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In re Fair Hearing Decision

Decided: January 8, 1976.

IN THE MATTER OF: FAIR HEARING DECISION IN THE CASE OF KING JAMES NURSING HOME RE: MARY NEMIS


Lynch, Larner and Fulop. The opinion of the court was delivered by Larner, J.A.D. Fulop, J.s.c. Temporarily Assigned (dissenting).

Larner

[138 NJSuper Page 419] This is an appeal from the determination of the Division of Medical Assistance and Health Services of the Department of Institutions and Agencies of the State of New Jersey (Division) rejecting a Medicaid claim asserted by King James Nursing Home (Home) under the

program established by N.J.S.A. 30:4D-1 et seq. The claim was submitted for skilled nursing home services rendered to a patient, Mary Nemis, from July 12, 1972 to February 10, 1973. There is no dispute relating to the patient's eligibility for Medicaid assistance, the services rendered or the amount of the claim. The single basis for denial by the Division after an administrative hearing was the failure of the Home to submit the claim with accompanying documentation within six months from the "last day of the current billing month."

This six-month limitation is prescribed by Circular Letter No. 16 of the Division, dated December 7, 1971, as part of the administrative procedure established by the Division for governance of claims for Medicaid payments by nursing homes. The underlying legislation contains no provision for a limitation period for claims filed thereunder.

By virtue of directives issued by the Division a billing statement of a nursing home must be accompanied by a form designated as MCNH-7 and a status report reflecting whether the recipient is entitled to coverage under Medicare. Concededly, the procurement of form MCNH-7, which is an authorization for payment based upon welfare eligibility as determined by the county welfare board, is the responsibility of the Division, while the submission of the Medicare status report is the responsibility of the Home. Nevertheless, a directive of the Division instructs nursing care providers that form MCNH-7 must be submitted with the other billing forms for patients confined to a nursing home for more than 30 days.

The billing clerk of the Home testified that she had difficulty in obtaining the authorization form from the Middlesex County Welfare Board despite many contacts for that purpose. Nevertheless, on December 7, 1972 she forwarded the billing for Ms. Nemis to the Bureau of Claims and Accounts without that welfare authorization. Apparently the welfare board had the case registered in its records but did not comply with her request for the written authorization

form. She recognized that the billing documents of December 7, 1972 were not complete in this respect, and the Local Administrator of the Division testified that he could not proceed with a medical assessment without the welfare eligibility form.

When the Bureau received the billing it in turn forwarded to the Home a computerized error list dated December 8, 1972 which included, among others, the Nemis billing and stated "no status report," with no reference whatever to the welfare eligibility document or the MCNH-7 form. On March 1, 1973 the Home forwarded a letter demonstrating the Medicare status of the patient in substantial compliance with the "status report." At this time the Home did not resubmit a billing statement nor did it have for submission MCNH-7, although the evidence reflects that the Home had the Medicare status data as early as July 26, 1972.

Nothing further was done by the Home or the Division until the administrator of the Home wrote to the Division on March 11, 1974 requesting payment, pointing out that the patient was eligible, that the services were rendered, and that the delay was due in part to turnover of personnel at the Home and the Division.

A response to this resubmission was not forthcoming from the Division until November 13, 1974 when the Deputy Director advised the Home administrator that the claim was denied because it was not submitted within the six-month period set forth in Circular Letter No. 16. Thereafter, the Home requested a "Fair Hearing" by the Division, contending that "we did make a sincere effort to submit the proper claim and were unable to do so because we experienced difficulty in obtaining the necessary forms from the local Medical Assistance office." The hearing resulted in the affirmance of the denial and thereafter the pending appeal.

The Division rested its conclusion on the late filing of the status report, as well as the fact that its filing on March 1, 1973 was not accompanied by a new billing statement or MCNH-7. In ...


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