EOHHS, nursing homes agree to tentative 2018 rate increases, stay suit

PROVIDENCE — The R.I. Executive Office of Health and Human Services and Alpine Nursing Home Inc. have “tentatively” settled a dispute over nursing home reimbursement rates in Rhode Island Supreme Court, agreeing to raise Medicaid rates paid to state nursing facilities 1.5 percent July 1, then by 1 percent Oct. 1, averting the payment of a potential $24 million in retroactive payments due from a 2015 case.

The EOHHS filed a motion June 1 to extend its filing deadline for an appeal on the 2015 decision due to lawyer “malfeasance.” Alpine Nursing Home had filed the lawsuit on behalf of 59 nursing homes in the state.

The appeal challenged an April 9 R.I. Superior Court ruling that an amendment, known as the 98% Provision, enacted by the General Assembly in 2015 that reduced nursing facility reimbursement rates by 2 percent was a one-time action limited to a specific fiscal year.

Counsel for the EOHHS noted in filing for the extended appeal deadline that lawyer Gregory Hazian, overseeing the case, had been removed Jan. 3, 2018, from the R.I. Supreme Court Master Rolls and did not inform EOHHS of his removal or update the department about the status of the appeal. The state subsequently missed the May 23 deadline, letting the decision and the potential retroactive reimbursement stand.

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According to the Supreme Court consent order, the parties met with R.I. Supreme Court Justice Gilbert V. Indeglia on June 12, agreeing to a tentative settlement on the case, and to a stay of the lawsuit.

According to the order:

  • Effective July 1, 2018, Medicaid rates paid to the state’s nursing facilities, including fee-for-service and managed care, will be increased by 1.5 percent from rates approved by the Centers for Medicare and Medicaid Services in effect Oct. 1, 2017.
  • Medicaid rates paid to the state’s nursing facilities, including fee-for-service and managed care, will be increased again by one percent, effective Oct. 1, 2018.
  • The state FY19 budget proposal that would eliminate retroactive eligibility for applicants seeking Medicaid long-term care coverage will not be enacted in the FY19 budget, but will be preserved as it was on Jan. 1, 2018.
  • The agreement does not limit the General Assembly’s ability to set Medicaid reimbursement rates in future budget appropriation acts.

“I’m pleased we’ve been able to reach a tentative settlement with our nursing homes, said Gov. Gina M. Raimondo. “This settlement will give clarity to budget writers in future years and provide nursing homes with a modest rate increase this year. I’m grateful that the legislature, administration and nursing homes were able to work together to reach an agreement that is fair to taxpayers and providers.”

“We are very pleased to have achieved a settlement that I think is fair to both the nursing homes and the state,” said Virginia Burke, president of the R.I. Healthcare Association, which counts 49 of its members among the 59 plaintiffs.

Burke noted that should the points of the agreement not be upheld in the course of budget proceedings under way, the lawsuit stay would be lifted and the parties would be back in court.

Rob Borkowski is a PBN staff writer. Email him at Borkowski@PBN.com.