Legislative leaders have approved a $2 million payment to the owner of several Utah nursing homes to end a dispute over Medicaid reimbursements.

When combined with federal settlement money, Rocky Mountain Care will receive some $7 million for its claims that the state health department underpaid the company for Medicaid patients in its care between July 1991 and December 2002.

Rocky Mountain Care filed the lawsuit in 2002. The case was scheduled to go to trial in April 2006, but the parties agreed upon the settlement prior to that time.

In its lawsuit, the company claimed the state used flawed methodology to figure reimbursement amounts for Rocky Mountain facilities.

Dr. David Sundwall, executive director of the Utah Department of Health, told lawmakers Thursday that the methodology has since changed and the state is not in danger of future lawsuits based on similar claims.

Sundwall, who was not in his position during the time period at issue, said there have been "lessons learned" from the case, particularly the need for a "clear meeting of the minds" when working on Medicaid contracts.

A Utah attorney cautioned members of the Legislative Management Committee, which is required by the state's constitution to approve high-price settlements, that the state's negotiations with Rocky Mountain Care will lead to many more "me, too" lawsuits from nursing home owners.

Janet Jenson said she has been authorized by three clients, whom she declined to name, to file a notice of claim against the state for similar allegations of underpayment.

To date, no other lawsuits have been filed based on the allegedly flawed methodology, Utah Attorney General Mark Shurtleff said. Any future claims must be filed before the statute of limitations runs out in January 2008, he said.

In her testimony Thursday, Jenson also raised questions about Rocky Mountain Care's integrity, noting that the company, formerly known as Care Enterprises, filed for bankruptcy in California in the late 1980s.

At that time, Care operated seven nursing homes in Utah and nearly 100 in five other states. Rocky Mountain attorneys said Thursday that the company runs four Utah facilities, plus one in Wyoming.

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