Opinion
NOT TO BE PUBLISHED
APPEAL from a judgment of the Superior Court of Los Angeles County, No. BS102863, David P. Yaffe, Judge.
Davis Wright Tremaine, Mary H. Haas and Camilo Echavarria for Plaintiff and Appellant.
Edmund G. Brown Jr., Attorney General, Douglas M. Press, Assistant Attorney General, Jennifer M. Kim and Karen L. Fried, Deputy Attorneys General, for Defendants and Respondents.
ALDRICH, J.
INTRODUCTION
Plaintiff and appellant Hillsides Home for Children provides mental health care services to children in Los Angeles, including children who are eligible for Medi-Cal. Hillsides provided services to 28 patients and submitted claims for reimbursement under Medi-Cal, but the claims were denied. Hillsides, alleging that the claims were denied based on an improper finding that the patients were ineligible for Medi-Cal, filed a petition for writ of mandate, naming as respondents the State of California, the California Department of Health Services and the California Department of Mental Health (collectively, the State). After a hearing, the trial court denied the petition for writ of mandate. The court found that when Hillsides submitted the claims for reimbursement, it failed to provide to the State the patients’ correct Medi-Cal beneficiary identification numbers. The court also found that Hillsides failed to identify the claims adequately for which it was seeking reimbursement. Substantial evidence does not, however, support these findings. We therefore reverse the judgment and remand this matter.
On the same day, it heard the motion on Hillsides’s petition for writ of mandate, the trial court heard argument on two cases that raise similar issues and facts, Five Acres–The Boys’ And Girls’ Aid Society of Los Angeles v. State of California et al. (Super. Ct. L.A. County, 2007, No. BS102862) B205312, and Hathaway-Sycamores Child and Family Services v. State of California et al. (Super. Ct. L.A. County, 2007, No. BS102861)B205311. Hillsides requests that we take judicial notice of the reporter’s transcripts filed in the appeals in those cases. Under Evidence Code section 452, we take judicial notice of those transcripts.
FACTUAL AND PROCEDURAL BACKGROUND
I. Factual background.
A. Hillsides Home for Children.
Hillsides Home for Children was founded in 1913 as an orphanage. Today, the Dependency Division of the Los Angeles Superior Court refers children to Hillsides, where the children receive counseling and mental health treatment. “Loving care, therapeutic healing, special education, family crisis intervention and children’s rights advocacy are at the heart of Hillsides’s mission.”
Hillsides contracts with Los Angeles County (the County) to provide services to Medi-Cal eligible patients. Under the contract, Hillsides covers the cost of the services, and it then submits reimbursement claims to the County. The County reviews the claims and submits them to the State of California for approval and payment. For contract years 1999 and 2000, Hillsides provided Day Rehabilitation and Medication Distribution treatment to 28 patients, all of whom were foster children assigned to the location either by the Department of Mental Health or by the Department of Children and Family Services. For these 28 patients, Hillsides submitted 2,894 claims for reimbursement that were denied. The State sent to Hillsides an Explanation of Benefits (EOB) denying claims for the period July 1, 1999 to June 30, 2000. A subset of those claims are at issue. The majority of claims were denied under Error Code 18, “ ‘Claim Too Old For Eligibility Check By SSN.’ ” Others were denied under Error Code 11 (“not on eligibility file”), and a handful were denied under Error Code 3 (“invalid code”) and under Error Code 15 (“no secondary match”).
According to the State’s Error Correction Report Manual, denied claims can be resubmitted for up to one year from the date of service. Hillsides contends that the State failed to process many of the claims in a timely manner, which impeded its ability to file correction reports to address any errors. According to a spreadsheet Hillsides created, it submitted 347 claims within one month of service, but it took the State 19 months to deny the claims. The spreadsheet also shows that it took the State anywhere from 4 months up to 22 months from the date of service to dispose of the claim. For some of the denied claims, Hillsides submitted Error Correction reports to correct information concerning the claims it had submitted for reimbursement.
Thereafter, the State waived timeliness requirements and, in 2003, conducted a “rerun” of certain of the Hillsides’s denied claims. The State apparently paid some additional claims, but not all. The State continued to refuse to reimburse claims for the 28 patients at issue and, in a letter to Hillsides’s attorney, stated: “Your information indicated that there were individuals who were confirmed as eligible at the time of service but have still been denied as ineligible. DHS [Department of Human Services] used the most accurate eligibility files in reprocessing these claims. These files may have included some people who lost eligibility retroactively.”
II. Procedural background.
A. The petition.
In April 2006, Hillsides filed a petition for writ of mandamus seeking reimbursement for claims it alleged the State improperly denied. Hillsides alleged that it was owed $220,000 in reimbursement. In support of the subsequent motion on the petition, Hillsides submitted the declaration of Marisol Lara, its revenue coordinator in charge of overseeing billings for fiscal years 1999/2000 and 2000/2001. Her duties included overseeing the submission of Medi-Cal claims and handling suspended and denied claims. Attached to her declaration are various exhibits, the most relevant of which we summarize here.
In the subsequent motion on the petition, Hillsides reduced its demand for reimbursement to $129,238.49, but did not explain the reduction.
Exhibit A.
Exhibit A is a computer disk containing two spreadsheets. The two spreadsheets contain 2,252 claims for reimbursement for services rendered in 1999 and 2000 that Hillsides submitted and were denied. The spreadsheet contains, for each claim, among other things, the claim number; Hillsides’s provider number; the patient’s last name and first initial; the “MIS” number; the patient’s Medi-Cal beneficiary identification number; the patient’s year of birth; the patient’s gender; the date service was provided to the patient; the amount billed for the service; the date the State received the claim; the date the State processed the claim; the patient’s social security number; and the batch number. The spreadsheets also have an error code, which describes why the claim was denied. The overwhelming majority of claims were denied under Error Code 18, which means the claim was too old for eligibility check by social security number.
Hillsides asserts that the State created the spreadsheets. Although the State never contradicted this assertion in the trial court, the State’s counsel claimed at oral argument in this court that the State did not create the document.
Exhibit B.
In 2003, the State reviewed the denied claims by doing a “rerun.” Exhibit B is two spreadsheets listing the claims that the State was still denying after the rerun, a subset of which are at issue. The spreadsheets contain columns similar to the ones in Exhibit A, for example, claim identification number; date of the claim; patient name; patient beneficiary identification number; date of birth; gender; date of service; the amount billed; the date the State received the claim; the date the State reprocessed the claim; the patient’s social security number; and the error code, which in most cases was Error Code 18 or 11.
The first spreadsheet is 38 pages. The second spreadsheet is 7 pages.
Exhibits 1-28.
These spreadsheets are a further distillation of Exhibits A and B. Each exhibit concerns one of the 28 patients at issue. For example, Exhibit 1 is denied claims pertaining to Patient No. 1/A. Blackburn. The numbered exhibits have one or more of the following documents: (1) A spreadsheet listing the claims at issue for the patient. (2) A MEDS Online Point of Service Inquiry (MOPI) receipt printed out from a government database showing the patient’s eligibility for Medi-Cal. The MOPI receipt states the patient’s Medi-Cal beneficiary identification number; month and year of birth; and “Date of Issue.” (3) Error correction reports that Hillsides submitted for some of the denied claims. It lists the claim number, the patient’s social security number, date of service, and the reason the claim was denied. It also has a blank line for the provider (Hillsides) to handwrite in the patient’s “record number,” which is the patient’s Medi-Cal beneficiary eligibility number. (4) A printout entitled “Primary Medi-Cal/CMSP Information.” It lists, among other things, month-to-month Medi-Cal eligibility status. (5) The patient’s Medi-Cal benefits identification card.
B. The respondents’ brief.
The State countered in its respondents’ brief that it was unable to find the 28 patients in the MEDS database with the data Hillsides provided. The State also claimed that Hillsides failed to file a claim, a prerequisite to filing the petition; failed to join an indispensable party, the County of Los Angeles; and failed to exhaust its administrative remedies.
In support of its opposition to the motion on the petition, the State submitted, among others, the declaration of Kim Maun, a staff programmer analyst at the Department of Health Care Services. The Department processes 16 million claims each year. She analyzed claims submitted by providers, including Hillsides, for services provided in 2000. In May and November 2003, Maun conducted a “rerun” of various claims, which appears to have included the claims at issue. The rerun resulted in a large batch of claims being approved. But “for the claims which still came up as denied—these claims were now outside the two year range for receipt of FFP [Federal Financial Participation] and, therefore, could no longer receive the federal part of the payment under the Short-Doyle program.” In 2007, she reran all the claims Hillsides submitted for fiscal year 2000/2001 to determine if prior reruns in 2003 were in error. She found no additional claims that could be approved. “[T]he errors remained the same—namely the beneficiary number was still not in the MEDS database.”
The trial court sustained some of Hillsides’s evidentiary objections to Maun’s declaration. The court sustained objections to paragraph 13; paragraph 16, lines 8-12, 17-18; and paragraph 21, line 20. The court also sustained Hillsides’s objection to the document entitled “Hillsides[’] Lawsuit Information.”
Maun also states that Hillsides did not correct the data for 1,413 claims. “Of those denied 1,085 had incorrect numbers which the MEDS system does not recognize (Error Code 11). The beneficiary may have been eligible but this error code means that the number was entered incorrectly or somehow defective. Thirteen claims were for beneficiaries that had Other Health Coverage (Error Code 32). One hundred and forty[-] eight were for duplicate service that has already been paid. Sixty-two had an incorrect Beneficiary ID Number. Ninety-seven had no identifying name, date of birth and/or gender to provide verification of the beneficiary. Three had conflicting dates for the date of submission. Four had conflicting information in the Eligibility file and one was a claim for zero dollars. Finally, over 830 claims were for children in the Foster Care program.” Maun does not specify whether the claims of which she is speaking are the ones at issue, and, if so, which ones.
Attached to the Maun declaration is a memorandum Maun asserts relates to the 2003 rerun of denied claims. It is unclear who authored that memorandum. Hillsides’s evidentiary objection to the memorandum was sustained.
According to Maun, the eligibility of a claim for reimbursement is checked using the Medi-Cal Eligibility Data System (MEDS). MEDS contains a list of all California citizens who have ever been eligible for Medi-Cal, although only the past 36 months are kept online. This is a secure and confidential database, and limited information is available to counties. Eligibility can change month to month, so a provider must check a client’s eligibility before services are rendered. For each approved, suspended or denied claim, the State creates an EOB. During the time at issue, the County sent paper Error Correction Reports (ECRs) to providers, who then handwrite corrections on the reports.
The “major problem with the claims submitted by Hillsides is that the number provided for the beneficiary was not a number recognized by the MEDS database. The DHCS cannot change the number that a provider submits. I reviewed the claims from Hillsides and noted that the beneficiary information was entered incorrectly as outlined in the attached exhibit entitled Beneficiary Information. DHCS can only pay claims in which the ID used for billing is correctly entered and there is supporting information including the correct date of birth, gender, and family name/first name. MEDS will also recognize Client ID Numbers, Beneficiary ID Numbers, and Social Security Numbers.” (Bold in original.)
The State also submitted the declaration of Gary Renslo, a data processing manager at the California Department of Mental Health. He states that this case “as presented” is unclear because the claims information that Hillsides submitted is “incomplete and unintelligible.” To “determine if the provider’s contentions are valid, the provider needs to submit unmodified EOB file information related to the claims at issue. Once this is accomplished, DMH can determine the disposition and amount of the claim in the SD/MC claim history files in order to establish a position on the provider’s contentions.”
The trial court sustained some of Hillsides’s objections to the Renslo declaration.
C. The trial court’s ruling.
The trial court denied the petition. At the hearing, the court focused on Patient No. 1/A. Blackburn. The court said it was unable, first, to determine which claims were at issue, and, second, whether Hillsides submitted the correct beneficiary identification number for each patient. The court’s minute order states: “The petition for writ of mandate is denied because petitioner has failed to show that any particular claim for reimbursement that was timely submitted, with the correct client identification number, and which was not a duplication of another claim for reimbursement for the same service, was rejected by respondent. [¶] The petition alleges that respondent improperly refused to authorize reimbursement of ‘in excess of $220,000.00’ (4:12) for services provided to eligible patients by petitioner. When petitioner submitted evidence to support that allegation, it reduced the amount claimed to $129,238.49 (Synopsis of Exhibits 1-28) for services rendered to twenty-eight identified patients, with a breakdown of the amount due for each patient. For example[,] for patient number one, petitioner states that the amount due is $8,531.64. When the documentation for the claim is independently examined by the court, it becomes apparent that petitioner did not furnish any evidence to support the amount of $8,531.64. That amount is supposed to be due because of 179 rejected claims. The evidence shows that petitioner initially claimed reimbursement for patient number one on the wrong patient identification number, causing the claims to be rejected, and that it then submitted 302 corrected claims which total $13,636.76. This petitioner is only claiming $8,531.64 for 179 claims, it is submitting irrelevant evidence with respect to 123 claims, but there is no way to determine which 179 claims of the 302 are relevant to its claims. [¶] Petitioner has made no attempt to support the amounts that it claims. It has elected not to identify the evidence pertaining to the claims that it is making, which is buried in a mass of evidentiary material. Respondent is unable to show that the 179 claims for which petitioner claims reimbursement were properly rejected because it cannot identify those claims.”
The trial court entered judgment on December 7, 2007.
DISCUSSION
I. The standard of review.
Subdivision (a) of section 1085 of the Code of Civil Procedure states: “A writ of mandate may be issued by any court to any inferior tribunal, corporation, board, or person, to compel the performance of an act which the law specially enjoins, as a duty resulting from an office, trust, or station, or to compel the admission of a party to the use and enjoyment of a right or office to which the party is entitled, and from which the party is unlawfully precluded by such inferior tribunal, corporation, board, or person.” A “writ of mandate under section 1085 is available where the petitioner has no plain, speedy and adequate alternative remedy; the respondent has a clear, present and usually ministerial duty to perform; and the petitioner has a clear, present and beneficial right to performance.” (Conlan v. Bontá (2002) 102 Cal.App.4th 745, 752.)
The trial court reviews an administrative action under Code of Civil Procedure section 1085 to determine whether the agency’s action was arbitrary, capricious, or entirely lacking in evidentiary support, contrary to established public policy, unlawful, procedurally unfair, or whether the agency failed to follow the procedure and give the notices the law requires. (American Federation of State, County & Municipal Employees v. Metropolitan Water Dist. (2005) 126 Cal.App.4th 247, 261.) Mandate will lie to correct abuses of a public agency’s discretion. (Ibid.) “ ‘ “In reviewing a trial court’s judgment on a petition for writ of ordinary mandate, we apply the substantial evidence test to the trial court’s factual findings.” [Citation.] Thus, foundational matters of fact are conclusive on appeal if supported by substantial evidence. [Citation.]’ [Citation.]” (Ibid.) However, “[t]o the extent the case involves the interpretation of a statute, which is a question of law, we engage in a de novo review of the trial court’s determination. [Citation.]” (Silver v. Los Angeles County Metropolitan Transportation Authority (2000) 79 Cal.App.4th 338, 348.)
II. Substantial evidence does not support the trial court’s factual findings.
“Medicaid is a cooperative federal-state program established by Congress in 1965 with the enactment of title XIX of the Social Security Act, 42 United States Code section 1396. ‘The program is designed to provide necessary medical services to poor people who had previously been denied access to medical care. Like private insurance, Medicaid furnishes coverage to eligible individuals and pays providers of health care for services rendered.’ [Citation.] California’s Medicaid program is called Medi-Cal, and is administered by DHS [Department of Human Services]. (Welf. & Inst. Code, §§ 10721, 14000 et seq.) State participation in Medicaid is voluntary but if a state participates, it must comply with the federal statutes and regulations governing the programs. [Citation.]” (Conlan v. Bontá, supra, 102 Cal.App.4th at p. 753; see also Doctor’s Medical Laboratory, Inc. v. Connell (1999) 69 Cal.App.4th 891, 893-894.)
California’s Department of Human Services manages Medi-Cal, but it is the County that contracts with mental health care providers, such as Hillsides, to provide services to patients who are Medi-Cal eligible. Within six months of the service, the provider must submit claims for reimbursement for the services it renders to Medi-Cal eligible patients to the County, which reviews them and submits them to the State of California for approval. If the State discovers a discrepancy concerning, for example, a patient’s eligibility for a state-funded program, such as Medi-Cal, it can deny or suspend the claim.
The trial court here found that Hillsides failed to establish that the 28 patients were eligible for Medi-Cal reimbursement, because it did not submit the correct beneficiary identification number for each patient. Focusing on Patient No. 1, the court also found that there was no way to determine which claims are at issue. The State, on appeal, agrees with these findings and asserts throughout its respondents’ brief that the 28 patients at issue could not be found in the MEDS database. Substantial evidence, however, does not support the court’s ruling, which appears to have been based on a misunderstanding of the exhibits, a review of which is certainly a frustrating and arduous task. Nonetheless, our review of the evidence suggests three things: (a) Hillsides submitted the correct beneficiary identification number for at least 17 patients; (b) Hillsides did identify for which claims it seeks reimbursement; and (c) Hillsides submitted evidence that the 28 patients were eligible for Medi-Cal.
A. Substantial evidence does not support the trial court’s finding that Hillsides failed to submit the correct beneficiary identification number for each of the 28 patients.
The trial court found that Hillsides, when it submitted the claims for reimbursement to the State, failed to submit the correct beneficiary identification numbers for the 28 patients. The State agrees that the “claims failed because the patients’ identities could not be verified in the [MEDS database.]” Our review of the record, however, does not support that finding.
The patient’s beneficiary identification number is, we understand, simply the patient’s Medi-Cal identification number. For the 28 patients, this number is in the MOPI receipt that Hillsides generally provided in Exhibits 1-28. MOPI receipts are printed from a government maintained database, and, therefore, if they are in some way incorrect, it is unclear how that mistake could be attributed to Hillsides.
Although Hillsides—in its papers filed in the trial court and this Court of Appeal—was clear that it used the identification number in the MOPI receipt when it submitted its reimbursement claims, the State’s counsel asserted, for the first time, that there is some other heretofore unidentified number that Hillsides was supposed to use. The existence of such a number, however, was news to Hillsides’s counsel, who, consistent with his briefs in the trial court and in this court, said he thought the beneficiary identification number is the one in the MOPI receipt. Despite it being crystal clear what number Hillsides was relying on, the State never made it equally clear that the number in the MOPI receipt cannot be used when filing reimbursement claims.
Indeed, if there is some other number, it does not appear in the record—or at least the State has not cited to it. To the contrary, the State submitted Kim Maun’s declaration, but she never once states in it that a provider cannot use the number in the MOPI receipt. For example, she never states, for example, that for patient No. 1 Hillsides used number X (the number in the MOPI receipt), but was supposed to use number Y. Also, it appears that Hillsides submitted claims using the number in the MOPI receipt and received reimbursements using that number. If Hillsides could not use this number, then why were those claims approved?
We thus must conclude that if Hillsides was supposed to use some number other than the one in the MOPI receipt, the State never made that clear. Such a number was never referenced in the State’s papers filed in the trial court or this court and at the hearing before the trial court. There is no evidence that such a number exists, other than the State’s bare assertion at oral argument before this court that it does.
We therefore turn to the MOPI receipts, from which we have ascertained the beneficiary identification numbers for each of the 28 patients. After ascertaining each patient’s beneficiary identification numbers, we cross-referenced them against Exhibit A. Exhibit A, as well as Exhibit B, is an EOB containing a list of denied claims, some of which are at issue. The exhibits list a beneficiary identification number for each patient. If a patient’s beneficiary identification number listed in Exhibit A corresponds to the number in the MOPI receipt, then it is reasonable to conclude that the State had the correct beneficiary identification number, and did not deny the claim on that basis.
We therefore reviewed each patient’s beneficiary identification number as stated in the MOPI receipts or Primary Medi-Cal/CMSP Information printout. According to those documents, the numbers are:
Patient No. 1/A. Blackburn. 84475001P and 95511314A.
Patient No. 2/M. Bowen. 605302912 and 94764294A.
Patient No. 3/K. Campbell. 622163061.
Patient No. 4/D. Cato. 94747719A.
Patient No. 5/A. Concha. 585639670.
Patient No. 6/M. Cox. 139883061.
Patient No. 7/V. Culpepper. 5698131384.
Patient No. 8/C. Decosta. 82390387P and 94752081A.
Patient No. 9/R. Elerick. 6163613479.
Patient No. 10/C. Frazier. 93735533D.
Patient No. 11/C. Gokey. 85866868P.
Patient No. 12/J. Gondola. 94761359AO.
Patient No. 13/J. Gondola. 94768641A.
Patient No. 14/M. Green. 94747743A and 82065978P.
Patient No. 15/L. Hernandez. 043826460.
This number is from the Primary Medi-Cal/CMSP Information printout. Hillsides did not provide a MOPI receipt or a copy of the patient’s benefits identification card.
Patient No. 16/L. Jones. 82812769P.
Patient No. 17/B. Lopez. 603200082.
Patient No. 18/J. McDaniel. 82741263P and 94777982A.
Patient No. 19/C. Moss. 613128456.
Patient No. 20/P. Painting. 93761100D.
Patient No. 21/M. Parker. 420335580.
Patient No. 22/S. Parker. 419335862.
Patient No. 23/T. Pruett. 603208812.
Patient No. 24/C. Rosales. 622444280.
Patient No. 25/O. Sanabria. 95213025A.
Patient No. 26/M. Sanford. 548918284.
Patient No. 27/S. Taylor. 85220783P and 97861100D.
Patient No. 28/M. Urena, Jr. 85516940P.
Based on our comparison of the patients’ Medi-Cal beneficiary numbers listed in the MOPI receipts with their beneficiary numbers listed in Exhibit A, this is what we found. For 17 of the patients—patients Nos. 1-3, 5, 6, 8, 10, 11, 14, 16-20, 22, 24, and 27—the beneficiary numbers listed in the MOPI receipts match the beneficiary numbers listed in Exhibit A. It therefore appears that Hillsides submitted the correct beneficiary identification number and/or the State did not deny the claim because the incorrect number had been submitted for these patients.
Several claims, however, list what appears to be the patient’s Social Security number (618-xxx-213) as the beneficiary identification number. Also, for patient No. 2, we found only one of the two identification numbers in Exhibit A—605302912.
We could not locate patients Nos. 7, 9, 15, 21, 25, 26, and 28 in Exhibit A, and we therefore could not cross-check the beneficiary numbers.
We located patient No. 4/D. Cato, in Exhibit A, but his beneficiary number in the MOPI receipt (94747719A) and the number in Exhibit A (564912571) do not match. Hillsides did not submit any Error Correction Reports for this patient.
We located patient No. 12/J. Gondola in Exhibit A. Her beneficiary identification number is listed in the MOPI receipt as 94761359A0. It is listed in Exhibit A as No. 157764090. Hillsides did submit Error Correction Reports for this patient, but they do not appear to correct the beneficiary identification number to conform to the number in the MOPI receipt.
We also located patient No. 13/J. Gondola in Exhibit A. His beneficiary identification number in the MOPI receipt (94768641A) does not match the number in Exhibit A (145847873).
As to patient No. 23/T. Pruett, the patient’s beneficiary number listed in the MOPI receipt (603208812) does not match the beneficiary number listed in Exhibit A (997xxx530). Hillsides, however, submitted Error Correction Reports in which the patient’s correct beneficiary number is listed.
From this information, we can conclude several things. First, for over half of the patients (patients Nos. 1-3, 5, 6, 8, 10, 11, 14, 16-20, 22, 24, and 27), Hillsides did submit evidence showing it provided their correct beneficiary numbers to the State. The trial court, however, believed it had no evidence before it to establish this fact. To the contrary, in support of its motion, Hillsides submitted Exhibit A to the declaration of Marisol Lara. Exhibit A is a computer disk, which contains two Excel spreadsheets. The spreadsheets contain a list of claims that were denied for reimbursement, a subset of which are at issue. During the hearing on this matter in the trial court, the court said it could not find any evidence that when Hillsides submitted the original claims, it used the correct beneficiary number. Exhibit A, however, shows that Hillsides used the correct beneficiary numbers for at least 17 of the patients. The court’s conclusion that Hillsides provided the wrong beneficiary numbers when filing claims for reimbursement as to these patients is therefore not supported by substantial evidence.
The trial court was apparently confused by Exhibits 1-28, which Hillsides created. In an attempt to simplify which claims are at issue, Hillsides condensed the information in Exhibit A into simpler spreadsheets. Exhibits 1-28 identify, among other things, claim numbers, the patients’ names and social security numbers. Hillsides did not, however, list each patient’s Medi-Cal beneficiary identification number. The court apparently equated Hillsides’s omission of the beneficiary identification number from Exhibits 1-28 with a failure to provide the beneficiary identification number at all to the State. As we have detailed, that conclusion is not supported by the record as a whole.
Second, as to those patients (Nos. 7, 9, 15, 21, 25, 26, and 28) whose beneficiary identifications numbers we could not locate in Exhibit A, we simply cannot make any determination as to why the claims, if they were in fact submitted to the State, were denied.
Third, as to patients Nos. 4, 12, 13 and 23 whose beneficiary identification numbers appear to be incorrect in Exhibit A, it may be that Hillsides did not submit sufficient evidence that these claims were properly submitted. We do note, however, that Hillsides submitted Error Correction Reports for patient No. 23 in which it corrected the beneficiary number to conform to the number in the MOPI receipts.
In conclusion, the trial court’s finding that Hillsides submitted the incorrect Medi-Cal beneficiary numbers lacks substantial evidence to support it, at least as to 17 of the patients. Hillsides submitted evidence, the error correction reports, showing that they corrected any error in the beneficiary number as to at least one additional patient (patient No. 23). As to the remaining patients, we can draw no conclusions about whether Hillsides submitted the correct beneficiary numbers to the State, and we therefore make no finding as to whether Hillsides has submitted sufficient evidence to establish the merit of these claims. But we also find that the court’s judgment must be reversed because Hillsides provided sufficient evidence, with respect to at least over half of the patients, that the State had the correct beneficiary number and this was not a basis for the denial of the claims.
B. Substantial evidence does not support the trial court’s finding that Hillsides did not identify the claims at issue.
The trial court found that Hillsides did not identify for which claims it is seeking reimbursement. Substantial evidence also does not support this finding.
The claims at issue for each patient are listed in the spreadsheets in Exhibits 1-28, entitled Hillsides Denied Report. The trial court, however, focused on the Error Correction Reports, which Hillsides submitted for some of the patients. The court pointed out, for example, that as to Patient No. 1/A. Blackburn, Hillsides states that 179 claims were improperly denied. But the Error Correction Reports for this patient lists more than 179 claims; it lists 302 claims. The court concluded that it could not determine which of the 302 claims in the Error Correction Reports were the ones at issue. Hillsides did not, however, submit those reports to identify the claims at issue. The Error Correction Reports were submitted merely to show that Hillsides tried to correct any errors. The claims at issue are identified in the spreadsheets, which is the first document in Exhibits 1-28.
The trial court’s finding that Hillsides did not identify the claims at issue is therefore not supported by substantial evidence.
C. Hillsides submitted evidence that the 28 patients were eligible for Medi-Cal.
Hillsides contends that the State refused to reimburse it for claims relating to these 28 patients because the State incorrectly found that the patients were ineligible for Medi-Cal. The trial court did not address whether the 28 patients were eligible for Medi-Cal. If the court, on remand reaches this issue, we set forth what our review of the record shows on this question to aid its review.
To establish eligibility for Medi-Cal, Hillsides produced, as we stated above, MOPI receipts for each of the 28 patients. As we now detail, those MOPI receipts and/or Primary Medi-Cal CMSP Information printouts establish that the patients were eligible for Medi-Cal and that Hillsides submitted proof of that eligibility.
Hillsides speculates as to why the State might have denied so many claims for reimbursement. It hypothesizes that the reason for the denials in this case, as well as in two similar cases, was some kind of system or computer failure. To support this supposition, Hillsides cites three letters. The first is from the California Department of Mental Heath stating that although staff had been unable to find any problems associated with the “system reset in June 2001,” nonetheless, “there appears to be ‘system’ problems external to the state system that may have caused claim failures[,] [t]he primary one being the conversion of the alpha character at the end of the Client Identification Number (CIN) to a numeric....”
For each patient, we reviewed the MOPI receipt, which shows the date the patient became Medi-Cal eligible and which contains at the top of the receipt what appears to be the date the MOPI was printed. The State does not provide a clear response to this evidence. Instead, the State provides a detailed overview of the Short-Doyle Managed Care Mental Health Program (Welf. & Inst. Code, § 5775 et seq.), which is the program under which mental health care providers receive reimbursement for the services they provide to eligible patients. An important point from its overview appears to be the State cannot get federal matching dollars if patients are not in the MEDS database. Another crucial point appears to be this: The “Point of Service system is a convenience that providers may use for initial eligibility screening. It provides minimal eligibility information and encompasses all possible funding sources,” although it is not precise enough to determine eligibility for a particular program, such as Short-Doyle. The State thus asserts: “Appellant also ignores the fact that simple Medi-Cal eligibility does not entitle the State to federal funds under the Short-Doyle program.” Kim Maun clarifies that “[n]ot all Medi-Cal beneficiaries are eligible for Short-Doyle.” In other words, even if the MOPI receipt shows that the patient is eligible for Medi-Cal, once the claims are processed further, the State may find that the patient is in fact ineligible.
Kim Maun, in her declaration on behalf of the State, also goes over the process by which she conducted a “rerun” of the claims at issue either in 2003 or 2007. That declaration is ambiguous, but the gist of it, as to the rerun, appears to be that many claims were approved as a result of the rerun, but the denied claims were “outside the two[-]year range for receipt of FFP and, therefore, could no longer receive the federal part of the payment under the Short-Doyle program.” That statement, however, does not address the issue. Approved claims are not issue, denied claims are at issue. Putting aside whether it is too late for the State to get federal reimbursement or matching funds for the claims, the initial question is: Were the claims improperly denied in the first place?
The trial court sustained a limited number of Hillsides’s objections to Maun’s declaration. Hillsides now asks that all of the objections should have been sustained. We decline to find that the trial court abused its discretion in overruling the objections, but we nonetheless refer to various problems with the Maun declaration in our discussion.
We describe the evidence Hillsides submitted concerning each patient’s eligibility for Medi-Cal, and the State’s response.
Patient No. 1/A. Blackburn.
Hillsides seeks reimbursement for claims totaling $8,531.64. The MOPI receipts, printed May 5 and October 13, 2000, shows that Patient No.1 was Medi-Cal eligible on September 23, 1996.
As we set forth above, A. Blackburn has two Medi-Cal beneficiary identification numbers.
Maun states that although Hillsides argues that 179 claims were unpaid, the Department of Health Services records show that only 88 claims were unpaid. Those 88 claims were denied because they were billed under an old MEDS identification number that had been “turned off. The provider billed under five different MEDS or Social Security Numbers and when notified of the error simply resubmitted the same claim without changing to the correct number.”
Maun’s explanation for why the claims were denied may be correct, but the problem is she doesn’t specify which 88 claims she is referencing. She notes that this patient has two beneficiary numbers, and that for 88 claims Hillsides improperly billed under the older number. Our review of Exhibit A shows that there were claims billed for this patient under both numbers. Therefore, if Maun’s declaration were more specific as to which 88 claims she is referencing, the validity of the denials could be evaluated.
We also note that the trial court specifically looked at claim No. H733231802 (Hillsides’s Exhibit 1). The court said it was unable to locate that claim. We, however, located the claim in Exhibit A at row 1594, which shows it was submitted for reimbursement.
Patient No. 2/M.
Bowen: Hillsides seeks reimbursement for claims totaling $5,118.56. The MOPI receipts, printed on February 24 and May 5, 2000, show that the patient became eligible for Medi-Cal on November 16, 1994.
Maun states that her review of the records shows that only 40 claims, rather than 155, were denied for M. Bowen. She indicates that some of the claims on page 33 of 38 of (Exhibit B) were denied as duplicates, and for “the other disapproved claims, the provider did not provide any error correction reports when informed that the number for the beneficiary was not in MEDS.” Maun does not identify with specificity the 40 claims. We do note, however, that this patient has two beneficiary identification numbers, only one of which we located in Exhibit A. Hillsides did provide MOPI receipts for both numbers.
Patient No. 3/K.
Campbell. Hillsides seeks $277.80 in reimbursement. The MOPI receipts printed on October 29, 1999, shows that the patient became eligible for Medi-Cal on March 12, 1996.
Maun states that the claims on pages 10 and 33 of 38 (of Exhibit B) were “duplicates.” “Approximately seven claims... for $3.08 had an incorrect beneficiary number-error code 11—which was not corrected in 303 days.” It is unclear which claims Maun is referencing, as all of the claims Hillsides seeks reimbursement for were in the amount of $15.40, not $3.08.
Patient No. 4/D. Cato.
Hillsides seeks reimbursement in the amount of $4,158.35. The MOPI receipts were printed on February 24, 2000, showing Medi-Cal eligibility on May 14, 1996.
As to Patient No. 4, Maun merely states: “Petitioner claims 135 claims, however, on page 38 of 38; D. Cato is listed as a duplicate approved and paid claim––Error Code 26.” That is correct, but it is a mere restatement of the evidence Hillsides submitted.
Patient No. 5/A. Concha.
Hillsides seeks reimbursement in the amount of $85. The MOPI receipt, printed on February 24, 2000, shows that the patient was Medi-Cal eligible on December 25, 1997.
Maun states that the one claim at issue is listed as a duplicate. That is correct, but it is a mere restatement of the evidence Hillsides submitted.
Patient No. 6/M. Cox.
Hillsides seeks reimbursement in the amount of $85. MOPI receipt, printed on October 13, 2000, shows that the patient was eligible for Medi-Cal on April 30, 1999.
Maun states that the one claim at issue was denied as a duplicate. That is a mere restatement of the evidence Hillsides submitted.
Patient No. 7/V. Culpepper.
Hillsides seeks reimbursement in the amount of $170. Hillsides submitted a copy of the patient’s benefits identification card showing that the patient was eligible for Medi-Cal on April 10, 1996.
Maun states that “he is not on the list and is not in MEDS.” We could not find this patient in Exhibit A.
Patient No. 8/C. Decosta.
Hillsides seeks reimbursement in the amount of $14,989.28. The MOPI receipt, printed on October 29, 1999 and on February 24 and May 5, 2000, shows that the patient was eligible for Medi-Cal on February 7, 1996.
Maun states that the claims at issue were denied as duplicates. That is a mere restatement of the evidence Hillsides submitted. She also states that C. DeCosta’s beneficiary number was not found in MEDS. The record, however, shows that this patient has two beneficiary identification numbers, both of which we found in Exhibit A, for example at lines 42 and 1649.
Patient No. 9/R. Elerick.
Hillsides seeks reimbursement in the amount of $680. Hillsides submitted a benefits identification card with an issue date of May 1, 1994.
Maun could not locate this patient in MEDS. We also could not locate this patient in Exhibit A.
Patient No. 10/C. Frazier.
Hillsides seeks reimbursement in the amount of $17,812.12. The MOPI receipt, printed on February 24, 2000, shows that the patient was eligible for Medi-Cal on October 22, 1998. A Primary Medi-Cal/CMPS Information printout appears to show that the patient was Medi-Cal eligible for 1999-2000.
Maun states: “Claims from 6/99 are from FY 1998-1999 are not within the scope of this lawsuit which deals with FY 1999-2000 and 2000-2001. In addition, the claims listed beginning on page 1 of 38 are listed as duplicate, approved and paid claims... or additional claims were filed with an ID number not found in MEDs.” As we have pointed out, however, Hillsides did produce a MOPI receipt. We also located the patient in Exhibit A.
Patient No. 11/C. Gokey. Hillsides seeks reimbursement in the amount of $3,677.28. The MOPI receipt, printed on May 5, 2000, show that the patient was eligible for Medi-Cal on March 16, 1999.
Maun could not find this patient’s identification number in MEDS. Hillsides did, however, produce a MOPI receipt. We also located the patient in Exhibit A.
Patient No. 12/J. Gondola.
Hillsides seeks reimbursement in the amount of $2,910.39. Hillsides submitted a copy of the patient’s benefits identification card, having an issue date of October 20, 1994.
Maun states that the claims were denied as duplicates. That is a mere restatement of the evidence Hillsides submitted.
Patient No. 13/J. Gondola.
Hillsides seeks reimbursement in the amount of $85. The MOPI receipt, printed on February 24, 2000, shows that the patient was eligible for Medi-Cal on May 1, 1994.
Maun states that the claims were denied as duplicates. That is a mere restatement of the evidence Hillsides submitted.
Patient No. 14/M. Green.
Hillsides seeks reimbursement in the amount of $11,262.16. The MOPI receipts, printed on February 24 and May 5, 2000, show that the patient was eligible for Medi-Cal on May 1, 1994.
Maun states: “The claims listed have an incorrect beneficiary [ID] and were denied with error codes 11 not in MEDS or where a different number is listed without a SSN––it is an 03––error code beneficiary I[D] incorrect. See pages 1 & 2 of 38. These claims were not corrected in 303 days.” Hillsides, however, produced MOPI receipts showing that this patient has two beneficiary identification numbers, both of which we located in Exhibit A.
Patient No. 15/L. Hernandez.
Hillsides seeks reimbursement in the amount of $85. Hillsides did not provide a MOPI receipt or a copy of the benefits identification card for this patient. It did, however, provide a Primary Medi-Cal/CMSP Information printout, which, according to Lara’s declaration, is printed out from the State’s database. That printout appears to show that the patient was eligible for Medi-Cal for 2000/2001.
Maun could not locate this patient. We also could not locate this claim in Exhibit A.
Patient No. 16/L. Jones.
Hillsides seeks reimbursement in the amount of $15,896.48. Hillsides did not provide a MOPI receipt or a copy of the benefits identification card for this patient. It did, however, provide a Primary Medi-Cal/CMSP Information printout, which, according to Lara’s declaration, is printed out from the State’s database. That printout appears to show that the patient was eligible for Medi-Cal for 1999/2000.
Maun states, “Claims from 4/99 and 6/99 predate this lawsuit because they are from the FY 1998-1999 and were not included in this lawsuit nor were they in any reruns.”
Patient No. 17/B. Lopez.
Hillsides seeks reimbursement in the amount of $595. The MOPI receipts, printed on October 13, 2000, show that the patient was eligible for Medi-Cal on September 16, 1999. Maun’s declaration contains no discussion of this patient.
Patient No. 18/J. McDaniel.
Hillsides seeks reimbursement in the amount of $6,150.28. The MOPI receipts, printed on October 29, 1999 and on February 24 and May 5, 2000, show that the patient was Medi-Cal eligible on December 7, 1995. Maun states that claims from fiscal year 1998-1999 are not a part of this lawsuit.
Patient No. 19/C. Moss.
Hillsides seeks reimbursement for patient No. 19 in the amount of $421.56. Hillsides submitted a benefits identification card having an issue date of October 19, 2000.
Maun states that the claims were denied as duplicates. That is a mere restatement of the evidence Hillsides submitted.
Patient No. 20/P. Painting.
Hillsides seeks reimbursement in the amount of $18,760.59. The MOPI receipt, printed on February 24, 2000, shows that the patient was eligible for Medi-Cal on April 17, 1998. A Primary Medi-Cal/CMSP Information printout appears to show Medi-Cal eligibility for 1999/2000.
Maun states that claims from fiscal year 1998-1999 are not a part of this lawsuit. She also refers to claims listed on page 8 of 38 (of Exhibit B). She points out that there are two beneficiary identification numbers listed for this patient: 194003632977512 and 00000C93761100D. That is correct, but the import of this fact is unclear.
Patient No. 21/M. Parker.
Hillsides seeks reimbursement in the amount of $85. The MOPI receipt, printed on October 13, 2000, shows that the patient was eligible for Medi-Cal on August 13, 1999.
Maun could not find this claim. We also could not locate it in Exhibit A.
Patient No. 22/S. Parker.
Hillsides seeks reimbursement in the amount of $425. The MOPI receipt, printed on October 13, 2000, shows that the patient was eligible for Medi-Cal on August 13, 1999.
Maun could not find these claims, but we located this patient in Exhibit A. We also randomly checked one of the five claims listed for this patient—claim No. H733248606—and we also located it in Exhibit A at line 1931.
Patient No. 23/T. Pruett.
Hillsides seeks reimbursement in the amount of $4,066.48. The MOPI receipt, printed on May 5, 2000, shows that the patient was eligible for Medi-Cal on September 13, 1999.
Maun could not find the claims for this patient. We note that in her declaration the patient’s name is misspelled. We did locate this patient in Exhibit A, albeit under a beneficiary identification number different than that in the MOPI receipt. We randomly checked two claims Nos. H733231440 and H733231441, and we could not locate them in Exhibit A. We found only one claim for this patient in Exhibit A at line 1144.
Patient No. 24/C. Rosales.
Hillsides seeks reimbursement in the amount of $1,970.44. The MOPI receipt, printed on February 24, 2000, shows that the patient was eligible for Medi-Cal on April 22, 1999.
Maun could not find the claims for this patient. We did, however, find this patient in Exhibit A. We randomly checked one claim No. H733229555 and found it in Exhibit A at line 1310.
Patient No. 25/O. Sanabria.
Hillsides seeks reimbursement in the amount of $796.44. The MOPI receipt, printed on February 24, 2000, shows that the patient was eligible for Medi-Cal on March 31, 1998.
Maun could not locate this patient. We also could not locate the patient in Exhibit A.
Patient No. 26/M. Sanford.
Hillsides seeks reimbursement in the amount of $2,040. The MOPI receipt, printed on February 24, 2000, shows that the patient was eligible for Medi-Cal on August 25, 1999.
Maun could not locate this patient. We also could not locate the patient in Exhibit A.
Patient No. 27/S. Taylor.
Hillsides seeks reimbursement in the amount of $2,383.08. The MOPI receipts, printed on October 29, 1999 and on February 24 and May 5, 2000, show that the patient was eligible for Medi-Cal on April 26, 1995.
Maun states that the claim is too old to process. It is unclear what this means with respect to the issue of whether it was properly denied in the first place.
Patient No. 28/M. Urena, Jr.
Hillsides seeks reimbursement in the amount of $5,720.56. The Primary Medi-Cal/CMSP Information printout, dated May 5, 2000, appears to show Medi-Cal eligibility for 1999/2000.
Maun states that some of the claims “predate this lawsuit” because they are from fiscal year 1998/1999. She also states that the beneficiary is not found on Exhibit B. We also could not locate this patient on Exhibit A.
To sum, what this evidence shows, at a minimum, is that the 28 patients were eligible for Medi-Cal around the time Hillsides provided services to them. The State’s response to this question of eligibility is elusive. The State broadly implies that claims were denied because the patients were ineligible, apparently for the specific program funded under Medi-Cal. It may very well be true that despite what the MOPI receipts show, these 28 patients were in fact ineligible for reimbursement under Short-Doyle. The problem is the State did not provide any evidence to show that this is in fact why reimbursement was denied; it merely implies that might have been the case. The evidence also shows that some of the patients (Nos. 7, 9, 15, 21, 23, 25, 26, and 28) are not in Exhibit A, which, we understand, should contain all of the claims for all of the patients.
We therefore express no opinion on the ultimate outcome of this case and we make no determination regarding whether Hillsides otherwise sustained its burden of proving its entitlement to reimbursement of any of the claims. We reverse and remand on the sole ground that there is insufficient evidence to support the trial court’s conclusions that Hillsides submitted incorrect beneficiary numbers for the claims and that Hillsides did not identify which claims are at issue. Because of the fact intensive nature of this matter, the trial court may wish to refer it to a special master.
In two footnotes in its respondent’s brief on appeal, the State notes, first, that the petition failed to name Los Angeles County, an allegedly indispensable party, as a real party in interest and, second, that the petition failed to allege that Hillsides exhausted its administrative remedies. The footnotes refer to those portions of its written opposition to the petition in which the State made these arguments, but, on appeal, the State offers no analysis. This is not sufficient to preserve the issue for appeal.
DISPOSITION
The request for judicial notice is granted. The judgment is reversed and the matter is remanded for further proceedings consistent with this opinion. Appellant to recover costs on appeal.
We concur: KLEIN, P. J., CROSKEY, J.
The second letter is also from the Department of Mental Health: “In response to contractor service providers’ inquiries, the Department requested, without claim line detail, the State to review their process. The State agreed with Dr. Southard to have SDHS run the alleged improperly processed claims through their claim system, with the approval function turned off (i.e.[,] ‘special processing run’). [¶]... [¶] It appears that error ’09-11’ occurred with high frequency. This suggests the financial screening process at the provider may not adequately be identifying Medi-Cal beneficiary status. The service providers that the State will not be using the ‘special processing run’ will be notified.”
In the third letter, addressed to Hillsides’s counsel, the Department of Mental Health states it had rerun denied claims “against the correct eligibility files” and approved over an additional eight thousand claims. “The remaining claims were denied for reasons other than being too old. [¶]... [¶] Your information indicated that there were individuals who were confirmed as eligible at the time of service but have still been denied as ineligible. DHS used the most accurate eligibility files in reprocessing these claims. These files may have included some people who lost eligibility retroactively.”
In addition to these letters, Hillsides created a spreadsheet, “Average Number of Months Disposition Delay from Month of Receipt for Denied EOB’s by Month of Service,” to illustrate the length of time the State delayed in processing claims. The spreadsheet shows, for example, that from the time the service was rendered, it took the State anywhere from 4 to 22 months to dispose of claims.
We need not decide why the State denied the claims, for example, perhaps because there was some failure of the computer system used by the State in processing claims.