Colo. CONSUMER HEALTH INITIATIVE v. Colo. Bd. of HEALTH, 09CA0822.

Citation240 P.3d 525
Decision Date10 June 2010
Docket NumberNo. 09CA0822.,09CA0822.
PartiesCOLORADO CONSUMER HEALTH INITIATIVE, Plaintiff-Appellant, v. COLORADO BOARD OF HEALTH, Defendant-Appellee.
CourtCourt of Appeals of Colorado

OPINION TEXT STARTS HERE

COPYRIGHT MATERIAL OMITTED.

Perkins Coie LLP, Michael A. Sink, L. Norton Cutler, Joanna Thies, Denver, Colorado, for Plaintiff-Appellant.

John W. Suthers, Attorney General, Alisa Campbell, Assistant Attorney General, Denver, Colorado, for Defendant-Appellee.

Opinion by Judge HAWTHORNE.

In this declaratory judgment action challenging the Colorado Board of Health's “patient copy” rule, plaintiff, the Colorado Consumer Health Initiative (CCHI), appeals the summary judgment entered for defendant, the Colorado Board of Health, as well as the denial of its cross-motion for summary judgment. We affirm the trial court's order denying CCHI's summary judgment motion, reverse its order entering summary judgment for the Board, and remand for further proceedings.

I. Facts

The Colorado Board of Health (the Board) is a state regulatory board that has the authority to adopt and amend rules regarding public health. § 25-1-108(1)(c)(I), C.R.S.2009. The Board's rule generally known as the “patient copy rule” establishes the fees that health care facilities can charge for providing copies of a patient's medical records. Standards for Hospitals & Health Facilities Rule II-5.2.3.4, 6 Code Colo. Regs. 1011-1.

In 2001, the Association of Health Information Outsourcing Services (AHIOS), a national lobby group for the health information management outsourcing industry, petitioned the Board to increase the copying fees charged to patients and third parties. The Board adopted AHIOS's proposed amendment.

In 2007, AHIOS again petitioned the Board to increase copying fees. However, the 2007 proposed amendment excluded from the fee increase individuals covered by the federal Health Insurance Portability and Accountability Act (HIPAA). To support the proposed fee increases, AHIOS included a self-compiled survey of the copying fees charged to certain third parties (attorneys and insurers) by forty-two other states. CCHI opposed the amendment.

In 2008, the Board adopted AHIOS's 2007 proposed amendment. CCHI subsequently filed a complaint for declaratory relief challenging the Board's rules amending the patient copy rule in 2001 and 2008. On cross-motions for summary judgment, the court granted the Board's motion and denied CCHI's.

CCHI appeals.

II. Standard of Review

We review a summary judgment de novo. Brodeur v. Am. Home Assurance Co., 169 P.3d 139, 146 (Colo.2007). Summary judgment is appropriate only if the pleadings and supporting documents show that there is no genuine, material, factual issue and that the moving party is legally entitled to judgment. Id.

The nonmoving party is entitled to all favorable inferences reasonably drawn from the undisputed facts; all doubts must be resolved against the moving party. Id. Cross-motions for summary judgment do not decrease either party's burden of establishing entitlement to summary judgment. Miller v. Hartford Cas. Ins. Co., 160 P.3d 408, 410 (Colo.App.2007). An order denying summary judgment is generally not reviewable unless it effectively ends the litigation. See Mahaney v. City of Englewood, 226 P.3d 1214, 1217 (Colo.App.2009).

When reviewing a challenge to board or agency rules, we presume a rule is valid if it was adopted pursuant to a statutory rulemaking proceeding, and the challenging party has the burden to establish the rule's invalidity by demonstrating that it is

arbitrary or capricious, a denial of statutory right, contrary to constitutional right, power, privilege, or immunity, in excess of statutory jurisdiction, authority, purposes, or limitations, not in accord with the procedures or procedural limitations of [the Colorado Administrative Procedure Act (APA) ] or as otherwise required by law, an abuse or clearly unwarranted exercise of discretion, based upon findings of fact that are clearly erroneous on the whole record, unsupported by substantial evidence when the record is considered as a whole, or otherwise contrary to law.

§ 24-4-106(7), C.R.S.2009; accord Augustin v. Barnes, 626 P.2d 625, 627 (Colo.1981); McClellan v. Meyer, 900 P.2d 24, 29 (Colo.1995).

“Whenever the scope of review is somewhere between the two extremes of de novo review and complete unreviewability, as it usually is, the key to scope of review is not the choice of formulas or standards, such as ‘substantial evidence’ or ‘arbitrary and capricious.’ Citizens for Free Enterprise v. Dep't of Revenue, 649 P.2d 1054, 1063 n. 6 (Colo.1982) (quoting K. Davis, Administrative Law Treatise § 29.00-1, at 528 (1982 Supp.)). Rather, “the underlying question is whether the agency action is reasonable.” Id.

Moreover, in reviewing an agency action, courts shall determine “all questions of law and interpret the statutory provisions involved and shall apply such interpretation to the facts duly found or established.” Transponder Corp. v. Property Tax Administrator, 681 P.2d 499, 503 (Colo.1984) (quoting § 24-4-106(7)); accord State v. Esser, 30 P.3d 189, 194 (Colo.2001) (although courts defer to agency's interpretation of its own enabling statute, “conclusions of law, including interpretations of the constitutions and statutes, are always subject to de novo review”).

A rule may not modify or contravene an existing statute, and any rule that is inconsistent with or contrary to a statute is void. Ettelman v. Colorado State Bd. of Accountancy, 849 P.2d 795, 798 (Colo.App.1992); see § 24-4-103(8)(a), C.R.S.2009 (any rule which conflicts with a statute is void).

Nevertheless, courts should give deference to an agency's construction of the rules it promulgates, as well as the agency's construction of its enabling legislation, “unless the agency's interpretation is not in accordance with law.” Esser, 30 P.3d at 193; accord Bd. of County Comm'rs v. Colorado Pub. Utils. Comm'n, 157 P.3d 1083, 1088 (Colo.2007). But courts are not bound by an agency's interpretation. Bd. of County Comm'rs, 157 P.3d at 1088. Courts should also give deference to a statute's construction given by the administrative agency charged with its enforcement or administration, unless that interpretation is inconsistent with the statute's clear language or the legislative intent. Meridian Ranch Metropolitan Dist. v. Colorado Ground Water Comm'n, 240 P.3d 382, 387 (Colo.App.2009); Cartwright v. State Bd. of Accountancy, 796 P.2d 51, 53 (Colo.App.1990).

Courts, however, have a duty to invalidate administrative rules that conflict with the statute's design. Cartwright, 796 P.2d at 53.

III. Analysis
A. Compliance with HIPAA

CCHI contends that, because the patient copy rule does not comply with HIPAA, the trial court erred in entering summary judgment for the Board and against CCHI. We conclude that neither party was entitled to summary judgment on this issue.

We review de novo the legal question of whether the 2001 and 2008 rules amending the Board's patient copy rule violate HIPAA and its related regulations. See Transponder Corp., 681 P.2d at 503 (in reviewing an agency action, courts shall determine all legal questions, interpret the statutory and constitutional provisions involved, and shall apply such interpretation to the facts duly found or established). Moreover, because the Board is charged with administering and enforcing state public health laws and not federal health laws, we need not defer to the Board's HIPAA interpretations. Cf. Meridian Ranch Metropolitan Dist., 240 P.3d at 387, 2009 WL 3765490 (court generally defers to statute's interpretation by agency charged with its enforcement).

1. Legal Principles

HIPAA is federal legislation that mandated reforms regarding health insurance access, portability, renewability, mandatory coverage, and preexisting condition exclusions. Pub.L. No. 104-191, 110 Stat. 1936 (Aug. 21, 1996) (codified primarily in titles 18, 26, and 42 of the United States Code); Usick v. American Family Mut. Ins. Co., 131 P.3d 1195, 1198 (Colo.App.2006).

HIPAA regulations mandate that covered health care entities may only charge a “reasonable, cost-based fee” for providing copies of patient health records, and the fee may only include the cost of [c]opying, including the cost of supplies for and labor of copying ...; [p]ostage [where applicable]; and [p]reparing an explanation or summary of the protected health information [where applicable].” 45 C.F.R. § 164.524(c)(4)(i)-(iii). However, HIPAA regulations apply only to the “person who is the subject of protected health information” (the patient) or the “person [who] has authority to act on behalf of [a patient] ... in making decisions related to health care” (the patient's “personal representative”). 45 C.F.R. §§ 160.103, 164.502(g).

HIPAA and its related regulations preempt state laws that are less stringent than HIPAA regulations. See HIPAA, Pub.L. 104-191, sec. 264(c)(2); South Carolina Med. Ass'n v. Thompson, 327 F.3d 346 (4th Cir.2003). Pursuant to executive order, HIPAA became effective on August 14, 2003. See HIPAA, Pub.L. 107-105, sec. 2(b). Thus, as of August 14, 2003, states whose laws were not more stringent were required to comply with HIPAA and its related regulations.

Here, the Board's 2001 rule amending the patient copy rule provided that patients or their personal representatives “shall pay for the reasonable cost of obtaining a copy of [the patient's] records, not to exceed $14.00 for the first ten or fewer pages, $.50 per page for pages 11-40, and $.33 per page for every additional page,” plus postage, shipping, and sales tax. The patient copy rule remained unchanged until the Board's 2008 amendment. The 2008 rule provided that individuals to whom HIPAA does not apply “shall pay for the reasonable cost of obtaining a copy of [the patient's] record, which shall be $16.50 for the first ten or fewer pages, $.75 for pages 11-40, and $.50 per page for every...

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