Local Initiative Health Care Authority of Los Angeles County (LA Care) operates a managed care plan that provides health coverage under Medi-Cal, California’s Medicaid program. Dignity Health operates Northridge Hospital, which did not have an inpatient service contract with LA Care during the relevant time period. Dignity provided inpatient poststabilization services to LA Care patients and sought reimbursement from LA Care at its full rates. LA Care paid Dignity at lower state-set rates known as “All Patient Refined Diagnosis Related Group” (APR-DRG). Dignity sued, alleging that LA Care’s failure to pay its full rates breached an implied contract and violated Health and Safety Code sections 1262.8 and 1371.4. Dignity moved for summary judgment, arguing that the inpatient treatment constitutes “managed care inpatient days,” which is exempt from APR-DRG rates under Welfare and Institutions Code section 14105.28, subdivision (b)(1)(B) (section 14105.28).
Category: Business Law
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