Belshe

Intercommunity Medical Center (IMC) appeals from the denial of its petition for writ of mandate under section 1094.5 of the Code of Civil Procedure, in which it sought review of an administrative decision of the State Department of Health Services (the Department) disallowing IMC’s cost reporting of its psychiatric unit as a separate cost entity. The Department based its decision upon two principal grounds: (1) IMC had failed to obtain prior authorization for treating its psychiatric unit as a separate cost entity; and (2) the psychiatric unit in any event would not qualify for such treatment because it provided only short-term acute psychiatric care. IMC challenges each of those grounds for denying separate cost entity treatment for its psychiatric unit.

IMC is a general acute-care hospital licensed and certified by the Department to provide health care services to eligible beneficiaries of the Medi-Cal program. The costs of providing hospital care to Medi-Cal patients throughout the hospital are reimbursed on a “reasonable cost” basis, as defined and limited by applicable regulations.

IMC reported its costs respecting its psychiatric unit as a separate cost entity for…