Choices Institute, Inc. v. Oklahoma Health Care Authority
308 P.3d 177
Okla. Civ. App.2013Background
- OHCA audited Choices Institute payments from Aug 1, 2005 to Oct 31, 2006, finding a 45.4% error rate on 136 claims.
- OHCA extrapolated the error rate to all paid claims, creating an overpayment determination of $174,911.
- After reconsideration, OHCA revised the error rate and overpayment, by April 2008, to 25.2% and $84,629.
- Choices appealed to the MAC in April 2008; MAC hearing occurred September 18, 2008, but Choices was not allowed to attend.
- MAC decision issued March 31, 2009; determined seven issues, reducing the error rate to 18% and overpayment to $53,666.
- Choices appealed to OHCA CEO; district court reversed and dismissed with prejudice, then this court reversed and remanded.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Choices had a due process right to a pre-deprivation hearing | Choices argues it has a property interest and deserved a hearing before funds were recouped. | OHCA contends no pre-deprivation hearing is required by the regulations and provider agreement. | District court ruling reversed; no pre-deprivation hearing required. |
| Whether MAC timing deadlines harmed Choices' rights | Choices contends delays violated § 317:2-1-7 deadlines and harmed rights. | OHCA argues no penalties are specified for delays; delay alone not grounds for dismissal. | District court's dismissal based on delay vacated; remand for record-based consideration. |
| Whether recoupment before final agency decision was improper | Choices claimed premature withholding of funds violated due process. | OHCA cites regulatory recoupment procedures that operate automatically. | Premature recoupment permissible under regulation; no reversal on this ground. |
| Whether Choices had a right to in-person participation and evidence at MAC/CEO levels | Choices sought in-person participation, witnesses, and cross-examination. | Regulations permitted some discretion; no requirement for in-person participation or cross-examination. | Regulations do not require in-person participation or cross-examination; no error found. |
Key Cases Cited
- Ferguson v. Long Term Care Pharmacy Alliance, 362 F.3d 50 (1st Cir. 2004) (private rights to challenge Medicaid reimbursement rates depend on statutory/regulatory framework)
- City of Tulsa v. Public Employees Relations Bd., 967 P.2d 1214 (Okla. 1998) (administrative decisions reviewed for substantial rights prejudiced by errors of law or procedure)
- Salazar v. City of Oklahoma City, 976 P.2d 1056 (Okla. 1999) (recognizes remand when agency record lacks determination on record-supported issues)
- Pharmcare Oklahoma, Inc. v. State Health Care Authority, 152 P.3d 267 (Okla. Civ. App. 2007) (Medicaid provider disputes and regulatory framework in Oklahoma)
- Gonzaga University v. Doe, 536 U.S. 273 (U.S. Supreme Court, 2002) (relying on constitutional implications for private rights under federal law)