IN THE MATTER OF STATE AND SCHOOL EMPLOYEES HEALTHBENEFITS COMMISSIONS' IMPLEMENTATION OF I/M/O PHILIP YUCHT(NEW JERSEY DEPARTMENT OF TREASURY, DIVISION OF PENSIONSAND BENEFITS), A-5550-14T1

In 2009 the State Health Benefits Commission (SHBC) and School Employees' Health Benefits Commission (SEHBC) implemented tiered out-of-network reimbursement for behavioral health providers, paying M.D.s at 100% of UCR and reducing reimbursements for Ph.D., LCSW, LMFT, LPC, and CNS providers.
In In re Yucht the Appellate Division held the tiering violated N.J.S.A. 52:14-17.46.7 and required reimbursement based on the UCR standard; the Commissions then adopted resolutions implementing Yucht retroactive to 2009.
The Division posted a notice and claim form on its website and on July 22, 2014 sent a letter to certifying officers, HR directors, and benefits administrators informing members they could seek reconsideration for out-of-network behavioral claims and giving a December 31, 2014 filing deadline.
On December 3, 2014 the Unions (CWA and Clinical Social Work Guild 49) petitioned the Commissions, arguing the website post and employer-distribution notice were inadequate and seeking either an extension of the December 31 deadline and direct mail notice to affected members, or (on appeal) automatic reprocessing/refunds.
The Commissions denied the petition (June 9, 2015), explaining they had posted notice, sent letters to certifying officers/employers, and that claims data showed many late or ineligible claims; they left the December 31, 2014 deadline in place.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Adequacy of notice that members could seek additional reimbursement after Yucht	Website posting and employer-directed letters were not "meaningful" notice; many members unaware and deadlines unfair	Notice was reasonably calculated: website post with link plus letters to certifying officers and employers met obligations	Commissions' notice was adequate; decision affirmed (not arbitrary or unreasonable)
Request to extend the December 31, 2014 filing deadline	Deadline should be extended and direct mail sent to affected members	Deadline was reasonable given notices and claim submission data; many claims already filed or ineligible	Extension denied; December 31 deadline stands
Mandatory automatic reprocessing/refunds (first raised on appeal)	Commissions should reprocess claims and issue refunds without member application or proof of loss	Issue not raised below; Commissions never considered mandatory refunds	Court declined to reach argument because it was not presented to the agency below (preservation rule); refused to grant relief raised first on appeal

In re Herrmann, 192 N.J. 19 (2007) (standards for appellate review of administrative decisions)
In re Carroll, 339 N.J. Super. 429 (App. Div.) (deference to agency factfinding)
In re Vey, 272 N.J. Super. 199 (App. Div.) (agency deference discussion)
McGowan v. N.J. State Parole Bd., 347 N.J. Super. 544 (App. Div.) (burden on appellant to show agency error)
Bowden v. Bayside State Prison, 268 N.J. Super. 301 (App. Div.) (agency action arbitrary/capricious standard)
N.J. Soc'y for the Prev. of Cruelty to Animals v. N.J. Dep't of Agric., 196 N.J. 366 (2008) (arbitrary, capricious, or unreasonable standard)
Henry v. Rahway State Prison, 81 N.J. 571 (appellate review standards)
In re Stallworth, 208 N.J. 182 (2011) (three-part inquiry for administrative review)
Circus Liquors, Inc. v. Governing Body of Middletown Twp., 199 N.J. 1 (agency expertise and deference)
Greenwood v. State Police Training Ctr., 127 N.J. 500 (deference to agency expertise)
In re Taylor, 158 N.J. 644 (administrative review narrow standard)
Nieder v. Royal Indem. Ins. Co., 62 N.J. 229 (1973) (appellate courts generally do not consider issues raised first on appeal)