Govt Response to Florida Medicaid Case

UNITED STATES DISTRICT COURTFOR THE DISTRICT OF COLUMBIA

__________________________________________KENNETH BERGE, ET. AL, )

)Plaintiffs, ) Civil Action No. 10-373 (RBW)

)vs. )

)UNITED STATES OF AMERICA, ET. AL, )

)Defendant. )

__________________________________________)

DEFENDANTS’ RESPONSE TO PLAINTIFFS’CITATION OF SUPPLEMENTAL AUTHORITY1

INTRODUCTION

This Court should reject another attempt by plaintiffs for it to conduct a de novo inquiry

and avoid the dictates of the Administrative Procedure Act (“APA”). The TRICARE

Management Activity (“TMA”), a field activity within Department of Defense (“DoD”),

conducted a comprehensive analysis, relying on DoD regulations, in making a benefit

determination under the TRICARE basic medical program. But plaintiffs ask this Court to rely

on a de novo inquiry conducted by a court for determining what is covered by an entirely

different statute, Medicaid. Plaintiffs’ reliance on K.G., et al. v. Dudek, case no. 11-20684-civ

(S.D. Fla. 2012) (Dkt. #122) (Ex. B to Pls’ Citation of Suppl. Auth.) (“Dudek Order”), is

accordingly misplaced.

The Dudek opinion provides no insight into whether DoD acted in violation of the APA

in determining that Applied Behavior Analysis (“ABA”) for Autism Spectrum Disorders

1 Plaintiffs docketed their citation of supplemental authority on the Court’s docketingsystem as a Supplemental Memorandum to Plaintiffs’ Amended Motion for Summary Judgment.

Case 1:10-cv-00373-RBW Document 117 Filed 04/23/12 Page 1 of 10

(“ASD”) is not “proven” “medical” care for purposes of the TRICARE Basic Program.

Specifically, the Dudek court did not analyze DoD’s regulations and thus did not address what is

at issue in this case: (1) whether DoD had a “plainly erroneous” interpretation of its own

regulations in concluding that ABA is not “medical” care covered under the TRICARE Basic

Program but rather is an educational modality covered under a separate supplemental TRICARE

program available to dependants of active duty personnel to assist in reducing the disabling

effects of ASD; and (2) whether DoD made a “clear error in judgment” in finding that ABA is

not “proven” care (even if considered “medical” care) in relying on its regulatory “reliable

evidence” standard for what is considered “proven” care.

The administrative record in this case shows that DoD neither had a “plainly erroneous”

interpretation of its regulations nor made a “clear error in judgment.” For the reasons

exhaustively explained in the government’s memoranda in support of summary judgment, this

Court should grant the government’s motion for summary judgment and deny plaintiffs’ motion

for summary judgment.

ARGUMENT

I. The Administrative Procedure Act Does Not Allow for the Independent MedicalJudgment Made by the Dudek Court.

Throughout this litigation, plaintiffs have asked this Court to substitute its judgment for

that of the agency. Plaintiffs’ reliance on the Dudek opinion is another such attempt; the Dudek

court conducted its own medical analysis by holding a four-day bench trial relying on plaintiffs’

witnesses and discounting the evidence put forth by the State of Florida in defending its

Medicaid coverage determination. The problematic nature of relying on the Dudek opinion is

exemplified by the fact that the court relied on evidence that would be considered unreliable

- 2 -


under TRICARE regulations while the court was dismissive of evidence that the regulations

explicitly dictate as being reliable. See, infra, at 7-10. But, regardless, it is contrary to black

letter law for such a de novo inquiry to be conducted in this case.

Although plaintiffs have attempted to expand the scope of this case, this case in the end is

a straight-forward APA action. Pursuant to the APA, review is limited to the administrative

record. See Camp v. Pitts, 411 U.S. 138, 142 (“the focal point for judicial review should be the

administrative record already in existence, not some new record made initially in the reviewing

court”); see also Defendants’ Opposition to Plaintiffs’ Motion to Supplement the Record

(“Defs.’ Opp. To Suppl. Record”) (Dkt. #113) at 6-7. Plaintiffs have been unable to meet the

heavy burden required to supplement the record. See Defs.’ Opp. To Suppl. Record at 7-14.

Rather, because DoD has given a “contemporaneous explanation” of its decision, “the validity of

the decision ‘must stand or fall on the propriety of that finding, judged, of course, by the

appropriate standard or review.’” See Vt. Yankee Nuclear Power Corp. V. Nat’l Res. Def.

Council, 435 U.S. 519, 549 (1978) (quoting Camp v. Pitts, 411 U.S. at 143 (1973).

The appropriate standard of review is a highly deferential one and the Dudek court’s

independent medical judgment is of no assistance. The Dudek court determined that the State of

Florida did not properly apply its procedures in making its coverage determination, see Dudek

Order at 22, but that certainly is not the case here. Rather, the matters before this Court are

whether DoD’s interpretation of its own regulations are “plainly erroneous” and whether DoD

made a “clear error in judgment” based on the record before the agency at the time of the

decision.

There should be no dispute as to what is at issue in this case. DoD determined that ABA

- 3 -


is not covered under the TRICARE Basic Program, the basic medical program at issue in this

case, because it is (1) not “medical” and (2) not “proven” care (even if considered “medical”).

See TRICARE Management Activity’s Formal Review Decision, dated October 29, 2010

(“Formal Review Decision”), Administrative Record (“AR”) Vol. I, Tab 1, 1-47; see TRICARE

Management Activity Assessment of Applied Behavior Analysis for Autism Spectrum Disorders

(“TMA Technical Assessment”), AR Vol. I, Tab 1, at 30 (“The reliable evidence reviewed

indicates that ABA is an educational intervention and does not meet the definition of medical

care.”); id. at 34 (“the results of [DoD’s] assessment support the conclusion that ABA has not

been shown by reliable evidence to meet the requirements of 32 C.F.R. § 199.4(g)(15) to be

proven as medically or psychologically necessary or as appropriate medical care”).

Plaintiffs cannot reasonably dispute that ABA has to be both (1) “medical” and (2)

“proven” to be covered under the Basic Program. See Defendants’ Memorandum In Support of

Their Cross-Motion For Summary Judgment And In Opposition to Plaintiffs’ Motion for

Summary Judgment (“Defs.’ MSJ Mem.”) (Dkt. #88) at 29-39; Defendants’ Reply to Plaintiffs’

Opposition to Defendants’ Motion for Summary Judgment (“Defs.’ MSJ Reply”) (Dkt. #96) at

2-9. DoD properly relied on its regulations to determine that ABA is not “medical” care, see

Defs.’ MSJ Reply at 9-13, and, alternatively, properly relied on the record before it to conclude

that ABA is not “proven” care (even if considered “medical”), see id. at 13-23.

A Court should not undermine an agency’s interpretation of its own regulations or an

agency’s comprehensive review without a strong showing by plaintiffs of the necessity of doing

so. In particular, a court is to give “substantial deference” to an agency’s interpretation of its

own regulations, especially in a “complex and highly technical regulatory program,” and should

- 4 -


only disturb that interpretation if is “plainly erroneous or inconsistent with the regulation.” See

Thomas Jefferson University v. Shalala, 512 U.S. 504, 512 (1994). Similarly, a court is not to

“disturb the decision of an agency that has ‘examine[d] the relevant data and articulate[d] a

satisfactory explanation for its actions including a rational connection between the facts found

and the choice made.’” See Banner Health v. Sebelius, 715 F.Supp.2d 142, 153 (D.D.C. 2010)

(quoting MD Pharm., Inc. v. DEA, 133 F.3d 8, 16 (D.C. Cir. 1998) (alterations in original). The

Court would have to find that the agency made a “clear error in judgment.” See Motor Vehicle

Mfrs. Ass’n of U.S., Inc. v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983)

The Dudek court’s independent judgment in interpreting a different statute, Medicaid,

from what is at issue in this case, TRICARE, provides no insight into answering either question.

II. This Court Should Not Rely on the Dudek Court’s Interpretation of Medicaid.

A. The Dudek Opinion Does Not Answer the Question of Whether ABA is“Medical” Care for purposes of the TRICARE Basic Program.

Plaintiffs cannot rely on the Dudek opinion for support that ABA is “medical” care for

purposes of the TRICARE Basic Program as defined by DoD’s regulations. The Dudek court

did not even analyze whether ABA was “medical” care for purposes of Medicaid, the statute at

issue in that case, and certainly did not address the TRICARE regulatory definitions.2 In

concluding that ABA is not “medical” care, and accordingly not covered under the Basic

2 In a footnote, the Dudek court stated that ABA could be covered under Medicaid as“medical care.” See id. at 9 n. 12. But the court conducted no analysis of what constitutes“medical care” for purposes of Medicaid and relied exclusively on conclusory statements madeby witnesses proffered as experts by the plaintiffs in the case. See id. Instead, the Dudek courtprimarily found that ABA is covered under Medicaid as a “preventive and rehabilitative service”that provides the “maximum reduction of physical or mental disability and restoration of arecipient to his best possible functional level.” See id. at 9-10.

- 5 -


Program, DoD relied on its own regulatory definitions for what is covered under TRICARE.

In understanding DoD’s interpretation that ABA does not constitute “medical” care for

purposes of the Basic Program, the program under which plaintiffs seek coverage, it is important

to understand the differences between the Basic Program and a non-medical supplemental

program, the Extended Care Health Option (“ECHO”). The Basic Program is a medical benefits

program available to dependents of active duty and retired personnel. See 10 U.S.C. § 1079(a);

32 C.F.R. § 199.4; see also Defs.’ MSJ Mem. at 4-7. ECHO is a supplemental program that

“does not provide acute care nor benefits available through the TRICARE Basic Program,” 32

C.F.R. § 199.5, but is instead available “to assist in the reduction of the disabling effects of a

qualifying condition” for dependents of active duty personnel, 10 U.S.C. § 1079(d). See Defs.’

MSJ Mem. at 7-9.

DoD found that ABA is not “medical” care under the Basic Program but rather is non-

medical care covered under ECHO. DoD’s regulations define “medical” care as pertaining to

“the diagnosis and treatment of illness, injury, pregnancy, and mental disorders by trained and

licensed or certified health professionals.” See 32 C.F.R. § 199.2(b). In reviewing the literature

surrounding ABA, DoD determined that ABA does not meet this definition and thus was not

covered under the Basic Program (which covers solely “medical” care); DoD concluded that

ABA does not pertain to the treatment of the underlying illness (ASD) but rather is a educational

tool used to modify social behavior and manage ASD. See TMA Assessment, AR Vol. I, Tab 1,

at 25-30; see also Defs.’ MSJ Mem. at 7-9, 30-34; Defs.’ MSJ Reply at 9-13. Correspondingly,

DoD concluded that ABA is covered under ECHO “as a non-medical service for eligible

beneficiaries to minimize the effects of ASD.” See TMA Technical Assessment, AR Vol. I, Tab

- 6 -


1, at 36; Action Memo, AR Vol. I, Tab 1, at 14; see also Defs.’ MSJ Mem. at 7-9, 33-34; Defs.’

MSJ Reply at 11-13.

Of course, the Dudek court did not conduct any such analysis because it was reviewing

the scope of Medicaid coverage rather than TRICARE regulations. This Court should give no

weight to the Dudek court’s interpretation of Medicaid; it is completely irrelevant to whether

DoD made a “plainly erroneous” interpretation of its regulations in determining that ABA is

covered under ECHO and not the TRICARE Basic Program.

B. The Dudek Court’s Interpretation of “Reliable Evidence” for purposes ofMedicaid is in Direct Conflict of What is Required under TRICARE.

This Court should particularly give no credence to the Dudek court’s review of the

efficacy of ABA in considering whether ABA is “proven” care (assuming that the care is

considered to be “medical” care). Besides suffering from the fatal flaw of conducting a de novo

inquiry, the Dudek court disregarded matters that are explicitly included in the TRICARE

regulatory definition for what constitutes “reliable evidence” and instead relied on testimony by

witnesses proffered as experts by the plaintiffs in that case. These purported expert opinions

would be considered unreliable for purposes of TRICARE.

There can be no doubt that even if ABA was considered “medical” for purposes the

TRICARE Basic Program, it would still need to meet the regulatory standard for “reliable

evidence” to be covered under the Basic Program as being “proven” “medical” care. See 32

C.F.R. § 199.4(g)(15) (“By law, [TRICARE] can only cost-share medically necessary supplies

and services. Any drug, device, or medical treatment or procedure, the safety and efficacy of

which have not been established as described in this paragraph (g)(15), is unproved and cannot

- 7 -


be cost-shared by [TRICARE] except as authorized under paragraph 199.4(e)(26)3 of this part”).

“Reliable evidence” is restricted by regulation to the following enumerated categories of

medical/scientific evidence:

(I) Well controlled studies of clinically meaningful endpoints, published in refereedmedical literature.

(ii) Published formal technology assessments.(iii) The published reports of national professional medical associations.(iv) Published national medical policy organization positions; and(v) The published reports of national expert opinion organizations.

See 32 C.F.R. § 199.2(b).4 “Specifically not included in the meaning of reliable evidence are

reports, articles, or statements by providers or groups of providers containing only abstracts,

anecdotal evidence or personal professional opinions.” See id.

The Dudek court’s analysis of what constitutes “reliable evidence” conflicts with the

TRICARE “reliable evidence” standard in two fundamental ways. First, the Dudek court

dismissed each formal technology assessment, such as the Hayes Report, that the State of Florida

relied upon in making its determination. See Dudek Order at 16-18. But for TRICARE, these

technology assessments are second on the hierarchy of what is considered the most “reliable

evidence” because they help condense voluminous studies on a particular subject. See, e.g.,

TMA Assessment, AR Vol. I, Tab 1, at 30-32; see also Defs.’ MSJ Mem. at 34-39; Defs.’ MSJ

Reply at 19-23. Although these technical assessments did not form the entire universe of what

DoD considered – in fact, DoD considered, inter alia, any evidence that plaintiffs submitted –

3 This exception regarding electrolysis is irrelevant for the purposes of the issues in thiscase.

4 “The hierarchy of reliable evidence of proven medical effectiveness, established by (1)through (5) of this paragraph, is the order of the relative weight to be given to any particularsource.” See id.

- 8 -


there is no basis to ignore the conclusions of these assessments. Rather, DoD would have acted

directly contrary to its own regulations if it did not give these assessments great weight.

While discounting these assessments, the Dudek court relied on the personal professional

opinions of a few witnesses hand-selected by the plaintiffs in that case. See Dudek Order at 19-

25. To do so under TRICARE would have conflicted with the TRICARE regulation’s

admonition that “personal professional opinions” do not constitute “reliable evidence.” See 32

C.F.R. § 199.2(b). In fact, when plaintiffs submitted a declaration from a purported expert, DoD

found that such an opinion did not meet the “reliable evidence” standard but, nevertheless,

reviewed each of the articles listed in the declaration’s bibliography to determine if any of those

articles were reliable. See TMA Technical Assessment, Attachment 1, AR Vol. I, Tab 1, at 38-

47 (list of each document submitted by plaintiffs and TMA comments concerning each

submission); Declaration of Michael Kottyan (attached to Defs.’ MSJ Reply) (expounding upon

rationale for why certain documents were considered unreliable).5

Because DoD properly followed its regulatory “reliable evidence” standard, plaintiffs

cannot rely on the Dudek court’s examination of the efficacy of ABA to support any argument

that DoD made a “clear error in judgment” that ABA is not “proven” care (even if considered

5 Although the Kottyan declaration was not included in the administrative record, it is aproper supplement to the record. See Seafarers Intern. Union of North America v. U.S., 891F.Supp. 641, 647 (D.D.C. 1995) (“Although judicial review is normally confined to theadministrative record, agency affidavits may be used to supplement the administrative record tofurther explain the administrative record and describe the background information that wasavailable to the agency”) (finding declaration by the agency official who “prepared therecommendation adopted by the Administrator” appropriate because it “‘merely illuminatesreasons obscured but implicit in the administrative record’”) (quoting Dyer v. Blue Cross & BlueShield, Assn., 848 F.2d 201, 207 (D.C. Cir. 1988)); see also Christ the King Manor, Inc. v.Sebelius, 2011 WL 484003 (M.D. Pa. Feb. 7, 2011).

- 9 -


“medical” care). To rely on the Dudek opinion for such a proposition would be to dismantle

TRICARE’s entire regulatory scheme for making determinations of whether a certain treatment

or therapy is considered “proven” “medical” care.

CONCLUSION

For the reasons stated herein and in the government’s memoranda in support of summary

judgment, this Court should grant the government’s motion for summary judgment and deny

plaintiffs’ motion for summary judgment.

Dated: April 23, 2012 Respectfully submitted,

STUART F. DELERYActing Assistant Attorney General

RONALD C. MACHEN JR.United States Attorney for the District of Columbia

VINCENT M. GARVEY Deputy Director, Federal Programs Branch

_/s/_______________________________ADAM D. KIRSCHNERTrial AttorneyU.S. Department of JusticeCivil Division, Federal Programs BranchMailing AddressP.O. Box 883Washington, D.C., 20044Delivery Address20 Massachusetts Ave., NW., Room 7126Washington, DC 20001Telephone: (202) 353-9265Fax: (202) [email protected]

COUNSEL FOR DEFENDANTS

- 10 -


Documents

Govt Response to Florida Medicaid Case