Alexian Bros. of St. Louis, Inc. v. Department of Social Services, Division of Medical Services

18 S.W.3d 534, 2000 Mo. App. LEXIS 756, 2000 WL 662612
CourtMissouri Court of Appeals
DecidedMay 23, 2000
DocketNo. WD 57453
StatusPublished
Cited by1 cases

This text of 18 S.W.3d 534 (Alexian Bros. of St. Louis, Inc. v. Department of Social Services, Division of Medical Services) is published on Counsel Stack Legal Research, covering Missouri Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Alexian Bros. of St. Louis, Inc. v. Department of Social Services, Division of Medical Services, 18 S.W.3d 534, 2000 Mo. App. LEXIS 756, 2000 WL 662612 (Mo. Ct. App. 2000).

Opinion

JAMES M. SMART, Jr., Judge.

This case concerns issues related to the jurisdiction of the Administrative Hearing Commission under § 208.156.4, RSMo 1994. Alexian Brothers Hospital of St. Louis, Inc., (“Alexian”) appeals the denial of its claim for reimbursement under the Federal Medicaid Act. We remand for dismissal for lack of jurisdiction.

Since before 1990, Alexian has been an authorized Medicaid provider under Missouri’s participation in the Federal Medicaid Act, 42 U.S.C. § 1896 et seq.(1992). Among the services provided by Alexian are psychiatric care services. Medicaid reimbursements to authorized providers are administered by the Division of Medical Services of the Missouri Department of Social Services (“DMS”).

Prior to January 1, 1990, health care providers participating in the Missouri Medicaid Program received reimbursements from DMS on the basis of a per diem rate. Effective January 1, 1990, in response to what it considered to be a great surge in psychiatric care costs, DMS placed a cap on the per diem reimbursement rates for certain inpatient psychiatric services. Pursuant to 18 C.S.R. 70-15.010(15), those psychiatric services were reimbursed at the lower of the hospital’s Title XIX per diem rate or an inpatient psychiatric per diem of $277.00. The rate was adjusted for inflationary factors, but the cap still remained below what the hospital contended was the reasonable cost of providing care.

In October of 1992, Alexian filed a petition with the Administrative Hearing Commission (“AHC”), challenging the calculation of the daily rate. Alexian sought reimbursement for the period beginning October 2, 1992. Alexian contended, inter alia, that DMS’s rate plan violated 42 U.S.C. § 1396(a)(13)(A)(1992), known as “The Boren Amendment.” The Boren Amendment requires that reimbursement rates be “reasonable and adequate to meet the costs which must be incurred by efficiently and economically operated facilities in order to provide care and services in conformity with applicable State and Federal laws, regulations, and quality and safety standards.... ” See also 42 C.F.R. § 447.253(b)(l)(1992).

The AHC made findings of fact in the case, but determined that it lacked jurisdiction to grant relief. On judicial review, the circuit court held that the cap set forth in 13 C.S.R. 70-15.010(15) violated the Boren Amendment to the Federal Medicaid law, and also violated the “reasonable cost” reimbursement provision of § 208.152, RSMo 1990. The court ordered DMS to reimburse Alexian for the losses caused by the cap since October 1, 1992. That decision was affirmed by this court, in Missouri Dep’t of Soc. Servs., Div. of Medical Servs. v. Alexian Bros, of St. Louis, Inc., 930 S.W.2d 439 (Mo.App.1996) (“Alexian I”). Thereafter, in 1997, Alexi-[536]*536an filed a second case with the AHC, seeking additional retroactive payments for the period between January 1, 1990, through October 1,1992.

The Department of Social Services (“Department”) moved to dismiss the second action on the ground that the claims were barred by the doctrine of res judicata. In September 1998, the AHC, pursuant to 1 C.S.R. 15-6.450(4)(C), granted the Department’s motion, concluding that the second petition was barred by the doctrine of res judicata. Alexian sought judicial review. On May 25, 1999, the circuit court entered its judgment in favor of the Department. Alexian appeals.

In its first point on appeal, Alexian contends that res judicata is not applicable because the earlier case, Alexian I, involved different facts, different rates of Medicaid reimbursement, different rules and regulations, separate and different periods of time, and was not based on the same cause of action. In its second point, Alexian argues that the circuit court erred in holding that, because the regulation imposing the cap was no longer in effect at the time Alexian filed this action with the AHC on January 7,1997, the court and the AHC lacked jurisdiction of Alexian’s claim.

We turn initially to the jurisdictional issue. The circuit court held that because the offending regulation had already been withdrawn three months before Alexian filed its case with the AHC, the AHC had no jurisdiction. Alexian claimed jurisdiction under § 208.156.4. That section authorizes AHC jurisdiction ' over those claims brought by a person “aggrieved by any rule or regulation promulgated by the department of social services or any division therein.... ” § 208.156.4, RSMo 1994. The court held that because there was no then-existing regulation which had caused Alexian to be aggrieved, the AHC had no jurisdiction to entertain the claims of Alexian for reimbursement.

Alexian contends on appeal that the court erred in that § 208.156.4 does not limit claims to those lodged against an existing rule or regulation. Alexian points out that the word “existing” is not in the statutes, and argues there is no reason for such a limitation to be inferred. The Department, in response, argues that Alexian overlooks the fact that there is a distinction between a challenge to an agency rule and a challenge to an agency decision. The Department suggests that § 208.156.4 is designed to create a forum for a challenge to an agency rule which aggrieves a citizen, and that § 208.156.2 and § 208.156.8 are designed to create a window of opportunity for challenging an agency decision. The Department argues that the distinction between an agency ruling and an agency decision appears in Missouri Health Care Ass’n v. Missouri Dep’t of Soc. Sens., 851 S.W.2d 567 (Mo.App.1993). The court in that case drew a distinction between a challenge to a rule, and a challenge to a decision, by suggesting that the task is whether the action seeks a declaration concerning a “statement of policy or interpretation of law of future effect on unnamed and unspecified persons or facts,” or whether the action involves a determination based on specific facts and persons. Id. at 570. The court said that the former instance involves an agency rule, and the latter instance involves an agency decision. Id.

The same distinction was echoed in Missouri Dep’t of Soc. Sens., Div. of Medical Servs. v. Great Plains Hosp., Inc., 930 S.W.2d 429 (Mo.App.1996). Noting that § 208.156.8 differentiates Department “decisions” from “regulations,” and noting further that the time limitation of subsection 8 applies only to departmental “decisions,” that provision would not apply to a challenge to a regulation under § 208.156.4. Id. at 439. Alexian suggests that Great Plains Hospital constitutes helpful authority for Alexian because in that case Great Plains Hospital was allowed to proceed against the rate determination for the fiscal years 1990, 1991 and 1992.

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18 S.W.3d 534, 2000 Mo. App. LEXIS 756, 2000 WL 662612, Counsel Stack Legal Research, https://law.counselstack.com/opinion/alexian-bros-of-st-louis-inc-v-department-of-social-services-division-moctapp-2000.