Source: http://pa.findacase.com/research/wfrmDocViewer.aspx/xq/fac.19911001_0040329.C03.htm/qx
Timestamp: 2017-04-29 09:22:09
Document Index: 302761643

Matched Legal Cases: ['§ 1396', '§ 1396', '§ 1396', '§ 1396', '§ 1396', '§ 962', '§ 1396']

| Erie County Geriatric Center v. Sullivan
Erie County Geriatric Center v. Sullivan
argued: October 1, 1991.
ERIE COUNTY GERIATRIC CENTER, A PENNSYLVANIA NON-PROFIT CORPORATION; COUNTY OF ERIE; J. ROBERT BALDWIN, INDIVIDUALLY AND ON BEHALF OF ALL OTHER SIMILARLY SITUATED REAL ESTATE TAXPAYERS OF ERIE COUNTY, PENNSYLVANIA, APPELLANTSv.LOUIS W. SULLIVAN, M.D., SECRETARY OF U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES; AND WALTER W. COHEN, SECRETARY OF THE COMMONWEALTH OF PENNSYLVANIA, DEPARTMENT OF PUBLIC WELFARE
Appeal from the United States District Court for the Western District of Pennsylvania. D.C. No. 84-00319E
This appeal raises issues emanating from the ongoing struggle of the Federal Government and the Commonwealth of Pennsylvania to contain costs in the delivery of health care services under the cooperative federal-state Medicaid program, Title XIX of the Social Security Act, 42 U.S.C.A. § 1396 et seq. (1983 and West Supp. 1991). Plaintiff-appellants, the Erie County Geriatric Center (ECGC or the Center), a non-profit corporation providing long-term health care to aged indigent under Medicaid, and the County of Erie, a guarantor of all of the Center's indebtedness, challenged the validity of the approval by the Secretary of the United States Department of Health and Human Services (the Secretary or HHS) of the 1980 and 1982 amendments to the Pennsylvania medical assistance plan.
As a participant in the Medicaid program, Pennsylvania must comply with the federal statutory and regulatory scheme which requires, inter alia, that it establish a medical assistance program designed to pay skilled nursing facilities (SNFs) and intermediate care facilities (ICFs) rates "which are reasonable and adequate to meet the costs which must be incurred by efficiently and economically operated facilities [providing] care and services in conformity with applicable State and Federal laws, regulations, and quality and safety standards." 42 U.S.C. § 1396(a)(13)(A). Plaintiffs filed a complaint against the Secretary and the Pennsylvania Department of Public Welfare (DPW) in 1984 seeking declaratory relief in the United States District Court for the Western District of Pennsylvania on the ground that the Secretary's approval and the State's application of the 1980 and 1982 plan amendments violated the Medicaid law. The district court dismissed the claims against DPW on eleventh amendment sovereign immunity grounds under Green v. Mansour, 474 U.S. 64, 88 L. Ed. 2d 371 , 106 S. Ct. 423 (1985), and DPW is not a party to this appeal.*fn1
ECGC relies substantially on reimbursements provided by the State through the Medicaid program. See 42 U.S.C.A. § 1396 et seq. States are not required to participate in the Medicaid program but if a state chooses to do so, it must comply with applicable federal law. Harris v. McRae, 448 U.S. 297, 301, 65 L. Ed. 2d 784 , 100 S. Ct. 2671 (1980). The Medicaid statute requires each participating state to submit a state plan containing a comprehensive description of the nature and scope of the state's Medicaid program for approval by the Secretary. 42 U.S.C.A. § 1396a(a). A state submits its plan to the Health Care Financing Administration (HCFA), the agency within HHS that Congress has designated to administer the Secretary's Medicaid responsibilities at the federal government level. Upon HCFA's approval of the plan, a state is entitled to federal government reimbursement for a percentage of the funds it has paid to health care facilities servicing Medicaid recipients. 42 U.S.C.A. § 1396b(a). Medicaid programs are administered by states, not the federal government, and so long as a state complies with the requirements of the Medicaid Act, "it has wide discretion in administering its local program." Lewis v. Hegstrom, 767 F.2d 1371, 1373 (9th Cir. 1985).
In 1980, in response to rapidly rising medical costs, Congress enacted section 962 of the Omnibus Budget Reconciliation Act, Pub. L. No. 96-499, § 962(a), 94 Stat. 2650 (1980), commonly referred to as to the Boren Amendment, amending 42 U.S.C. § 1396(a)(13)(A) to provide:
for payment of the skilled nursing facility and intermediate care facility services provided under the plan through the use of rates (determined in accordance with methods and standards developed by the State) which the State finds, and makes assurances satisfactory to the Secretary, are reasonable and adequate to meet the costs which must be incurred by efficiently economically operated facilities in order to provide care and ...