Opinion
NO. 2013 CA 2214
08-18-2014
ACADIAN AMBULANCE SERVICE, INC. v. STATE OF LOUISIANA DEPARTMENT OF HEALTH AND HOSPITALS
Terry C. Landry, Jr. Baton Rouge, Louisiana Attorney for Appellee, Acadian Ambulance Service, Inc. Douglas L. Cade Neal R. Elliott, Jr. Baton Rouge, Louisiana Attorneys for Appellant, State of Louisiana, Department of Health and Hospitals
NOT FOR PUBLICATION On Appeal from the Nineteenth Judicial District Court In and for the Parish of East Baton Rouge State of Louisiana
No. C609581, Div. E, Sec. 23
The Honorable William A. Morvant, Judge Presiding Terry C. Landry, Jr.
Baton Rouge, Louisiana
Attorney for Appellee,
Acadian Ambulance Service,
Inc.
Douglas L. Cade
Neal R. Elliott, Jr.
Baton Rouge, Louisiana
Attorneys for Appellant,
State of Louisiana, Department
of Health and Hospitals
BEFORE: PARRO, GUIDRY, AND DRAKE, JJ.
DRAKE, J.
The State of Louisiana, through the Department of Health and Hospitals (DHH), denied Acadian Ambulance Service, Inc.'s (Acadian) application for Medicaid payment at an air ambulance rate. Under administrative appeal, an Administrative Law Judge (ALJ) reversed the denial of the air ambulance rate in a Recommended Decision and Order. The ALJ's Recommended Decision and Order was sent to DHH for final approval. In a final administrative decision, the Secretary of DHH held that DHH properly denied Medicaid payment to Acadian at an air ambulance rate. Acadian filed a petition for judicial review with the Nineteenth Judicial District Court. Acting in its capacity as an appellate court for administrative decisions, the district court reversed the final administrative decision of DHH and ordered DHH to pay Acadian at an air ambulance rate. DHH filed this appeal. For the reasons that follow, we affirm the judgment of the district court.
FACTS AND PROCEDURAL HISTORY
On July 12, 2011, between 1:49 a.m. and 2:20 a.m., Acadian transported a 56-year-old female Medicaid recipient from her home in Church Point, Louisiana, to Opelousas General Hospital by air transport. Transfer from the ground unit to the air unit took 7 minutes, while the actual air transport time was 11 minutes. The distance by ground from her home to Opelousas General was 17 miles, and it was estimated that the ground trip would take 28 minutes. Acadian personnel at the scene reported that the obstacles faced by ground transportation were an indirect path of travel on rough rural roads with multiple curves, turns, red lights, stop signs, and traffic congestion through heavily populated cities.
The paramedics at the scene reported that the patient had severe mid-substernal chest pain (10 on a scale of 1 to 10) radiating to her left shoulder, shortness of breath, weakness, and nausea. The patient had a history of coronary artery disease, diabetes mellitus, and myocardial infarction. The patient described the pain as similar to her previous myocardial infarctions. Her blood pressure was elevated at first, but declined with treatment provided en route; her pulse was 90, and her vital signs were stable. The electrocardiogram (EKG) taken by the paramedics showed no ST segment elevation or rhythm abnormalities.
Acadian subsequently requested Medicaid payment for the air ambulance transportation from the patient's home in Church Point to Opelousas General Hospital. The reviewing physician at DHH's fiscal intermediary (Molina Medicaid Solutions) denied the claim for payment of the air ambulance rate and approved the Medicaid payment at the land ambulance rate. The reviewing physician determined that the difference in response time of an air ambulance and a land ambulance would not have made a difference in the patient's clinical status under the circumstances presented.
Acadian appealed the denial of payment at the air ambulance rate, and Dr. Lalit Barai reconsidered the claim of medical necessity for air ambulance transport on behalf of DHH. On reconsideration, Dr. Barai, who is a cardiologist and board-certified physician in internal medicine, determined there was "no indication of need for air transportation noted."
Following the reconsideration of Acadian's claim, the Division of Administrative Law held a telephone hearing on the appeal before ALJ Gregory Toney. Dr. Maurice Nassar testified on behalf of DHH as an expert physician reviewer; Kenneth Endsley, Acadian's reimbursement/utilization manager, testified on behalf of Acadian. Dr. Nassar testified that immediate treatment was not necessary because there was no ST elevation on the EKG. Mr. Endsley testified that the patient described her pain as being identical to her previous heart attacks. Because the Acadian staff is unable to diagnose or rule out that the patient was having a heart attack, the Acadian paramedics determined that immediate admission to the hospital was necessary for the patient. In his Recommended Decision and Order, the ALJ reversed DHH's denial of payment to Acadian at an air ambulance rate.
The ALJ's Recommended Decision and Order was sent to the Secretary of DHH for final administrative decision. The Secretary of DHH issued its final decision in the matter and affirmed DHH's original denial of payment to Acadian at an air ambulance rate. The Secretary ruled that DHH properly denied Medicaid payment at the air ambulance rate, since neither of the mandatory criteria for Medicaid reimbursement for air transport was met. The Secretary noted that "[b]ased on the evidence available at the time of transport, a land ambulance was sufficient to meet the cardiac needs of the recipient because there was insufficient objective documentation of an emergent medical condition requiring air emergency transport, and there was insufficient evidence to determine that there were obstacles to transporting this recipient by land to an appropriate facility to meet the recipient's medical needs."
Following the final decision of DHH, Acadian filed a Petition for Judicial Review. After a hearing, the district court granted Acadian's Petition for Judicial Review, reversed the final administrative decision of DHH, and ordered DHH to pay Acadian at an air ambulance rate. DHH now appeals.
DISCUSSION
Standard of Review
This case is an action for judicial review of an administrative adjudication pursuant to the Louisiana Administrative Procedure Act. Women's and Children's Hosp. v. State, Dept. of Health and Hospitals, 07-1157 (La. App. 1 Cir. 2/8/08), 984 So. 2d 760, 765, writ granted, 08-0946 (La. 6/27/08), 983 So. 2d 1287, and aff'd, 08-0946 (La. 1/21/09), 2 So. 3d 397; see La. R.S. 49:950-973. When reviewing an administrative final decision in an adjudication proceeding, the district court functions as an appellate court. Once a final judgment is rendered by the district court, an aggrieved party may seek review of the same by appeal to the appropriate appellate court. Smith v. State Dept. of Health and Hospitals, 39,368 (La. App. 2 Cir. 3/2/05), 895 So. 2d 735, 739, writ denied, 05-1103 (La. 6/17/05), 904 So. 2d 701. On review of the district court's judgment, no deference is owed by the court of appeal to factual findings or legal conclusions of the district court, just as no deference is owed by the Louisiana Supreme Court to factual findings or legal conclusions of the court of appeal. Maraist v. Alton Ochsner Medical Foundation, 02-2677 (La. App. 1 Cir. 5/26/04), 879 So. 2d 815, 817. Thus, an appellate court sitting in review of an administrative agency reviews the findings and decision of the administrative agency and not the decision of the district court. Smith, 895 So. 2d at 739.
Our review of the district court's judgment is governed by La. R.S. 49:964. Subsection F of La. R.S. 49:964 provides that a reviewing court is confined to the record established before the agency. A reviewing court's function is not to weigh de novo the available evidence and to substitute its judgment for that of the agency. Smith, 895 So. 2d at 739. Nevertheless, Subsection G of La. R.S. 49:964 provides that the reviewing court:
...may affirm the decision of the agency or remand the case for further proceedings. The court may reverse or modify the decision if substantial rights of the appellant have been prejudiced because the administrative findings, inferences, conclusions, or decisions are:
(1) In violation of constitutional or statutory provisions;
(2) In excess of the statutory authority of the agency;
(3) Made upon unlawful procedure;
(4) Affected by other error of law;
(5) Arbitrary or capricious or characterized by abuse of discretion or clearly unwarranted exercise of discretion; or
(6) Not supported and sustainable by a preponderance of evidence as determined by the reviewing court. In the application of this rule, the court shall make its own determination and conclusions of fact by a preponderance of evidence based upon its own evaluation of the record reviewed in its entirety upon judicial review. In the application of the rule, where the agency has the opportunity to judge the credibility of witnesses by first-hand observation of demeanor on the witness stand and the reviewing court does not, due regard shall be given to the agency's determination of credibility issues.
The district court applies the manifest error standard of review in reviewing the facts as found by the administrative tribunal; the district court applies the arbitrary and capricious test in reviewing the administrative tribunal's conclusions and its exercise of discretion. Samuels v. Goodwin, 05-2131 (La. App. 1 Cir. 11/3/06), 950 So. 2d 736, 738. A reviewing court should afford considerable weight to an administrative agency's construction and interpretation of its rules and regulations adopted under a statutory scheme that the agency is entrusted to administer, and its construction and interpretation should control unless they are found to be arbitrary, capricious, or manifestly contrary to its rules and regulations. Delahoussaye v. Board of Sup'rs. of Community and Technical Colleges, 04-0515 (La. App. 1 Cir. 3/24/05), 906 So. 2d 646, 649 (citing Matter of Recovery I, Inc., 93-0441 (La. App. 1 Cir. 4/8/94), 635 So. 2d 690, 696, writ denied, 94-1232 (La. 7/1/94), 639 So. 2d 1169). An interpretation used by the state administrative agency may be persuasive, but inconsistent interpretation of the overall scheme or use of the wrong rule cannot stand. Varner v. Day, 00-2104 (La. App. 1 Cir. 12/28/01), 806 So. 2d 121, 125. If the evidence, as reasonably interpreted, supports the determination of an administrative agency, its orders are accorded great weight and will not be reversed or modified in the absence of a clear showing that the administrative action is arbitrary and capricious. Recovery I, 635 So. 2d at 699 (citing Blackett v. Louisiana Dept. of Environmental Quality, 506 So. 2d 749, 752 (La. App. 1 Cir. 1987)). Hence, the test for determining whether the action is arbitrary and capricious is whether the action taken is reasonable under the circumstances. Recovery I, 635 So. 2d at 699-700 (citing Castle Investors, Inc. v. Jefferson Parish Council, 472 So. 2d 152, 154 (La. App. 5th Cir.), writ denied, 474 So. 2d 1311 (La. 1985)). Stated differently, the question is whether the action taken was without reason. Recovery I, 635 So. 2d at 700.
On legal issues, however, the reviewing court gives no special weight to the findings of the administrative tribunal, but conducts a de novo review of questions of law and renders judgment on the record. Schackai v. Louisiana Board of Massage Therapy, 99-1957, 99-1958 (La. App. 1 Cir. 9/22/00), 767 So. 2d 955, 960, writ denied, 00-2898 (La. 12/8/00), 776 So. 2d 464. The court is free to make its own determination of the correct legal meaning of the appropriate statutes and render judgment on the record. Twin B. Casinos, Inc. v. State ex rel. Louisiana Gaming Control Bd, 00-1681 (La. App. 1 Cir. 9/28/01), 809 So. 2d 995, 999.
The issue in this case is whether DHH properly approved Medicaid payment to Acadian at the land ambulance rate, rather than at the air ambulance rate. This requires an interpretation of law, and therefore, it is a question of law subject to appellate review for legal correctness, and the prior decision of DHH is not entitled to deference. Appellate review of questions of law is simply review of whether the lower court was legally correct or legally incorrect. Smith, 895 So. 2d at 739.
We note that the statutory and jurisprudential rules for statutory construction and interpretation apply equally well to ordinances, rules, and regulations. Samuels, 950 So. 2d at 739. The paramount consideration in statutory construction is ascertainment of the agency's intent and the reason or reasons that prompted the agency to enact the rule. It is well established that the starting point for the interpretation of any rule is the language of the rule itself. When a rule is clear and unambiguous and its application does not lead to absurd consequences, the provision is applied as written with no further interpretation made in search of the agency's intent. See Fori v. Holliday, 09-0093 (La. 10/30/09), 27 So. 3d 813, 817.
When the language of the law is susceptible of different meanings, it must be interpreted as having the meaning that best conforms to the purpose of the law. La. C.C. art. 10. When the words of a law are ambiguous, the meaning must be sought by examining the context in which they occur and the text of the law as a whole. La. C.C. art. 12. An agency is entitled to deference regarding its interpretation and construction of the rules and regulations that it promulgates. Where the legislature has authorized an agency to promulgate rules and regulations, such is analogous to the situation where Congress has explicitly left a void for a federal agency to fill. Accordingly, the agency's interpretations should stand unless they are arbitrary, capricious, or manifestly contrary to its rules and regulations. Women's, 984 So. 2d at 768-69. Applicable Law
La. Admin. Code tit. 50, pt. XXVII, § 351(C) provides the Louisiana Medicaid Program air ambulance reimbursement rule. The rule states, in pertinent part:
The Prior Authorization Unit of the fiscal intermediary must approve the medical necessity for all air ambulance services.LAC 50:XXVII.351. This rule is promulgated by the Secretary of DHH, Bureau of Health Services Financing.
1. Air ambulance claims will be reviewed and a determination will be made based on the following requirements. Air ambulance services are covered only if:
a. speedy admission of the patient is essential and the point of pick-up of the patient is inaccessible by a land vehicle; or
b. great distance or other obstacles are involved in getting the patient to the nearest hospital with appropriate services. (Emphasis added.)
In order to reimburse a provider at an air ambulance rate, DHH posits that LAC 50:XXVII.351 has two independent, conditional requirements, that is, one or the other, but not both, must be met in order to satisfy the rule. Thus, if requesting reimbursement is based on the first prong, DHH argues that a provider must show that speedy admission is essential and the point of pick-up is inaccessible by land vehicle. If requesting reimbursement is based on the second prong, DHH contends that a provider must show that great distance or other obstacles are involved in getting the patient to the nearest hospital with appropriate services. DHH's interpretation of LAC 50:XXVII.351 is that the first prong of the rule is a combination of medical severity and inaccessibility by land vehicle of the patient. DHH's interpretation of the second prong of the rule is that a patient may not have an immediate medical necessity for air transport, but a great distance or other obstacles are involved in getting the patient to the nearest hospital with appropriate services.
Acadian argues that it is entitled to reimbursement at the air ambulance rate because its claim satisfies the requirements of LAC 50:XXVII.351. Acadian, like DHH, interprets the rule as a two-prong, conditional rule; however, Acadian argues that immediate medical necessity is a requirement for both prongs. Thus, Acadian argues that speedy admission of the patient was essential in this matter and that while the patient was accessible by a land vehicle, there was a great distance or obstacles involved in getting her to the nearest hospital.
Acadian also argues that its interpretation of LAC 50:XXVII.351 is consistent with the air ambulance reimbursement rule found in the Medical Transportation Provider Manual of the Louisiana Medicaid Services Manual, which is a document given to participating providers by the State of Louisiana, Bureau of Health Services Financing. Acadian submitted a prior version of the rule contained in the Medical Transportation Provider Manual on air ambulance reimbursement payments in conjunction with the administrative law hearing on its claim. Testimony at the hearing on Acadian's Petition for Judicial Review establishes that there is a "current" version of the air ambulance reimbursement rule found in the Medical Transportation Provider Manual, Section 10.13, "Ambulance-Air Transportation"; however, neither party admitted the alleged "current" version of the manual rule into evidence.
Our review of this matter is confined to the record on appeal. La. R.S. 49:964(F); La. C.C.P. art. 2164. The record on appeal is that which is sent by the district court to the appellate court and includes the pleadings, court minutes, transcript, jury instructions, judgments and other rulings, unless otherwise designated. La. C.C.P. arts. 2127 and 2128; Official Revision Comment (d) for La. C.C.P. art. 2127; Tranum v. Hebert, 581 So. 2d 1023, 1026 (La. App. 1 Cir.), writ denied, 584 So. 2d 1169 (La. 1991); Reed v. Peoples State Bank of Many, 36,531 (La. App. 2 Cir. 3/5/03), 839 So. 2d 955, 958. An appellate court cannot review evidence that is not in the record on appeal and cannot receive new evidence. The briefs of the parties and the attachments thereto are not part of the record on appeal. Appellate briefs are not part of the record on appeal, and this court has no authority to consider on appeal facts referred to in briefs, or in exhibits, if those facts are not in the record on appeal. Tranum, 581 So. 2d at 1026-27; Reed, 839 So. 2d at 958.
The only document in the record that contains the full language of the Medical Transportation Provider Manual rule on air ambulance reimbursement is DHH's brief in opposition to Acadian's Petition for Judicial Review. As that document does not form a part of the record on appeal, this court will not consider arguments relating to any version of the air ambulance reimbursement rule found in the Medical Transportation Provider Manual.
While our review of LAC 50:XXVII.351 is de novo, we agree with Acadian, the ALJ, and the district court's interpretation of LAC 50:XXVII.351. In order to interpret LAC 50:XXVII.351 in a logical way that best conforms to the purpose of the law, speedy admission, i.e., immediate medical necessity, must be a requirement under every prong of the rule. Thus, air ambulance claims are covered only if (a) speedy admission of the patient is essential, and (i) the point of pick-up is inaccessible by a land vehicle, or (ii) great distance or obstacles are involved in getting the patient to the nearest hospital. To interpret the rule any other way would lead to absurd results. For example, if we adopt DHH's interpretation, that a patient may not have an immediate medical necessity for air transport, but a great distance or other obstacles are involved in getting the patient to the nearest hospital, a patient with a hangnail who has no medical necessity, but who lives a great distance from a hospital, would be entitled to air transportation.
The findings of fact made by the ALJ show that the patient was awakened with sudden severe substernal pain radiating to her left shoulder. She rated the pain at ten out of ten and reported that the pain felt like her two previous heart attacks. The patient had shortness of breath, weakness, and nausea. Besides her previous heart attacks, the patient's medical history included hypertension, diabetes, and angina. An EKG showed no ST elevation. Her vital signs were stable. Based on the patient's signs and symptoms, paramedics were unable to rule out a heart attack and determined that this was a life-threatening situation that required speedy admission to a hospital. The route from the point of pick-up to the hospital contained obstacles including streets through the town of Church Point, multiple turns, and rural roads. The paramedics' assessment of the patient at the scene showed that speedy admission was essential. Acadian estimated the time savings of air transportation to be 17 minutes. Thus, the ALJ found that, based on the facts of the case, speedy admission was essential, and there were obstacles to ground transportation necessitating air transportation of the patient. The ALJ determined that DHH incorrectly denied payment at the air ambulance rate. The district court agreed that Acadian is entitled to be reimbursed at the air ambulance rate. We agree with the ALJ and the district court. DHH's interpretation of LAC 50:XXVII.351 in this matter is manifestly contrary to its own rules and regulations. See Women's, 984 So. 2d at 768-69.
DECREE
Considering the foregoing, the October 18, 2013 judgment of the district court, which reversed the final administrative decision of DHH and ordered DHH to pay Acadian at an air ambulance rate, is hereby affirmed. All costs of this appeal, in the amount of $1,382.00, are assessed to the State of Louisiana, through the Department of Health and Hospitals.
AFFIRMED.
PARRO, J., concurring.
I concur with the result in this case, which I believe is justified under LAC 50:XXVII.351(C)(l)(b), namely, that "great distance or other obstacles are involved in getting the patient to the nearest hospital with appropriate services." I am not persuaded, however, that the wording of sub-paragraph (a) of the rule, that "speedy admission of the patient is essential," should be interpreted as applicable to both subparagraphs (a) and (b). This interpretation rewrites the rule to say that air ambulance services are covered if speedy admission of the patient is essential and (a) the point of pick-up of the patient is inaccessible by a land vehicle, or (b) great distance or other obstacles are involved in getting the patient to the nearest hospital with appropriate services. It seems that if this had been the intent of the rule, DHH could easily have written it with this construction.
Accordingly, I respectfully concur in the result.