Cabral v. Ddd
1 CA-CV 15-0721
| Ariz. Ct. App. | Feb 14, 2017Background
- Cabral House, owned by David and Kathy Maniscalco, was a DDD-qualified vendor that provided habilitation services to Frank Rebelo, a disabled adult, under Individual Support Plans (ISPs).
- May 15, 2012 ISP authorized 18 hours/day of habilitation; subsequent ISPs (Aug 2012 onward) reduced authorization to 3 hours/day after DDD assessments; guardianship objections and signature irregularities were alleged.
- Cabral House continued to provide 18 hours/day despite ISPs authorizing only 3 hours and invoiced DDD for the excess services; DDD refused payment.
- Cabral House filed an administrative claim (for services Aug 2012–May 2014); ALJ and the AHCCCS Director denied the claim; superior court affirmed.
- The superior court found, and the Court of Appeals considered, issues including Cabral House’s contractual rights, standing to challenge reductions in authorized services, medical necessity/cost-effectiveness, and timeliness.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether QVA + ISP created a contract obligating Cabral House to provide 18 hrs/day to Rebelo | QVA incorporates ISPs so vendor had contractual duty to provide services under the May 2012 ISP | QVA contains no obligation to any specific enrollee; payments capped by authorizations | No contract rights to enforce individual ISP; QVA does not obligate vendor to exceed ISP authorizations |
| Whether Cabral House has standing to challenge reductions in Rebelo's authorized services | Cabral House asserted it had to continue care due to DDD violations/fraud and thus suffered injury | Only the enrollee or an authorized representative may challenge reductions; provider lacks distinct legal interest absent contract | Cabral House lacks standing to litigate Rebelo's service authorization; claims dismissed on standing grounds |
| Whether providers can challenge beneficiary service reductions when uncompensated services were rendered | Cabral House relied on authority allowing provider challenges to state rate reductions | Defendants: provider-standing case law limited to compensation/rate reductions, not beneficiary-specific service authorization | Provider cannot challenge beneficiary-specific authorization reductions absent contractual or representative status |
| Whether administrative findings (medical necessity/cost-effectiveness, timeliness) were unsupported | Cabral House argued DDD acted unlawfully and its administrative denials were incorrect | Defendants maintained substantial evidence supported agency decisions and procedural bars applied | Court affirmed agency: record supported denial; no need to reach many substantive claims due to standing failure |
Key Cases Cited
- Siler v. Ariz. Dep’t of Real Estate, 193 Ariz. 374 (App. 1998) (standard for reviewing agency action for substantial evidence and legal error)
- Ritland v. Ariz. State Bd. of Med. Exam’rs, 213 Ariz. 187 (App. 2006) (de novo review of agency application of law)
- Rios Moreno v. Ariz. Dep’t of Econ. Sec., 178 Ariz. 365 (App. 1994) (agency abuse of discretion occurs when law is misapplied or relevant facts ignored)
- All. Marana v. Groseclose, 191 Ariz. 287 (App. 1997) (standing is a question of law reviewed de novo)
- Sears v. Hull, 192 Ariz. 65 (App. 1998) (Arizona courts’ approach to standing and limits on parties’ ability to sue)
- Bennett v. Brownlow, 211 Ariz. 193 (App. 2005) (plaintiff must show distinct and palpable injury to have standing)
- Ariz. Ass’n of Providers for Persons with Disabilities v. Ariz., 223 Ariz. 6 (App. 2009) (providers have standing when state reduces provider reimbursement rates—not when an individual beneficiary's authorized services are reduced)