Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Appellate Division
SUBJECT: New York
State
Department
of Social Services
Docket No.
89-154, 89-184, and 89-253
Decision
No. 1216
DATE: January 2, 1991
DECISION
The New York State Department of Social Services (State)
appealed
determinations by the Health Care Financing Administration
(HCFA)
disallowing federal financial participation (FFP) claimed under
title
XIX of the Social Security Act (Act). The State claimed FFP in
payments
which it determined were made on behalf of individuals eligible
for
Medicaid but which were originally charged solely to the
State-funded
medical assistance (MA) program. 1/ The State reclassified
the payments
as Medicaid payments based on a statistical sample of MA cases
which
identified some individuals as eligible for Medicaid during the
period
in question on the basis of age (under 21), pregnancy, eligibility
for
benefits under title IV-A, or disability. In the case of
individuals
eligible on the basis of disability, the State alleged that a
disability
determination had been made, but that the individual was not
listed in
the State's files as Medicaid-eligible due to a clerical or
coding
error. HCFA disallowed the claims on the ground that they
were
impermissibly based on a statistical sample.
At the request of the State, the Board stayed proceedings in Docket
Nos.
89-154, 89-184, and 89-253 pending the issuance of a decision in
several
other New York appeals.involving the permissibility of
statistical
sampling. Following the issuance of that decision (New York
State Dept.
of Social Services, DAB No. 1134 (1990)), the stay was continued
in
order to permit HCFA to determine whether these appeals were
entirely
governed by that decision. By letter dated December 18, 1990,
counsel
for HCFA advised the Board that it had determined that these
appeals
"can be resolved on the same basis as" the appeals which were
the
subject of DAB No. 1134, and that it did not object to the issuance of
a
summary decision based on DAB No. 1134. 2/
In New York State Dept. of Social Services, DAB No. 1134 (1990), the
Board
considered whether the State could properly use a statistical
sample to claim
FFP in payments on behalf of individuals whom the State
determined were
eligible for Medicaid on the basis of age, pregnancy, or
eligibility for
benefits under title IV-A. The Board found that HCFA's
prohibition on
sampling was unreasonable as applied to those types of
claims. However,
the Board further determined that this did not mean
that the State's claims
satisfied all conditions for allowability.
Thus, the Board remanded the
appeals to HCFA to determine whether the
individuals in the sample cases were
in fact Medicaid eligibles who
received services covered by Medicaid and
whether the State's
statistical methodology was valid..Conclusion
Accordingly, we conclude, based on the rationale of DAB No. 1134, that
the
claims in question were not properly disallowed on the sole ground
that they
were developed using statistical sampling procedures. The
appeals are
remanded to HCFA to assess the validity of the sampling
methodology which the
State used to establish its claims and other
matters which DAB No. 1134
indicated were left open.
_____________________________ Judith A. Ballard
_____________________________ Alexander G. Teitz
_____________________________ Norval D. (John) Settle
Presiding
Board Member.1. Docket No. 89-154 involves a
claim for
$4,341,105 FFP for costs incurred during the quarter ended
March
31, 1987. Docket No. 89-184 involves a claim for $310,915
FFP
for costs incurred during the quarter ended June 30,
1987.
Docket No. 89-153 involves a claim for $20,557 FFP for
costs
incurred during the quarter ended September 30, 1987.
2. The letter listed the appeals which were the subject of DAB
No.
1134, but mistakenly referred to DAB No.