Dave Sotak, CEO of New River Health Association in Fayette and Raleigh counties, said Medicaid underpaid his association by about $315,000 in 2009 alone. New River had to extend a line of credit at the end of 2010 to meet its payroll, he said.
Rainelle Medical Center has come close to shutting its doors because of Medicaid underpayments, according to CEO Kristi Rader.
All this is happening while the state is depending on community health centers to serve tens of thousands more Medicaid patients through federal health care reform, Sotak said. "We can do that, and the state needs us to do that, but we've got to be paid at least cost."
In 2014, an estimated 125,000 more West Virginians will become eligible for Medicaid under health care reform. "Many will come to community health centers," Reese said. "That is a major reason why it is very important to resolve this payment issue now."
The centers are specifically asking the court to order Medicaid to pay the federally prescribed cost of dental work, vaccines and labs and to stop cutting off payment for psychological services after 10 visits.
They are also asking the court to order Medicaid to calculate payment rates by the formula prescribed by federal Medicaid law. At this point, Medicaid is using a formula borrowed from Medicare, which covers less, according to the lawsuit.
In her Jan. 21 letter, Perry said federal regulators said West Virginia Medicaid could use Medicare caps and screens if they conduct a thorough financial analysis, to determine appropriateness. According to the lawsuit, there is no evidence they have done so.
The lawsuit lists numerous meetings and other attempts by the centers to resolve the issues. "We've got a long record of trying to extend the olive branch," said Andy Wessels, Primary Care Association business director.
Medicaid now has a reserve surplus of $360 million, but Medicaid officials say that money will be needed to prevent a deficit, now that federal stimulus funds are gone.
The lawsuit has been assigned to U.S. District Judge Thomas Johnson, Reese said. "I hope we will be before the judge within six to eight weeks," the centers' attorney, Edward Waters, said.
Waters is a partner with Feldesman Tucker Liefer Fidell of Washington, D.C.
The plaintiff centers include FamilyCare, New River, Cabin Creek Health Systems, Minnie Hamilton Health Care System, Inc., Rainelle Medical Center, E.A. Hawse Health Center, Senandoah Valley Medical Systems, and Valley Health Systems.
Reach Kate Long at katel...@wvgazette.com or 304-348-1798.