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CAMPBELL'S PERSONAL CARE v. THOMPSON

April 22, 2003

CAMPBELL'S PERSONAL CARE AND MAE C. CAMPBELL, PLAINTIFFS,
v.
TOMMY THOMPSON, SECRETARY OF THE UNITED STATES DEPARTMENT OF HEALTH AND HUMAN SERVICES, AND BLUE CROSS BLUE SHIELD OF ILLINOIS, D/B/A THE HEALTH CARE SERVICE CORPORATION, DEFENDANTS.



The opinion of the court was delivered by: Ruben Castillo, United States District Court Judge

MEMORANDUM OPINION AND ORDER

Plaintiffs Campbell's Personal Care ("CPC") and Mae C. Campbell seek review under 42 U.S.C. § 1395oo(f) of the decision of the Medicare Provider Reimbursement Review Board ("PRRB") affirming the Department of Health and Human Services' decision to reimburse a lower number of payments than CPC believes is due for services rendered in 1995. Currently before this Court are Plaintiffs' and Defendants' motions for summary judgment pursuant to Federal Rule of Civil Procedure 56. Because the PRRB's decision was supported by substantial evidence on the record as a whole, we grant Defendants' motion for summary judgment, (R. 24-1), and deny Plaintiffs' motion for summary judgment, (R. 27-1).

RELEVANT FACTS

CPC, a home health care agency owned and operated by Ms. Campbell, has been a provider of Medicare services since 1988. CPC mainly provided services to Chicago's indigent population. CPC maintains that not all of its claims for home health visits in 1995 were processed and that Defendants therefore undercounted and did not reimburse CPC for the correct number of visits.

I. The Medicare Reimbursement Process

Under the Medicare statute, home health agencies such as CPC enter into provider agreements with the Secretary of Health and Human Services ("Secretary"). 42 U.S.C. § 1395cc. The Secretary contracts with fiscal intermediaries that pay providers the "reasonable cost" of services supplied to Medicare beneficiaries. 42 U.S.C. § 1395f(b)(I). In order to determine the "reasonable cost" of services rendered, the provider must supply the Secretary or fiscal intermediary with data in a cost report on a regular basis. The provider is required to keep financial records that can be used to calculate the amount of reimbursement. 42 C.F.R. § 413.20 (a). These records must be of such quality that the data can be verified by auditors if necessary. 42 C.F.R. § 413.24 (a).

As part of the reimbursement process, the intermediary generates a document called the Provider Statistical and Reimbursement System report ("PS&R"). The PS&R is a Medicare statistical report that assesses the accuracy of the provider's cost data. It lists all Medicare charges reported to the intermediary by the provider during each quarter. When the intermediary creates the PS&R, it also generates two statistical reports called the Payment Reconciliation Report and the Provider Summary Report. The Payment Reconciliation Report is a detailed report of claims accepted by the PS&R system, while the Provider Summary Report summarizes claim data for reimbursement purposes. The intermediary uses the Provider Summary Report to establish reimbursement amounts unless the provider furnishes proof that inaccuracies exist in that report.

Providers such as CPC receive estimated monthly payments. At the end of the year, the intermediary makes adjustments for any overpayment or underpayment. The intermediary analyzes the provider's annual cost report along with the PS&R to determine the correct amount of reimbursement due the provider.

II. Campbell's 1995 Costs

CPC maintains that its staff kept daily, weekly and monthly records of services that it provided in 1995. In order to be reimbursed for these services, CPC submitted claims electronically to its fiscal intermediary, Blue Cross Blue Shield of Illinois ("BCBS"), using the "Florida Shared System."*fn1 When BCBS paid a claim, CPC's staff updated its records to reflect the reimbursement.

CPC alleges that a number of visits provided in 1995 were never reimbursed by BCBS. At the PRRB hearing, Ms. Campbell testified that when BCBS failed to process a claim CPC would resubmit a claim through the Florida Shared System. If the claim did not get reimbursed again, Ms. Campbell contends that CPC mailed a hard copy of the bill to BCBS. According to Ms. Campbell, in January 1996 CPC sent BCBS all claims that had not yet been reimbursed from 1995. She testified that BCBS did not claim that these visits had not been provided or that they were not covered by Medicare.

In its 1995 cost report, CPC reported, based on its internal billing records, that it provided 7,344 total services. BCBS, using PS&R data generated in March 1997, concluded that only 5,769 visits should be reimbursed. CPC alleges that it notified BCBS by phone of the discrepancy between the PS&R data and its internal billing logs.

CPC filed an appeal to the PRRB in order to obtain reimbursement for the visits it alleges were provided and submitted to BCBS. It claimed before the PRRB that its internal billing data was more accurate than the PS&R data. CPC alleged that BCBS failed to process some of its claims and that BCBS also stopped paying claims for a number of months. CPC also alleged that BCBS did not send it the PS&R on a regular ...


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