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SB 553: Read the Plain Language of the Statute….Or…”Do You Understand the Words That Are Coming Out of My Mouth?”

One of my pet peeves is when people park in handicapped parking spots (especially at the grocery store…because, of course, they are just running in for one thing) without a handicapped sticker or any physical ailment. The handicapped spot is meant to be used by a person with a handicap, not the person in a hurry.  Or when the person in the grocery store has 14 items, yet still stands in the “10 items or less line.”  “10 items or less” means “10 items or less!!”  There is a reason for the theory behind “10 items or less.”  When people exploit the “10 items or less” aisle that were not intended to benefit from “10 items or less,” the very purpose of the “10 items or less line” is thwarted.

“Do you understand the words that are coming out of my mouth?”

Similarly, in law school, you learn to read statutes with what is called “The Plain Meaning Rule.”  The Plain Meaning Rule means that if the statutory language is clear on its face (prima facie) and there is no reasonable doubt as to its meaning, then the judge will simply apply the language of the statute to the case at hand.

As in, if the sign says “10 items or less,” do not stand in line with 14 items.

This week I have 5 hearings.  (I know…ugh, right?! Good thing I love my job and believe in my cause).  Well, it is Tuesday.  So far in two of my hearings, opposing counsel representing the managed care organizations (MCOs) have argued that SB 553 applies to providers and holds that providers cannot appeal grievances to the Office of Administrative Hearings (OAH).  And that OAH has no jurisdiction over the MCOs for these appeals.


Ok, seriously, you are probably reading this thinking…what the heck is Knicole talking about….usually I understand her rants…but what is SB 553 and why is she arguing that it does not apply to providers….

SB 553, or Session Law 2013-397 states, in pertinent part, “Right to LME/MCO Level Appeal. – There is no right to appeal the resolution of a grievance to OAH or any other forum.”

No right to appeal to OAH?? Or any other forum?? Basically, you must appeal within the MCO…you must exhaust all administrative remedies prior to appealing to OAH.

What venue does “no-OAH-or-any-other-forum” leave? Reading the plain language of SB 553, you have a right to an MCO level appeal…nothing else (until you exhaust the appeal at the MCO).  Yet, per common  sense, if an MCO makes a decision with which you do not agree, and you appeal to the very people who made the adverse decision, the “reconsidered decision,” more times than not, will be identical to the original adverse decision. 

So for SB 553 to mandate that no right to appeal a grievance at OAH is HUGE!! And I would argue that SB 553 takes away a right to appeal at OAH that is (a) embedded with the OAH Mission Statement; and (b) found with NC General Statutes 150B.

But to whom does SB 553 apply?


The MCOs in the last 2 days have argued that SB 553 applies to Medicaid provider.  So to whom does SB 553 apply???

Remember the “Plain Meaning Rule?”  Let’s look at the plain language of the Session Law. Let’s start with the title.  The title of Part 1of SB 553 (the part at issue) is:


Medicaid enrollees.

The title does NOT say “Medicaid enrollees and Medicaid providers.”  Nope.  Enrollees.  Period.

Further, enrollee is defined as:

Enrollee. – A Medicaid beneficiary who is currently enrolled with a local management entity/managed care organization.

If the title states that it applies to “Medicaid enrollees,” then, per the title, the Session Law does NOT apply to Medicaid providers (unless they are appealing on behalf of a Medicaid recipient…standing in the shoes of the Medicaid recipient).

If the sign says “10 items or less,” it means “10 items or less.”  Simply count the number of items in your grocery cart.  If the items equal to less than or equal to 10, go to the “10 items or less line.”  If the items in your cart equal greater than 10, do not stand in the “10 items or less line.”


Do you understand the words coming out of my mouth???!!!

Starting Monday, Without a Veto, the Legal Burden of Proof Will ALWAYS Be on the Medicaid Recipients

I am not sure whether you have noticed, but Medicaid recipients have very little pull in North Carolina government.  Medicaid recipients have very little voice in our society.  Obviously, Medicaid recipients are indigent, so they do not have the money to hire lawyers and lobbyists. 

Politicians (while they are campaigning) always protest that they believe that Medicaid recipients are important…that Medicaid is important…but, most importantly, that it is important that Medicaid recipients receive quality health care….right?

We’ve heard the rhetoric over and over.

But then what happens when the politician takes office?

I can tell you what does NOT happen. Medicaid recipients do not band together, hire a lobbyist and begin influencing government policies.

Per norm, the Medicaid recipients remain invisible.  And mute.

I have a client with a daughter.  This daughter, we will call her Jennifer, is in her 30s, but with mentality of an 18-month old.  Jennifer is diagnosed with Tuberous Sclerosis Complex (“TSC”), a rare, multi-system genetic disease.  She is nonverbal and requires 24 hours/day supervision for health and safety and total care for activities of daily living and incidental activities of daily living, just as an 18-month old would require.

The Managed Care Organization (MCO), where Jennifer resides, is Smokey Mountain Center (SMC).  For the last 4 years in North Carolina (five years ago Jennifer resided in California), Jennifer has received 16 hours/day Medicaid. Once SMC went live and Jennifer’s yearly authorization was up for renewal, SMC reduced Jennifer’s services to 12 hours/day, thereby leaving a 4-hour gap in which Jennifer would be  unsupervised. (Shocking that the MCO did not want to foot the bill for the extra 4 hours, right?)

I will spare you the details of the legal arguments on both sides, as, today, my husband made a comment that my blogs were “too long.”

So, we are in the administrative hearing in front of an Administrative Law Judge (ALJ) with the attorneys for SMC and the Department of Health and Human Services (DHHS) present.  The ALJ asks me, “Counselor, who has the burden of proof, the Petitioner [us] or the Respondents [them]?”

To which I had to think back to my days during which I worked as an Assistant Attorney General (AG) for NC  (yes, I used to work on the other side…where do you think I learned this stuff?? At law school?)

For those of you without law degrees, the burden of proof (onus probandi, in Latin) is the obligation (hence the Latin word “onus“) on the party in a trial, who must prove [something] in court in order for the burden to shift to the other party to dispute.

Sometimes people will explain the burden of proof as “the necessity of proof always lies with the person who lays charges.”  As in, if you claim that I stole your watch, you must prove I stole it.  I do not have to prove that I did NOT steal it.

This may seem like ridiculous semantics to you, but, legally, who bears the burden of proof is huge.

In Jennifer’s example, the ALJ was asking me whether we (Jennifer) had to prove that she medically needed 16 hours/day Medicaid services or whether the State had to prove why Jennifer did NOT need the 16-hours/day Medicaid services.

If we (Jennifer) put on compelling evidence that she needed 16-hours/day services, and Respondents SMC and DHHS put on equally, compelling evidence that she did NOT need 16-hours/day services, then the Judge would have to rule against the party bearing the legal burden of proof.

As of today, here is the law as to burden of proof for Medicaid recipients:

(d) Burden of Proof. – The recipient has the burden of proof to show entitlement to a requested benefit or the propriety of requested agency action when the agency has denied the benefit or refused to take the particular action. The agency has the burden of proof when the appeal is from an agency determination to impose a penalty or to reduce, terminate, or suspend a previously granted benefit. The party with the burden of proof on any issue has the burden of going forward, and the administrative law judge shall not make any ruling on the preponderance of evidence until the close of all evidence.

(emphasis added). 

Senate Bill 553 will change all this.

Senate Bill 553 states that, “The enrollee has the burden of proof on all issues submitted to OAH for a contested case hearing under this section and has the burden of going forward. The administrative law judge shall not make any ruling on the preponderance of evidence until the close of all evidence in the case.”

The enrollee = the Medicaid recipient.

Therefore, even if the MCO terminates an enrollee’s services (and even if the termination is arbitrary and without merit), the Medicaid RECIPIENT bears the legal burden to prove this.

Really?  Let’s make it even harder for Medicaid recipients to appeal denials or reductions in services.  They can handle it!  They can hire a lawyer!  Right?

Who does this change benefit? Who benefits from the Medicaid recipients bearing the burden of proof in a legal action?

Answer? The MCOs.  And guess what?  The MCOs have lobbyists.  The MCOs have lawyers.

Senate Bill 553 was ratified July 26, 2013.  Which means that SB 553 will be law beginning Monday unless Governor McCrory vetoes the bill by Sunday.  On Sunday (August 25, 2013), McCrory can choose to sign SB 553, allow SB 553 to pass without his signature, or veto the bill.

If McCrory does NOT veto the bill, Medicaid recipients will bear the burden of proof in all contested cases. 

I ask you, why would we as a society place the legal burden of proof on the party LEAST likely to be able to afford a lawyer?

Send Gov. McCrory an email. Veto SB 553!!!