Appeal from the Order of the Department of Public Welfare in case of Appeal of: Forbes Health System and Geoffrey M. Hosta and Associates, dated November 14, 1977.
William J. McCormick, with him Moorhead & Knox, for petitioner.
Betty F. Perry, Assistant Attorney General, for respondent.
James H. Stewart, Jr., and Nauman, Smith, Shissler & Hall, for amicus curiae, The Hospital Association of Pennsylvania.
President Judge Bowman and Judges Crumlish, Jr., Mencer, Blatt, DiSalle, Craig and MacPhail. Judges Wilkinson, Jr. and Rogers did not participate. Opinion by Judge MacPhail.
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Forbes Health System (Forbes) and Geoffrey M. Hosta and Associates (Hosta) appeal to this Court
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from a decision of the Department of Public Welfare (DPW) denying them Medicaid reimbursement to which, they contend, they are entitled.
The facts of this case are not in dispute. Forbes is a non-profit Pennsylvania corporation which, at the time this case arose, operated two hospitals with emergency rooms in the Pittsburgh area. Hosta is a California based association which retains local physicians to provide emergency room physician services for hospitals.
Since 1966, DPW, under the provisions of Title XIX of the Social Security Act, 42 U.S.C. § 1396 et seq. (commonly referred to as Medicaid), has been making payments to providers of medical services to the categorically needy and the medically needy citizens of Pennsylvania. To implement the provisions of Section 443.3 of the Public Welfare Code, Act of June 13, 1967, P.L. 31, as amended, added by Section 5 of the Act of July 31, 1968, P.L. 904, as amended, 62 P.S. § 443.3 relating to payments for out-patient services, DPW promulgated Section 9412 of its Medical Assistance Manual (Manual) setting forth the circumstances under which DPW would make Medicaid payments and prescribing the amounts of such payments. In the Manual, Section 9412 is under the general heading "Clinics."
At issue in the instant case are charges made for emergency room services to out-patients at the two hospitals operated by Forbes. Prior to August 1, 1974, Section 9412.76 of the Manual prescribed a $6.00 fee for emergency room services. As revised on August 1, 1974, Section 9412.76 reads as follows:
Emergency Room Service Fee. . . . [$]9.00
Independent, private physicians are permitted to bill for certain selected services performed in the emergency room of a hospital on an outpatient basis. When these services
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are provided, the hospital will be reimbursed $9.00 for the use of the emergency room. ...