Whitesburg KY

ARH sues West Virginia over Medicaid payments


Appalachian Regional Healthcare made good on its threat to sue the state Department of Health and Human Resources over what it claims are inadequate Medicaid payments that threaten the fiscal health of one of its hospitals.

The health care system filed a 30-day notice of intent to sue in November, saying it would be forced to seek relief if DHHR didn’t adjust its rates to treat lowincome and disabled residents at Beckley ARH. The lawsuit announced Tuesday was filed Monday in Kanawha County Circuit Court.

The DHHR has had a change in leadership since the November notice was filed. Acting Gov. Earl Ray Tomblin named Dr. Michael Lewis to head the agency. Lewis and Bureau for Medical Services Commissioner Nancy Atkins are named in the lawsuit.

“We hope he (Lewis) is aware of the situation providers are in when it comes to Medicaid patients,” ARH attorney Steven Price said Tuesday. “Everyone’s goal is to make sure Medicaid patients are being taken care of.”

Price said the company talked with DHHR officials last week, but decided to file the lawsuit.

A second ARH hospital based in South Williamson, Ky., may join the lawsuit because it also treats a high percentage of West Virginia Medicaid patients, he said.

Agency spokeswoman Marsha Dadisman declined comment because of the litigation, but confirmed the two sides have been talking.

Medicaid is a federalstate program that provides health care to low-income families with children, the blind and disabled, the needy and the aged. About 346,600 West Virginians are covered by the program.

About 22 percent of Beckley ARH’s patients are covered by Medicaid. The 173-bed hospital provides acute and psychiatric services to southern West Virginia residents.

The state receives a federal match for every dollar it provides to Medicaid expenses. The lawsuit says during the 12-month period that ended June 30, 2009, West Virginia’s Medicaid expenses totaled more than $2.4 billion. Of that, $680 million came from the state and the rest from the federal government.

During the same period, the hospital provided $14.7 million in services to Medicaid patients, but was only paid $9.9 million, the lawsuit said.

Kentucky-based Appalachian Regional Healthcare operates nine hospitals, including Whitesburg’s.

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