PROVIDENCE, R.I. (WPRI) – State officials are pleading with a judge to give them more time to appeal a costly court decision, insisting they were not aware of the deadline to file an appeal and blaming one of their own lawyers for the oversight.
The R.I. Executive Office of Health and Human Services lawyer who is being blamed, Gregory Hazian, is now on administrative leave, according to Ashley O’Shea, a spokeswoman for EOHHS. Deborah George, the agency’s executive counsel since 2014 and Hazian’s boss, is also on administrative leave, O’Shea said.
The agency failed to answer questions from Eyewitness News about the case for more than 72 hours last week, missing multiple self-imposed deadlines, as lawyers scrambled to deal with the situation. It’s another embarrassment for the troubled agency, which manages billions of dollars in state spending and was also responsible for the UHIP computer system fiasco.
“I am deeply disappointed and frustrated by this development. It is unacceptable,” Democratic Gov. Gina Raimondo said in a statement Sunday night. “I will make sure that EOHHS takes every step possible to hold the people who put us in this position accountable.”
The case involves a 2016 complaint by 59 Rhode Island nursing homes challenging EOHHS’s interpretation of a state law cutting their rates. In a court document, the office says a win for the nursing homes could cost taxpayers about $8 million annually for each year starting in 2016-17.
“Other state programs within EOHHS may have to be cut as a result of this decision,” the agency’s lawyers wrote in a court filing.
It’s unclear where lawmakers would come up with the money to cover the court ruling in the new budget soon to be released. O’Shea acknowledged roughly $24 million would be needed to cover three years of higher payments if the decision is upheld, but emphasized that the agency’s lawyers “believe we have a case on the merits of the case, should we be granted an appeal.”
While the state won in an initial administrative hearing about the nursing homes’ complaint, on April 9 Superior Court Judge Jeffrey Lanphear reversed that ruling and sided with the nursing homes.
Yet for weeks following Lanphear’s decision, EOHHS took no action.
According to an affidavit filed by George, the executive counsel, Hazian did not inform her about the decision or a May 23 deadline to appeal. “And when [EOHHS] did learn of the Decision, it was from an outside party, not its own counsel,” state lawyers reported in a court filing.
George also revealed that Hazian had been removed from the Rhode Island Supreme Court’s Master Roll of Attorneys back on Jan. 3, but claimed she and other senior officials did not know of his removal until they discovered the missed appeal. Court documents say he was removed for failing to complete his continuing legal education requirements.
According to the Rhode Island Bar Association, “Any person whose name is not on the Master Roll, and who practices law or who holds himself or herself out in any manner to the public or to another person as being competent, qualified, authorized, or entitled to practice law in this State … is engaged in the unauthorized practice of law and may be subject to the disciplinary procedures of the Supreme Court.”
Hazian declined to comment. He began working for state government in 1998, left for a period of time, then was rehired by the state in 2007, O’Shea said.
In a motion late Friday, EOHHS lawyers asked Lanphear to issue a stay of his decision, warning that otherwise the agency would need to immediately come up with tens of millions of dollars owed to the nursing homes under his ruling. They said the reasons they missed the appeal deadline qualify as “excusable neglect.”
The lawyers accused Hazian of “egregious failure,” arguing he was leading his bosses “to believe that the case is being diligently handled while essentially abandoning it.” They said he received notice of Lanphear’s decision both at his home Verizon email address and at his state email address, and said a forensic audit of his work email determined he had deleted the message.
“And, while a private client may have recourse against his attorney’s malpractice carrier, state attorneys generally do not carry malpractice insurance, leaving EOHHS – and the public it serves – with few avenues of redress,” the lawyers wrote.
Health and Human Services Secretary Eric Beane sent an all-staff email to the agency’s workforce on Friday informing them about the blown deadline. He called it “a hard situation to be in.”
“We believe we have a strong case on the merits for appeal; however, our position is compromised by the late filing of today’s appeal documents,” Beane wrote. “We are currently exercising and exploring all options available to us to protect the state’s position.”
“Additionally, we continue to investigate how this situation occurred, put safeguards in place to ensure it doesn’t happen again, and make changes to work and staffing assignments,” he continued. “We will continue to keep you informed as updates are available.”
The technical question at issue is whether a 2% Medicaid rate cut for nursing homes instituted by the General Assembly in 2015 was a temporary one, meaning rates should have returned to their old level after the reduction period ended, or if the lower rates should be a new permanent base level to which future increases are applied.
O’Shea said the court matter does not reflect a poor relationship between the state and the facilities. “We value our partnership with nursing homes,” she said in a statement. “They play an important role in supporting many Rhode Island seniors and promoting quality of life.” She noted that the governor’s proposed 2018-19 budget would give them a 1% rate increase.
“We will continue to work closely with these providers – and our many health care partners – to support Rhode Islanders and to strengthen our state’s long-term care system,” O’Shea said.
State lawmakers expressed frustration about the situation.
House Oversight Committee Chairwoman Patricia Serpa, a West Warwick Democrat who has been investigating the UHIP debacle for more than a year, tweeted: “‘Astonishing,’ you say? Nothing that happens over there astonishes me anymore. Now if you said, ‘Complete, unabashed incompetence,’ I would have to agree. Is there no end to this debacle?”
State Rep. Brian Newberry, a North Smithfield Republican and a lawyer, tweeted: “Mistakes happen and people are human but certain mistakes should never happen because redundancy and back up systems should be in place. Presumably the Superior Court decision was on more than one person’s radar, no?”
“Just seems to me Superior Court ruling was so impactful it would/should have been top of the agenda for past week and multiple people charged with ensuring deadline not missed,” Newberry added. “I mean what if lawyer got hit by a bus? No one would have noticed?”
Raimondo’s opponents quickly seized on the legal mess, as well.
“Complete failure of leadership starts at the top,” Republican gubernatorial candidate Allan Fung tweeted. Giovanni Feroce, another Republican hopeful, called on Raimondo to immediately fire Health and Human Services Secretary Eric Beane.
Matt Brown, who is running in the Democratic primary, described the news as “just the latest example of how Governor Raimondo’s scandalous mismanagement has inflicted enormous harm and expense on the people of Rhode Island.” He cited UHIP as another example.
Eric Halperin contributed to this report.
An earlier version of this story said the General Assembly enacted the rate cut for nursing homes in 2016; it was enacted in 2015.