Copyright © 2010 by K&L Gates LLP. All rights reserved.

Administrative Appeals of ODP Revenue Reconciliation and Rate Letters

Ruth E. Granfors, Esq.K&L Gates LLP, Harrisburg

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Introduction

Context for presentation 4th quarter revenue reconciliation, 2009-2010 Revenue reconciliation in 2010-2011 Rate letters for 2010-2011

Options Informal communications with ODP Formal legal process Association activities

Nature of legal process

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General Rule

A provider that is aggrieved by a decision of the Department of Public Welfare regarding the Medical Assistance Program may request a hearing before the Bureau of Hearings and Appeals.

67 Pa.C.S.A. § 1102(a)

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What is meant by “aggrieved”?

A provider is aggrieved if the Department’s action “adversely affects the property rights, privileges, immunities, duties, liabilities or obligations of the provider.”

55 Pa. Code § 41.31(b)

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Bureau of Hearings and Appeals (BHA)

Secretary of Public Welfare

Office of Administration

Bureau of Hearings and Appeals

Office of Developmental

Programs

Office of Medical Assistance Programs

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Statute and Applicable Rules

Statute - 67 Pa.C.S.A. §§ 1101-1106 (attachment)

Regulations: 55 Pa. Code, Chapter 41

(www.pacode.com/secure/data/055/chapter41/chap41toc.html)

General Rules of Administrative Practice and Procedure (“GRAPP”)

(www.pacode.com/secure/data/001/partIItoc.html)

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Conduct of BHA

Among other things, the BHA is required under law to:

Act independently of the employees or officials whose actions are under review.

Not engage in “ex parte communications” with any party to a hearing.

Allow “reasonable and necessary discovery.” Conduct “de novo review” of all factual and legal

issues raised by the provider.

67 Pa.C.S. § 1102(e)(2)

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Initiating an Action in the BHA

A provider that wishes to contest a decision of a program office specific to that provider files a document titled a Request for Hearing.

Other documents to initiate an action under Chapter 41 include:

Petition for Relief Request for Supersedeas Waiver Requests

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Filing of Request for Hearing

Provider must file “within 30 days of the date of the notice of the departmental action” or, if notice of action is by mail, “within 33 days of the date of the notice.” 67 Pa.C.S.A. §1102(b)

PA Supreme Court found that a DPW letter with a stamped date and a statement of a right to appeal within 33 days of the date of the letter, with no mailing date, is sufficient to begin appeal period.

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Timeliness of Request for Hearing

When filing a request for hearing by first-class mail, the United States postmark is the filing date. Thus, the appeal must be postmarked within 33 days of notice of DPW determination (if notice was given by mail).

If the request for hearing is filed in any other manner, e.g., in person or overnight delivery, the filing date is the date it is received by the Bureau.

Possibility of appeal filed “nunc pro tunc.”

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Request for Supersedeas

The filing of a Request for Hearing does not act as a supersedeas, or stay, of the program office action. A separate request must be filed. The BHA may grant a supersedeas if:

Irreparable harm to petitioner; Likelihood of success on the merits; and Likelihood of injury to the public or third parties.

67 Pa.C.S. § 1103

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Content of Request for Hearing

Name, address and telephone number of the provider.

Detailed reasons why the provider believes the agency action is factually or legally erroneous.

Identification of the specific issues that the provider is raising.

The relief the provider is seeking.

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Expediting the Hearing

Certain requests for hearing are automatically expedited, including:

Denial of payment of claims requiring prior authorization.

The recovery of overpayments through the utilization review process.

The denial of claims on prepayment review. The denial of claims for payment based upon

invoice.

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Expediting the Hearing (cont.)

The BHA may expedite matters under appeal that do not fall within one of the specific categories of appeals for which expedited hearings are automatic if the provider/appellant and the program office file a joint motion to expedite.

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Effect of Expedited Hearing The case is heard more quickly.

Certain procedures do not apply, including: No pre-hearing orders No discovery No mandatory disclosures or position papers No dispositive motions (e.g., motions to dismiss;

motions for summary judgment)

Parties who obtain an expedited hearing may ask that some of these procedures apply.

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Pre-hearing Process

Scheduling Order

Mandatory Disclosures

Discovery Position Papers

Dispositive Motions

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Hearing Process

May request that a matter be decided without a hearing:

Provider would be required to waive right to hearing.

Parties would need to stipulate to material facts, or agree to submit direct and rebuttal testimony in the form of affidavits (no cross-examination) or by deposition.

BHA would need to determine that there is no issue of material fact.

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Hearing Process (cont.)

Hearings are conducted in a trial-like manner, with opening statement, direct examination and cross-examination of witnesses, objections, and closing arguments.

Provider typically carries burden of proof: Provider must first establish a prima facie case

by a preponderance of the evidence. The program office must offer evidence rebutting

provider’s case.

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Post-hearing Process

Preparation of hearing transcript Post-hearing briefs:

May be waived. Must include proposed findings of fact

referencing exhibits or testimony from transcript, legal argument and proposed conclusions of law.

If briefs filed, disputed factual issues or legal arguments that are not addressed in the brief are deemed waived.

Provider files brief first, program office 30 days after.

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Post-hearing Process (cont.)

The record may be re-opened if: Recently discovered evidence that

conconclusively establishes or contradicts a material fact;

Evidence could not have been discovered prior to the close of the record through the exercise of due diligence; and

Evidence does not simply substantiate other existing evidence of record.

Alternatively, record may be reopened if there is a change in law that affects the evidence.

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Post-hearing Process (cont.)

BHA decision issued with 30 days. Within 30 days, either party, if aggrieved by the BHA decision, may ask the Secretary of Public Welfare to review. Under the rules, the program office is deemed to be aggrieved if:

The provider prevails, in whole or part; The BHA interprets a statute, regulation, policy or

bulletin inconsistent with the program office interpretation; or

The BHA alters an existing or imposes a new policy on the program office.

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Post-hearing Process (cont.)

Review by the Secretary: Discretionary, not a matter of right.

If the Secretary fails to act in 30 days, the review is deemed denied.

If review is granted, an answer to the request for review may be filed by the opposing party.

The Secretary must issue a decision on the review within 180 days of granting the review.

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Final Agency Adjudication

If no request for review of the BHA decision by the Secretary within 30 days, the BHA decision is the final agency adjudication.

If a request for review by the Secretary is made within 30 days, but the Secretary denies review or fails to act within 30 days, the BHA decision is the final agency adjudication.

If the Secretary grants review of the BHA decision, the Secretary’s decision is the final agency adjudication.

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Appeal to Commonwealth Court

A final agency adjudication may be appealed to the Commonwealth Court of Pennsylvania.

Under Chapter 41, the provider may appeal an adverse action, but the program office may not file an appeal.

The appeal must be filed within 30 days of the final agency adjudication.

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Petitions for Relief

Petitions for Relief are not to be used to raise issues that can be brought in a Request for Hearing or vice versa.

The BHA may not issue final decisions on Petitions for Relief. It may only issue recommendations to the Secretary of Public Welfare.

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Petitions for Relief (cont.)

Petition for Issuance, Amendment, Deletion or Waiver of a Regulation under 1 Pa. Code § 35.18

Petition for Declaratory Order under 1 Pa. Code § 35.19

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Waiver Requests

A request to waive a regulation as applied to a specific provider in a specific action by a program office may be included in a Request for Hearing.

The BHA may not grant the waiver relief, but may must make a recommendation to the Secretary of Public Welfare.

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Contact Information:Ruth E. Granfors717-231-5835ruth.granfors@klgates.com