Vencor last week won a federal appeals court ruling that could mean higher payments from private Medigap insurers to long-term-care hospitals.
A three-judge panel of the U.S. Circuit Court of Appeals in Washington said Louisville, Ky.-based Vencor has the right to charge "reasonable and customary" fees for the care of patients whose Medicare Part A benefits have been exhausted.
In a unanimous nine-page opinion, the panel overturned a lower court decision last year that said Omaha, Neb.-based Physicians Mutual Insurance was within its legal rights to limit payments to what Medicare would have reimbursed for the same care.
Vencor sued Physicians Mutual in 1998 after the insurer reduced payments to six of the company's long-term-care hospitals by a total of $2 million for care to 10 patients whose Medicare Part A benefits had been exhausted.
The appeals court sent the case back to district court for trial.