Texas Health and Human Services Commission v. Jessica Lukefahr

Opinion

ACCEPTED 03-15-00325-CV 8123327 THIRD COURT OF APPEALS AUSTIN, TEXAS 12/7/2015 4:08:36 PM JEFFREY D. KYLE CLERK No. 03-15-00325-CV _______________________________________________________________ FILED IN 3rd COURT OF APPEALS IN THE COURT OF APPEALS AUSTIN, TEXAS FOR THE THIRD DISTRICT OF TEXAS 12/7/2015 4:08:36 PM AT AUSTIN JEFFREY D. KYLE Clerk _______________________________________________________________

TEXAS HEALTH AND HUMAN SERVICES COMMISSION Appellant,

v. JESSICA LUKEFAHR Appellee. ________________________________________________________________

On Appeal from the 345th Judicial District Court of Travis County, Texas Cause No. D-1-GN-14-002158 The Honorable Stephen Yelenosky Presiding __________________________________________________________________

APPELLANT’S RESPONSE TO APPELLEE’S SUR-REPLY __________________________________________________________________

KEN PAXTON KARA HOLSINGER Attorney General of Texas Assistant Attorney General State Bar No. 24065444 CHARLES E. ROY OFFICE OF THE ATTORNEY GENERAL First Assistant Attorney General OF TEXAS Administrative Law Division JAMES E. DAVIS P.O. Box 12548, Capitol Station Deputy Attorney General for Civil Austin, Texas 78711-2548 Litigation Telephone: (512) 475-4203 Facsimile: (512) 320-0167 DAVID A. TALBOT, JR. kara.holsinger@texasattorneygeneral.gov Chief, Administrative Law Division COUNSEL FOR APPELLANT ORAL ARGUMENT REQUESTED TABLE OF CONTENTS

TABLE OF CONTENTS ............................................................................................. ii

INDEX OF AUTHORITIES........................................................................................ iii

ARGUMENT AND AUTHORITIES .......................................................................... 2

I. Ms. Lukefahr Failed to Provide Evidence-Based Medical Peer-Reviewed Literature in Support of the Exceptional Circumstances Request as Required by HHSC’s Exceptional Circumstances Policy................................................. 2

II. There is no set Clinical Criteria for Exceptional Circumstances Review because these Requests are Considered on a Case-by-Case Basis .................... 3

III. Requesting Prior Authorization of Alternative Durable Medical Equipment is not an Exceptional Circumstances Review Requirement .................................. 4

IV. Ms. Lukefahr has a Medical Need to Stand, but she does not have a Medical Need for an Integrated Stander .......................................................................... 5

V. HHSC’s Denial Letter Provides the Legal Basis for the Denial as Required by Federal Medicaid Regulations ........................................................................... 6

PRAYER ...................................................................................................................... 7

CERTIFICATE OF COMPLIANCE ........................................................................... 8

CERTIFICATE OF SERVICE .................................................................................... 9

ii TABLE OF AUTHORITIES

FEDERAL STATUTE 42 C.F.R. § 431.210(c)...............................................................................................6

RULES 1 Tex. Admin. Code 354.1039(a)(4)(D) ........................................................... 2, 3, 5

iii No. 03-15-00325-CV _______________________________________________________________

IN THE COURT OF APPEALS FOR THE THIRD DISTRICT OF TEXAS AT AUSTIN _______________________________________________________________

v. JESSICA LUKEFAHR Appellee. ________________________________________________________________

On Appeal from the 345th Judicial District Court of Travis County, Texas Cause No. D-1-GN-14-002158 The Honorable Stephen Yelenosky Presiding __________________________________________________________________

APPELLANT’S RESPONSE TO APPELLEE’S SUR-REPLY __________________________________________________________________

TO THE HONORABLE JUDGE OF SAID COURT:

NOW COMES the Texas Health and Human Services Commission

(“HHSC”) and files this reply to Appellee’s Sur-Reply. The matters raised in

Appellee’s Sur-Reply have largely been addressed in Appellant’s Brief and Reply

Brief. But Appellant files this response to Appellee’s Sur-Reply to address factual

and legal matters not addressed in previous briefing. ARGUMENT AND AUTHORITIES

I. Ms. Lukefahr Failed to Provide Evidence-Based Medical Peer- Reviewed Literature in Support of the Exceptional Circumstances Request as Required by HHSC’s Exceptional Circumstances Policy.

Appellee states that the exceptional circumstances rule does not require the

submission of evidence-based medical peer-reviewed literature in support of an

exceptional circumstances request, but omits the fact that the exceptional

circumstances policy does so require. Sur-Reply at 5; compare 1 Tex. Admin.

Code 354.1039(a)(4)(D) with Administrative Record (A.R.) 428-31 (2013 Texas

Medicaid Program Policy Manual—Exceptional Circumstances Policy). As

discussed extensively in Appellant’s Brief, HHSC’s exceptional circumstances

policy sets out the documentation that must be provided in support of an

exceptional circumstances request. Appellant’s Br. 6-10, 14-25. Ms. Lukefahr

complied with this policy and does not challenge the policy on appeal. A.R. 208-

241; see also A.R. 71-115, 129-207. According to the exceptional circumstances

policy, Ms. Lukefahr was required to submit “[a] minimum of two articles from

evidence-based medical peer-reviewed literature that demonstrate validated,

uncontested data for use of the requested equipment to treat the client’s specific

medical condition, and that the requested equipment has been found to be safe and

effective.” A.R. 429. Although Ms. Lukefahr submitted two articles, the articles

2 did not rise to the level of evidence-based medical peer-reviewed literature

supporting medical necessity for the mobile stander, as discussed in Appellant’s

Brief. A.R. 147-61; Appellant’s Br. 9-11. As such, Ms. Lukefahr failed to meet the

requirements for an exceptional circumstances request, and HHSC’s denial of the

integrated stander should have been affirmed. A.R. 428-29.

II. There is no set Clinical Criteria for Exceptional Circumstances Review because these Requests are Considered on a Case-by-Case Basis.

Appellee claims that HHSC witnesses could not identify criteria used to

deny Ms. Lukefahr’s exceptional circumstances request and could not name a

medical purpose that could justify approval of an integrated stander. Sur-Reply at 9

n. 8. This is because each exceptional circumstances request must be considered on

a case-by-case basis: “Medical equipment or appliances not listed in subparagraph

(C) of this paragraph [related to covered appliances and equipment] may, in

exceptional circumstances, be considered for payment when it can be medically

substantiated as a part of the treatment plan that such service would serve a

specific medical purpose on an individual case basis.” 1 Tex. Admin. Code

§ 354.1039(a)(4)(D) (emphasis added). The exceptional circumstances policy

further clarifies that enrollment criteria and adjudication guidelines to not apply to

exceptional circumstances. A.R. 429-30. Thus, HHSC witnesses testified that there

is no set clinical criteria for review of an exceptional circumstances request, as the

3 exceptional circumstances rule and policy requires that each request be considered

on an individual case basis. Fair Hearing Audio Recording (“H.R.”) 1:15.40,

1:20.50, 1:24, 2:49. As Ms. Lukefahr’s request was considered based on her

individual medical needs in compliance with law and policy, HHSC’s decision

should have been affirmed. A.R. 58-60 (Exceptional circumstances denial letter

stating, in part: “After reviewing and studying the clinical points of your request

and your special medical needs it was found you may have a medical need for a

power wheelchair without a standing feature and a static standing system to meet

both your medical and mobility needs.”).

III. Requesting Prior Authorization of Alternative Durable Medical Equipment is not an Exceptional Circumstances Review Requirement.

Appellee asserts that HHSC denied the exceptional circumstances request

because Ms. Lukefahr did not submit a prior authorization request for a static

stander, thereby creating a new requirement that alternative Durable Medical

Equipment (“DME”) be requested for prior authorization prior to submitting an

exceptional circumstances request. Sur-Reply at 6. This claim is not supported by

the record. Rather, the exceptional circumstances request was denied, in part,

because Ms. Lukefahr failed to show that alternative DME had been tried or ruled

out, and why, as required by the exceptional circumstances policy. A.R. 429

(Exceptional Circumstances request must include “[l]etters of Medical Necessity

4 (LOMN) from the client’s clinical professionals documenting alternative measures

and alternative DME that have been tried and that have failed to meet the client’s

medical need(s), or have been ruled out, and an explanation of why it failed or was

ruled out.”); Appellant’s Br. 22-25. The evidence showed that Ms. Lukefahr did

not have a static stander and that a static stander had never been prior authorized

for her. A.R. 588 (Finding of Fact No. 5). This did not create a requirement that

alternative DME must be requested for prior authorization prior to submitting an

exceptional circumstances request, and no such requirement exists in law or policy.

1 Tex. Admin. Code § 354.1039(a)(4)(D); A.R. 429-30. Rather, it was evidence

that alternative DME had not been tried or ruled out as required by the exceptional

circumstances policy. A.R. 429-30.

IV. Ms. Lukefahr has a Medical Need to Stand, but she does not have a Medical Need for an Integrated Stander.

Appellee conflates evidence regarding Ms. Lukefahr’s need to stand with

evidence regarding the need for an integrated stander. Sur-Reply at 10 n. 9. Ms.

Lukefahr points out that Ms. Clayes, a nurse employed by HHSC, testified that Ms.

Lukefahr has a medical need to stand, asserting that this disproves that the

integrated stander was requested to help Ms. Lukefahr progress at work. Id. But

Ms. Lukefahr ignores that Ms. Clayes further testified that no medical need for an

integrated stander was expressed in the exceptional circumstances request. H.R.

5 1:28 (“All of that documentation justifies standing. None of that justifies why that

stander needs to be part of a wheelchair. . . It looks like convenience.”). As noted

in the denial letter, the integrated stander was requested primarily to help Ms.

Lukefahr progress at work, which is not a medical need. A.R. 59 (“The review of

the papers sent in show the main reason for requesting a standing power

wheelchair was to help you progress at work. The main reason was not for the

treatment of your medical condition.); H.R. 1:27 (Ms. Clayes testifying that the

integrated stander seemed to have been requested for work reasons, not due to

medical need.). Instead, Ms. Lukefahr’s medical need to stand may be met through

use of a static stander, as discussed in Appellant’s Brief. Appellant’s Br. 18-21;

Appellant’s Reply Br. 8-13. Thus, the Court should disregard Ms. Lukefahr’s

attempts to conflate a medical need to stand with a medical need for an integrated

stander.

V. HHSC’s Denial Letter Provides the Legal Basis for the Denial as Required by Federal Medicaid Regulations.

Finally, Ms. Lukefahr notes that that HHSC, in its Reply Brief, failed to cite to part

of a Federal Medicaid regulation requiring that a denial letter provide the legal

basis for the denial. Sur-Reply at 4 n. 3; 42 C.F.R. § 431.210(c) (the notice must

contain “[t]he specific regulations that support, or the change in Federal or State

law that requires, the action.”). This is true, since the portion of HHSC’s Reply

6 Brief cited by Ms. Lukefahr refers to the level of detail required in a denial letter,

not the legal basis for the denial. See Reply Br. at 8 n. 2. Regardless, HHSC’s

denial letter provided the legal basis for denial in compliance with federal

regulations, stating: “Because the standing feature on the power wheelchair would

not serve a specific medical purpose for you, it could not be approved under the

exceptional circumstances provision of 1 Texas Administrative Code

§ 354.1039(a)(4)(D) as requested by your provider.” A.R. 59.

PRAYER

HHSC asks this Court to reverse the district court’s judgment because

HHSC’s order denying Ms. Lukefahr’s request for a custom power wheelchair

with an integrated stander is supported by substantial evidence and is not arbitrary

and capricious or in violation of Ms. Lukefahr’s due process rights.

Respectfully submitted,

KEN PAXTON Attorney General of Texas

CHARLES E. ROY First Assistant Attorney General

JAMES E. DAVIS Deputy Attorney General for Civil Litigation

DAVID A. TALBOT, JR. Chief, Administrative Law Division

7 /s/ Kara Holsinger KARA HOLSINGER Assistant Attorney General State Bar No. 24065444 Office of the Attorney General of Texas Administrative Law Division P.O. Box 12548, Capitol Station Austin, Texas 78711-2548 Telephone: (512) 475-4203 Facsimile: (512) 320-0167 kara.holsinger@texasattorneygeneral.gov Attorneys for Appellant

CERTIFICATE OF COMPLIANCE

In compliance with Travis County Local Rule 10.5 and relying on the word

count function in the word processing software used to produce this document, I

certify that the number of words in this document is 1,854 including the portions

that would otherwise be exempted by TRAP Rule 9.4(i)(1).

/s/ Kara Holsinger KARA HOLSINGER

8 CERTIFICATE OF SERVICE

A true and correct copy of the foregoing Appellant’s Response to Appellee’s

Sur-Reply was served via e-serve and e-mail on this the 7th day of December,

2015, to the following:

Maureen O’Connell Texas Bar No. 00795949 Southern Disability Law Center 1307 Payne Avenue Austin, Texas 78757 Telephone: 512-458-5800 Facsimile: 512-458-5850 moconnell458@gmail.com

Attorney for Appellee /s/ Kara Holsinger KARA HOLSINGER Assistant Attorney General