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FRANKFORD HOSPITAL v. COMMONWEALTH PENNSYLVANIA (05/24/85)

decided: May 24, 1985.

FRANKFORD HOSPITAL, PETITIONER
v.
COMMONWEALTH OF PENNSYLVANIA, DEPARTMENT OF PUBLIC WELFARE, RESPONDENT



Appeal from the Order of the Department of Public Welfare in the case of Appeal of: Frankford Hospital, Torresdale Division, Re: Jackie Hamilton, Case No. 09-0128512; Susan Grohman, Case No. 51-1420105; and Nancy McCreary, Case No. 51-1588808, dated October 4, 1983.

COUNSEL

Martin G. Goch, Greenstein, Gorelick, Price, Silverman & Laveson, for petitioner.

Bruce Baron, with him, John Kane and Jeffrey Gonick, Assistant Counsels, for respondent.

Judges MacPhail, Barry and Palladino, sitting as a panel of three. Opinion by Judge Barry. Judge Williams, Jr., did not participate in the decision in this case. Judge MacPhail dissents.

Author: Barry

[ 89 Pa. Commw. Page 523]

This appeal results from an order of the Department of Public Welfare (DPW), which refused reimbursement to Frankford Hospital (petitioner) for services which petitioner provided to three medical assistance patients. Each of the three patients were admitted to the hospital for emergency surgical procedures. Because of various reasons, none of these patients were admitted into the Short Procedure Unit, which would have been the appropriate unit of the hospital to receive these admissions. The patients were admitted as inpatients and each of them was discharged from the hospital less than twenty-four hours after their admission.

Petitioner then sought payment from DPW for the services provided to these medical assistance patients. DPW denied payment, relying on a number of its regulations. This appeal followed.

Our scope of review on appeal from a determination of an administrative agency is limited to determining

[ 89 Pa. Commw. Page 524]

    whether the adjudication is supported by substantial evidence, whether the petitioner's constitutional rights have been violated and whether an error of law has been committed. Montgomery County Child Welfare Services v. Hull, 51 Pa. Commonwealth Ct. 1, 413 A.2d 757 (1980), 2 Pa. C.S. § 704. In this case, petitioner argues that DPW committed an error of law in applying the following applicable statutes and regulations. Section 443.1 of the Public Welfare Code, Act of June 13, 1967, P.L. 31, as amended, 62 P.S. § 443.1 (Supp. 1984-85) (emphasis added), provides, "The following medical assistance payments shall be made in behalf of eligible persons whose institutional care is prescribed by physicians: (1) The reasonable cost of inpatient hospital care . . . for a bed patient on a continuous twenty-four hour basis in a multi-bed accommodation of a hospital. . . ." Furthermore, Section 9421.1 of the Medical Assistance Manual defines inpatient hospital care "as room, board and professional services furnished to a patient on a continuous twenty-four hour a day basis. . . ." (Emphasis added.) DPW's denial of payment to petitioner for the three patients in question is based on the fact that, while the services provided were medically necessary, the patients did not remain in the hospital for at least twenty-four hours, and therefore petitioner is not entitled to reimbursement for inpatient hospital care. Petitioner asserts that this interpretation is plainly erroneous and inconsistent with the purposes of the Medical Assistance program. We agree and accordingly must reverse.

In Department of Public Welfare v. Forbes Health System, 492 Pa. 77, 81, 422 A.2d 480, 482, the court stated:

In reviewing an administrative agency's interpretation of its own ...


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