This “Dag On,” Esoteric Medicaid! What is the LAW?

What is the “law” of North Carolina Medicaid? I mean, as a health care provider in North Carolina accepting Medicaid, you are expected to know EVERYTHING.  You must follow ALL laws/regulations/policies to a tee. Yet you have:

1.  The State; i.e., the  Division of Medical Assistance (DMA);

2.  The Managed Care Organizations (MCOs); i.e.; Alliance Behavioral Health (Alliance), Cardinal Innovations (Cardinal), East Carolina Behavioral Health (East Carolina), or whatever MCO is in charge of your county; not to mention,

3.  The Recovery Audit Contractors (RACs); i.e., Carolinas Center of Medical Excellence (CCME), Public Consulting Group (PCG), and HP Enterprises (HP);

all telling you that you are NOT following the (fill in the blank) (a) the law; (b) NC Medicaid rules and regulations; (c) the DMA Clinical Policies; (d) the Implementation Updates; (d) the Basic Medicaid Billing Guide; or (e) all of the above.

Let’s break it down.

First, in the world of Medicaid, because federal dollars are used, the federal law is supreme.

Therefore, if any state, whether North Carolina or Alaska, states that you must abide by “_____” and “_____” is specifically not allowed by federal law, “_____” violates federal law and is not “law.” So many people just assume that if North Carolina states “____”…”____”  must be “law.”  Forgive me for being the naysayer, but the U.S. federal government is supreme.  As in, if North Carolina and the U.S. government got in a fight, NC would be the underdog. Yet, despite the fact, most people read a NC general statute and act as a Stepford Wife….”Yes,  sir, it must be true.”

So let’s put the Medicaid laws in a hierarchy, most important to least important:

1. Federal law.  Most of the federal Medicaid regulations are found in the Code of Federal Regulations (CFR). (Please understand that this blog is NOT comprehensive; I am merely trying to simplify a system that is not easily simplified.  Please contact an attorney if you have any questions (not necessarily me:) ).  There is also the Social Security Act.

2.  Centers for Medicare and Medicaid Services (CMS).  I know, CMS is a federal agency. Why would I denote CMS as the second most important in the genre of Medicaid law? CMS does not make law.  CMS must follow federal law.  But, in reality, let me assure you, if CMS says its ok, it is ok.  So it is important to note CMS.

CMS issues guidance in the form of letters to State Medicaid Directors and letters to State Health Officials. CMS also issues federal regulations. Issue. Not draft. Regardless, CMS is important.

3.  North Carolina laws.  Here’s where it gets sticky…

People make good money on arguing as to which NC laws/policies/manuals are most important.

In my humble opinion, only promulgated policies are mandatory.

What does promulgated mean?

Definition of PROMULGATE

1: to make (as a doctrine) known by open declaration : proclaim
a : to make known or public the terms of (a proposed law)

b : to put (a law) into action or force
Obviously, the NC General Statutes are law.  Each bill has been passed by the House and Senate in the General Assembly and signed by the Governor.  However, let me be the first to warn you: Just because NC has passed anything into statutory law, does not mean that the statute is NOT in violation of federal law.
Remember, recently, in Wos v. E.M.A., the U.S. Supreme Court struck down a NC law that would have allowed the state of North Carolina to seize one-third of a family’s $2.8 million medical malpractice settlement.  However, the Supreme Court concluded that the North Carolina statute was unreasonable and arbitrary, possibly much like the Medicaid statutes found in N.C. Gen. Stat. 108C.
So even promulgated Medicaid statutes can be stricken.
Therein lies so many questions.
In my humble opinion, the DMA Clinical Policies need to be followed.  Also, the Implementation Updates need to be followed (despite the fact that these Implementation Updates are drafted so frequently and are not necessarily promulgated…that’s another issue).
So we have the N.C. Gen. Stats. (although not necessarily in compliance with federal law), the DMA Clinical Policies, and Implementation Updates.
Yet, recently, in a hearing, a DMA representative testified that the Basic Medicaid Billing Guide was also “law.” Law? A Manual? Hmmmm….interesting.  I think everyone would agree that the Basic Medicaid Billing Guide is amazing guidance. But…law?
We shall see. We have lawsuits exploring these issues. But, for now, in my opinion, these are great unknowns.
So, health care providers, what laws/regulations/policies are you supposed to follow? In the opinion of the State, EVERYTHING. Even if some random person writes an email with no authority to write, “All health care providers must list the Medicaid recipients’ alphabetically and also alphabetically by the guardian with handwritten lines corresponding the recipient to the guardian;” the State believes the email must be adhered to.
My opinion? Only adhere to federal law and state laws that comply with federal laws. Which are those? We will see in the upcoming litigation…


About kemanuel

Medicare and Medicaid Regulatory Compliance Litigator

Posted on April 1, 2013, in Alliance, CCME, CMS, Division of Medical Assistance, Federal Law, Health Care Providers and Services, Legal Analysis, Legislation, MCO, Medicaid, Medicaid Audits, NC DHHS, North Carolina, RAC, US Supreme Court and tagged , , , , , , . Bookmark the permalink. 1 Comment.

  1. How can someone file a complaint with DMA anonymously against a health care provider, and not be held liable if their allegations are untrue after the investigation? Even when a person files a BBB complaint, they are required to put their personal information in the form. Why would DMA allow this considering the serious allegations, costs, stress, etc.. caused to the heath care providers.?? Shouldn’t this be an issue with DMA that gets changed? (Actually just requiring that the person filing the allegations with DMA ( false or not ) to be required to place their personal information. )

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