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Methodist Medical Center v. Ingram

OPINION FILED NOVEMBER 18, 1980.

THE METHODIST MEDICAL CENTER OF ILLINOIS, APPELLANT,

v.

ROBERT L. INGRAM, TOWNSHIP SUPERVISOR, APPELLEE.



Appeal from the Appellate Court for the Third District; heard in that court on appeal from the Circuit Court of Tazewell County, the Hon. Charles J. Perrin, Judge, presiding.

MR. JUSTICE UNDERWOOD DELIVERED THE OPINION OF THE COURT:

Plaintiff, the Methodist Medical Center of Illinois (hereinafter referred to as the Center), brought this action in the circuit court of Tazewell County against Robert L. Ingram, supervisor of general assistance for Groveland Township, to recover charges of $3,545.80 for medical services which it provided to Robert L. Hunt III, a minor son of Robert L. Hunt, Jr. The circuit court granted plaintiff's motion for summary judgment. Defendant appealed and the appellate court reversed (78 Ill. App.3d 944). We granted the Center's petition for leave to appeal.

The issues in this case arise in connection with the operation of this State's system of providing aid to the medically indigent as set forth in article VII of the Illinois Public Aid Code (Code) (Ill. Rev. Stat. 1977, ch. 23, par. 7-1 et seq.), which requires townships and other local governmental units to assist those unable to finance necessary medical care. Eligibility for assistance is determined in accordance with statewide standards established by the Department of Public Aid (Department) (Ill. Rev. Stat. 1977, ch. 23, pars. 7-1, 7-2). Section 7-2 of the Code also requires that in determining eligibility the amount which the applicant can contribute to the cost of necessary care is to be computed according to departmental standards. For those eligible, assistance can then be given in an amount equal to the difference between the amount which the applicant can contribute and the amount to which the hospital is entitled pursuant to a per diem rate determined by the Department. That per diem rate is at the heart of this controversy. It is apparently computed by the Department pursuant to the provisions of sections 5-5 and 5-7 of article V of the Code (Ill. Rev. Stat. 1977, ch. 23, pars. 5-5, 5-7). It is used, however, as a basis for payment of all in-patient hospital care furnished under the Code. A separate computation is made annually for each hospital from data contained in the annual reports filed by each hospital; these reports may be amended quarterly if desired. The per diem rate so computed is somewhat lower than the hospital's usual and customary charges. Inflation, coupled with the fact that the rate is based upon the hospital's costs for the preceding year, widens the gap between the per diem rate and the hospital's customary charges. Aggravating the problem, it is said, is the absence from the article VII system of payments of the year-end two-way reconciliation of accounts which occurs under article V. Federal funds are used and Federal regulations apply to assistance given under article V, which concerns medical care for those already receiving financial assistance under other programs. Those regulations require the Department, in cases where the operating costs of the hospital have not been met, to reimburse the hospital for any deficit (apparently the difference between the per diem rate and a rate sufficient to pay the operating costs). Conversely, if the hospital has been overpaid, it must refund the overpayment to the Department. Under article VII, however, State and local funds are used; if the hospital is overpaid, refund to the State is required; but, if the per diem rate payments are insufficient to cover the actual operating costs of the hospital, no additional reimbursement is made. The resulting deficit spawned this litigation and other litigation pending in other courts> of this State.

Article V of the Code is captioned "Medical Assistance." It is referred to in the briefs as providing a State "Medicaid" program, and its stated purpose is "to provide a program of essential medical care and rehabilitative services for persons receiving basic maintenance grants under this Code and for other persons who are unable, because of inadequate resources, to meet their essential medical needs" (Ill. Rev. Stat. 1977, ch. 23, par. 5-1). It seems to be undisputed that sections 5-5 and 5-7 of article V authorize the Department's per diem rate for use in connection with medical care and services furnished under that article. Article VII is captioned "Local Aid To The Medically Indigent." It does not contain the express authority found in section 5-5 to "determine the quantity and quality of the medical assistance for which payment will be authorized" (Ill. Rev. Stat. 1977, ch. 23, par. 5-5) nor the authority to negotiate fees and rates contained in section 5-7 (Ill. Rev. Stat. 1977, ch. 23, par. 5-7). It is plaintiff's position that the per diem rate computed pursuant to the authority contained in article V cannot be applied to hospital charges for care furnished under article VII in the absence from the latter article of the express authority contained in the former. We do not agree.

In this case Robert L. Hunt III, a resident of Groveland Township, received medical care, part of which was of an emergency nature, at the Center from December 26, 1977, to January 12, 1978. His father, Robert L. Hunt, Jr., applied for assistance in paying his son's bill. The Center forwarded the application to Supervisor Ingram, who determined that the Hunts were qualified for assistance under article VII of the Illinois Public Aid Code (Ill. Rev. Stat. 1977, ch. 23, par. 7-1 et seq.), that the 17 days of care at the Center should be reimbursed to the extent of $2,747 (which is, to the nearest dollar, 17 times $161.60, which Ingram believed to be the "per diem" rate specified for the Center in the Department regulations) and that Hunt had "available" resources of $2,156. Ingram tendered the Center $591 in full payment of the bill, after deducting the $2,156 which the Center could obtain from Hunt pursuant to section 11-13 of the Code (Ill. Rev. Stat. 1977, ch. 23, par. 11-13). Section 11-13 bars a supplier who accepts a direct Department payment on behalf of an aid recipient from recovering any additional payment except the amount which the Department's regulations specify is to be met from the aid recipient's "available" income and resources. The Center refused to accept Ingram's payment and instituted this action.

Plaintiff has cited in support of its position only four cases: Sisters of the Third Order of St. Francis v. Groveland Township (1972), 7 Ill. App.3d 278; Pekin Memorial Hospital v. Shilling (1970), 121 Ill. App.2d 473; St. John's Hospital v. Town of Capitol (1966), 75 Ill. App.2d 222, and Rockford Memorial Hospital Association v. Whaples (1960), 25 Ill. App.2d 79, none of which discusses the issue here. Plaintiff apparently refers to these four cases because they involve judgments for the full amount of the hospital charges. That is totally unpersuasive, however, for the hospital services in each of those cases were furnished long prior to November 1, 1971, the date upon which use of the per diem rate was apparently first required. Nor do we regard Bio-Medical Laboratories, Inc. v. Trainor (1977), 68 Ill.2d 540, as indicating the absence of departmental authority to adopt the challenged regulations. We there held the Director of the Department could not suspend vendors from participation in the medical assistance program because of the total absence from the statute of any indication of an intent to confer such authority and the presence of provisions delegating enforcement responsibilities to others.

Neither the parties nor amici, the State of Illinois, the Illinois Hospital Association and St. Mary's Hospital of East St. Louis, Illinois, Inc., have cited, nor have we found, any Illinois authority on the precise issue before us. Consequently, its resolution must depend upon the legislative purpose and intent to be gleaned from the statutory language.

The pertinent sections of article VII demonstrate the General Assembly's intent to therein provide for only such assistance as may be necessary to provide needed care for those eligible persons whose financial resources are inadequate and who are not receiving assistance under some other public program. Section 7-2 is particularly relevant to our issue. It provides:

"The person shall be given such care as may be necessary and proper, including transportation, and if he dies he shall be decently buried.

The amount and nature of the care provided shall be determined in accordance with a uniform standard of eligibility established by the Illinois Department and its rules and regulations. However, the amount and nature of any such care is not affected by the payment of any grant under the `Senior Citizens and Disabled Persons Property Tax Relief Act'. The standard shall include provision for determining what, if any, portion of the income, property or other resources of an applicant or recipient is available to meet the cost of necessary care. However, a local governmental unit not receiving State funds for purposes of this Article may prescribe a uniform standard of eligibility according to local conditions. Such locally prescribed standards may be less, but not more, restrictive than the uniform standard of eligibility established by the Illinois Department." (Ill. Rev. Stat. 1977, ch. 23, par. 7-2.)

This section contemplates that eligible persons be given "such care as may be necessary and proper," i.e., proper under the uniform standard the section requires the Department to formulate. The Department's standard is to determine "[t]he amount and nature of the care provided." The statement, "The standard shall include provision for determining what, if any, portion of the income, property or other resources of an applicant or recipient is available to meet the cost of necessary care" indicates that the standard is to include, but is not to be limited to, income limits of eligibility. Rather, section 7-1.2 indicates that one means by which the Department may regulate the "amount and nature of the care provided" pursuant to section 7-2 is by defining the "cost of necessary care":

"The money, property, or other resources available to the person, including support available from legally responsible relatives, must be insufficient to meet the costs of necessary care, as defined by standards established in accordance with Section 7-2 of this Article. The eligibility of any applicant for or recipient of public aid under this Article is not affected by the payment of any grant under the `Senior Citizens and Disabled Persons Property Tax Relief Act.'" Ill. Rev. Stat. 1977, ch. 23, par. 7-1.2.

The word "defined" can be reasonably read as referring only to "costs of necessary care," the nearest words. It would be a strained reading of the section to do otherwise. The regulatory scheme provided by article VII is that the local governments will provide "aid" in meeting "costs of necessary care," as that term is defined in regulations of the Department pursuant to section 7-2, in order that all eligible persons in the State be given "such care as may be necessary and proper" under statewide supervision by the Department.

Article XII of the Illinois Public Aid Code (Ill. Rev. Stat. 1977, ch. 23, par. 12-1 et seq.), which deals more generally with the Department's responsibility for the administration of the Illinois Public Aid Code, also indicates that the Department ...


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