STATE, HEALTH CARE BUREAUCRACY, CITIZEN

I don't know enough about health law to comment on the case issued today by the Appeals Court of Massacusetts, Centennial Healthcare Investment Corp. v. Commissioner of the Division of Medical Assistance (No. 02-P-915, accessible through this page). But the facts section is worth reading, to remind yourself of how difficult it can be to navigate relationships with private health care bureacracies. I've omitted the footnotes.

Thomas Columbo was admitted to Charlwell House in January, 1993; he was in his late eighties at the time and mentally incapacitated. Throughout the period of Columbo's residency at Charlwell House, Centennial was under contract with the division to provide skilled nursing home care for residents receiving medical assistance through the Medicaid and Medicare programs. Upon Columbo's admission, Columbo's temporary guardian, a family member, agreed to pay the cost of Columbo's care; Columbo's assets at the time of his admission exceeded $1 million.

Shortly thereafter, Paul Donovan, an attorney, was appointed Columbo's guardian and arranged to pay Centennial from Columbo's cash assets and, later, from the sale of portions of Columbo's real estate. In April, 1997, Donovan stopped paying Centennial, claiming that Columbo's cash assets were depleted and that he was attempting to sell additional real estate to cover the nursing home expenses. After unsuccessful negotiations between Donovan and Centennial, and a failed attempt by Donovan to obtain a court injunction to prevent Centennial from discharging Columbo, Centennial filed a complaint in Norfolk Superior Court in September, 1998, to recover over $90,000 for unpaid services.

That case was settled on February 18, 1999. Centennial and Donovan, in his capacity as Columbo's guardian, executed an agreement for judgment, pursuant to which Donovan agreed to pay Centennial $71,573, less any payments received after that date, for services provided through February 28, 1999. A second agreement for judgment dismissed Donovan's counterclaims. Donovan began liquidating Columbo's assets. However, on April 28, 1999, he moved to stay the entry of final judgment, stating, among other things, that a delay in his receipt of payment in the sale of one of Columbo's real properties did not warrant Centennial's execution on the judgment, and that Donovan's application for Medicaid on Columbo's behalf, if approved, would reduce the amount of the judgment. Donovan's motion was denied, and final judgment was entered for Centennial on May 3, 1999.

In October, 1998, while this dispute with Centennial was pending, Donovan filed an application for Medicaid benefits for Columbo. The division initially denied the application on the basis of Columbo's extensive assets. At Donovan's request, the division held a hearing on the application. Centennial attempted to appear at that hearing, but was not permitted to attend or participate. Again, the division denied Columbo's application. Donovan then sought a rehearing, and the division, on its own, determined that Columbo was, in fact, eligible to receive benefits, retroactive for the period from July 1, 1998, to July 16, 1999. The term of Columbo's eligibility was later extended to October 18, 1999.

As a result, the division issued a notice approving Columbo's Medicaid application on September 22, 1999. Donovan wrote to Centennial, notifying it of Columbo's Medicaid eligibility and seeking a refund of $70,250.41 for amounts he had paid for nursing home services between July, 1998, and July, 1999; he instructed Centennial to submit a bill to the division for that period instead. Centennial failed to respond. Subsequent letters, with adjustments in the amounts demanded, likewise went unanswered.

By letter dated December 8, 1999, the division, taking Columbo's side, notified Centennial that it was in violation of the law and its provider agreement for its failure to reimburse Donovan, and threatened the imposition of sanctions. Centennial responded that it was investigating the matter. On January 24, 2000, the division sent Centennial a sanction notice, imposing a fine of $54,900 for its failure to refund to Donovan amounts he had paid at the private pay rate for the period of Columbo's eligibility. Centennial appealed the sanction. Following an adjudicatory hearing, the hearing officer affirmed the imposition of sanctions, but reduced the award so that the sanctions accrued from the date Centennial received notice of Columbo's eligibility, rather than from the actual date of his eligibility.

Centennial filed this action in Suffolk Superior Court on July 5, 2001, alleging breach of contract, constitutional violations, and civil conspiracy; seeking declaratory and injunctive relief; and requesting a review of the board's decision under G.L. c. 30A, § 14, affirming the imposition of sanctions. Donovan filed a motion to dismiss, and the division joined in the motion. Centennial moved for judgment on the pleadings on count VIII of its complaint, for c. 30A review of the sanctions. The judge allowed the defendants' motion to dismiss as to all counts except count VIII; as to that count, the judge ruled that the board's decision was supported by substantial evidence and correct as matter of law. Judgment was entered for the defendants on all counts, and Centennial filed this appeal.

Note: Columbo's cash assets were depleted after four years of care in the nursing home, and then they started selling off real estate. The family got a lawyer (who seems pretty gutsy from the record) who could help them figure out how to keep Centennial at bay on the one side, and figure out how to get state aid on the other. Long years of continuing litigation ensue. Meanwhile, Columbo is still mentally incapacitated, and it's not an unreasonable assumption that this whole affair takes its toll on the emotional health of his family.

And just in case you missed it: Centennial was suing the state because it had granted retroactive Medicaid eligibility to a patient under its care. Centennial wanted to be able to bill Columbo at the higher private rate, but the terms of a lower court judgment forced it to accept the Medicare payment as payment in full for the time frame of eligibility and to refund to Columbo the rest. Centennial also wanted review of the grounds for the penalties assessed against it.

The court wasn't too happy with Centennial's claim, though.

"Junk lawsuit," albeit not of the standard trope?