New York State Court of Claims

New York State Court of Claims

XL- CARE v. THE NEW YORK STATE DEPARTMENT OF HEALTH, #2007-015-160, Claim No. NONE, Motion No. M-72547


Claim for medicaid reimbursement for services rendered to eligible individuals was dismissed. Although claim requested monetary damages it was essentially equitable in nature and governed by Art. 78 of the CPLR.

Case Information

Claimant short name:
Footnote (claimant name) :

Footnote (defendant name) :

Third-party claimant(s):

Third-party defendant(s):

Claim number(s):
Motion number(s):
Cross-motion number(s):

Claimant’s attorney:
David K. Lieb, P.C.By: David K. Lieb, Esquire
Defendant’s attorney:
Honorable Andrew M. Cuomo, Attorney General
By: Saul Aronson, EsquireAssistant Attorney General
Third-party defendant’s attorney:

Signature date:
March 21, 2007
Saratoga Springs

Official citation:

Appellate results:

See also (multicaptioned case)


Movant’s application for an order permitting service and filing of a late claim is denied on the ground that the Court lacks jurisdiction to hear the claim[1]. The proposed claim seeks to recover $68,985.25 in damages for the alleged failure of the New York State Department of Health (DOH) to reimburse the movant under the medicaid program for skilled nursing care which it provided to Miram Frankel, a medicaid eligible individual, from May 13, 2003 to November 12, 2003. The proposed claim alleges causes of action for negligence and unjust enrichment.

Correspondence submitted by the parties on this motion reflects the following: On May 18, 2004 the movant submitted to DOH a list of its clients, including Miram Frankel, for whom "prior approval" requests for payment had not been timely submitted due to staff shortcomings. By letter dated July 20, 2004, movant notified DOH that the prior approval request on behalf of Miram Frankel was originally submitted on June 3, 2003 but was not pursued thereafter due to the fact that "this one slipped by our office thru the cracks" (see defendant's Exhibit D). The claims for services provided to Miram Frankel and another client were denied and by letter dated August 25, 2004, movant filed an appeal of the denials. In response to the appeal letter, DOH reviewed its files and determined that no prior approval request had been received. By letter dated August 27, 2004, DOH notified movant that "it would not be appropriate to issue retroactive prior approvals at this late date" (see defendant's exhibit G). Further correspondence from the movant and its attorney requesting reconsideration of the denial was unsuccessful. By letter dated October 19, 2004, DOH notified movant's counsel that the claims were not timely submitted within 90 days of service thereby rendering the question of the prior approval requests moot. Letters from DOH dated November 19, 2004 and December 8, 2004 restated its position that the lack of timely submissions required denial of the claims because it resulted from "circumstances within the control of your company..." (see defendant's Exhibit M, letter dated December 8, 2004).

In support of its motion for late claim relief, the movant submitted a notice of intention to file a claim which was served on DOH, but not the Attorney General, on February 28, 2005. Movant contends that the failure to serve the Attorney General with the notice of intention was the result of law office failure.

The defendant opposes the motion on the ground, inter alia, that the Court lacks jurisdiction to hear this claim, which it contends is primarily equitable in nature and properly brought in the Supreme Court pursuant to Article 78 of the CPLR.

The law is clear that "[a]s a court of limited jurisdiction, the Court of Claims has no jurisdiction to grant strictly equitable relief" (Madura v State of New York, 12 AD3d 759, 760 [2004], lv denied 4 NY3d 704 [2005], citing Ozanam Hall of Queens Nursing Home v State of New York, 241 AD2d 670, 671 [1997] and Psaty v Duryea, 306 NY 413 [1954]). The threshold question in determining whether subject matter jurisdiction resides in the Court of Claims is "[w]hether the essential nature of the claim is to recover money, or whether the monetary relief is incidental to the primary claim" (Matter of Gross v Perales, 72 NY2d 231, 236 [1988]; see also Guy v State of New York, 18 AD3d 936 [2005]). Whether the instant action is primarily one for money damages is not determined by how the claimant characterizes the claim (see Sidoti v State of New York, 115 AD2d 202, 203, citing Schaffer v Evans, 86 AD2d 708, 709 [1982], affd 57 NY2d 992 [1982]) but rather, by reference to what this Court must do to award a money judgment (Ouziel v State of New York, 174 Misc 2d 900, 905, see also, Safety Group No.194-New York State Sheet Metal Roofing & A.C. Contrs. Assn. v State of New York, 2001 WL 939747 [Ct Cl, Sise, J.], affd 298 AD2d 785 [2002]). Where an act of an administrative agency is challenged on the ground that it "was made in violation of lawful procedure, was affected by an error of law or was arbitrary and capricious or an abuse of discretion" a proceeding in the form prescribed by article 78 should be maintained (CPLR 7803[3]; see also New York City Health and Hospitals Corp. v McBarnette, 84 NY2d 194 [1994]).

Here, the movant’s claim for reimbursement was denied on two grounds: (1) that the prior approval request was required but not timely submitted pursuant to 18 NYCRR § 505.8 and 10 NYCRR § 85.33, and (2) that the claim was not submitted within 90 days of the date of the medical care or service rendered as required by 18 NYCRR § 540.6(a)(1). The 90-day time limitation for submission of medicaid reimbursement claims contained in 18 NYCRR § 540.6(a)(1) permits denial of a claim "unless the provider's submission of the claims is delayed beyond 90 days due to circumstances outside of the control of the provider... subject to the limitations of paragraph (3) of this subdivision". Paragraph 3 of section 540.6 requires all claims to be finally submitted within two years from the date the care, services or supplies were furnished.

In an affidavit submitted in opposition to the instant motion, Vincent Martiniano of DOH points out that the "real issue in this matter is not the prior approval number, it is the lack of timely filing of a claim". Whether or not payment of a claim should be allowed where it is submitted beyond 90 days from the date of service is a discretionary determination based on whether or not the delay was caused by "circumstances outside of the control of the provider..." (18 NYCRR § 540.6[a][1]).

Like the facts in Madura v State of New York, supra, "[t]his is a quintessential example of a dispute governed under CPLR article 78. That claimant may have obtained an award of money had she timely commenced a CPLR article 78 proceeding does not bring the instant claim within the jurisdiction of the Court of Claims, as any such money damages would have been incidental to the primary issue of whether . . . [the] determination was irrational and/or arbitrary and capricious such that it should be annulled" (Madura v State of New York, 12 AD3d at 761[citations omitted]). Similar cases illustrate that the relief sought here is primarily equitable in nature. For example, in Berkshire Nursing Ctr., Inc. v Novello (13 AD3d 327 [2004]) the action was converted to an article 78 proceeding and the Court held, as pertinent here, that the issue of whether the denial of reimbursement under 18 NYCRR § 540.6(a) was due to circumstances beyond the plaintiff's control and whether the exceptions to the statute made by the defendants were arbitrary was an issue of fact which required the denial of the defendant’s motion for summary judgment. Here, too, the timeliness of the claim and the propriety of the denial are matters which must be resolved in a proceeding pursuant to article 78 (see also, Matter of Quantum Health Resources v De Buono, 273 AD2d 730 [2000] lv dismissed 95 NY2d 927 [2000]; Matter of Herberg v Perales, 180 AD2d 166 [1992]; Matter of Bronx-Lebanon Special Care Ctr. v DeBuono, 268 AD2d 234 [2000]; cf., Matter of Chrislex Staffing v New York State Dept. of Health, 195 Misc 2d 465 [2003]).

Inasmuch as this Court lacks jurisdiction to annul an administrative determination, the movant’s application for late claim relief must be denied. As a result of this determination it is unnecessary to address the factors enumerated in Court of Claims Act § 10(6) for the determination of late claim relief.

Accordingly, the movant’s application for late claim relief is denied.

March 21, 2007
Saratoga Springs, New York

Judge of the Court of Claims

The Court considered the following papers:
  1. Notice of motion dated November 13, 2006;
  2. Affirmation of David K. Lieb dated November 6, 2006 with exhibits;
  3. Affidavit of Kathleen Danler-Lopez sworn to November 3, 2006 with exhibits;
  4. Affirmation of Saul Aronson dated December 11, 2006 with exhibits;
  5. Affidavit of Vincent Martiniano sworn to November 7, 2006 with exhibits;

[1].Movant articulates the requested relief as an application "for an Order allowing claimant to file a notice of intent to file a claim on the Attorney General of the State of New York pursuant to the Court of Claims Act § 10(6)". Inasmuch as Court of Claims Act §10(6) pertains to the late filing of a claim and not a notice of intention to file a claim, the defect in the relief requested will be ignored.