TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN NO. 03-15-00226-CV Texas Health and Human Services Commission, Appellant v. Linda Puglisi, Appellee FROM THE DISTRICT COURT OF TRAVIS COUNTY, 53RD JUDICIAL DISTRICT NO. D-1-GN-14-000381, HONORABLE GISELA D. TRIANA, JUDGE PRESIDING M E M O R A N D U M O P I N I O N Appellee Linda Puglisi filed a petition for judicial review of an administrative decision by the Texas Health and Human Services Commission. The trial court held a hearing and signed a judgment reversing the Commission s decision and remanding the matter to the Commission. As explained below, we vacate the trial court s judgment for want of jurisdiction and remand the cause to the trial court for further proceedings consistent with this opinion. Factual and Procedural Background Puglisi was left paralyzed following surgery on her neck in 2011. She cannot walk, has limited movement in her arms and hands, and must use a wheelchair. In early 2013, Puglisi began intensive rehabilitation at TIRR Memorial Hermann Hospital, where she was given a comprehensive wheelchair evaluation. The results of that evaluation recommended a custom power wheelchair with integrated standing feature, known as the Permobil C500 VS, because the standing
feature would allow her to independently perform pressure relief and weight bearing through her [lower extremities][,] preventing skin breakdown and bone density loss, as well as enhancing biomechanical alignment throughout the entire body on a daily basis, which helps to prevent further impact of spasticity on joints in upright postures, and would increase her ability to participate in activities of daily living, including grooming, toileting, and personal hygiene. A doctor involved in the evaluation process provided a Medicaid-required attestation of medical necessity and a letter of medical necessity explaining Puglisi s medical and functional needs for the chair. On April 4, 2013, a Medicaid-enrolled provider of durable medical equipment 1 ( DME ) submitted Puglisi s prior authorization request to Molina Healthcare, the Commission s contracted managed care organization, and Molina forwarded the request to an outside contractor for review. Puglisi submitted further documentation explaining how integrated standing features are useful to people with spinal cord injuries, the secondary medical conditions Puglisi faces if she continues to sit for twelve hours a day in a wheelchair, and how the standing feature would give her some independence and reduce her risk of injury during transfer to and from the wheelchair. The contractor made no determination about whether the requested chair was medically necessary or should be approved, although it told Molina that Puglisi s doctors had detailed how standing would benefit her. On June 6, 2013, Molina denied the request based on its doctor s advice. Puglisi next sought a Medicaid hearing. She asserted that Molina had not given her adequate notice of its denial decision and that the Commission s denial of her request for a power 1 Medicaid requires a claimant to obtain prior authorization for a DME item. See 1 Tex. Admin. Code 354.1039(a)(4) (Tex. Health & Human Servs. Comm n, Home Health Services Benefits and Limitations); Detgen ex rel. Detgen v. Janek, 945 F. Supp. 2d 746, 757 (N.D. Tex. 2013), aff d, 752 F.3d 627 (5th Cir. 2014). 2
wheelchair was unlawful. A Commission hearing officer held a hearing and sustained the denial. Puglisi then filed a request for administrative review, asserting that the hearing officer had applied an improper standard to her request. The Commission sustained the hearing officer s decision. Puglisi filed this suit for judicial review on February 7, 2014, asserting errors in the Commission s process and the administrative decisions and asserting that the Commission s denial of her request exceeded its statutory authority, was affected by substantial errors of law, violated federal Medicaid requirements, violated Puglisi s constitutional and statutory due process rights, was arbitrary and capricious, was based on unlawful procedures, and was not supported by substantial evidence. On May 1, 2014, while her suit for judicial review was pending, Puglisi became qualified for Medicare, meaning she is now dual eligible for Medicare and Medicaid benefits and is considered a Medicaid Qualified Medicare Beneficiary (also referred to as a dual-eligible recipient ). See 42 U.S.C. 1315b ( Providing Federal coverage and payment coordination for dual eligible beneficiaries ) (establishing Federal Coordinated Health Care Office and explaining that dual-eligible individuals are individuals eligible for benefits under Medicare and Medicaid). The Commission filed a motion to dismiss, asserting that when Puglisi became dual eligible, Medicare 2 became the primary payor, and that she therefore had to seek benefits under Medicare before turning 2 When a person is dual eligible for Medicare and Medicaid, medical claims must be sought first under Medicare. See Tex. Hum. Res. Code 32.050(b) (Commission shall adopt rules to ensure that Medicaid is payor of last resort for dual-eligible recipient s claims); 1 Tex. Admin. Code 354.1041 (Texas Health & Hum. Servs. Comm n, Benefits for Medicare/Medicaid Recipients) (Medicare is primary payor, Medicaid shall pay Medicare deductibles and coinsurance subject to certain limitations, and DME may be covered by Medicaid if intended for use in recipient s home and not otherwise available as a Medicare Part B benefit ),.1143 (Texas Health & Hum. Servs. Comm n, Coordination of Medicaid with Medicare Parts A, B, and C) (governing Commission s payment of dual-eligible recipient s Medicare deductible and coinsurance). 3
to Medicaid. Because Puglisi had not filed a Medicare claim for the requested wheelchair, the Commission argued, her claims were not ripe or, in the alternative, had become moot. The trial court denied the Commission s motion to dismiss and later signed a final judgment finding that the Commission s determination that Puglisi had not demonstrated medical necessity was not supported by substantial evidence and that the Commission s denial of Puglisi s request did not comply with the applicable laws and was arbitrary, capricious, and unreasonable. Discussion The Commission argues that Puglisi s dual-eligibility status was a significant intervening event that has rendered her claims related to the Commission s denial of her preapproval request unripe. Because the ripeness, or lack thereof, of Puglisi s claims relates to our and the trial court s jurisdiction to consider the merits of the case, we consider this issue first. Texas courts may not issue advisory opinions, which include opinions addressing disputes that are not ripe. Patterson v. Planned Parenthood of Hous. & Se. Tex., Inc., 971 S.W.2d 439, 442-43 (Tex. 1998). Ripeness is peculiarly a question of timing, Blanchette v. Connecticut Gen. Ins. Corps., 419 U.S. 102, 140 (1974), and an inquiry into whether a claim is ripe focuses on whether the case involves uncertain or contingent future events that may not occur as anticipated, or indeed may not occur at all, Patterson, 971 S.W.2d at 442 (quoting 13A Charles Alan Wright, Arthur R. Miller & Edward H. Cooper, Federal Practice and Procedure 3532 (2d ed. 1984)). A case is not ripe when its resolution depends on contingent or hypothetical facts, or upon events that have not yet come to pass. Id. at 443. In the administrative-law context, moreover, avoiding premature litigation over administrative determinations prevents courts from entangling themselves 4
in abstract disagreements over administrative policies while simultaneously allowing the agency to perform its functions unimpeded. Trinity Settlement Servs., LLC v. Texas State Secs. Bd., 417 S.W.3d 494, 506 (Tex. App. Austin 2013, pet. denied) (quoting Patterson, 971 S.W.2d at 443). Ripeness should be determined at the time of adjudication on the basis of all the information available, including intervening events that occur during the pendency of the action. Perry v. Del Rio, 66 S.W.3d 239, 250 (Tex. 2001) (quoting 13A Wright, et al. 3532.1). The Commission asserts that the trial court lacked jurisdiction to make its determination of medical necessity because Puglisi s dual-eligible status requires her to first seek prior authorization from Medicare. Puglisi agrees that Medicare is now the payor of first resort for her claims but insists that the Commission is improperly conflating issues related to the payment of 3 claims with those related to the preauthorization of a claim. She insists that until the Commission 3 For support of this assertion, Puglisi first cites us to a 1992 determination from the New York Office of Health Systems Management and next refers to the settlement of a lawsuit filed in Connecticut challenging this same practice, and that Connecticut clarified that the DME prior authorization process must be available to dually eligible beneficiaries. The New York decision, attached to her brief as an appendix item, does not contain enough information for us to analyze its similarity here, and even if the facts did appear to be squarely on point with this case, that decision was rendered in an administrative proceeding in New York, under New York Medicaid rules and statutes as they stood in 1992. As for the Connecticut case, we have been unable to locate the settlement to even review it. Further, it is doubtful that the 1998 settlement of a lawsuit, which was filed in Connecticut under Connecticut s Medicaid statutes and rules, can be considered persuasive here. We note, however, that the Connecticut statute quoted by Puglisi states only that access to the Connecticut preauthorization process shall not be denied to a recipient on the basis that a Medicare coverage determination has not been made prior to the submission of a [Medicaid] request for preauthorization. See Conn. Gen. Stat. 17b-281a(b) (emphasis added). It does not state that access to the Medicaid preapproval process must be open to a recipient who has not yet even filed a Medicare preapproval request. There is an important distinction between a preapproval request not having been made and Medicare not yet having made a decision on such a request. Neither of Puglisi s authorities is persuasive in this case. 5
authorizes the wheelchair, the DME supplier cannot deliver the chair or request payment, first from Medicare and second from Medicaid. She also asserts that Medicare s primary payor status does not dictate any particular order for securing prior authorization, that there is no requirement in Medicare or Medicaid law or policy requiring her to first seek preapproval from Medicare, and that the DME supplier s manual cited by the Commission does not provide support for the Commission s assertion that Medicare prior authorization must be obtained in the first instance. Further, she contends that her eligibility for Medicare does not limit the Medicaid services to which she is entitled and that if an item of DME is not available through Medicare, Medicaid remains a source for this service. Contrary to Puglisi s contentions, the record reflects that a dual-eligible recipient must seek preapproval from Medicare for certain items of DME. See Texas Medicaid Provider Procedures Manual: Vol. 2; Texas Medicaid Managed Care Handbook (Texas Health & Hum. Servs. Comm n 2014), at 2.3.1.2 (Benefits for Medicare and Medicaid Clients) (Commission may provide preauthorization for certain medical equipment if equipment is denied by Medicare Part B and [is] a benefit of Medicaid Home Health Services; Medicare Part B recipient must contact Medicare for preapproval and should not contact Commission; Medicaid will only pay deductible and coinsurance on crossover claims), 2.3.1.3 (Medicare and Medicaid Prior Authorization) (for dual-eligible clients, do not submit prior authorization requests to [the Commission] if the Medicare denial reason states not medically necessary. Medicaid only will consider prior authorization requests if the Medicare denial states not a benefit of Medicare. ). 6
Further, the statutes and rules governing Medicare provide that Medicare must give preapproval before certain DME items, including many power wheelchairs, are covered under that program. See 42 U.S.C. 1395m(a)(1)(E)(iv) (Social Security, Special payment rules for particular items and services) (power wheelchair is not covered unless appropriate medical professional has conducted face-to-face exam and written prescription), (a)(15) (carrier shall determine coverage in advance of delivery of certain items or medical supplies); Medicare Program; Prior Authorization Process for Certain Durable Medical Equipment, Prosthetics, Orthotics, and Supplies, 80 Fed. Reg. 81674-01 (Dec. 30, 2015) (to be codified at 42 C.F.R. pts. 405 & 414) (establishing prior authorization program for certain DME determined to be subject to frequent unnecessary utilization, defining unnecessary utilization, and providing that claims for such items must be preapproved). 4 Because Medicare is the primary payor for Puglisi s medical needs, it appears likely that Medicare will conduct a prior authorization review. If the wheelchair is a covered Medicare benefit, Medicare will pay the bulk of the cost, and Medicaid will pay Puglisi s deductible and coinsurance. Only if Medicare denies the request because the requested wheelchair is not a Medicare 4 A cursory review of information provided by Medicare to guide recipients through the process of obtaining a power wheelchair also shows that prior approval must be obtained from Medicare before any such benefit will be covered. See Medicare s Wheelchair & Scooter Benefit (revised April 2014, https://www.medicare.gov/pubs/pdf/11046.pdf) (Medicare Part B covers wheelchairs as DME if doctor submits written order stating that you have a medical need for a wheelchair and client meets certain conditions; doctor will submit a written order telling Medicare why you need the device and that you re able to operate it ; if client lives in state with high rate of Medicare fraud, including Texas, your doctor or supplier must get pre-approval (prior authorization) for wheelchair ordered after September 1, 2012); Prior Authorization of Power Mobility Devices (PMDs) Demonstration Fact Sheet (https://www.cms.gov/research-statistics- Data-and-Systems/Monitoring-Programs/CERT/Downloads/Fact-Sheet-new-8112.pdf) (Texas residents must use prior authorization process). 7
benefit might Medicaid determine the chair is a covered Medicaid benefit. It appears that a Medicaid preapproval will have no effect on the Medicare approval process and that Puglisi must proceed under Medicare s prior-authorization process before either Medicare or Medicaid will cover any costs of her requested wheelchair. Puglisi s complaint about the Commission s denial of her preapproval request seems to have been rendered unripe by her new dual-eligible status. The trial court therefore lacked jurisdiction to consider the merits of the Commission s denial of Puglisi s preapproval request and instead should have remanded the matter to the Commission for full consideration of how Puglisi s dual eligibility affects her preapproval request to the Commission. Conclusion Because Puglisi s becoming dual eligible appears to have rendered unripe her complaints against the Commission s Medicaid denial of her preapproval request, we vacate the trial court s judgment and remand the matter to the trial court for further proceedings consistent with this opinion. David Puryear, Justice Before Justices Puryear, Goodwin, and Bourland Vacated and Remanded Filed: March 24, 2016 8