Judge deals another blow to La. in its unpaid Medicaid bill fight

Louisiana has lost another round in its fight to avoid paying a long overdue, multimillion-dollar Medicaid bill. In February, U.S. District Judge Brian Jackson granted summary judgment against the state in a lawsuit it filed in 2011, upholding a U.S. Department of Health and Human Services finding that Louisiana must repay the federal government $239 million in overpayments. At issue are federal funds Louisiana received for nine charity hospitals operated by LSU between 1996 and 2006 to treat Medicaid beneficiaries and uninsured patients. The U.S. Department of Health and Human Services advanced funds to the state on a quarterly basis, based on estimated expenses. Once actual costs were determined, Louisiana was supposed to return any overpayment within 60 days, which it did not do. Attorneys representing the Louisiana Department of Health & Hospitals had hoped the judge would deem the bulk of the debt “uncollectible” in light of the post-Hurricane Katrina closure of Charity Hospital in New Orleans, where a majority of eligible patients were treated. But the judge instead had a harsh response to the state’s argument that it should be allowed to keep the money. “Louisiana would have the court believe that the federal government would agree to a plan that allows a state to claim additional funding if it is underpaid, yet pocket excess funds when overpaid,” Jackson writes in his ruling. “It is well settled that states must follow the standards incorporated in their approved Medicaid plans and not unilaterally amend the language.” The state filed notice this week that it plans to appeal the case to the U.S. Court of Appeals for the Fifth Circuit. —Penny Font