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Welsh Wins Important Rulings for Medicaid Providers

On September 27, 2016, the Waukesha County Circuit Court ruled that the Wisconsin Department of Health Services may lawfully recoup past payments to Medicaid providers only if the Department cannot verify that the services were provided or if the Department determines that the amount paid was inaccurate or inappropriate for the services.

The Court also enjoined the Department from recouping Medicaid payments made to Medicaid-certified providers for medically necessary, statutorily covered benefits provided to Medicaid enrollees, based solely on findings of the provider's noncompliance with Medicaid policies or guidance where the documentation verifies that the services were provided.

Attorney Diane Welsh brought the suit on behalf of Professional Homecare Providers, a non-profit association of nurses who provide home-based care to patients with complex medical needs enrolled in the Wisconsin Medicaid program.

The decision is an important victory for Medicaid providers and Medicaid enrollees. It should rein in the Department's practice of seeking to recoup payments for full days, weeks, or even months of services from Medicaid providers for care that was indisputably provided, based on documentation errors and other minor noncompliance with thousands of program requirements. The court's ruling restricting the Department to its statutory authority should help ensure that Medicaid providers are not driven out of the program and that Medicaid enrollees have access to the care they need.

In a related, but different matter, Diane Welsh submitted an amicus brief on behalf of the Wisconsin Personal Services Association and the Wisconsin Association of Home Care in a Milwaukee County case in which the Department sought to recover over a million dollars from home health agency based largely on alleged documentation shortcomings.

The amicus brief explained the limits of the Department's statutory authority to recoup funds, argued that the Department's recoupment policy and practice exceeded the Department's statutory authority, and discussed the public policy concerns raised by the practice.

On September 7, 2016, the Milwaukee County Circuit Court ruled that the Department exceeded its legislative authority by its recoupment efforts. The Court stated, "Such recovery runs afoul of the spirit of the Medicaid program, which at some level, seeks to ensure that patients receive the level of care they require. Further, it is certainly foreseeable that such recovery action would have a chilling effect on the number of providers who choose to participate in the Medicaid program and consequently, hinder the effective care of Medicaid recipients."

Click on the following links to download PDFs of the above-referenced decisions and orders: Papa v DHS order.pdf / Quality Assurance Decision and Order.pdf.

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