In Papa v. DHS (2016AP2082/2017AP634), the court held that a challenge to a Wisconsin Department of Health Services (DHS) policy failed because the policy was not an administrative rule with the force of law.

Medicaid-certified nurse Kathleen Papa and Professional Homecare Providers, Inc. (PHP) filed the instant claim against DHS regarding Topic #66 in DHS’s Medicaid Provider Handbook. Topic #66 states that Medicaid providers must “meet all applicable program requirements” for reimbursement. If providers fail to meet all requirements, DHS can recoup payments from the providers.

Papa and PHP argued that Topic #66 was an illegal unpromulgated administrative rule and that the policy exceeded DHS’s explicit statutory authority under Wis. Stat. Ch. 227. The court held that Topic #66 is not an unpromulgated administrative rule because it does not have the “force of law” (Wis. Stat. § 227.01(13)). According to the court, Topic #66 simply summarizes existing law found elsewhere. Furthermore, PHP failed to show that DHS was enforcing Topic #66 like a rule. In recouping payments, DHS was not enforcing Topic #66 but was enforcing other statutes and rules referred to in the Topic.

Because the court found Topic #66 was not an administrative rule, Papa and PHP could not obtain a declaratory judgement via Wis. Stat. Ch. 227 judicial review of administrative rule proceedings.

In a dissent, Judge Reilly agreed that Topic #66 is not an administrative rule. However, the dissent argued Papa and PHP should be entitled to relief based on that fact. Under Topic #66, DHS was enforcing a requirement and recouped payments without legal right by statutes or properly promulgated administrative rules, in violation of 2011 Act 21 requirements in Wis. Stat. Ch. 227.