Six Community Hospitals Sue Massachusetts Over DSH Payments - December 8, 2009

Six Massachusetts community hospitals filed a lawsuit on December 2 against the State of Massachusetts, alleging that the state violated state and federal law by not adequately compensating the hospitals, which treat a disproportionate share of Medicaid and uninsured patients. The lawsuit alleges that the state’s Medicaid reimbursement formula constitutes an unconstitutional taking, a breach of contract, a breach of the covenant of good faith and fair dealing, and is pre-empted by federal Medicaid law. The lawsuit, Holyoke Medical Center Inc. v. Secretary of the Executive Office of Health and Human Services, is similar to a suit filed by NAPH member Boston Medical Center in July. Berkshire Medical Center, Cape Cod Hospital, Merrimack Hospital, Signature Healthcare Brockton Hospital, and Quincy Medical Center joined Holyoke Medical Center in the suit.