Summary
In Montrie, a group of nursing homes filed a petition for a writ of mandamus to compel ODPW to reimburse the relators according to applicable statutes, and not in the lower amounts ODPW had reimbursed them pursuant to that agency's administratively established policies not in compliance with statute.
Summary of this case from Morning View Care v. OdjfsOpinion
No. 77-1018
Decided June 21, 1978.
Mandamus — To compel statutory reimbursement to nursing homes — Writ allowed.
APPEAL from the Court of Appeals for Franklin County.
Relators, Montrie Nursing Home, Inc., Worthington Nursing Home, Inc., and Norworth Convalescent Center, Inc., are operators of nursing homes in Sylvania and Worthington, Ohio. Relators instituted this action in November of 1976 in the Court of Appeals for Franklin County on behalf of themselves and an alleged class of all other persons who own and operate licensed nursing homes which provide services to the medically indigent under the Medicaid programs of the state and federal governments.
Respondent Kwegyir Aggrey is the Director of the Ohio Department of Public Welfare (O.D.P.W.). Pursuant to R.C. 5101.51, the O.D.P.W. is the agency responsible for the administration of the state plan of medical assistance under Title XIX of the Social Security Act (Section 1396, Title 42, U.S. Code).
Am. Sub. H.B. No. 155 of the 111th General Assembly provides for vendor nursing home care to be paid:
"* * * on a reasonable cost related basis to be determined, as follows:
"(A) Reimbursement for the reasonable cost incurred for the care, comfort, and safety of patients;
"(B) Reasonable costs considered ordinary and necessary and related to patient care shall not include any amounts for property or equipment and any interest paid on loans to finance or refinance such property or equipment. Reimbursement for cost of property and equipment and related interest expense shall be on a reasonable cost basis, as follows: Facilities (including beds within such facilities) constructed prior to and subsequently originally licensed prior to 1958 — $2.50 per available bed per day. Facilities (including beds within such facilities) constructed and subsequently originally licensed after 1957 but prior to 1968 — $3.50 per available bed per day. Facilities (including beds within such facilities) constructed and subsequently originally licensed January 1, 1968 and after, $4.50 per available bed per day.
"(C) Applicable rates shall include a profit allowance equal to ten per cent of costs incurred for the care, comfort, and safety of patients not to exceed $1.50 per patent per day. Such allowance shall not include a return on the fixed cost factor referred to in paragraph (B), nor a return on salaries attributable to owner's services.
"* * *
"The department of public welfare shall have authority to modify any section herein contained to the extent necessary in order to comply with federal regulations effective July 1, 1976, subject to the review and approval of the controlling board. * * * If sufficient funds are not available to fund the reimbursement rates provided by appropriations made herein, the director of public welfare, subject to the review and approval of the controlling board, may make pro rata reductions in vendor per diem payments to nursing homes."
From July through November 1975, O.D.P.W. computed the nursing home rates in accordance with Am. Sub. H.B. No. 155 and then, due to a shortage of funds, applied a pro-rata reduction to keep the payments within the total funds available.
Thereafter, O.D.P.W. reimbursed participating nursing homes in an amount less than that prescribed by Am. Sub. H.B. No. 155 based upon two bulletins (Nursing Home Fiscal Policy and/or Procedure Bulletin Nos. 4 and 7) issued by the Bureau of Fiscal Review of the O.D.P.W. The amounts paid were less than those prescribed by paragraph (B) of that part of Am. Sub. H.B. No. 155 quoted, supra. Instead, such payments were based upon the director's own determination of "* * * a reasonable cost related basis * * *" for reimbursement.
The Court of Appeals held that mandamus would not lie, and the cause is now before this court upon appeal as a matter of right.
Messrs. Lucas, Prendergast, Albright, Gibson, Brown Newman, Mr. Rankin M. Gibson and Mr. W. Joseph Strapp, for appellants.
Mr. William J. Brown, attorney general, Mr. William J. Anderson, Mr. Patrick V. Kerrigan and Mr. George E. Lord, for appellees.
Federal Medicaid regulations require that participating states must enter into written contracts with participating nursing homes. Section 249.82(c)(1), Title 45, Code of Federal Regulations. The Court of Appeals below held that mandamus would not lie because the relators could sue on their contracts in the Court of Claims for amounts due.
In this case, however, payment was being made by O.D.P.W. in accordance with administratively established policies not in compliance with legislative enactment, i. e., Am. Sub. H.B. No. 155. Payments were not determined by contract. The director may not modify the clearly expressed legislative intent by issuing bulletins providing lesser renumeration for participating nursing homes than the General Assembly has directed.
In State, ex rel. Pressley, v. Indus. Comm. (1967), 11 Ohio St.2d 141, this court held that where a public officer or agency is under a clear legal duty to perform an official act, and where there is no plain and adequate remedy in the ordinary course of the law, an action in mandamus will lie originally in the Supreme Court or in the Court of Appeals. See, also, State, ex rel. National City Bank, v. Bd. of Education (1977), 52 Ohio St.2d 81.
We find that the relators are not being damaged due to a breach of contract but due to the failure of a public officer to perform an official act which he is under a clear legal duty to perform. The General Assembly has mandated in Am. Sub. H.B. No. 155 the amount of recompense to be received by relators for their services rendered. Relators have no adequate remedy in the ordinary course of law, and the judgment of the Court of Appeals is, accordingly, reversed and the prayed-for writ of mandamus is allowed.
Judgment reversed and writ allowed.
O'NEILL, C.J., HERBERT, CELEBREZZE, W. BROWN, COLE, COOK and LOCHER, JJ., concur.
COLE, J., of the Third Appellate District, sitting for P. BROWN, J.
COOK, J., of the Eleventh Appellate District, sitting for SWEENEY, J.