The state's nursing home industry has filed a lawsuit claiming the California Department of Health Services underpaid long-term care facilities by at least $54 million for their care of Medi-Cal beneficiaries in 2001-2002.
The California Assn. of Health Facilities, which represents 1,400 long-term care homes, says the state did not pay nursing homes and facilities for the developmentally disabled enough money to cover higher costs associated with energy, workers' compensation and liability insurance.
The lawsuit contends that the state health department knew about those increased costs but acted "arbitrarily and capriciously" in not paying nursing homes for them. The trade group is asking a Superior Court judge in San Francisco to order the state to repay facilities at least $2.16 per patient per day to offset the cost increases for care provided between Aug. 1, 2001, and July 31, 2002, totaling $54.6 million.
"Basically, we've seen total operating costs that have escalated at rates of 20% over the past two years, and we've received a little under 3% from the state," said Darryl Nixon, director of reimbursement and fiscal programs for the health facilities association.