GAB Decision 512
Docket No. 84-5
February 21, 1984
Maryland Department of Health and Mental Hygiene;
Ford, Cecilia Sparks; Settle, Norval Teitz, Alexander
The Maryland Department of Health and Mental Hygiene (State) appealed
a determination by the Health Care Financing Administration (Agency)
disallowing $338,490 in federal financial participation (FFP) for the
quarter ended June 30, 1983. The State's claim represented advances
("working capital advances") made to hospitals participating in a
Medicaid reimbursement "experiment" being conducted by the State under
a
waiver contract between the State and the Agency. The State provides
funds to the participating hospitals in advance of services rendered and
in return receives a 2% discount in the cost of inpatient hospital
services for Medicaid patients.
The Agency disallowed the claim for FFP on the grounds that the
advances were not reimbursement for "medical assistance" under the
Social Security Act and applicable federal regulations, and that the
approved State plan did not provide for the advances or the 2% discount.
The Agency also noted in its letter of disallowance that the claim was
comparable to disallowed claims made in 1981, and that the Board had
upheld the Agency's disallowance of the 1981 claims in Maryland
Department of Health and Mental Hygiene, Decision No. 400, March 29,
1983. In that decision the Board concluded that the advances were not
specifically expenditures for "medical assistance," and that the Agency,
in approving the waiver contract, had not specifically agreed to
participate in the working capital advances. Therefore, the Board
concluded, the Agency was not bound to participate in their payment.
Subsequently, the Board upheld another disallowance by the Agency
because the claim was identical, in facts and applicable law, to the
appeal decided in Decision No. 400. See Maryland Department of Health
and Mental Hygiene, Decision No. 476, November 16, 1983.
The State acknowledged in its February 2, 1984 brief that the claim
appealed here is identical, in facts and applicable law, to the appeals
decided in Decision Nos. 400 and 476. The State requested that, in the
interests of economy and preserving the issues for judicial review, the
Board issue a summary decision, relying on the briefs and arguments
submitted in the previous appeals. The Agency agreed to this (2)
procedure. Accordingly, for the reasons stated in Decision Nos. 400 and
476, which are incorporated here by reference, we uphold the
disallowance in the amount of $338,490.
NOVEMBER 14, 1984