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Grane Hospice Care, Inc. v. Department of Public Welfare

Commonwealth Court of Pennsylvania

July 25, 2013

Grane Hospice Care, Inc., Petitioner
Department of Public Welfare, Respondent

Argued: April 16, 2013




Grane Hospice Care, Inc. petitions for review of an adjudication of the Department of Public Welfare directing it to reimburse the Department $71, 630.25. This amount represented payments the Department made to Grane Hospice for 18 months of service it provided to R.H. (Patient) who was enrolled in Medical Assistance. The Department ordered this reimbursement because it found that Patient was not at the end of his life and, thus, the hospice services he received in his home were not medically necessary. Grane Hospice counters that it complied with the regulation relating to the determination of an individual's eligibility for hospice care and that no one can know with certainty whether a person will die within six months. Concluding that the record established that Grane Hospice complied with the regulations for determining eligibility for hospice care, we reverse the Department's adjudication.

Grane Hospice provides hospice care to terminally ill patients. Under the Medical Assistance regulations, an individual is considered "terminally ill" if he "has a medical prognosis that his life expectancy is 6 months or less." 55 Pa. Code §1130.3. Grane Hospice is enrolled in the Medical Assistance Program and receives payment from the Department for providing hospice care to eligible Medical Assistance recipients.

Grane Hospice admitted Patient to its care on October 23, 2008, and continued to provide him hospice care until April 15, 2010. It then admitted Patient for hospice care a second time, for a period from August 19, 2010, through February 28, 2011. The Department paid Grane Hospice for both periods of care. Thereafter, it reviewed Grane Hospice's records and determined that Patient should not have been admitted to Grane Hospice either time. On December 11, 2011, the Department sent a letter to Grane Hospice demanding, inter alia, reimbursement of $71, 630.25, for the first period of care and $26, 804.65 for the second period. Grane Hospice appealed, and a hearing was held by the Department's Bureau of Hearings and Appeals.

In its demand letter, the Department cited a number of state and federal regulations to support its claim for reimbursement from Grane Hospice regarding eight different Medical Assistance patients who had lived longer than six months.[1] By the time of Grane Hospice's appeal, it was clear that the Department's claim with regard to its services for Patient was reduced to one, i.e., that Grane Hospice had admitted Patient without reviewing his pre-admission medical records. The Department argues that it was the duty of the medical director of Grane Hospice to do an independent evaluation of Patient's attending physician's diagnosis by reviewing Patient's prior medical records. Had the medical director done so, he would have discovered that Patient's records did not support the attending physician's diagnosis that Patient would die within six months.

At the hearing, the Department presented the telephonic testimony of Dr. Mark Bates. He explained that the New York Heart Association categorizes heart disease into four classes. To be a hospice patient, there must be a reasonable expectation of death within six months. For heart disease patients, this means they must be diagnosed as having a disease at the Class IV level. Class IV heart disease is diagnosed when the patient is unable to carry out any physical activity without symptoms. Even at rest, there is shortness of breath. The patient is bedbound or able to move only from the bed to a chair. A normal heart has an ejection fraction rate of 60-65%; an end stage cardiac patient has an ejection fraction rate of 20% or less. The patient requires maximal medical management by diuretics and vasodilators.

Dr. Bates reviewed Patient's medical records, obtained from several different providers. He testified about the contents of those medical records.[2]

On March 28, 2008, Patient experienced a heart attack at the tip of the heart. At that time, his ejection fraction equaled 40%. Patient then underwent bypass surgery and a valve replacement. He suffered a mild stroke after the surgery. Patient's post-surgery medical records, dating to five months before his admission to Grane Hospice, reported that the middle structures in his chest were normal; his pulmonary vasculature was normal; and there was no fluid in the lungs. Stated otherwise, there was no evidence of end stage cardiac disease at this point in time.

Patient's medical records of September 2, 2008, six weeks before his hospice admission, reported complaints of chest pain, but his cardiologist determined their cause was not cardiac. He referred Patient to a gastroenterologist for an endoscopy. The cardiologist's records also showed that Patient's heart and lung exams were normal; that there was no evidence of fluid building up; and that there was no swelling of the extremities. Patient's ejection fraction was listed as normal. His congestive heart failure was listed as between Class I and II. A patient at Class II heart disease is comfortable at rest with only slight restrictions on physical activity. The cardiologist reduced Patient's diuretic.

On October 20, 2008, three days before his admission to Grane Hospice, Patient had a check-up with Dr. Gates. Dr. Bates testified that he believed Dr. Gates was Patient's family physician, but he was not certain. Dr. Gates' check-up reported a normal cardiovascular examination. Three days later, however, Dr. Gates signed a certification of terminal illness with a diagnosis of "end stage cardiac." R.R. 121a.

Based on these above-described medical records, Dr. Bates opined that Patient did not have a terminal illness when admitted to hospice care; rather, his condition was stable. Patient's medical records did not report an event that would have caused his diagnosis to fall from Class II to Class IV cardiac disease in the few days before his admission as a patient of Grane Hospice.

Grane Hospice presented the testimony of Dr. Thomas Mextorf, its medical director during the period in question.[3] He agreed that under the Medical Assistance guidelines Class IV cardiac disease must be established for a heart-related terminal illness. He also agreed with Dr. Bates' discussion of end stage cardiac disease but he added that there are several types of end stage heart disease. They include ischemic heart ...

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