Facility Insurance Corporation v. Patients Medical Center, 574 S.W.3d 436

Patient had an implanted spinal cord stimulator; Provider performed a revision surgery after Carrier preauthorized CPT 63660 and CPT 95972.
Provider billed $94,640.48; Carrier paid $2,345.75, asserting preauthorization limits, an informal network discount, and later denial for late submission of a corrected bill (claimed forfeiture under Tex. Lab. Code § 408.027).
Provider requested MFDR; the MDRO awarded Provider $20,495.78 in additional reimbursement based on calculations including a contested “sum of all packaged costs.”
Carrier requested a SOAH contested-case hearing; the ALJ issued an order affirming the MDRO award and concluded Carrier failed to carry its burden that Provider was not entitled to $20,495.78.
Carrier appealed to district court, which affirmed; the court of appeals reviewed under the APA substantial-evidence standard and focused on whether the ALJ improperly shifted the burden of proof at SOAH.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Proper burden of proof at SOAH	Provider seeks reimbursement and thus bears burden at SOAH	Carrier argued provider bears burden only initially; at SOAH Carrier must disprove MDRO award and ALJ shifted burden to Carrier	Held: Provider carries the burden of proof in de novo SOAH contested-case hearings; ALJ improperly shifted burden to Carrier, requiring reversal and remand
Entitlement to informal/network rate	(Provider) Carrier not entitled to apply Aetna informal network discounts absent proof	(Carrier) Was entitled to apply the informal network discounted rate to reduce payment	Not reached—court reversed on burden issue and did not decide this claim
Timeliness/forfeiture of corrected bill	(Provider) Bill timely for MFDR; forfeiture defense invalid or inapplicable	(Carrier) Corrected bill was submitted after 95 days, constituting forfeiture of reimbursement right	Not reached—court remanded due to burden-shifting error
Waiver for not seeking reconsideration of Carrier’s response to corrected bill	(Provider) Did not waive MFDR rights; process preserved	(Carrier) Provider failed to request reconsideration and thus waived MFDR claim	Not reached—court remanded due to burden-shifting error

Vista Med. Ctr. Hosp. v. Texas Mut. Ins. Co., 416 S.W.3d 11 (Tex. App.—Austin 2013) (describing MFDR/SOAH process and nature of de novo contested-case hearings)
In re Mid-Century Ins. Co. of Tex., 426 S.W.3d 169 (Tex. App.—Houston [1st Dist.] 2012) (discussing MDRO role and fee-schedule vs. contract disputes)
Texas Mut. Ins. Co. v. Vista Cmty. Med. Ctr., LLP, 275 S.W.3d 538 (Tex. App.—Austin 2008) (explaining provider’s right to administrative review under Labor Code)
Jenkins v. Crosby Indep. Sch. Dist., 537 S.W.3d 142 (Tex. App.—Austin 2017) (explaining appellate review under substantial-evidence rule)
Hartford Ins. Co. v. Crain, 246 S.W.3d 374 (Tex. App.—Austin 2008) (noting substantial-evidence standard for workers’ compensation reviews)
Texas Dep’t of Pub. Safety v. Alford, 209 S.W.3d 101 (Tex. 2006) (per curiam) (appellate standard for reviewing administrative actions)
Columbia Med. Ctr. of Las Colinas, Inc. v. Hogue, 271 S.W.3d 238 (Tex. 2008) (statutory interpretation principle against rendering statutory provisions meaningless)
Manbeck v. Austin Indep. Sch. Dist., 381 S.W.3d 528 (Tex. 2012) (distinguishing when a party seeks affirmative relief)
Liberty Mut. Ins. Co. v. Garrison Contractors, Inc., 966 S.W.2d 482 (Tex. 1998) (presumption against interpreting statutes as useless acts)
Texas Lottery Comm’n v. First State Bank of DeQueen, 325 S.W.3d 628 (Tex. 2010) (same canon reinforcing statutory effectiveness)