The United States Court of Appeals has reaffirmed the right of Saint Anthony Hospital to sue the state agency in charge of Medicaid to require compliance with federal law on timely payment and full disclosure of payment computations.  Saint Anthony Hospital, a safety-net hospital in Little Village that primarily cares for Medicaid patients in the West and Southwest side of Chicago, sued the Illinois Department of Healthcare and Family Services in 2020, alleging that the agency fails to oversee the insurance companies the State hires to administer and pay Medicaid claims. The result, according to the lawsuit, is late payments to providers, made without disclosure of how complex payment rules are applied. When the hospital sued, late or denied payments by insurance companies caused Saint Anthony Hospital’s funds on hand to drop from six months operating costs, to barely enough to pay its daily costs. The sharp decline resulted from entrusting for-profit insurance companies, who keep any savings generated, to administer the Medicaid system, the hospital alleged. The hospital’s lawsuit asserts that it has been denied over $20 million in payments due.

In 2023, Medicaid insurance accounted for about 60 percent of all patient cases at Saint Anthony Hospital. Under the threat of this lawsuit, the insurance companies have improved timeliness in paying claims since 2020. But timely payment is only half the problem, as the state still doesn’t require that the insurance companies explain how they compute payments. The federal trial court dismissed the hospital’s lawsuit in 2021, on the ground that the Hospital had no right to sue the State to require it to enforce federal law against the insurance companies the State hires to run the Medicaid program. In July 2022, the Court of Appeals reversed the trial court ruling, upheld Saint Anthony’s right to sue the State, and sent the case back to the federal trial court. In 2023 the U.S. Supreme Court directed the Court of Appeals to consider whether an intervening Supreme Court decision had changed the law regarding the hospital’s right to sue the State. In the decision released on April 25, 2024, the Court of Appeals found that the intervening Supreme Court decision reaffirmed the hospital’s right to sue. It found no reason to alter its prior ruling in favor of Saint Anthony Hospital, allowing the lawsuit to move forward in the federal district court in Chicago. For more information, go to SAHChicago.org.