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TLC Health Care Services, LLC v. Ohio Department of Job & Family Services

Court of Appeals of Ohio, Tenth District

December 21, 2017

TLC Health Care Services, LLC, Plaintiff-Appellant,
v.
Ohio Department of Job & Family Services et al., Defendants-Appellees. Medcorp, Inc. and Medcorp E.M.S. South, LLC Plaintiffs-Appellants,
v.
Ohio Department of Job & Family Services et al., Defendants-Appellees.

         APPEAL from the Franklin County Court of Common Pleas Nos. 08CV-13630, 08CV-17879

         On brief:

          Barkan & Robon, Ltd., and R. Ethan Davis, for appellant TLC Health Care Services, LLC.

         On brief:

          Webster & Associates Co., LPA, Geoffrey E. Webster, and Bryan M. Pritikin, for appellants Medcorp, Inc. and Medcorp E.M.S. South, LLC.

         Argued:

          Geoffrey E. Webster.

         On brief:

          Michael DeWine, Attorney General, and Rebecca L. Thomas, for appellees.

         Argued:

          Rebecca L. Thomas.

          DECISION

          SADLER, J.

         {¶ 1} Plaintiffs-appellants, TLC Health Care Services, LLC ("TLC") and Medcorp, Inc. and Medcorp E.M.S. South, LLC[1] ("Medcorp") (collectively "appellants"), appeal from a judgment of the Franklin County Court of Common Pleas dismissing their claims against defendants-appellees, Ohio Department of Job and Family Services ("ODJFS") and Helen E. Jones-Kelley, Director of ODJFS (collectively "appellees"), for lack of subject-matter jurisdiction. For the reasons that follow, we affirm.

         I. FACTS AND PROCEDURAL HISTORY

         {¶ 2} At all relevant times, appellants engaged in the business of providing both emergency and non-emergency ambulance services and emergency and non-emergency ambulette services (wheelchair van) for patients enrolled in the Ohio Medicaid program administered by appellees. In order for appellants to conduct such business, appellees required appellants to obtain Medicaid certification and to execute provider agreements setting forth the terms of service, including the rate of reimbursement for covered services provided. Ohio Adm.Code 5160-1-17.2 defines the provider agreement, in relevant part, as follows:

A provider agreement is a contract between the Ohio department of job and family services (ODJFS) And a provider of medicaid covered services. By signing this agreement the provider agrees to comply with the terms of the provider agreement, Revised Code, Administrative Code, and federal statutes and rules.

         {¶ 3} Ohio Adm.Code 5160-1-60 sets forth the Medicaid payments providers are to receive for covered services, in relevant part, as follows:

(A) The medicaid payment for a covered procedure, service, or supply constitutes payment in full and may not be construed as a partial payment when the payment amount is less than the provider's submitted charge.
(B) * * * The medicaid payment amount for a covered service, procedure, or supply is the lesser of the submitted charge or the established medicaid maximum. Medicaid maximum payment amounts for many existing services, procedures, and supplies, particularly services rendered by practitioners of the healing arts, are set forth in the appendix to this rule.

         {¶ 4} On December 11, 2007, Medcorp filed a complaint against appellees in the Lucas County Court of Common Pleas. The complaint alleges the Medicaid reimbursement rates set by appellees are so low as to violate state and federal statutory, regulatory, and constitutional provisions, including 42 U.S.C. 1983, 42 U.S.C. 1396a(a)-(30)(A), 42 C.F.R. 447.204, R.C. Chapter 5111, R.C. 5111.01 and 5111.02, the Due Process Clauses, the Equal Protection Clauses, and the Takings Clauses. The complaint further alleges the Medicaid reimbursement rates set by appellees constitute a breach of the provider agreement. On May 12, 2008, TLC filed a complaint against appellees in the Lucas County Court of Common Pleas alleging the same claims. Appellants' complaints seek declaratory and injunctive relief, as well as "just compensation for Medicaid reimbursement monies taken to which it is entitled." (TLC Compl. at 9; Medcorp Compl. at 10.)

         {¶ 5} On appellees' motion, the Lucas County Court of Common Pleas transferred venue of the two cases to Franklin County, and the trial court in Franklin County consolidated the two cases pursuant to Civ.R. 42(A). On October 10, 2008 and January 20, 2009, appellees filed a motion to dismiss, pursuant to Civ.R. 12(B)(1), for lack of subject-matter jurisdiction. Appellees argued because appellants alleged claims for monetary relief against the state of Ohio sounding in breach of contract, the Court of Claims of Ohio had exclusive original jurisdiction of the complaints. Appellants argued even though the complaints seek ...


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