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CITIZENS GENERAL HOSPITAL NEW KENSINGTON v. COMMONWEALTH PENNSYLVANIA (06/09/81)

decided: June 9, 1981.

CITIZENS GENERAL HOSPITAL OF NEW KENSINGTON, PENNSYLVANIA, PETITIONER
v.
COMMONWEALTH OF PENNSYLVANIA, DEPARTMENT OF HEALTH AND ARNOLD MUELLER, J.D., SECRETARY OF HEALTH, RESPONDENTS



Original jurisdiction in the case of Citizens General Hospital of New Kensington, Pennsylvania v. Commonwealth of Pennsylvania, Department of Health and Arnold Mueller, M.D., Secretary of Health.

COUNSEL

Rod J. Pera, McNees, Wallace & Nurick, with him George W. Lamproplos, Cassidy & Lamproplos, for petitioner.

Ruth M. Siegel, with her Carolyn B. McClain, for respondents.

President Judge Crumlish and Judges Wilkinson, Jr., Rogers, Blatt, Craig, MacPhail and Williams, Jr. Judges Mencer and Palladino did not participate. Opinion by Judge Craig. Judge Wilkinson, Jr. did not participate in the decision of this case. Dissenting Opinion by Judge Williams, Jr.

Author: Craig

[ 59 Pa. Commw. Page 550]

Directed to our original jurisdiction, Citizens General Hospital of New Kensington (hospital) has filed a petition for review in the nature of an action for a peremptory mandamus. Named as respondents are the Pennsylvania Department of Health (department) and its Secretary. The hospital seeks an order directing the department to issue a recommendation of approval as to a proposed capital project, so that the hospital can obtain capital reimbursement pursuant to Section 1122 of the Federal Social Security Act.*fn1 The department is the designated planning agency administering the Section 1122 program in Pennsylvania, and the recommendation of the department is virtually a sine qua non of obtaining reimbursement. The respondents have filed preliminary objections requesting that the suit be dismissed.

The averments are that on August 1, 1978, the hospital filed its application for capital reimbursement with the Health Systems Agency of Southwestern Pennsylvania (HSA), agent for the department. The petition avers that the hospital subsequently augmented the application with additional information, as requested.

[ 59 Pa. Commw. Page 551]

On March 29, 1979, the HSA recommended approval. The petition avers that the deadline for the department recommendation expired before April 13, 1979, but also notes an agreement to extend the deadline (allegedly ineffective) to April 27, 1979. The petition avers that, on the latter date, the hospital learned only by telephone that the department was not going to recommend approval of the project. According to the petition, the hospital did not receive written notification (allegedly required) of the department's negative recommendation until April 30, 1979.

Under Pennsylvania regulations at 28 Pa. Code § 401.6(a)(6)(8), following federal regulations at C.F.R. § 100.106(a)(4), the department, as the designated planning agency, is required to give written notice within 90 days of receiving a proposal, if the department determines that the proposed capital expenditure does not meet required standards for reimbursement. This regulation further provides that a failure of the designated planning agency to give such notification within the 90 days will have the effect of a recommendation of approval. Contending that the department's written notice of disapproval came after the required 90-day period, the hospital avers that it was entitled to a recommendation of approval from the department by force of law.

The department's preliminary objections, relying upon Canonsburg General Hospital v. Department of Health, 51 Pa. Commonwealth Ct. 156, 422 A.2d 141 (1980), assert that the hospital's petition should be dismissed for failure to pursue remedies available under state and federal law and regulations.

First, we consider the hospital's pursuance of state remedies. At the outset, this case is different from Canonsburg in the fact that here no question remained as to the completeness of the application, so that ...


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