Charleston Memorial Hospital v. Conrad

693 F.2d 324 (1982)

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Charleston Memorial Hospital v. Conrad

United States Court of Appeals for the Fourth Circuit
693 F.2d 324 (1982)

Facts

The South Carolina Department of Social Services (DSS) (defendant) administered South Carolina’s Medicaid program. In 1982, DSS requested an allocation of $280 million from the state legislature to cover the state’s total proposed healthcare budget, $84 million of which was to cover the cost of inpatient and outpatient hospital services. The legislature approved only $232.6 million, with $67 million allocated toward hospital services. As a result, DSS notified providers that DSS was reducing inpatient hospital coverage for each Medicaid recipient from 40 to 18 days per year and outpatient hospital visits from unlimited to 18 per year. After determining that some costs were underestimated, DSS made further cuts, reducing coverage for inpatient stays from 18 to 12 days per year per recipient. The South Carolina Hospital Association (SCHA), including Charleston Memorial Hospital (plaintiffs), brought suit seeking declaratory and injunctive relief against DSS and the US secretary of Health and Human Services (HHS) (defendant), arguing that the reductions violated substantive federal law requirements. The district court found that 12 inpatient hospital stays annually would sufficiently meet the needs of 88 percent of Medicaid recipients and that 18 outpatient visits would sufficiently meet the needs of 99 percent of recipients. The district court found in DSS’s favor. SCHA appealed.

Rule of Law

Issue

Holding and Reasoning (Ervin, J.)

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