FROM THE CIRCUIT COURT OF THE CITY OF RICHMOND. Melvin R. Hughes, Jr., Judge.
Kathryn E. Kasper (Eileen R. Geller; Hancock, Daniel, Johnson & Nagle, P.C., on briefs), for appellant.
Elizabeth M. Guggenheim, Assistant Attorney General (Mark R. Herring, Attorney General; Cynthia V. Bailey, Deputy Attorney General; Kim F. Piner, Senior Assistant Attorney General, on brief), for appellees.
Humphreys, McCullough and Senior Judge Haley.
[64 Va.App. 209] STEPHEN R. McCULLOUGH,
The Director of the Department of Medical Assistance Services, DMAS, concluded that Culpeper Regional Hospital failed to make a certification required by law before admitting patients for treatment. Based on this failure to certify, the Director ordered the Hospital to refund certain Medicaid payments. The Circuit Court for the City of Richmond upheld the Director's decision. The Hospital appeals, arguing that: (1) the Hospital's form admitting a patient for treatment, which is signed by a physician, satisfies the certification requirement; (2) alternatively, if the Hospital's certification was deficient, the Hospital's substantial compliance with its contractual obligations excuse the absence of a certification; and (3) finally, the Director and the circuit court should have adopted the hearing officer's recommendation. For the reasons noted below, we affirm.
Culpeper Regional Hospital is a seventy-bed community hospital located in Culpeper, Virginia. The Hospital is a participating provider in the Medicaid program. DMAS is the agency charged with administering the Medicaid program for Virginia. According
to the Provider Participation Agreement between the Hospital and DMAS, the Hospital must " comply with all applicable state and federal laws, as well as administrative policies and procedures of [DMAS] as from time to time amended."
[64 Va.App. 210] DMAS issues a Hospital Manual that contains applicable policies and procedures. The Manual specifies that " [p]roviders will be required to refund payments made by Medicaid if they are found to have . . . failed to maintain any record or adequate documentation to support their claims." Hosp. Manual, ch. VI, at 2 (June 12, 2006).
On October 24, 2011, DMAS informed the Hospital that an audit identified deficiencies in the Hospital's documentation. Specifically, the auditor determined that the Hospital failed to certify that admitting certain patients for inpatient treatment was medically necessary. Based on this failure, DMAS claimed it was entitled to recoup $46,760.10 in Medicaid payments it made to the Hospital. The Hospital argued that a patient's admission form is sufficient to satisfy the certification requirement and, in ...