Court Opinion

ID: 4172086
Source: CourtListenerOpinion
Date Created: 2017-05-26 14:15:28.031825+00
Date Added: 2024-06-11T14:25:20.620531
License: Public Domain

IN THE COMMONWEALTH COURT OF PENNSYLVANIA

ManorCare Health Services        :
Pittsburgh,                      :
                       Petitioner:
                                 :
           v.                    : No. 1557 C.D. 2016
                                 : Submitted: May 5, 2017
Department of Human Services,    :
                      Respondent :

BEFORE:      HONORABLE ROBERT SIMPSON, Judge
             HONORABLE MICHAEL H. WOJCIK, Judge
             HONORABLE DAN PELLEGRINI, Senior Judge

OPINION NOT REPORTED

MEMORANDUM OPINION BY
SENIOR JUDGE PELLEGRINI                               FILED: May 26, 2017

             ManorCare Health Services Pittsburgh (ManorCare) petitions for
review of the Bureau of Hearings and Appeals’ (BHA) denial of its Invoice
Exception Request because it was untimely. For the following reasons, we affirm.

                                            I.
             ManorCare is a nursing and rehabilitation provider which provides
nursing services to inpatient residents at its facility. In February 2014, on behalf of
one of its residents, ManorCare filed an application for Medical Assistance and
Long-Term Care (MA-LTC) benefits for payment of long-term service that would
be provided at one of its inpatient facilities.
             Eighteen months later, on June 18, 2015, the Allegheny County
Assistance Office found that the patient was eligible for benefits effective April 1,
2014. However, because the resident had transferred $10,000 in assets at less than
fair market value to achieve financial eligibility, a penalty period was applied,
making the resident ineligible for benefits until after May 4, 2014. ManorCare
appealed the decision, arguing that retroactive benefits should have been granted
from an earlier date. That appeal was denied on October 26, 2015.

             On November 10, 2015, ManorCare filed an Invoice Exception
Request with the Department of Human Services (Department) seeking payment
for the period of May 5, 2014, through April 30, 2015. An invoice exception
request was necessary because of the time periods set forth in 55 Pa. Code §
1101.68(b)(1) for requesting payment for service which states that “[a] provider
shall submit original or initial invoices to be received by the Department within a
maximum of 180 days after the date the services were rendered or compensable
items provided.” However, should a provider miss the deadline, they may seek an
exception provided “[e]ligibility determination was requested within 60 days of the
date of service and the Department has received an invoice exception request from
the provider within 60 days of receipt of the eligibility determination.” 55 Pa.
Code § 1101.68(c)(1).

             The Department denied the Invoice Exception Request because it was
not submitted within 60 days of the June 18, 2015 notice when the resident’s
eligibility for benefits was determined. ManorCare appealed that determination.

                                         2
               After a hearing, an Administrative Law Judge (ALJ) issued a
recommendation and adjudication denying in part and sustaining in part
ManorCare’s appeal. The ALJ found that ManorCare failed to submit its Invoice
Exception Request within 60 days of the June 18, 2015 denial of eligibility by the
Department. On the same day, the BHA issued an Order adopting the ALJ’s
recommendation. Unsure of what the Order was actually sustaining or denying,
ManorCare sought review and clarification of the Order from the Secretary, who
subsequently granted reconsideration on May 18, 2016.

               After 180 days passed from the November 14, 2016 order granting
reconsideration of the Department’s determination and the Secretary had failed to
make a determination on its appeal,1 ManorCare requested the Department to pay
the invoices, asserting that pursuant to 55 Pa. Code § 41.212(i), the Secretary’s
inaction led to the “deemed approval” of ManorCare’s appeal. The Department
refused to do so, arguing that ManorCare’s appeal had actually been deemed
denied because, under the regulation, it was the BHA order that was deemed
approved.

               While that was all going on and before the 180 days had passed, in
September 2016, ManorCare filed a petition for review in this Court’s original
jurisdiction. The Department filed an application for relief for the purpose of
clarifying whether the appeal should be in this court’s original or appellate

       1
         According to 55 Pa. Code § 41.212 (i), “[i]f the Secretary fails to act within 180 days of
the order granting review, the determination of the Bureau will be deemed approved by, and the
final order of, the Secretary effective the date it is deemed approved.”

                                                3
jurisdiction. We issued a Memorandum and Order on January 12, 2017, noting
that the appeal, though premature, would be treated as a timely petition for review
from the November 14, 2016 deemed denial of ManorCare’s appeal. We also
granted ManorCare’s motion to correct and supplement the record.

                                         II.
                                         A.
             ManorCare argues that its appeal was deemed sustained because the
Secretary failed to act within 180 days of the filing of its request for
reconsideration. Therefore, under 55 Pa. Code § 41.212(i), ManorCare’s request
for reconsideration was granted. However, that position is contrary to the plain
language of the regulation which provides that the BHA’s determination denying
ManorCare’s Invoice Exception Request is the order deemed approved, not the
appeal ManorCare filed with the Secretary to overturn that decision. As we stated
in our January 12, 2017 Memorandum and Order, “the 180-day period in this case
expired on November 14, 2016 due to inaction by the [Secretary]. Accordingly,
the merits order again became appealable on November 14, 2016.” Furthermore,
we held that all portions of the petition for review which related to the Secretary’s
failure to act should be stricken and that “the petition for review [was] timely filed
from the November 14, 2016 deemed denial.” Memorandum and Order, January
12, 2017.

                                         B.
             Even if its request was not deemed approved, ManorCare argues that
the Department erred in finding that its Invoice Exception Request was untimely

                                          4
because its appeal of the Department’s June 18, 2015 denial notice stayed the
running of the 60-day period that it had to file an invoice exception request.
Because that appeal was decided on October 26, 2015, ManorCare argues that its
November 10, 2015 submission of an Invoice Exception Request was within 60
days, making it timely.

               Under 55 Pa. Code § 1101.68(b)(1), a provider has 180 days after the
date the services were rendered to submit original or initial invoices to the
Department.2 Here, the eligibility determination providing that the resident was
eligible for MA-LTC services as of May 5, 2014, was not issued until June 18,
2015.3 When a provider cannot timely submit an invoice, as here, because an
eligibility determination for benefits has not been made, the regulation provides an

       2
          This is commonly referred to as the “180-day rule.” A medical assistance nursing
facility provider has until the end of the calendar month to seek reimbursement for all days of
services provided in that month. If original invoices are not received within 180 days of the time
periods provided in 55 Pa. Code § 1101.68(b)(1), those invoices are rejected unless the
exceptions and requirements found in 55 Pa. Code §§ 1101.68(c) and (d) apply. 55 Pa. Code §
1101.68(d)(5) provides that “[n]o exceptions to the normal invoice processing deadlines will be
granted other than under this section.”

       “This Court has held that substantial compliance with Medical Assistance regulations is
not sufficient, but, rather ‘[s]trict compliance with the regulations pertaining to submission of
claims is required where disbursement of public funds is at issue. . . . Men must turn square
corners when they deal with the Government.’” Grane Hospice Care, Inc. v. Department of
Public Welfare, 72 A.3d 322, 327 (Pa. Cmwlth. 2013) (quoting Nayak v. Department of Public
Welfare, 529 A.2d 557, 562 (Pa. Cmwlth 1987)).

       3
           It appears that approximately half the services at issue here – services provided from
May 5, 2014, through April 30, 2015, — were rendered within 180 days of the June 18, 2015
eligibility determination, so a request for payment for those services submitted promptly after
that decision would have been paid without an exception being filed.

                                                5
exception to the 180-day rule by allowing a provider to submit an invoice
exception request for payment within 60 days of receipt of the Department’s
eligibility determination. Under the regulation, ManorCare had until August 17,
2015, to submit an invoice exception request from the June 18, 2015 eligibility
determination. It did not file its request until November 10, 2015.

              ManorCare’s position that the 60-day period did not begin until
October 26, 2015, when its appeal of the June 18, 2015 order was decided is not
tenable for several reasons. First, nowhere in the Department’s regulations does it
provide that an appeal from a Department eligibility determination stays the 60-day
period a provider has to submit an invoice exception request.                   If ManorCare
wanted a stay, it was obligated to seek one. Second, even if there was a regulation
that provided for such a stay, that stay would not excuse ManorCare from timely
filing invoices for services for May 5, 2014, through April 30, 2015. All the stay
means is that actions involving the matter involved are held in abeyance pending
resolution of the appeal. The October 26, 2015 adjudication did not involve those
payments for May 5, 2014, through April 30, 2015. It only dealt with payments
from April 1, 2014, to May 4, 2014, the period the resident was found ineligible for
benefits.4

       4
          Even if its request was untimely, ManorCare contends that the reason it had to file an
invoice exception request at all was because it took 18 months from the filing of the application
for MA-LTC benefits to get a decision, and the Department should have granted ManorCare’s
Invoice Exception Request whether it was late or not. However, this type of delay is anticipated
by 55 Pa. Code § 1101.68(b)(1) which allows a provider to seek reimbursement within 60 days
of the date an eligibility determination has been made.

                                               6
            Accordingly, we affirm the BHA’s order denying ManorCare’s
Invoice Exception Request as untimely.

                                    _________________________________
                                    DAN PELLEGRINI, Senior Judge

                                         7
            IN THE COMMONWEALTH COURT OF PENNSYLVANIA

ManorCare Health Services        :
Pittsburgh,                      :
                       Petitioner:
                                 :
           v.                    : No. 1557 C.D. 2016
                                 :
Department of Human Services,    :
                      Respondent :

                                    ORDER

             AND NOW, this 26th day of May, 2017, the order of the Bureau of
Hearings and Appeals dated April 8, 2016, in the above-captioned matter is
affirmed.

                                     _________________________________
                                     DAN PELLEGRINI, Senior Judge