Janek’s “Capricious” Decision in Antoine Dental Case Challenged in District Court

Kyle Janek
Former HHSC Executive Commissioner Kyle Janek

Last Wednesday, July 16, lawyers for Antoine Dental Centers of Houston again went to court.

Going Travis County District Court

This time they appeared before Travis County District Court to appeal the Medicaid payment hold final decision by former Health and Human Services Commission Executive Commissioner Kyle Janek that was issued back on May 7, 2014.

Janek decision “capricious,” “arbitrary,” “abuse of discretion”

The lawyers, in the pleadings, deemed that Janek’s decision amounted to a “violation of law and a denial of due process… an arbitrary and capricious act and an abuse of discretion.”

Long time en route

Unfortunately, time moves slowly for those in HHSC-OIG limbo land. The 100% payment hold dates from April of 2012 relating to Antoine’s Medicaid orthodontic billings from 2008 to 2011. The original State Office of Administrative Hearings {SOAH) hearing was held in June of 2013 with its decision released in November of that year!

In Medicaid “credible allegations of fraud” payment hold cases, the order of business had been a SOAH hearing which generates a “proposal for decision” which then went to the HHSC Appeals court for review and a final order approved by the agency.

SB 207 makes SOAH decisions final now

This process has been changed by the enactment of SB 207 this past legislative session which makes any SOAH decision final in such cases. Undoubtedly, Janek’s action in this case was one big reason for the legislation and its swift passage.

Order overturned findings of innocence for Antoine and kept in place 100% payment hold

Janek’s final order overturned the proposal for decision from the SOAH judges that had found Antoine innocent of allegations of fraud in their Medicaid orthodontic billings and ordered an end to the practice’s “credible allegations of fraud” payment hold.

Janek’s 2014 decision not only dismissed the findings of the SOAH court which had been comprised of two experienced administrative judges who held four days of hearings but also attempted to negate the earlier SOAH decision in the case of Harlingen Family Dentistry that had been approved by HHSC Appeals court judge Susan Fekety. HFD had also been found innocent of allegations of fraud and state witnesses had been found not credible by the SOAH judge and this was approved by Fekety. Fekety retired immediately after her decision.

“Cut and paste” justice

In the case of Antoine, HHSC Appeals court judge Rick Gilpin, a former employee of the Attorney General’s Office which is involved in the Antoine case, simply overturned the SOAH proposal for decision in what can only be deemed a “cut and paste” action which was then shored up by Janek’s controversial decision.

Antoine Dental lawyers in their brief to the court argue the following [excerpts]:

Following a series of unusual procedural errors, Commissioner Janek reversed the SOAH judges’ decision and kept the 100% payment hold in place. Determined to justify this reversal, Commissioner Janek’s decision broke the rules for what an agency is allowed to do after a SOAH hearing. This case—specifically the issues surrounding the Commissioner’s abandonment of the facts supporting SOAH’s proposal for decision—presents numerous, considerable errors of law that require this court to overturn Commissioner Janek’s reversal of the SOAH decision.

Commissioner Janek’s Final Order may appear justified at first blush as he attempts to carefully, albeit wrongly, recast factual changes as legitimate policy decisions. But examining the Order with scrutiny reveals the many reversible errors of law. In his decision to reverse the SOAH judges’ ruling, Commissioner Janek had to disregard the ALJs’ most critical points – 17 factual findings and 5 legal conclusions. Where SOAH deemed witnesses credible, the Commissioner reversed the decision and deemed them non-credible. SOAH found no credible evidence on many factual questions, but the Commissioner chose to reweigh the evidence and found “overwhelmingly” credible evidence on those same points. Where the ALJs found TMHP’s prior authorization/approval of ADC’s orthodontic work relevant, the Commissioner claimed TMPH approval was irrelevant. The ALJs ruled the OIG’s experts acted improperly, but the Commissioner reversed that finding and held that the OIG’s experts did their job correctly. Most importantly, the ALJs found no evidence that ADC intentionally did anything improper, but the Commissioner determined ADC willfully misrepresented its patients’ dental conditions to the HHSC.

Commissioner Janek cannot “change a green light to a red light.” The SOAH judges determined that ADC and its dentists drove through an intersection under a green light; Commissioner Janek claimed that neither the SOAH judges nor ADC properly understood what a green light looks like, and he reversed the ALJs decision so that ADC drove through the intersection under a red light. Then Commissioner Janek added the finding that ADC willfully ran the red light. That sort of creative “fact fabrication” cannot stand. When Commissioner Janek changed the SOAH judges’ proposed Findings of Fact 46-50, his actions prejudiced ADC’s substantial rights because his actions were in excess of his authority, and not reasonably supported by substantial evidence, and arbitrary and capricious, and an abuse of his discretion.

The pleadings for both parties are available here for download:

Antoine Dental Brief

Attorney General Office Brief

Antoine Dental Reply

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