CABINET FOR HEALTH v. APPALACHIAN REG'L

No. 2016-CA-001140-MR.

606 S.W.3d 623 (2019)

Commonwealth of Kentucky, CABINET FOR HEALTH AND FAMILY SERVICES, Appellant, v. APPALACHIAN REGIONAL HEALTHCARE, INC., d/b/a Harlan ARH Hospital, d/b/a Hazard ARH Regional Medical Center, d/b/a Middleboro ARH Hospital, d/b/a Whitesburg ARH Hospital, d/b/a Williamson ARH Hospital; Ashland Hospital Corporation, d/b/a King's Daughters Medical Center; Baptist Healthcare Affiliates, Inc.; Baptist Healthcare System, Inc.; Bourbon Community Hospital, LLC, d/b/a Bourbon Community Hospital; Bowling Green-Warren County Community Hospital Corporation; Crittenden County Hospital; Clinton County Hospital, Inc.; Community United Methodist Hospital, Inc., d/b/a Methodist Hospital; Ephraim McDowell Regional Medical Center, Inc.; Flaget Healthcare, Inc., d/b/a Flaget Memorial Hospital; Fleming County Hospital Foundation, Inc.; Georgetown Community Hospital, LLC; Grayson County Hospital Foundation, Inc.; Hardin Memorial Hospital, Inc.; Harrison Memorial Hospital, Inc.; Highlands Hospital Corporation; Hospital of Fulton, Inc., d/b/a Parkway Regional Hospital; Hospital of Louisa, Inc., d/b/a Three Rivers Medical Center; Jackson Hospital Corporation, d/b/a Kentucky River Medical Center; Jennie Stuart Medical Center, Inc.; Jewish Hospital & St. Mary's Healthcare, Inc., d/b/a Jewish Hospital Shelbyville; Kentucky Hospital, LLC, d/b/a Clark Regional Medical Center, Inc.; Kentuckyone Health, Inc.; Lake Cumberland Regional Hospital, LLC, d/b/a Lake Cumberland Regional Hospital; Logan Memorial Hospital, LLC, d/b/a Logan Memorial Hospital; Meadowview Regional Medical Center, LLC, d/b/a Meadowview Regional Medical Center; Mercy Health Partners-Lourdes, Inc., d/b/a Lourdes Hospital; Muhlenberg Community Hospital; Murray-Calloway County Public Hospital Corporation, d/b/a Murray-Calloway County Hospital; Norton Hospitals, Inc., d/b/a Norton Hospital; Our Lady of Bellefonte Hospital, Inc.; Owensboro Medical Health Systems, Inc.; Paintsville Hospital Company, LLC, d/b/a Paul B. Hall Regional Medical Center; Pattie A. Clay Infirmary Association, d/b/a Pattie A. Clay Regional Medical Center; Pikeville Medical Center, Inc.; Pinelake Reginal Hospital, LLC, d/b/a Jackson Purchase Medical Center; Saint Elizabeth Medical Center, Inc.; Saint Joseph Health System, Inc., d/b/a Saint Joseph East, d/b/a Saint Joseph London, d/b/a Saint Joseph Hospital, Saint Joseph Mount Sterling; Springview Hospital, LLC, d/b/a Springview Hospital; St. Claire Medical Center, Inc.; T.J. Samson Community Hospital; Taylor County Hospital District Health Facilities Corporation d/b/a Taylor Regional Hosital; the Hardin Memorial Hospital Foundation; the Harrison Memorial Hospital, Inc.; the Trover Clinic Foundation, Inc., d/b/a Regional Medical Center of Hopkins County, Appellees.

Court of Appeals of Kentucky.

Discretionary Review Denied September 16, 2020.


Attorney(s) appearing for the Case

BRIEFS FOR APPELLANT: Catherine York , Deputy General Counsel, Office of Legal Services, Frankfort, Kentucky.

BRIEF FOR APPELLEES BOURBON COMMUNITY HOSPITAL, LLC, D/B/A BOURBON COMMUNITY HOSPITAL; KENTUCKY HOSPITAL, LLC, D/B/A CLARK REGIONAL MEDICAL CENTER, INC.; CRITTENDEN COUNTY HOSPITAL, INC.; EPHRAIM MCDOWELL REGIONAL MEDICAL CENTER, INC.; FLEMING COUNTY HOSPITAL FOUNDATION, INC.; GEORGETOWN COMMUNITY HOSPITAL, LLC; APPALACHIAN REGIONAL HEALTHCARE, INC., D/B/A HARLAN ARH HOSPITAL, D/B/A HAZARD ARH REGIONAL MEDICAL CENTER, D/B/A MIDDLEBORO ARH HOSPITAL, D/B/A WHITESBURG ARH HOSPITAL, D/B/A WILLIAMSON ARH HOSPITAL; HARRISON MEMORIAL HOSPITAL, INC.; PINELAKE REGIONAL HOSPITAL, LLC, D/B/A JACKSON PURCHASE MEDICAL CENTER; JENNIE STUART MEDICAL CENTER, INC.; JACKSON HOSPITAL CORPORATION, D/B/A KENTUCKY RIVER MEDICAL CENTER; ASHLAND HOSPITAL CORPORATION, D/B/A KING'S DAUGHTERS MEDICAL CENTER; LAKE CUMBERLAND REGIONAL HOSPITAL, LLC, D/B/A LAKE CUMBERLAND REGIONAL HOSPITAL; LOGAN MEMORIAL HOSPITAL, LLC, D/B/A LOGAN MEMORIAL HOSPITAL; MERCY HEALTH PARTNERS-LOURDES, INC., D/B/A LOURDES HOSPITAL; MEADOWVIEW REGIONAL MEDICAL CENTER, LLC, D/B/A MEADOWVIEW REGIONAL MEDICAL CENTER; COMMUNITY UNITED METHODIST HOSPITAL, INC., D/B/A METHODIST HOSPITAL; MURRAY-CALLOWAY COUNTY PUBLIC HOSPITAL CORPORATION, D/B/A MURRAY-CALLOWAY COUNTY HOSPITAL; OWENSBORO MEDICAL HEALTH SYSTEMS, INC.; HOSPITAL OF FULTON, INC., D/B/A PARKWAY REGIONAL HOSPITAL; PATTIE A. CLAY INFIRMARY ASSOCIATION, D/B/A PATTIE A. CLAY REGIONAL MEDICAL CENTER; PAINTSVILLE HOSPITAL COMPANY, LLC, D/B/A PAUL B. HALL REGIONAL MEDICAL CENTER; THE TROVER CLINIC FOUNDATION, INC., D/B/A REGIONAL MEDICAL CENTER OF HOPKINS COUNTY; SPRINGVIEW HOSPITAL, LLC, D/B/A SPRINGVIEW HOSPITAL; T.J. SAMSON COMMUNITY HOSPITAL; TAYLOR COUNTY HOSPITAL DISTRICT HEALTH FACILITIES CORPORATION D/B/A TAYLOR REGIONAL HOSPITAL; HOSPITAL OF LOUISA, INC., D/B/A THREE RIVERS MEDICAL CENTER; MUHLENBERG COMMUNITY HOSPITAL: Stephen R. Price, Sr. , Carole D. Christian , John W. Woodard, Jr. , Allison L. Brown , Louisville, Kentucky.

BRIEF FOR APPELLEES KENTUCKYONE HEALTH, INC.; JEWISH HOSPITAL & ST. MARY'S HEALTHCARE, INC., D/B/A JEWISH HOSPITAL SHELBYVILLE; SAINT JOSEPH HEALTH SYSTEM, INC., D/B/A SAINT JOSEPH EAST, D/B/A SAINT JOSEPH LONDON, D/B/A SAINT JOSEPH HOSPITAL, SAINT JOSEPH MOUNT STERLING; FLAGET HEALTHCARE, INC. D/B/A FLAGET MEMORIAL HOSPITAL: Wesley R. Butler , Jeffery T. Barnett , Holly R. Iaccarino , Lexington, Kentucky.

BRIEF FOR APPELLEE NORTON HOSPITALS, INC. D/B/A NORTON HOSPITAL: Kevin G. Henry , Bryan H. Beauman , Sarah Charles Wright , Lexington, Kentucky.

BRIEF FOR APPELLEES BAPTIST HEALTHCARE SYSTEM, INC.; BAPTIST HEALTHCARE AFFILIATES, INC.; CLINTON COUNTY HOSPITAL, INC.; HIGHLANDS HOSPITAL CORPORATION; ST. CLAIRE MEDICAL CENTER, INC.; SAINT ELIZABETH MEDICAL CENTER, INC.; BOWLING GREEN-WARREN COUNTY COMMUNITY HOSPITAL CORPORATION; GRAYSON COUNTY HOSPITAL FOUNDATION, INC.; OUR LADY OF BELLEFONTE HOSPITAL, INC.: Matthew R. Klein , David M. Dirr , Crestview Hills, Kentucky.

BRIEF FOR APPELLEE PIKEVILLE MEDICAL CENTER, INC.: Harry Dadds , Perry M. Bentley , Lexington, Kentucky, Erich E. Blackburn , Pikeville, Kentucky.

BEFORE: DIXON, COMBS, AND TAYLOR, JUDGES.


OPINION

The Cabinet for Health and Family Services ("Cabinet") has appealed from an opinion and order entered by the Franklin Circuit Court on July 7, 2016, regarding Medicaid reimbursement rates as well as administrative appeals of rates filed by fifty-eight acute care hospitals ("Hospitals"). The circuit court found the...

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