Kent County v. Department of Social Services
| Decision Date | 20 May 1986 |
| Docket Number | Docket No. 81792 |
| Citation | 386 N.W.2d 663,149 Mich.App. 749 |
| Parties | , Medicare & Medicaid Guide P 35,500 KENT COUNTY, Petitioner-Appellant, v. Michigan DEPARTMENT OF SOCIAL SERVICES, Respondent-Appellee. |
| Court | Court of Appeal of Michigan — District of US |
Riddering, Schmidt & Howlett by Judy E. Bregman, Grand Rapids, for petitioner-appellant.
Frank J. Kelley, Atty. Gen., Louis J. Caruso, Sol. Gen., and William K. Basinger, Asst. Atty. Gen., for respondent-appellee.
Before WAHLS, P.J., and ALLEN and RAVITZ, * JJ.
In this case, petitioner challenges the Medicaid reimbursement system implemented by the Department of Social Services (DSS) pursuant to the annual social welfare medical assistance appropriations acts. Petitioner appeals as of right from a circuit court order affirming the decision of the Director of the Michigan Department of Social Services.
The instant dispute concerns the DSS's method of computing the reimbursement due county-operated Kent Community Hospital (KCH) for skilled nursing care provided for persons entitled to Medicaid. Before discussing petitioner's specific objection to the DSS's computation method, it would be helpful to breifly outline the federal-state cooperative program under the Social Security Act.
Under Title XIX of the Social Security Act, 42 U.S.C. Sec. 1396 et seq., the federal government provides grants-in-aid to states that administer programs for supplying medical assistance to specified categories of needy individuals and families. The state plan must conform with certain federal statutory requirements and the accompanying regulations. Section 1396a. Specifically, participating states are required to provide medical services to certain individuals and families, i.e., those eligible through such programs as Aid to Families With Dependent Children and Supplemental Security Income for the Aged, Blind, and Disabled. See Sec. 1396a(a)(13). These individuals and families comprise the "categorically needy". Friedman v. Berger, 547 F.2d 724 (C.A.2 1976), cert. den. 430 U.S. 984, 97 S.Ct. 1681, 52 L.Ed.2d 378 (1977). In addition to the mandatory provisions of medical care to the "categorically needy", a state also has the option of providing services to those categorized as "medically needy" and Michigan has elected to provide such services. See M.C.L. Sec. 400.106(1)(b)(iii); M.S.A. Sec. 16.490(16)(1)(b)(iii), 42 U.S.C. Sec. 1396a(a)(10)(A)(ii). The "medically needy" are those whose income exceeds that of the "categorically needy" but is insufficient to cover medical care. M.C.L. Sec. 400.106(1)(b)(iii); M.S.A. Sec. 16.490(16)(1)(b)(iii). Under this branch of the Medicaid program, the state will pay the medical expenses of eligible persons whose income is not sufficient to cover their medical expenses. These individuals are eligible for medical assistance once their own expenses for medical care have effectively reduced their income to that level which entitles persons to medical assistance as "categorically needy" persons. Id. The state is responsible only for the difference between its established fee schedule and the amounts these individuals are able to pay. The individual is responsible for the remainder, the "patient pay amount" (PPA). See Winter v. Quern, 490 F.Supp. 788, 790-791 (N.D.Ill.1980). It is the reimbursement for care of these "medically needy" persons that lies at the heart of this controversy.
At issue is reimbursement for the years 1969 through 1974. The resolution of this issue depends primarily on the construction to be accorded the relevant appropriations acts under which the DSS disburses Medicaid funds: 1969 P.A. 316, Sec. 13; 1970 P.A. 99, Sec. 14; 1971 P.A. 230, Sec. 15; 1972 P.A. 206, Sec. 14; 1973 P.A. 131, Sec. 17; and 1974 P.A. 241, Sec. 21. The language of the six acts is almost identical and provides the following reimbursement formula, or fee schedule, as quoted from section 13 of the 1969 act:
"[T]he state shall pay for skilled nursing care in county medical institutions, chronic care facilities and chronic care units of general hospitals the daily rate as determined by the director of the department of social services plus 40% of the difference between that rate and the total audited cost for the institution in those facilities where the total daily cost exceeds the determined rate." (Emphasis added.)
The county does not dispute the DSS's determination of the daily rate amounts. The county challenges the DSS's method of determining the total audited cost for KCH in its care of "medically needy" individuals.
The "total audited cost" of an institution is "the total resources necessary to provide goods and services" to eligible patients. Ingham County v. Dep't of Social Services, 62 Mich.App. 683, 687, 233 N.W.2d 833 (1975). Under the DSS's present formula of reimbursement, the total audited cost of an institution's care of medically needy persons includes costs for services for which the eligible person is able to pay, i.e amounts compensated by the PPA. The PPA is then deducted when the DSS reimburses a facility for 40% of the difference between the daily amount and the total audited cost. The county contends that DSS may not include the PPA in the total audited costs, since the individual, not the DSS, is liable for that amount. The DSS counters that subtraction of the PPA from the total audited cost would cause DSS payment in excess of the 40% over daily rate amount mandated by the Legislature with respect to that portion of costs reimbursed by the PPA.
We agree with the DSS and affirm. At the outset, it must be noted that this issue must be reviewed with respectful consideration of the DSS's interpretation, since due deference is accorded the construction placed upon legislation by the agency responsible for its administration. Bd. of Ed. of Oakland Schools v. Superintendent of Public Instruction, 401 Mich. 37, 41, 257 N.W.2d 73 (1977). In light of the consideration given the DSS's interpretation, we find its interpretation of "total audited cost" to be reasonable.
Petitioner's construction assumes that eligibility of the "medically needy" is contingent upon payment of the PPA. In fact, Medicaid eligibility is determined in advance. Berrien County v. Michigan, 136 Mich.App. 772, 782, 357 N.W.2d 764 (1984). As Medicaid-eligible persons whose eligibility is determined in advance, the medically needy must pay their portion of medical costs based on the...
To continue reading
Request your trial
-
Vansach v. Dep't of Health & Human Servs. (In re Estate of Vansach)
...calculations of income. See 42 USC 1396a(a)(17) ; 42 USC 1396r-5(d)(1) ; 42 CFR 435.725 ; Kent County v. Dep’t of Social Servs. , 149 Mich.App. 749, 751-752, 386 N.W.2d 663 (1986). However, Medicaid, "with all of its complicated rules and regulations, has also become a legal quagmire that h......
-
KENT CTY. AERO. BD. v. Dept. of State Police
...See also Oakland Co. Bd. of Co. Rd. Comm'rs v. MPCGA, 456 Mich. 590, 607-610, 575 N.W.2d 751 (1998); Kent Co. v. Dep't of Social Services, 149 Mich.App. 749, 754, 386 N.W.2d 663 (1986); Berrien Co. v. Michigan, 136 Mich.App. 772, 778-779, 357 N.W.2d 764 (1984) (all dismissing equal protecti......
-
Rock County v. Spire
...in opposition to will of its creator); Trenton v. New Jersey, 262 U.S. 182, 43 S.Ct. 534, 67 L.Ed. 937 (1923); Kent County v. DSS, 149 Mich.App. 749, 386 N.W.2d 663 (1986) (local units of government, such as counties, are creatures of the Legislature and, as such, have no due process rights......
-
Majurin v. Department of Social Services
...of Oakland Schools v. Superintendent of Public Instruction, 401 Mich. 37, 41, 257 N.W.2d 73 (1977); Kent Co. v. Dep't of Social Services, 149 Mich.App. 749, 753, 386 N.W.2d 663 (1986). However, an administrative interpretation of a statute is not conclusive and cannot overcome a logical rea......