Zion Nursing Home, Inc. v. Creasy

Clifford F. Brown, J.,

dissenting. The only fair way to administer the reimbursement program as contemplated under Am. Sub. H.B. No. 475 is to conclude that no limitations period commenced until the state determined its final position on reimbursement amounts due. The expiration date of the budget bill is irrelevant to this determination, which looks instead to the time the state completed its audit. Because the practical effect of today’s decision is to permit the state to destroy a cause of action by merely delaying performance of its statutory duties, I dissent.

Appellee’s legislated duty and liability to appellants under Am. Sub. H.B. No. 475 were to be determined, pursuant to its explicit terms, in accordance with appellee’s own departmental rules and regulations. The audit-settlement system established thereunder by appellee Creasy called for the review of cost reports in a multi-step process, involving for each provider a preliminary desk audit, an initial payment adjustment, an on-site field audit, and a final settlement payment. None of these procedures was followed for any member of appellants’ class for the calendar year 1972 until late 1977. It is my position that prior to the time these audits were prepared, appellants did not have a cause of action against appellee.

It was only after the field audit and final adjustment phase that each provider knew where appellee stood on reimbursement. It was therefore at this time that final and conclusive liability, which forms the basis for the cause of action, was established. It would be ludicrous for a statute of limitations to begin to run before the claimant had knowledge of the extent, or in some cases the very existence, of damages. See Amer v. Akron City Hospital (1976), 47 Ohio St. 2d 85, 93 [ 1 O.O.3d 51 ] (dissenting opinion, per Celebrezze, J.). See, also, Adams v. Sherk (1983), 4 Ohio St. 3d 37 ; O’Stricker v. Jim Walter Corp. (1983), 4 Ohio St. 3d 84 . Such a view is also consistent with a long line of federal cases 4 which have examined reimbursement systems for health care services identical to the method utilized herein.

I further disagree with the court’s assessment that State, ex rel. Country Court, v. Creasy (1980), 62 Ohio St. 2d 419 [ 16 O.O.3d 446 ], decided the “precise issue” paramount to the present appeal. Conspicuously absent from today’s opinion is the actual holding of the fifteen line Country Court case: “* * * [appellants’ equal protection argument, premised on the diligence of the six nursing homes who brought a timely action, is without merit.” Id. at *227 420 . In so rejecting the claim that the providers had a right to reimbursement based upon the Equal Protection Clause, the Country Court court did no more than acknowledge that Am. Sub. H.B. No. 475 was subject to R.C. 2305.07. The question of when that statute of limitations began to run was apparently neither argued to, nor considered by, that court.

In my view, appellants’ cause of action did not arise until the liability became fixed, irrespective of the expiration date of the budget bill. I would therefore reverse the judgment of the court of appeals.

Sweeney and J. P. Celebrezze, JJ., concur in the foregoing dissenting opinion.

E.g., United States v. Pisani (C.A. 3,1981), 646 F. 2d 83 ; United States v. Gravette Manor Homes, Inc. (C.A. 8, 1981), 642 F. 2d 231 ; United States v. Withrow (C.A. 7, 1979), 593 F. 2d 802 ; United States v. McCarthy (C.D. Cal. 1980), CCH Medicare & Medicaid Guide, 1980-1981 Transfer Binder, Paragraph 30,807; United States v. White House Nursing Home, Inc. (M.D. Fla. 1979), 484 F. Supp. 29 ; United States v. Graham (S.D. Tex. 1979), 471 F. Supp. 123 .