Scottsdale Healthcare, Inc. v. AHCCCS

• Decision Date: 20 August 2003
• Docket Number: No. CV-02-0220-PR., No. CV-02-0218-PR, No. CV-02-0190-PR
• Citation: 206 Ariz. 1,75 P.3d 91
• Parties: SCOTTSDALE HEALTHCARE, INC., dba Scottsdale Healthcare—OSBORN, Plaintiff-Appellee, v. ARIZONA HEALTH CARE COST CONTAINMENT SYSTEM ADMINISTRATION, an agency of the State of Arizona; and Phyllis Biedess, in her capacity as Director, Defendants-Appellants. Banner Health System, a North Dakota non-profit Corporation, dba Good Samaritan Regional Medical Center, Plaintiff-Appellee, v. Arizona Health Care Cost Containment System Administration, an agency of the State of Arizona; and Phyllis Biedess, in her capacity as Director, Defendants-Appellants. Banner Health System, a North Dakota non-profit Corporation, dba Good Samaritan Regional Medical Center, Plaintiff-Appellee, v. Arizona Health Care Cost Containment System Administration, an agency of the State of Arizona; and Phyllis Biedess, in her capacity as Director, Defendants-Appellants.
• Court: Arizona Supreme Court

75 P.3d 91

206 Ariz. 1

SCOTTSDALE HEALTHCARE, INC., dba Scottsdale Healthcare—OSBORN, Plaintiff-Appellee, v. ARIZONA HEALTH CARE COST CONTAINMENT SYSTEM ADMINISTRATION, an agency of the State of Arizona; and Phyllis Biedess, in her capacity as Director, Defendants-Appellants.

Banner Health System, a North Dakota non-profit Corporation, dba Good Samaritan Regional Medical Center, Plaintiff-Appellee, v. Arizona Health Care Cost Containment System Administration, an agency of the State of Arizona; and Phyllis Biedess, in her capacity as Director, Defendants-Appellants.

Banner Health System, a North Dakota non-profit Corporation, dba Good Samaritan Regional Medical Center, Plaintiff-Appellee, v. Arizona Health Care Cost Containment System Administration, an agency of the State of Arizona; and Phyllis Biedess, in her capacity as Director, Defendants-Appellants.

Nos. CV-02-0190-PR, CV-02-0218-PR, CV-02-0220-PR.

Supreme Court of Arizona.

August 20, 2003.

Reconsideration Denied October 28, 2003.¹

Gammage & Burnham, P.L.C, By Richard B. Burnham, Cameron C. Artigue, Susan L. Watchman and Aaron C. Schepler, Phoenix, Attorneys for Consolidated Plaintiffs-Appellees.

Johnston & Kelly, P.L.C., By Logan T. Johnston, Phoenix, Attorney for Defendants-Appellants.

OPINION

RYAN, Justice.

¶ 1 Undocumented aliens are eligible for publicly funded medical coverage only for an emergency medical condition. See Ariz.Rev.Stat. ("A.R.S.") § 36-2905.05(A) (Supp.1997).² If a hospital provides medical treatment for the emergency medical condition of an undocumented alien, the Arizona Health Care Cost Containment System ("AHCCCS") will reimburse the hospital for the costs of the care. A.R.S. § 36-2905.05 (Supp.1997). The central question we must answer in this case is whether an undocumented alien's emergency medical condition has necessarily ended when the initial injury has been stabilized to the point of permitting the undocumented alien to be transferred from an acute care ward to a sub-acute care ward.

¶ 2 This matter involves three consolidated cases: Scottsdale Healthcare, Inc. v. AHCCCS, 202 Ariz. 365, 45 P.3d 688 (App.2002); Banner Health System v. AHCCCS, 1 CA-CV 01-0380 (Ariz.App. May 30, 2002)(mem.decision)(Banner I); and Banner Health System v. AHCCCS, 1 CA-CV 01-0468 (Ariz.App. Jun. 4, 2002)(mem.decision)(Banner II). All three decisions reversed trial court rulings and upheld the AHCCCS Director's determinations that when the undocumented aliens were transferred from an acute care ward, they were not suffering from an emergency medical condition, and thus AHCCCS was not required to reimburse the hospitals for their continuing care after the transfer. The hospitals petitioned for review. We consolidated the three cases, see ARCAP 8(b), and granted review because of the statewide importance of this issue. We have jurisdiction under Article 6, Section 5(3), of the Arizona Constitution, A.R.S. section 12-120.24 (2003), and Rule 23 of the Arizona Rules of Civil Appellate Procedure.

I.

¶ 3 AHCCCS administers Arizona's Medicaid program in accordance with Title XIX of the Social Security Act, 42 U.S.C. §§ 1396 to 1396v (2001). See A.R.S. §§ 36-2901 to -2958 (Supp.1997) (superseded by A.R.S. §§ 36-2901 to -2975 (2003)). Section 36-2905.05(A) provides that undocumented aliens are eligible for AHCCCS coverage "necessary to treat an emergency medical condition as defined in § 1903(v) of the [S]ocial [S]ecurity [A]ct." In relevant part, § 1903(v) of the Social Security Act states the following:

[T]he term "emergency medical condition" means a medical condition (including emergency labor and delivery) manifesting itself by acute symptoms of sufficient severity (including extreme pain) such that the absence of immediate medical attention could reasonably be expected to result in—

(A) placing the patient's health in serious jeopardy,

(B) serious impairment to bodily functions, or

(C) serious dysfunction of any bodily organ or part.

See 42 U.S.C. § 1396b(V)(3) (2000) (codifying § 1903(v) of the Social Security Act).³

¶ 4 All the patients involved in these consolidated cases were undocumented aliens. The injuries and treatment regimes for each of the five patients differed greatly.⁴ But the consistent thread through all three cases, in terms of interpreting § 1903(v), is that AHCCCS's denial of reimbursement to the hospitals coincided directly with the transfer of patients from an acute care ward to a rehabilitative type of ward.

¶ 5 After AHCCCS rejected the hospitals' grievances of the denials for reimbursement, hearings were held before administrative law judges to determine when each patient stopped receiving treatment for an emergency medical condition, thereby terminating AHCCCS's responsibility to reimburse the hospitals. In Scottsdale Healthcare, the judge recommended that AHCCCS's denial of the hospital's grievance be sustained. In Banner I and Banner II, the administrative law judges recommended that AHCCCS's denial of reimbursement be reversed in whole or in part. In Scottsdale Healthcare, the AHCCCS Director adopted the recommendation denying reimbursement; in Banner I and Banner II, the Director rejected the recommendations that the hospitals be reimbursed. The hospitals appealed to the superior court. The trial courts ruled in favor of the hospitals, and AHCCCS then appealed the three cases to the court of appeals.

¶ 6 The lead decision in the present matter is Scottsdale Healthcare. The court held that at the time coverage was denied the patient was not suffering from an "emergency medical condition" within the meaning of A.R.S. section 36-2905.05(A) and § 1903(v) of the Social Security Act. Scottsdale Healthcare, 202 Ariz. at 369, ¶ 10, 45 P.3d at 692. The two other cases consolidated for this opinion relied on Scottsdale Healthcare. See Banner I, slip op. at ¶ 9; Banner II, slip op. at ¶¶ 17-18.

II.

¶ 7 The hospitals maintain that once a hospital admits an undocumented alien for treatment of an emergency medical condition, § 1903(v) requires AHCCCS to reimburse the hospital for the medical treatment provided to the undocumented alien until "the treating physician [has] a reasonable degree of confidence that the patient and his lay caregivers can manage his medical condition so that serious adverse consequences are not `reasonably likely' to occur."

¶ 8 AHCCCS contends the evidence established that when transferred, the patients' conditions in these cases had stabilized, and thus they were not being treated for emergency medical conditions.

¶ 9 There is no dispute that when the patients arrived at the respective hospitals each was suffering from an "emergency medical condition" within the meaning of § 1903(v). The question is whether each still suffered from an "emergency medical condition" at the time of their transfers from an acute care ward or bed. The answer to this question turns on the determination of when an emergency medical condition as defined by § 1903(v) ceases, and therefore AHCCCS's obligation to pay for medical treatment ends. Answering the question requires us to interpret the statute.

¶ 10 We review questions of law involving statutory interpretation de novo. Forest Guardians v. Wells, 201 Ariz. 255, 258-59, ¶ 9, 34 P.3d 364, 367-68 (2001) ("[I]f the administrative decision was based on an interpretation of law, it is reviewed de novo."). In interpreting a statute, we first look to the language of the statute itself. Zamora v. Reinstein, 185 Ariz. 272, 275, 915 P.2d 1227, 1230 (1996). Our chief goal is to ascertain and give effect to the legislative intent. Id. The obvious intent of § 1903(v) is to limit publicly funded medical coverage for undocumented aliens to that necessary to treat "`emergency medical conditions' but not `long-term care."' Mercy Healthcare Ariz., Inc. v. AHCCCS, 181 Ariz. 95, 98, 887 P.2d 625, 628 (App.1994).

¶ 11 Section 1903(v) has been characterized as "clearly defin[ing] the scope of coverage." Id. The statute has also been characterized as "plain in its meaning." Greenery Rehab. Group, Inc. v. Hammon, 150 F.3d 226, 233 (2nd Cir.1998). However, no bright line can be drawn as to what constitutes an emergency medical condition because "the unique combination of physical conditions and the patient's response to treatment are so varied that it is neither practical nor possible to define with more precision all those conditions which will be considered emergency medical conditions." Eligibility of Aliens for Medicaid, 55 Fed.Reg. 36,813, 36,816 (Sep. 7, 1990).

¶ 12 Before the court of appeals issued its lead decision in these cases, the courts in Mercy Healthcare and Greenery had grappled with what § 1903(v) meant by an emergency medical condition. We initially turn to Mercy Healthcare, the first decision to interpret the scope of the statute.

¶ 13 In Mercy Healthcare, the parties had taken positions similar to those taken by the parties here. The undocumented alien there had suffered a serious closed head injury. 181 Ariz. at 97, 887 P.2d at 627. After initial treatment at the hospital, the patient was transferred to a skilled nursing facility. Id. "At the time of transfer, [the patient] was non-verbal, could not move his lower extremities, had a gastrointestinal tube for feeding, and had a tracheostomy." Id. Mercy Healthcare contended that "if an undocumented alien initially suffers from an emergency medical condition, AHCCCS must cover the patient's treatment so long as the emergency medical condition necessitates uninterrupted care." Id. at 98, 887 P.2d at 628. AHCCCS contended that its obligation to cover an undocumented alien's medical care ended when the patient's condition stabilized. Id.

¶ 14 The court of appeals rejected both positions. Id. The court held that the statute required a two-part test. Id.

[T]he statute requires that the medical condition manifest itself by "an acute symptom (including severe pain)." The statute then mandates that AHCCCS must

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