Administrative — Medicaid Reimbursement – Civil Practice – Subject Matter Jurisdiction – Failure to Exhaust Administrative Remedies

Abrons Family Practice & Urgent Cart, PA v. North Carolina Department of Health & Human Services (Lawyers Weekly No. 15-15-0642, 25 pp.) (Gregory McGuire, J.) 2015 NCBC 60

Holding: The remittance statements received by medical providers explaining the outcome of their Medicaid claims, the applicable regulations, and the North Carolina Medical Management Information System Provider Claims and Billing Assistance Guide create a very confusing and difficult process for medical providers to determine why their Medicaid claims have been denied and how to appeal denials. Furthermore, the providers never receive anything that explicitly purports to be a final agency decision. Nevertheless, none of the plaintiff-medical providers even tried to use the administrative review procedure, so the court is not persuaded that the administrative review process would have been futile.

The court grants defendants’ motion to dismiss for lack of subject matter jurisdiction based on plaintiffs’ failure to exhaust their administrative remedies.

Plaintiffs’ primary claims are for unpaid Medicaid reimbursements. In addition, their tort-type claims for damages to their businesses were also caused by the allegedly improper failure to pay Medicaid claims. Plaintiffs’ ancillary tort-type claims do not render the available administrative process inadequate so as to relieve plaintiffs from the requirement that they first exhaust their administrative remedies before seeking redress in court.