MARVIN LIEBLEIN, INC. v. Shewry

40 Cal. Rptr. 3d 547, 137 Cal. App. 4th 700, 2006 Daily Journal DAR 3006, 2006 Cal. App. LEXIS 333
CourtCalifornia Court of Appeal
DecidedMarch 13, 2006
DocketC050233
StatusPublished
Cited by13 cases

This text of 40 Cal. Rptr. 3d 547 (MARVIN LIEBLEIN, INC. v. Shewry) is published on Counsel Stack Legal Research, covering California Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
MARVIN LIEBLEIN, INC. v. Shewry, 40 Cal. Rptr. 3d 547, 137 Cal. App. 4th 700, 2006 Daily Journal DAR 3006, 2006 Cal. App. LEXIS 333 (Cal. Ct. App. 2006).

Opinions

Opinion

SIMS, J.

Plaintiff Marvin Lieblein (president and sole shareholder of Marvin Lieblein, Inc.), doing business as Family Pharmacy, submitted an application to defendant California Department of Health Services (the Department) for continued enrollment as a Medi-Cal pharmacy provider. The application, which Lieblein signed under penalty of perjury, stated that he had not incurred any discipline against his license. In fact, the State Board of Pharmacy had recently revoked his license, stayed the revocation, and imposed three years’ probation.

When the Department discovered the facts, it denied Lieblein’s application for “failure to disclose required information.” The Department also notified Lieblein that his Medi-Cal provider numbers were to be deactivated and that he would be barred from reapplying to the program for three years.

Lieblein appealed to the Department’s Office of Administrative Hearings and Appeals (OAHA), which denied the appeal. He then filed a petition for writ of mandate in the superior court; the court denied the petition.

Lieblein now appeals, contending: (1) The Legislature did not intend to require the Department to debar existing providers for disclosure errors, absent fraud or abuse. (2) The Department’s administrative appeal procedure violated due process because it did not allow live testimony. (3) The Department failed to provide timely notice of its denial of Lieblein’s application.

[707]*707We shall affirm.

FACTUAL AND PROCEDURAL BACKGROUND

Statutory and regulatory framework

Under the federal Medicaid program (42 U.S.C. § 1396 et seq.), the federal government financially assists participating states that provide medical services to eligible persons. California participates in Medicaid through the Medi-Cal program, administered by the Department. (Welf. & Inst. Code, §§ 10720 et seq., 14000 et seq.;1 Cal. Code Regs., tit. 22, § 51000 et seq.)

To obtain reimbursement for services provided through Medi-Cal, a medical professional must enroll in the Medi-Cal program and receive a Medi-Cal “provider number.” (Cal. Code Regs., tit. 22, §§ 51000.7, 51000.20.) A “provider” of Medi-Cal services is an “individual, partnership, group, association, corporation, institution, or entity . . . that provides services, goods, supplies, or merchandise, directly or indirectly, to a Medi-Cal beneficiary and that has been enrolled in the Medi-Cal program.” (§ 14043.1, subd. (n).) An “applicant” is any person or entity that applies to the Department for enrollment as a provider. (§ 14043.1, subd. (b).)

The Department is authorized to require categories of providers to apply for continued enrollment in order to continue to participate in Medi-Cal. (§§ 14043.2, 14043.26; Cal. Code Regs., tit. 22, § 51000.55.) The Department is also authorized to adopt regulations for certifying applicants and providers. (§ 14043.15, subd. (a).)

To apply for provider status, both “applicants] ... not currently enrolled in the Medi-Cal program” and “providers] applying for continued enrollment” (§ 14043.26, subd. (a)(1)) must follow the procedures outlined in section 14043.26. (See also Cd. Code Regs., tit. 22, §§ 51000.30, 51000.35, 51000.45, 51000.50.) Section 14043.26 repeatedly uses the expression “applicant or provider” without distinction. (§ 14043.26, subds. (c)(1), (2), (d)(1), (4)(C), (e)(1)(A), (2)(A), (C), (f)(1), (A), (2)(A), (C), (i).)

When seeking provider status, “an applicant or provider may be required to sign a provider agreement and shall disclose all information as required in federal medicaid regulations and any other information required by the [Department.” (§ 14043.2, subd. (a).) “The application form for enrollment, [708]*708the provider agreement, and all attachments or changes to either, shall be signed under penalty of perjury.” (§ 14043.25, subd. (a).)

Among other required disclosures, “[t]he applicant or provider shall . . . state on the ‘Medi-Cal Provider Disclosure Statement:’ [][]... [!]••• [w]hether the license, certificate or other approval to provide health care of the applicant or provider has been disciplined by any licensing authority[,]” and if the answer is “yes” he must provide specifics. (Cal. Code Regs., tit. 22, § 51000.35, subd. (b)(5).)2

“Failure to disclose the required information, or the disclosure of false information, shall result in denial of the application for enrollment or shall make the provider subject to temporary suspension from the Medi-Cal program, which shall include temporary deactivation of all provider numbers used by the provider to obtain reimbursement from the Medi-Cal program.” (§ 14043.2, subd. (a); see also §§ 14043.26, subd. (d)(4)(A), 14043.28, subd. (b)(1) [deactivation of provider numbers and removal from enrollment by operation of law when application denied for failure to disclose or false disclosure].)

A provider may appeal from these sanctions in writing, including supporting evidence, to the Department director or the director’s designee, within 60 days of receiving notice of the Department’s action. (§§ 14043.2, subd. (b), 14043.65, subd. (a); Cal. Code Regs., tit. 22, § 51000.50, subd. (i).) “he appeal procedure shall not include a formal administrative hearing under the Administrative Procedure Act and shall not result in reactivation of any deactivated provider numbers during appeal.” (§ 14043.65, subd. (a).) The director or director’s designee shall issue a final decision within 90 days of receipt of the appeal. {Ibid.) Any further appeal must proceed according to Code of Civil Procedure section 1085. (Ibid.)

“No applicant whose application for enrollment as a provider has been denied pursuant to Section 14043.2 [failure to disclose or false disclosure] . . . [709]*709may reapply for a period of three years from the date the application is denied. If the provider has appealed the denial, the three-year period shall commence upon the date of final action by the director or the director’s designee.” (§ 14043.65, subd. (b); see also Cal. Code Regs., tit. 22, § 51000.50, subd. (k).)

Procedural history

The discipline

In an administrative proceeding against Lieblein, the State Board of Pharmacy (the Board) notified him by letter dated January 7, 2002, that it was revoking his pharmacy permit, but staying the revocation and placing his license on probation for three years. The record and the parties’ briefs do not reveal the grounds for the Board’s action.

Lieblein’s application

By letter dated April 1, 2003, the Department notified Lieblein that he was required to enroll for continued participation in Medi-Cal.3 After receiving his response, the Department notified him by letter dated October 24, 2003, that he must submit his completed application package (consisting of an application, a provider agreement, and a disclosure statement) within 70 days.

On January 21, 2004, Lieblein submitted an application package, which the Department acknowledged by a letter dated January 26, 2004. However, the Department noted the package was incomplete in respects not material to this case, and returned it for completion or correction.

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MARVIN LIEBLEIN, INC. v. Shewry
40 Cal. Rptr. 3d 547 (California Court of Appeal, 2006)

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Bluebook (online)
40 Cal. Rptr. 3d 547, 137 Cal. App. 4th 700, 2006 Daily Journal DAR 3006, 2006 Cal. App. LEXIS 333, Counsel Stack Legal Research, https://law.counselstack.com/opinion/marvin-lieblein-inc-v-shewry-calctapp-2006.