Department of Health & Mental Hygiene v. Granada Nursing Home, Inc.

Per Curiam We granted a writ of certiorari in this case in order to address important public issues concerning the construction and application of Maryland Code (1957, 1980 Repl. Vol.), Art. 43, § 42E. That section provides in pertinent part: "The Department of Health and Mental Hygiene or its agent shall notify each hospital, skilled nursing facility and intermediate care facility participating in the Maryland medical assistance program of the results of field verification. The hospital, skilled nursing facility and intermediate care facility shall have the right to request review of the field verification by an appeal board by filing written notice with the appeal board within 30 days after receipt of the notification from the Department or its agent of the results of the field verification. ...

After the Department receives the findings of the appeal board, the Department shall make a determination of the amount due the State and so notify the hospital, skilled nursing facility or intermediate care facility of that amount. Each hospital, skilled nursing facility, or intermediate care facility shall pay the amount due the Department within 60 days after notification or, if notice was issued before July 1,1976, within 60 days after that date. After expiration of the 60-day period, the Department shall, in addition to other rights or remedies which may be available, recover the unpaid balance by withholding up to 20 percent from payments which would otherwise be due or payable to the hospital, skilled nursing facility or intermediate care facility.” More particularly, the question presented is whether under § 42E an appellant, the Department of Health and Mental Hygiene (Department), was authorized to withhold funds payable to the appellee, Granada Nursing Home, Inc. (Granada), after the Nursing Home Appeal Board (Appeal ²⁴⁵ Board) and the Secretary of the Department (Secretary) had determined that money was due and owing but before the Department’s Board of Review (Board of Review) had determined, on appeal, whether any money was due and owing. Granada provides nursing home services to the public under the Maryland medical assistance program.

On various occasions the Department notified Granada of the results of field verification of allowable costs for specified periods of time. Granada appealed certain of these determinations to the Appeal Board which determined that Granada owed certain amounts of money to the Department. On 2 March 1981, the Secretary reviewed the Appeal Board’s action and determined that Granada owed a greater amount of money than that