DEPARTMENTAL APPEALS BOARD
Department of Health and Human Services
SUBJECT: New York State Dept. DATE: December 13, 1988 of Social
Services Docket No. 88-211 Decision No. 1002
DECISION
The New York State Department of Social Services (State) appealed the
decision of the Health Care Financing Administration (HCFA) disallowing
$1,452,159 claimed under title XIX of the Social Security Act (Act) for
the quarter ended March 31, 1988. The disallowed costs, which were
included in the per diem rates for hospitals, were incurred for
supplemental malpractice insurance purchased by the hospitals for their
affiliated physicians and dentists. The disallowance was taken on the
ground that the costs were claimed under a proposed State plan amendment
which had not been approved by HCFA. Section 1903(a)(1) of the Act
requires that costs be claimed under an approved state plan in order to
be eligible for reimbursement under title XIX.
The State contended on appeal that the costs were reimbursable as
inpatient hospital costs pursuant to section 1903(a)(13)(A) of the Act.
It acknowledged, however, that the Board had upheld the disallowance of
similar costs claimed for earlier quarters under proposed State plan
amendments which had been disapproved by HCFA. New York State
Department of Social Services, DAB No. 947 (1988). While upholding the
disallowance in that case, the Board noted that the State had requested
pursuant to 45 C.F.R. Part 213 that HCFA reconsider its decision
disapproving the proposed plan amendments and that HCFA had stated that
were it to later approve the plan amendments, it would pay the costs in
question. Asserting that the plan amendments in question in the
instant case were similar to the amendment at issue in DAB No. 947, the
State requested that the Board issue a summary decision upholding the
disallowance based on DAB No. 947. HCFA had no objection.
Conclusion
Accordingly, we conclude that the disallowance was properly taken on the
ground that the costs were not claimed pursuant to an approved State
plan, and sustain the disallowance based on the analysis set forth in
DAB No. 947. If the proposed plan amendment under which the costs were
claimed is subsequently approved by HCFA, this decision would not
preclude HCFA from paying the costs.
_____________________ Donald F. Garrett
_____________________ Alexander G. Teitz
______________________ Norval D. (John) Settle
Presiding Board