Suburban Home Health Care, Inc. v. Exec. Office of Health & Human Servs., Office of Medicaid
| Decision Date | 03 September 2021 |
| Docket Number | SJC-13051 |
| Parties | SUBURBAN HOME HEALTH CARE, INC. v. EXECUTIVE OFFICE OF HEALTH AND HUMAN SERVICES, OFFICE OF MEDICAID. |
| Court | United States State Supreme Judicial Court of Massachusetts Supreme Court |
Heard: April 9, 2021.
Civil action commenced in the Superior Court Department on October 7, 2019. A motion to dismiss was heard by Kenneth W Salinger, J.
The Supreme Judicial Court on its own initiative transferred the case from the Appeals Court.
Brian T. Kelly for the plaintiff.
David R. Marks, Assistant Attorney General, for the defendant.
Present: Budd, C.J., Lowy, Cypher, Kafker, Wendlandt, & Georges, JJ.
The primary issue presented in this case is whether the six-year statute of limitations for civil actions in contract applies when the Executive Office of Health and Human Services, Office of Medicaid (MassHealth), attempts to collect overpayments made to providers in the State Medicaid program, or whether no statute of limitations whatsoever applies to these administrative proceedings, thereby allowing them to be brought indefinitely. In late 2005, MassHealth sent an audit notice to one such provider, Suburban Home Health Care, Inc. (Suburban), but took no further action at that time. Then, more than a decade later in 2016, MassHealth initiated recovery proceedings, alleging that Suburban received approximately $75, 000 in overpayments over a three-month period in 2005. Suburban sought declaratory relief in the Superior Court, arguing that the proceedings were time barred because the statute of limitations for "actions of contract" in G. L. c. 260, § 2, applied to MassHealth's overpayment recovery proceedings. A Superior Court judge rejected Suburban's arguments, concluding that the administrative proceedings to collect these overpayments could never be considered civil actions and therefore no statute of limitations applied.
Statutes of limitations serve fundamental purposes ensuring the efficient, accurate, and equitable resolution of disputes, and the Legislature has established time frames based on the nature of the dispute. Where a statutory scheme is silent or ambiguous as to a statute of limitations, we generally look to the essential nature of the rights involved to determine which statute of limitations applies. Silence or ambiguity alone is not sufficient to support the conclusion that there is no statute of limitations whatsoever. Rather, we require express or at least clear legislative guidance to that effect. In the instant case, the essential nature of the right is contractual, and the Legislature has not expressed a clear intention that no statute of limitations applies. Accordingly, we reverse the judgment that no statute of limitations applies to the administrative proceedings at issue here. We hold that the six-year statute of limitations for contract actions governs, and that MassHealth's decades-old attempt to collect the overpayment in this case is time barred.
MassHealth administers the Medicaid program for the Commonwealth. Daley v. Secretary of the Exec. Office of Health &Human Servs., 477 Mass. 188, 190 (2017). States that participate in the Medicaid program "must comply with certain requirements imposed by [Federal statute] and regulations promulgated by the [United States Secretary of Health and Human Services] through [the Centers for Medicare and Medicaid Services]." Id. As part of its administration of the Commonwealth's program, MassHealth is required to enter into agreements with the companies that provide medical service to covered individuals. See G. L. c. 118E, § 36. MassHealth pays the provider directly for the eligible care and services it provides. G. L. c. 118E, § 30. Providers have ninety days from the date the services or goods are provided to send MassHealth a bill, and MassHealth must verify at least ten percent of the bills with the recipient. G. L. c. 118E, § 38.[1] Suburban is a Medicare and Medicaid certified home health agency that provides in-home nursing and rehabilitative therapy services. It first entered into a provider agreement with MassHealth in 1994.
The agreement is relatively straightforward. Suburban promised "[t]o comply with all state and federal statutes, rules, and regulations applicable to the Provider's participation in the Medical Assistance Program." Suburban also agreed "[t]o keep such records as are necessary to disclose fully the extent of the services to recipients and to preserve these records for a minimum period of four years"[2] and to provide any information upon request regarding services for which it claimed payment. In exchange, MassHealth agreed to pay Suburban "for all reimbursable services and goods actually and properly delivered to eligible recipients and properly billed to [MassHealth] both in accordance with the terms of this Provider Agreement and in accordance with all applicable federal and state laws, regulations, rules, and fee schedules."
An overpayment results when a provider's reimbursement exceeds that to which the provider is legally entitled. See 130 Code Mass. Regs. § 450.235(A) (2018) (). MassHealth has a legal obligation to recoup the overpayment. See 42 C.F.R. § 433.312. The procedures governing the recovery of overpayments -- found in G. L. c. 118E, § 38, and 130 Code Mass. Regs. § 450.237 (2017) -- are among the many applicable laws and regulations to which providers agree when they execute a provider agreement.
The recoupment proceeding begins when MassHealth sends an initial notice of overpayment to the provider when it believes that an overpayment has been made. 130 Code Mass. Regs. § 450.237(A).[3] The notice must include the amount believed to have been overpaid and the basis for concluding that it is an overpayment. Id. The provider has thirty days to respond to the initial notice. 130 Code Mass. Regs. § 450.237(B). In its response, the provider must contest any allegations in the initial notice with which it disagrees. Id. It also may provide data or argument in support of its claim for payment. Id. The provider must submit any documentary evidence it wants MassHealth to consider with its reply. Id. MassHealth then reviews the information it requested as well as any information submitted by the provider in its reply. 130 Code Mass. Regs. § 450.237(C). If MassHealth determines that the provider has been overpaid, it must send the provider a notice of its final determination. Id. The provider can then appeal from the final determination in an adjudicatory hearing before the board of hearings. 130 Code Mass. Regs. § 450.237(D).
On December 2, 2005, MassHealth, through its noninstitutional provider review unit, informed Suburban that it would be initiating an audit (a "retrospective utilization review and peer review of services") of services rendered to MassHealth.[4] On December 27, MassHealth's third-party vendor at the time, MassPRO, contacted Suburban regarding the audit. This audit concerned the period from June 1, 2005, through August 30, 2005. MassPRO requested thirteen specific categories of documents as well as all other "pertinent" documents. MassPRO gave Suburban twenty-one days to provide the information. According to Suburban, it provided MassPro with the requested documents in early 2006. Suburban alleges that, also in early 2006, MassPRO auditors held a "close-out" meeting with Suburban's director of nursing and informed Suburban that its review had not identified any concerns. This was the last time that MassPRO communicated with Suburban.
Over ten years passed during which neither MassHealth nor its vendors took any further action on the audit. Then, on November 8, 2016, Suburban received an initial notice of determination of overpayment from MassHealth arising out of the audit. MassHealth determined that several violations resulted in overpayments totaling $95, 291.38. It directed Suburban to contact its new vendor, MAXIMUS Federal Services, Inc. (MAXIMUS), and respond to the notice within thirty days. On December 6, 2016, Suburban sent MAXIMUS its written response, asserting various equitable and statutory arguments challenging the ability of MassHealth to collect the overpayments. MassHealth and Suburban held an informal conference on December 7, at which, Suburban alleges, MassHealth represented that MAXIMUS would issue a final notice within thirty days. About ninety days later, Suburban contacted MassHealth regarding the review. MassHealth responded that MAXIMUS was in the final stages of completing its review of the initial notice. Suburban followed up again in May 2017 but did not receive a response.
Again, a long time passed without a word from MassHealth or MAXIMUS. Finally, on September 9, 2019, over two years after its last communication with MassHealth, Suburban received a final notice of determination of overpayment. In the final notice, MAXIMUS informed Suburban that the final amount of overpayments was $75, 538.49. Suburban filed for an adjudicatory hearing with the MassHealth board of hearings on October 7, 2019.[5]
That same day, Suburban also filed its complaint seeking declaratory and injunctive relief in the Superior Court. Suburban's complaint argued that MassHealth's overpayment procedure is subject to the six-year statute of limitations for "actions of contract" in G. L. c 260, § 2, and therefore is time barred. MassHealth moved to dismiss the complaint, arguing that Suburban failed to exhaust its administrative remedies and that the statute of limitations only applied to civil actions and not to administrative collection procedures. The judge agreed that the statute of limitations did not apply and dismissed the complaint. Suburban appealed, and we t...
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