Companies claim Medicaid owes them

Friday, July 15, 2005 | 9:54 a.m.

CARSON CITY -- Three companies that provide health and personal services to the low-income elderly and disabled in rural Nevada are complaining they are owed more than $1.8 million by the state's Medicaid program.

The firms filed suit in federal court in Reno on Wednesday against First Health Services Corp., which processes the claims for the Medicaid program.

After the state switched in 2002 to an electronic system developed by First Health, numerous problems were reported in paying doctors, hospitals, nursing homes and others that submitted claims.

The state had to advance $90 million to health care providers who submitted claims that were not processed.

Visiting Angels, Helping Angels and American Home Companion, companies based in the Reno area, brought the suit, saying their claims for services have been wrongly rejected.

The suit accuses First Health of "wrongful acts" in failing to process the claims.

Tim Brewer, a representative for First Health, could not be reached for comment.

Chuck Duarte, administrator of the state Division of Health Care and Financing, who said he is familiar with the dispute with the three companies, said First Health has worked closely with the three firms.

Duarte, whose state agency is in charge of Medicaid, said First Health is "pretty much caught up" in paying claims. He added that the Center for Medicaid and Medicare on June 22 certified that First Health was meeting all of the requirements for paying health care claims.

He said First Health's system passed a federal review.

However, American Homes, which provides home health care services, says it is owed at least $925,000. Helping Angels, which provides skilled and nonskilled home health care, is seeking more than $475,000 in the suit and Visiting Angels, which is licensed for nonmedical personal care services, maintains it is owed at least $455,000.

The three companies, in the lawsuit, said that in August 2003 they started to notice that an unusually large number of claims were being rejected. They said the claims were for authorized services provided Medicaid patients.

They said they repeatedly resubmitted their Medicaid claims at great expense and they received "confusing, arbitrary and contradictory reasons for rejections."

The state is not named a defendant in the suit.