the State Plan. Therefore, the Court reversed the judgments of DOM and the chancery court. Consistent with its opinion, the Court remanded and ordered the Executive Director of DOM to recalculate the Hospitals’ cost-to-charge ratio using the Hospital’s submitted costs in their cost reports, excluding laboratory and radiology services, and reimbursing the Hospitals the appropriate amounts determined by using the State Plan. View "Crossgates River Oaks Hospital v. Mississippi Division of Medicaid" on Justia Law
Watson Laboratories, Inc. v. Mississippi
In 2005, the State of Mississippi filed suit against more than eighty prescription drug manufacturers alleging, among other things, that each committed common-law fraud and violations of the Mississippi Consumer Protection Act. The allegations primarily focused on whether the prescription-drug manufacturers inflated reported prices, which caused the Mississippi Division of Medicaid to reimburse pharmacies at inflated rates. The cases were eventually severed; this appeal involved only Watson Laboratories, Inc., Watson Pharma Inc., and Watson Pharmaceuticals, Inc. (collectively “Watson”). Following a bench trial, the Chancery Court concluded that Watson had committed common-law fraud and had violated the Mississippi Consumer Protection Act. As a result, the chancery court awarded the State a total of $30,262,052 in civil penalties, compensatory damages, and punitive damages. The chancery court also awarded post-judgment interest of three percent on the compensatory and punitive damages. Watson appealed, challenging the chancery court’s decision; the State also filed a cross-appeals relating to damages. After review, the Mississippi Supreme Court affirmed the chancery court’s judgment in favor of Mississippi Medicaid. Further, the Court affirmed the ruling on the State’s cross-appeal. View "Watson Laboratories, Inc. v. Mississippi" on Justia Law