Decision No. CR652 |
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IN THE CASE OF | ||||||||
Lauderhill Community Mental Health Center, |
DATE: March 6, 2000 | |||||||
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Health Care Financing Administration | Docket No.C-99-636 | |||||||
DECISION | ||||||||
I enter summary disposition sustaining the determination
of the Health Care Financing Administration (HCFA) to deny certification
to Petitioner, Lauderhill Community Mental Health Center, to participate
in the Medicare program as a community mental health center (CMHC) providing
partial hospitalization services. I do so because Petitioner has not shown
that it may provide screening for patients being considered for admission
to State mental health facilities to determine the appropriateness of
such admissions consistent with the requirements of federal and applicable
Florida State law. Background Petitioner is a corporation that is located in Lauderhill,
Florida. Petitioner applied to be certified to participate in the Medicare
program as a CMHC providing partial hospitalization services. On December
29, 1998, HCFA notified Petitioner that it had determined that Petitioner
did not qualify to be certified as a CMHC. Petitioner applied for reconsideration
of HCFA's determination on February 18, 1999. On March 29, 1999, HCFA
notified Petitioner that it had determined to deny Petitioner's reconsideration
request. Petitioner then requested a hearing. The case was assigned to me for a hearing and a decision.
HCFA moved for summary disposition. Petitioner opposed HCFA's motion.
HCFA submitted seven proposed exhibits (HCFA Ex. 1 - 7) with its motion.
Petitioner submitted three proposed exhibits (P. Ex. 1 - 3) with its reply
in opposition to HCFA's motion. Neither party objected to the proposed
exhibits. I hereby receive into evidence HCFA Ex. 1-7 and P. Ex. 1-3.
A. Federal law
"Partial hospitalization services" are services which
are described at section 1861(ff) of the Social Security Act (Act) and
which are reimbursed by the Medicare program. "Partial hospitalization
services" consist of services that are prescribed by a physician and provided,
pursuant to specified statutory criteria, and which include: individual
and group therapy with physicians and psychologists; occupational therapy
requiring the skills of a qualified occupational therapist; services of
social workers, trained psychiatric nurses, and other staff trained to
work with psychiatric patients; drugs and biologicals furnished for therapeutic
purposes; individualized activity therapies; family counseling; patient
training and education; diagnostic services; and such other services as
the Secretary of this Department may determine to be reasonable and necessary.
Act, sections 1861(ff)(1); 1861(ff)(2)(A) - (I).
The Medicare program will reimburse for partial hospitalization services that are provided by either a certified hospital or by a CMHC. See Act, section 1861(ff)(3)(A). A "community mental health center" is defined by the Act to mean an entity:
Act, section 1861(ff)(3)(B)(i), (ii). Although the Act refers to section 1916 of the Public Health Service Act (PHSA), the section was recodified as section 1913(c)(1) of the PHSA. Under this section, the services that a CMHC must provide include the following:
Additionally, the Secretary of this Department has issued a regulation which defines the term "community mental health center." A CMHC is defined by the regulation to be an entity that:
42 C.F.R. � 410.2. HCFA has published policy guidelines which describe a CMHC's obligations under section 1913(c)(1) of the PHSA and the above-cited regulation. In a document that is entitled "All States Letter 76-95" (All States Letter), HCFA states that a CMHC must provide all of the services that are listed in the PHSA, either directly or under arrangements with others. HCFA Ex. 2. The term "under arrangements" is defined in the All States Letter to mean that a CMHC may arrange for those services described at section 1916(c)(4) of the PHSA (now codified as section 1913(c)(1) of the PHSA) and partial hospitalization services:
Id., at 3 (emphasis added).
HCFA has elected to defer to the laws of the States in order to determine what constitutes adequate screening for patients being considered for admission to State mental health facilities pursuant to section 1913(c)(1)(iv) of the PHSA. In a memorandum dated August 21, 1998, HCFA stated that "screening":
HCFA Ex. 3 at 1 (emphasis in original). B. Florida State law
Florida State law defines the entities that are authorized to perform the procedures which are necessary prerequisites to admission of individuals for treatment at a Florida State mental health facility. Under the Florida Mental Health Act, F.S.A. � 394.451, et seq., only certain types of entities are authorized to perform the necessary procedures. Specifically, these entities are limited to those entities which are authorized to perform "transfer evaluations." F.S.A. � 394.461(2). A "transfer evaluation" is defined under Florida State law as being:
F.S.A. � 394.455(29). Under Florida State law, a "community mental health center or clinic" is a:
F.S.A. � 394.455(6).
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ISSUE, FINDINGS OF FACT AND CONCLUSIONS OF LAW | ||||||||
Issue The issue in this case is whether HCFA properly determined
not to certify Petitioner to participate in Medicare as a CMHC providing
partial hospitalization services. Findings of fact and conclusions
of law I make findings of fact and conclusions of law (Findings)
to support my decision in this case. I set forth each Finding below as
a separately numbered heading. I discuss each Finding in detail. 1. Summary disposition is
appropriate in this case. A threshold question in this case is whether summary disposition
is appropriate. Summary disposition is appropriate either where: there
are no disputed issues of material fact and the only questions that must
be decided involve application of law to the undisputed facts; or, where
the moving party must prevail as a matter of law even if all disputed
facts are resolved in favor of the party against whom the motion is made.
I have looked closely at Petitioner's arguments in order to decide whether
there exist any genuinely disputed issues of material fact.
I am assuming the facts that Petitioner asserts in its
brief and exhibits to be true for purposes of deciding HCFA's motion for
summary disposition. I conclude that summary disposition is appropriate
in this case notwithstanding my decision to accept as true the facts alleged
by Petitioner. As I explain in detail in the Findings which follow, Petitioner
has failed to make a showing that it qualifies to participate in Medicare
as a CMHC providing partial hospitalization services even accepting as
true the facts which Petitioner alleges. 2. Petitioner did not satisfy
participation criteria for a CMHC As I discuss above, at Part II. A. of this decision, in
order to be certified to provide partial hospitalization services - and
to satisfy the statutory definition of a CMHC contained at section 1913(c)(1)
of the PHSA - an entity must meet criteria which, among other things,
include the following:
a. Petitioner cannot qualify
under federal participation requirements In order to be able to perform directly the screening
services that are required under section 1861(ff)(3)(A) of the Act and
section 1913(c)(1)(iv) of the PHSA, Petitioner must be authorized to perform
transfer evaluations pursuant to Florida State law. Federal law requires
a CMHC to comply with applicable State requirements in order to participate
in Medicare. 42 C.F.R. � 410.2. Florida's law governing a transfer evaluation
by a CMHC is plainly applicable State law inasmuch as a transfer evaluation
is a process that is identical to screening. Under federal law, screening
is the clinical evaluation of a patient to determine his or her suitability
for hospitalization in a State mental health facility. Under Florida State
law, a transfer evaluation also is a clinical evaluation of a patient
to determine his or her suitability for transfer to a State mental health
facility. F.S.A. � 394.455(29). Petitioner cannot qualify to perform screening directly
because it cannot qualify pursuant to Florida State law to perform transfer
evaluations. Florida State law provides that a CMHC may perform a transfer
evaluation only if it is a not-for-profit publicly funded entity. F.S.A.
� 394.455(6). Petitioner has not made any showing that it is a nonprofit
publicly funded CMHC that is certified to perform transfer evaluations
under Florida State law. b. Petitioner does not qualify
under federal participation requirements In order to comply with federal participation criteria
an arrangement between a CMHC and another entity must provide that the
CMHC retains overall supervision over the screening process. HCFA Ex.
2. It is not sufficient for the CMHC merely to refer a patient to another
entity for screening. The CMHC must directly supervise the basic functions
which the other entity performs that comprise screening. Id., at
1-3. Petitioner does not comply with federal participation
requirements which govern screening through an arrangement with others.
The evidence in this case does not show that Petitioner has a screening
arrangement with another entity which complies with federal requirements.
Petitioner argues that, under Florida State law, an entity
known as a "receiving facility" is permitted to perform transfer evaluations.
Petitioner's Brief (P. Br.), at 3 - 4. Petitioner then asserts that it
may satisfy the screening requirement by transferring its patients to
a receiving facility which will then perform the requisite screening.
This argument is essentially the same argument that was made by the facility
in the case of T.L.C. Mental Health Center, DAB CR636 (1999). I
held there that a referral of a patient to a receiving facility does not
satisfy the screening requirement where the referring entity does not
exercise the supervisory authority that is required by HCFA. T.L.C.,
DAB CR636, at 8. I restate that holding here. As Petitioner describes referral of a patient to a screening
facility, it is not screening through an arrangement with others as is
required by HCFA, because Petitioner would not retain the necessary management
control or supervisory authority over the screening process. The fact
that the receiving facility may be authorized under Florida State law
to perform a transfer evaluation begs the question of whether Petitioner
is exercising the requisite supervision of the receiving facility's performance
of its functions. c. The question of whether Petitioner actually is providing screening is moot. HCFA argues that it is not enough for Petitioner to establish
that it is capable of providing screening, either directly, or through
an acceptable arrangement with another entity. HCFA asserts that, in order
to satisfy participation criteria, Petitioner must show that it is providing
screening consistent with federal and applicable State requirements.
It is not necessary for me to address this issue here.
Whether or not Petitioner is screening patients for referral is a moot
point because Petitioner does not satisfy the criteria for performing
screening. 3. HCFA's application of the
law is not on its face inconsistent Petitioner argues that HCFA's August 21, 1998 memorandum,
in which HCFA explained what it meant by screening through an arrangement
with another entity, constitutes a departure by HCFA from its previous
policy concerning certification of CMHCs to provide partial hospitalization
services. P. Br., at 6; see HCFA Ex. 3. Petitioner asserts that
such an allegedly fundamental change in policy by HCFA - and any certification
determination that HCFA makes pursuant to the allegedly changed policy
- is unlawful where HCFA has failed to follow the notice and comment requirements
of the Administrative Procedures Act (APA). I do not find that this argument provides a basis for
me to order that HCFA certify Petitioner to participate in Medicare. First,
Petitioner has made no showing that HCFA's interpretation of the law as
is stated in HCFA's August 21, 1998 memorandum is inconsistent with federal
statutes or regulations published by the Secretary.
Indeed, HCFA's policy statement is consistent with the
requirements of law. Section 1913(c)(1)(iv) of the PHSA requires a CMHC
to provide screening. The PHSA could be read consistent with its plain
meaning to require that a CMHC provide screening directly. HCFA
has chosen to apply the statute somewhat more liberally by allowing a
CMHC to provide screening via an arrangement with another entity. However,
it is not unreasonable - and it is certainly consistent with the plain
meaning of the PHSA - for HCFA to require that any screening done via
such an arrangement be done with the CMHC exercising the same degree of
control and supervision over such screening as if the CMHC had performed
the screening directly. Second, I lack the authority to do what Petitioner requests,
which is to declare HCFA's official interpretation of law to be ultra
vires because HCFA failed to publish it pursuant to the notice and comment
requirements of the APA. I have no authority to declare an official interpretation
of law by HCFA to be ultra vires the requirements of the Act. Regulations
give me the authority to hear and decide whether HCFA's determination
that an entity fails to qualify as a provider was made correctly. 42 C.F.R.
�� 498.3(b)(1), 498.5(a)(2). In the course of hearing and deciding such
a case, I may decide whether HCFA applied correctly to the facts of a
case applicable regulations or official interpretations of law. I may
also decide whether HCFA's interpretation of a regulation is correct or
incorrect. However, I lack the authority to decide whether HCFA or the
Secretary published an interpretation of the law in violation of the APA. 4. I do not have the authority
to order HCFA to certify Petitioner Petitioner argues that I should declare HCFA's determination
to deny Petitioner certification to be unlawful on the ground that the
certification determination was arbitrary and capricious. Petitioner contends
that, prior to August 21, 1998, HCFA made determinations to certify CMHCs
to participate in Medicare which are inconsistent with the policy that
HCFA announced in the August 21, 1998 memorandum. However, according to
Petitioner, HCFA has not rescinded these pre-August 21, 1998 determinations
even while it is enforcing the August 21, 1998 memorandum against entities
which apply for certification after August 21, 1998. P. Br., at 7. Petitioner
asserts that this allegedly disparate treatment of entities by HCFA establishes
HCFA to be arbitrary and capricious in denying certification to Petitioner.
I do not have the authority to order HCFA to certify Petitioner
to participate in Medicare on the ground that HCFA's determination not
to certify Petitioner is arbitrary and capricious in light of its alleged
failure to decertify other CMHCs. My authority is limited pursuant to
42 C.F.R. �� 498.3 and 498.5 to hearing and deciding whether HCFA's determination
in this case, given the undisputed facts, complies with applicable
law. The premise which underlies HCFA's August 21, 1998 memorandum
is that, prior to that date, HCFA had misunderstood the implications of
Florida State law and had been certifying incorrectly as CMHCs entities
that did not comply with the requirements of Florida State law. I am aware
of nothing in the Act or in regulations which commands HCFA to continue
to certify applicants to participate on the ground that it has certified
similarly situated applicants in the past. And, there is nothing in the
Act or regulations which prohibits HCFA from changing its provider certification
policies prospectively, as its understanding of the meaning of State laws
evolves. 5. I do not have the authority
to hear and decide Petitioner's claim of estoppel.
Petitioner asserts that it remained in operation after
September 1998 and incurred expenses based on its understanding from conversations
with employees of HCFA that Petitioner would be certified to participate
in Medicare. P. Br., at 8. Petitioner asserts that it relied to its detriment
on representations allegedly made to it by HCFA's employees. It contends
that it suffered damages as a consequence of its reliance on these alleged
statements. Presumably, Petitioner would have me award money damages to
it premised on the injury caused by its reliance on the representations
allegedly made by HCFA's employees. For purposes of deciding Petitioner's argument I am assuming
to be true Petitioner's contentions about the representations that HCFA's
employees are alleged to have made. I am also assuming to be true Petitioner's
assertions that it relied on these representations to its detriment. Notwithstanding,
I lack the authority to hear and decide Petitioner's claim to equitable
relief based on estoppel. On several previous occasions, I have held that I lack the authority to decide claims of estoppel in cases involving the manner in which HCFA allegedly has processed applications for provider certification. T.L.C. Mental Health Center, DAB CR636 (1999); GranCare Home Health Service & Hospice, DAB CR464 (1997); The Rivers Health Care Resources, Inc., DAB CR446 (1996); SRA, Inc. d/b/a St. Mary Parish Dialysis Center, DAB CR341 (1994). As I explain above, at Finding 3 of this decision, my authority in a case involving HCFA is limited to hearing and deciding whether any of those determinations that are described in 42 C.F.R. �� 498.3 and 498.5 was made correctly by HCFA. My authority to hear and decide a case involving HCFA does not extend to awarding money damages based on principles of estoppel. Petitioner has offered no argument here which would give me reason to revisit my previous decisions that I lack the authority to hear and decide estoppel arguments.
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JUDGE | ||||||||
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