The latest on the Downcoding case
Note: The following is an update to VACEP’s ongoing legal challenge against the Commonwealth’s Downcoding Provision and its harmful impacts on emergency medicine. If you need background on the case, start here before you continue.
A Virginia Circuit Court judge recently ruled in favor of the Virginia Department of Medical Assistance Services (DMAS) in their request for dismissal of a VACEP lawsuit where emergency physicians are ultimately seeking to recoup nearly three years’ worth of unfairly downcoded Medicaid reimbursements.
This was a technical ruling only. The judge determined that a formal “case decision” had never been issued by DMAS, therefore VACEP had not exhausted its administrative remedies before turning to the courts. Of note, the judge did not comment on any of the other DMAS arguments such as standing, jurisdiction, sovereign immunity (which says the government is immune from lawsuits unless there’s a very specific reason), or the actual merits of the case.
Implementation date vs. Ruling date
VACEP’s case stems from an April 2023 decision by a federal judge that Virginia’s harmful “Downcoding” policy, implemented in July 2020, was not done in accordance with federal law and the prudent layperson standard and must end. DMAS did not appeal that decision, stopped downcoding claims, and said it would retroactively pay for downcoded Medicaid claims starting April 27, 2023 — the day the federal ruling went into effect.
But VACEP and our allies believe that, since the policy was vacated, the program was never properly implemented. Therefore, we believe, all Downcoding since July 2020 was unauthorized and full and fair reimbursements should be made for those visits.
Exchanging letters
In September 2023, after the Virginia Attorney General stated that no retroactive relief was available to reimburse emergency physicians despite the federal ruling, VACEP, the Medical Society of Virginia, and the Virginia Hospital & Healthcare Association sent a letter to DMAS challenging that decision and requesting a meeting to discuss the matter. The agency replied, in its own letter, that a discussion was not necessary because DMAS has “no legal authority to pay the retroactive claims.” VACEP and our allies appealed to the courts.
Emergency medicine employer group? We’re happy to talk to you. Reach out to us at vacep@societyhq.com and we’ll have one of our top leaders video conference or meet in person to discuss our next steps on this case.
In the latest ruling, the judge determined DMAS’s letter did not constitute a “case decision” and therefore wasn’t appealable. In doing so, the state’s other arguments were made moot and VACEP was determined to not have grounds — yet — for appeal.
So what’s next?
VACEP plans to file a notice to appeal Richmond circuit court judge Richard B. Campbell’s decision. We also plan to appeal DMAS’s original decision to only pay for retroactive payments from when the federal ruling went into effect (April 2023) and not when the policy went into effect (July 2020), thereby forcing DMAS to issue a formal case decision.
We also will ask the federal judge for clarification on the ability to gain retroactive payments.
This isn’t just money. It’s about precedent.
VACEP strongly believes our case is winnable. In fact, the April 2023 federal decision that was ultimately in our favor was marked by a similar administrative loss early on. Moreover, our effort is about setting a legal precedent not only for emergency physicians, but all medical providers, to ensure a state agency cannot implement such a harmful policy in the future and never be held accountable. This is unacceptable and sets dangerous precedent.
VACEP’s Statewide Action Trust, or STAT, helps fund legal initiatives like this one. Here’s how your support helps.
We need your group’s help with legal costs
Obviously, this case has required and will continue to involve legal fees to our law firm, Williams Mullen.
Our ask: For Emergency Physicians to ultimately recoup tens of millions of dollars in Medicaid reimbursements and succeed in this case, we need help from emergency physician employer groups. You can do that with contributions to our STAT fund, which supports our legal and communications initiatives.
Thank you to groups that have contributed since October 2023, several of which have already given to this next round of legal funding.
Team Health
Chesapeake Emergency Physician
US Acute Care Solutions
Commonwealth Emergency Physicians
Fredericksburg Emergency Medical Alliance
Emergency Physicians of Tidewater
Williamsburg Emergency Physicians
Augusta Emergency Physicians
Vituity
Emergency Physicians of Tidewater
SCPHealth
