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Parkview Hospital, Inc. v. Wernert

Court of Appeals of Indiana

July 14, 2015

Parkview Hospital, Inc., Appellant-Plaintiff,
v.
John J. Wernert, in his official capacity as Secretary of the Indiana Family and Social Services Administration, Appellee-Defendant, and the Methodist Hospitals, Inc., Appellee-Intervening Defendant

Appeal from the Allen Superior Court. The Honorable Nancy Eshcoff Boyer, Judge. Cause No: 02D01-1212-PL-443.

ATTORNEYS FOR APPELLANT: James P. Fenton, Kathryn A. Brogan, Eilbacher Fletcher, LLP, Fort Wayne, Indiana; Myra C. Selby, Ice Miller LLP, Indianapolis, Indiana.

ATTORNEYS FOR APPELLEE, FSSA: Gregory F. Zoeller, Attorney General of Indiana; David L. Steiner, Kyle Hunter, Deputy Attorneys General, Indianapolis, Indiana.

ATTORNEYS FOR APPELLEE, METHODIST HOSPITALS, INC.: Steven Jackson, Juliana Yanez, Faegre Baker Daniels LLP, Indianapolis, Indiana.

Brown, Judge. Riley, J., and Robb, J., concur.

OPINION

Brown, Judge.

[¶1] Parkview Hospital, Inc. (" Parkview" ), appeals the July 25, 2014 judgment of the trial court in favor of Indiana Family and Social Services Administration (" FSSA" ), and Methodist Hospitals, Inc. (" Methodist," and FSSA and Methodist, together, " Appellees" ) on Parkview's petition for judicial review. Parkview raises two issues, which we revise and restate as whether the court erred in entering the July 25, 2014 order affirming the decision of the Secretary of FSSA regarding the denial of disproportionate share hospital payments to Parkview. We affirm.

Background and Procedural History

[¶2] FSSA administers the Medicaid program for the State of Indiana. Ind. Code § 12-15-1-1. Certain hospitals receive disproportionate share hospital (" DSH" ) payments, a related part of Medicaid, if the hospitals meet certain criteria and serve a disproportionate share of Medicaid recipients and other low income patients in accordance with Ind. Code § § 12-15-16 through -19 and other state and federal laws. See Ind. Code § 12-15-17-1; 42 U.S.C.A. § 1396r-4; 42 U.S.C.A. § 1395ww(d)(5)(F). The federal government limits its financial participation by apportioning a specific DSH allotment for each state. See 42 U.S.C.A. § 1396r-4(f). FSSA may not implement a program until the federal Centers for Medicare and Medicaid Services (" CMS" ) approves the provisions regarding the program in an amended state plan for medical assistance. Ind. Code § 12-15-15-10(d); Ind. Code § 12-15-16-5(a). FSSA may determine not to continue to implement the provisions relating to DSH payments if federal financial participation is not available. Ind. Code § 12-15-16-5(b).

[¶3] Ind. Code § § 12-15-16 relates to a provider's eligibility to receive DSH payments. Ind. Code § 12-15-16-1(a) states that a provider is a disproportionate share provider if, in part, the " provider's Medicaid inpatient utilization rate is at least one (1) standard deviation above the mean Medicaid inpatient utilization rate for providers receiving Medicaid payments in Indiana." See also 42 U.S.C.A. § 1396r-4(b)(1)(A). Ind. Code § 12-15-16-2(a) provides:

For purposes of disproportionate share eligibility, a provider's Medicaid inpatient utilization rate is a fraction (expressed as a percentage) where:
(1) the numerator is the provider's total number of Medicaid inpatient days in the most recent year for which an audited cost report is on file with the office; and
(2) the denominator is the total number of the provider's inpatient days in the most recent year for which an audited cost report is on file with the office.

See also 42 U.S.C.A. § 1396r-4(b)(2) (providing in part " the term 'medicaid inpatient utilization rate' means, for a hospital, a fraction (expressed as a percentage), the numerator of which is the hospital's number of inpatient days attributable to patients who (for such days) were eligible for medical assistance under a State plan approved under this subchapter . .., and the ...


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