240 Cal. App. 4th 87
Cal. Ct. App.2015Background
- Medi-Cal requires payor-of-last-resort principles; OHC (other health coverage) must be exhausted before Medi-Cal benefits.
- DHCS maintains MEDS coding for OHC status and shares codes with providers to guide treatment and payment.
- Petitioners sought writ of mandate to compel notice/hearing when DHCS assigns or updates OHC codes that affect service delivery.
- They allege OHC coding errors, incomplete data, and delays that harm timely access to care and potentially increase copayments.
- Trial court denied relief; appellate court reviews de novo the statutory/regulatory and constitutional due process questions.
- Court concludes DHCS coding events are not “actions” requiring a hearing and denies mandamus relief.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether 10950/50951 require a hearing for OHC coding events | Marquez argues coding events deny care without due process | DHCS contends coding events do not affect eligibility or benefits | No; coding events do not trigger a required hearing. |
| Whether California due process requires notices/hearings for OHC coding | Due process requires notice and hearing for OHC changes | Existing informal remedies suffice | No; due process not violated; existing processes adequate. |
| Whether DHCS duties to provide services are violated by OHC practices | OHC gaps deprive beneficiaries of needed services | DHCS uses pay-last-resort and suppression/correction for errors; no ministerial breach shown | No ministerial breach proven; duties satisfied. |
| Whether pay-and-chase and copayment rules are violated by OHC handling | DHCS fails to pay/pursue third-party liability as required | Policies generally comply; no demonstrated violation | No violation established. |
Key Cases Cited
- Madrid v. McMahon, 183 Cal.App.3d 151 (Cal. App. 1986) (action defined by significant effect on receipt of aid; not every process event merits a hearing)
- Lentz v. McMahon, 49 Cal.3d 393 (Cal. 1989) (hearing requests for vitally needed benefits must be prompt and informal)
- Jeneski v. Myers, 163 Cal.App.3d 18 (Cal. App. 1984) (denial of TAR; compelled pre-denial hearing characterized for specific services)
- Ramirez v. Ramirez, 25 Cal.3d 260 (Cal. 1979) (due process analysis balancing private interest, risks, dignitary interests, and governmental burden)
- Cowan v. Myers, 187 Cal.App.3d 968 (Cal. App. 1986) (Medicaid payor principles and provider payment framework)