CHICAGO, April 28, 2020 /PRNewswire/ -- Saint Anthony Hospital has filed suit against the state of Illinois in the U.S. District Court for the Northern District of Illinois, seeking overdue reform of the State's Medicaid reimbursement system.
Saint Anthony was forced to take the state to court yesterday to continue providing essential services to patients on Chicago's West and Southwest Sides who otherwise would lack access to healthcare, including children, low-income uninsured and other vulnerable populations.
"We believe that, regrettably, the Pritzker Administration inherited a broken Medicaid reimbursement system from the Rauner Administration. Saint Anthony Hospital was left with no alternative except to sue the state after negotiations with the Illinois Department of Healthcare and Family Services (HFS) hit what appears to be a dead end," said Saint Anthony President and CEO Guy A. Medaglia.
"Saint Anthony needs disclosure by the state to open to public view the opaque systems used to pay safety net hospitals like Saint Anthony for Medicaid Services and uncompensated care. It needs to be paid the approximately $42 million it is owed as a result of the lack of transparency and accountability from the state and its Managed Care intermediaries. It needs emergency reimbursement to help keep the doors open," he said
"Gov. J.B. Pritzker did not create this broken system, but hopefully he can fix it. Saint Anthony Hospital had no choice other than to sue the state in federal court to protect the vulnerable, largely Hispanic and African American patients for whom we provide essential care to on the West and Southwest Sides of Chicago. We continue to hope for an amicable resolution," Medaglia said.
"The COVID-19 pandemic makes our situation more urgent because the community we serve is a hotspot within a hotspot. That has put even greater demands on the hospital. We credit Gov. Pritzker with proactively managing the state's pandemic response, but the state's recruiting away of some of our nursing staff to the temporary McCormick Place field hospital with much higher salaries has been an unintended double hit for Saint Anthony and our patients," he said.
Saint Anthony's lawsuit, which names Theresa Eagleson in her capacity as HFS director, includes the following:
- A request of the Court to order the State and the managed care organizations with which the State contracts (MCOs) to provide transparency in their programs and payments so Saint Anthony can ensure it is receiving all applicable amounts due to safety net hospitals like Saint Anthony, which take all patients without ability to pay for care.
- A request of the Court to require the state to cause MCOs to pay Medicaid claims as required by Federal law. Federal and state laws require the State to ensure that the MCOs timely and properly make these payments to providers like Saint Anthony. Neither the MCOs, which are agents of the State, nor the State are meeting their obligations.
- The complaint states that the MCOs have systematically delayed and denied claims without justification, failed to pay undisputed claims, and when payments are made, they refuse to provide the detail necessary for Saint Anthony to determine if it is receiving proper payment or, if not, why not. Other safety net hospitals face the same problems. When asked by the Department to provide this detail to the providers, several large MCOs have admitted that they cannot do so. The MCOs appear to operate on a "squeaky-wheel" principle: whichever hospital raises the loudest outcry gets paid something, but not necessarily what it was owed.
- To ensure timely payment of claims, the Medicaid law requires that the states ensure payment on 90% of all clean claims submitted by certain providers within 30 days and 99% of all clean claims submitted by such providers within 90 days. A clean claim is generally one that can be processed without the need to obtain additional information from the provider or a third party.
- When Saint Anthony asks for explanations from MCOs and from the State about payment delays and amount of reimbursement, it often gets the run-around. Transparency is woefully lacking. The MCOs often do not even tell it which claims were not paid in full or the reasons for such underpayments.
- The complaint states that from 2015 (when the shift to the MCOs accelerated) to 2019, Saint Anthony's cash on hand has fallen approximately 98%: from over $20 million (enough to fund 72 days of operation) to less than $500,000 (less than 2 days). Much of this decrease is due to the unnecessary and often unexplained delays in payments, and lack of consistency and rationale, on the part of the MCOs, and the State's failure to ensure that the MCOs comply with express Medicaid obligations regarding payment of claims.
The Complaint also alleges:
- " . . . the State, through HFS, has failed to comply with its obligations under the federal Social Security Act and implementing regulations with regard to the operation of the State's Medicaid program that are meant to protect the finances of safety-net health care providers like Saint Anthony, and thus assure their ability to provide necessary medical services to their patient cohort."
- "Under former Governor Rauner's administration, the State aggressively shifted its Medicaid reimbursement process by contracting with private healthcare insurance companies—generally referred to as managed care organizations or MCOs — rather than administering Medicaid reimbursement itself. "
- "The State pays MCOs billions of federal and State Medicaid dollars and entrusts them with ensuring that the most vulnerable patient populations are provided necessary medical care, and that health care providers are compensated for their services on a fair and timely basis."
- ". . . before the Rauner administration instituted the expanded and overhauled managed care regime, Saint Anthony achieved a high and predicable level of Medicaid reimbursement from the State when the State administered a direct payment system. Saint Anthony has not materially changed its billing practices or provision of care. It follows the same procedures for reimbursement from MCOs but is not getting paid either as promptly or as fully as it was under the prior system."
- As a result, "Saint Anthony has to wait anywhere from 90 days to 2 years to be paid for services provided to these patients, all while still timely making payroll and struggling to pay its vendors. The guesswork and lack of transparency makes it impossible to know if Saint Anthony has been paid properly. What is known, however, is the bottom line: Saint Anthony is being paid much less than before the Medicaid managed care expansion under the prior administration."
Prior to filing the suit, Saint Anthony had made a number of good-faith attempts to work with the MCOs, HFS and the state to resolve these issues.
The Center for Medicaid and Medicaid Services (CMS) scores Saint Anthony Hospital in the top 10th percentile in the state and first in Chicago for "Patient Safety" and first in Chicago for "Total Performance," based on quality of care, patient safety, cost and patient experience measures. These scores, considered excellent for any community hospital, are almost unheard of for a safety net hospital. In addition, Saint Anthony is the only hospital in Chicago to be awarded the Perinatal Certification by The Joint Commission, received the Partners in Progress Award in 2018 and 2019 as part of the Illinois Health and Hospital Association's Innovation Challenge and is a CMS five-star-rated dialysis center.
Links to Filings: https://ecf.ilnd.uscourts.gov/cgi-bin/login.pl. Login via Pacer and access Docket Number 20-cv-02561.
About Saint Anthony Hospital
For more than a century, Saint Anthony Hospital has been a community‐centered organization, serving more than 400,000 residents on Chicago's West and Southwest Sides. Saint Anthony Hospital, its affiliated clinics and community wellness centers provide quality health and wellness services, as well as a wide variety of free bilingual community health education and outreach programs.
SOURCE Saint Anthony Hospital