Matter of Rate Appeals of Lyngblomsten Care Center

578 N.W.2d 1, 1998 Minn. App. LEXIS 465, 1998 WL 202534
CourtCourt of Appeals of Minnesota
DecidedApril 28, 1998
DocketC1-97-1876
StatusPublished

This text of 578 N.W.2d 1 (Matter of Rate Appeals of Lyngblomsten Care Center) is published on Counsel Stack Legal Research, covering Court of Appeals of Minnesota primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Matter of Rate Appeals of Lyngblomsten Care Center, 578 N.W.2d 1, 1998 Minn. App. LEXIS 465, 1998 WL 202534 (Mich. Ct. App. 1998).

Opinion

OPINION

SHUMAKER, Judge.

The Minnesota Department of Human Services (DHS) refused to reimburse relator nursing homes’ capital repair and replacement costs under the repair and replacement provision of the Nursing Facility Rate statute. The Commissioner of Human Services granted DHS summary judgment. Relators seek review through writ of certiorari.

FACTS

Relators Lyngblomsten Care Center and Camilia Rose Care Center are nursing home facilities that participate in Minnesota’s Medical Assistance (MA) program. In 1993, both *2 facilities completed major construction projects that were approved under the nursing home moratorium process. Minn.Stat. § 144A.073 (1996).' The legislature determined that a nursing home moratorium was necessary “to control nursing home expenditure growth.” Minn.Stat. § 144A.071 (1996). A major construction project is one that “exceeds the lesser of $150,000 or ten percent of [the facility’s] most recent appraised value.” Minn.Stat. § 256B.431, subd. 16 (1996). Lyngblomsten’s major construction project included a three-story addition, two elevators, and the remodeling of a lounge and two nursing stations at a cost of $1,234,223. Ca-milia Rose’s major construction project was a 3,700 square foot addition to its building at a cost of $477,144.

Within 12 months of the major construction projects, relators made additional capital repairs and replacements to their facilities. During the year before the termination of Lyngblomsten’s major construction project, it incurred costs of approximately $34,000 for light fixtures, carpeting, a nurse call system, a compressor, windows, elevator equipment, a cooler, and a heating filter system. Similarly, approximately four months after Cami-lia Rose completed its major construction project, it replaced a heating and cooling unit for its main building at a cost of approximately $26,000. These later repair and replacement costs were unrelated to and not a functional part of the major construction projects that had been approved for reimbursement.

DHS reimburses nursing facilities differently for a major construction project or for a capital repair or replacement. Relators applied to DHS for reimbursement of their major construction projects under the specific statutory provision for major construction projects, Minn.Stat. § 256B.431, subds. 16,17 (1996). Relators also sought reimbursement of their unrelated capital repairs and replacements under a separate statutory provision, Minn.Stat. § 256B.431, subd. 15 (1996). The effect of relators’ separation of costs, if DHS would have accepted them, would have been to obtain a greater total amount of MA reimbursement for their total costs.

During a desk audit, however, DHS disallowed relators’ separation of costs. It adjusted the reported costs by adding the repair and replacement costs together with the major construction project costs. DHS’s adjustment was based on a statutory definition of construction project. Because of DHS’s action, relators did not receive reimbursement for their repairs under Minn.Stat. § 256B.431, subd. 15(e) (1996).

After DHS’s desk audit adjustment, rela-tors sought a contested ease hearing before an administrative law judge (ALJ). The ALJ, on competing motions for summary judgment, recommended that the commissioner grant DHS’s motion. The Commissioner of Human Services granted summary judgment to DHS. Relators obtained a writ of certiorari to this court, and we now review the commissioner’s decision.

ISSUE

Did DHS correctly combine relators’ major construction project costs and their ordinary repair and replacement costs under Minn. Stat. §§ 144A.071 and 256B.431?

ANALYSIS

This court independently reviews an agency’s decision on a question of law or statutory interpretation. Matter of Dougherty, 482 N.W.2d 485, 488 (Minn.App.1992), review denied (Minn. June 10, 1992). However, “[w]hen the meaning of a statute is doubtful, courts should give great weight to a construction placed upon it by the department charged with its administration.” Krumm v. R.A. Nadeau Co., 276 N.W.2d 641, 644 (Minn.1979); see also Estate of Atkinson v. Minnesota Dept, of Human Servs., 564 N.W.2d 209, 213 (Minn.1997) (citing Krumm).

There are three statutory provisions at issue. The first defines nursing home capital repair and replacement cost reporting:

If costs otherwise allowable under this subdivision are incurred as the result of a project approved under the moratorium exception process in section 144A.073, or in connection with an addition to or re *3 placement of buildings, attached fixtures, or land improvements for which the total historical cost of these assets exceeds the lesser of $150,000 or ten percent of the nursing facility’s appraised value, these costs must be claimed under subdivision 16 or 17, as appropriate.

Minn.Stat. § 256B.431, subd. 15(e) (emphasis added).

The second provision instructs the department of health and human services to employ the definition of construction project found at Minn.Stat. § 144A.071, subd. la (g)(3) (1996). Minn.Stat. § 256B.431, subd. 10 (1996). 1

The third provision defines the term “construction project” as “capital asset additions or replacements that are completed within 12 months before or after the completion date of the project described in clause (1).” Minn. Stat. § 144A.071, subd. la (g)(3) (1996).

There is no case law interpreting these provisions. Relators contend that the two phrases in section 256B.431, subdivision 15(e), “as a result of,” and “in connection with,” require DHS to find that the claimed capital repair and replacement costs are a function of or related to the major construction project before those costs could be added to the cost of a major construction project approved under the moratorium process. Relators’ argument would be more compelling if subdivision 15(e) were read in isolation. The department, however, is charged with interpreting all relevant statutory provisions together. Because Minn.Stat. § 256B.431, subd. 15(e) has more than one reasonable interpretation, the statute presents an ambiguity and is subject to the rules of statutory construction. See Tuma, v. Commissioner of Econ. Sec., 386 N.W.2d 702, 706 (Minn.1986) (statute is ambiguous if it has. more than one reasonable interpretation and court must apply rules of construction); Waller v. Powers Dep’t. Store, 343 N.W.2d 655, 657 (Minn.1984) (statutory construction appropriate only when statute is ambiguous). The object of statutory construction is to determine and give effect to the legislature’s intent. Minn.Stat. § 645.16 (1996).

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Related

Tuma v. Commissioner of Economic Security
386 N.W.2d 702 (Supreme Court of Minnesota, 1986)
Estate of Atkinson v. Minnesota Department of Human Services
564 N.W.2d 209 (Supreme Court of Minnesota, 1997)
Krumm v. R. A. Nadeau Co.
276 N.W.2d 641 (Supreme Court of Minnesota, 1979)
A/AL, INC. v. City of Faribault
569 N.W.2d 546 (Court of Appeals of Minnesota, 1997)
Waller v. Powers Department Store
343 N.W.2d 655 (Supreme Court of Minnesota, 1984)
Matter of Dougherty
482 N.W.2d 485 (Court of Appeals of Minnesota, 1992)

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Bluebook (online)
578 N.W.2d 1, 1998 Minn. App. LEXIS 465, 1998 WL 202534, Counsel Stack Legal Research, https://law.counselstack.com/opinion/matter-of-rate-appeals-of-lyngblomsten-care-center-minnctapp-1998.