In re Mid-Century Ins. Co. of Tex.

Decision Date04 October 2012
Docket NumberNo. 01–12–00446–CV.,01–12–00446–CV.
Citation426 S.W.3d 169
PartiesIn re MID–CENTURY INSURANCE COMPANY OF TEXAS, Relator.
CourtTexas Court of Appeals

OPINION TEXT STARTS HERE

David L. Swanson, James M. Loughlin, Stone Loughlin & Swanson, L.L.P., Austin, TX, for Relator.

P. Matthew O'Neil, Law Offices of P. Matthew O'Neil, Austin, for Real Party in Interest.

Panel consists of Justices KEYES, MASSENGALE and BROWN.

OPINION

HARVEY BROWN, Justice.

TH Healthcare, Ltd. d/b/a Park Plaza Hospital sued Mid–Century Insurance Company of Texas seeking additional reimbursement for medical services provided to a patient insured by Mid–Century.1Mid–Century filed a plea to the jurisdiction, asserting that Park Plaza Hospital failed to exhaust its administrative remedies with the Division of Workers' Compensation (DWC) before filing suit. The trial court denied the plea to the jurisdiction, and this petition for writ of mandamus followed. We conditionally grant the petition for writ of mandamus.

Background

Park Plaza Hospital provided medical services to an injured worker insured by Mid–Century and billed Mid–Century $178,496.41 for the services. Mid–Century paid the hospital $43,812.47 for the services billed. Park Plaza asserts that Mid–Century should have paid $98,173.02 (55% of its billed charges) pursuant to Park Plaza's provider services agreement with Beech Street Corporation, a preferred provider organization.2 Mid–Century denies any obligation under the services agreement and asserts that its payment of $43,812.47 was proper pursuant to the DWC's outpatient fee guideline. The dispute resulted in this lawsuit, filed by Park Plaza.

Mid–Century filed a plea to the jurisdiction, asserting that its payment dispute with Park Plaza falls within the exclusive jurisdiction of the DWC such that Park Plaza was required to exhaust its administrative remedies with the DWC before filing this action in state court. Because Park Plaza failed to exhaust its administrative remedies before filing suit, Mid–Century contends, the trial court lacks jurisdiction over this case. The trial court denied Mid–Century's plea, and Mid–Century filed a petition for writ of mandamus with this Court.

Standard of Review

A plea to the jurisdiction is a dilatory plea; its purpose is “to defeat a cause of action without regard to whether the claims asserted have merit.” Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547, 554 (Tex.2000). A plea challenges the trial court's authority to decide a case. Heckman v. Williamson Cnty., 369 S.W.3d 137, 149 (Tex.2012) (citing Blue, 34 S.W.3d at 553–54). In the context of jurisdictional exclusivity, there is a constitutional presumption that district court jurisdiction “consists of exclusive, appellate, and original jurisdiction of all actions, proceedings, and remedies, except in cases where exclusive, appellate, or original jurisdiction may be conferred by this Constitution or other law on some other court, tribunal, or administrative body.” In re Entergy Corp., 142 S.W.3d 316, 322 (Tex.2004) (quoting Tex. Const. art. V, § 8). But when the legislature grants an administrative agency exclusive jurisdiction over a dispute, the district court lacks jurisdiction to the extent of the agency's exclusive authority to decide the dispute. See Thomas v. Long, 207 S.W.3d 334, 340 (Tex.2006).

Whether the legislature has conferred exclusive jurisdiction on an agency is a question of statutory interpretation. Blue Cross Blue Shield of Tex. v. Duenez, 201 S.W.3d 674, 675–76 (Tex.2006). In construing statutes, we seek to determine legislative intent by interpreting a statute according to its plain language when the plain language is unambiguous. In re Entergy Corp., 142 S.W.3d at 322 (citing City of San Antonio v. City of Boerne, 111 S.W.3d 22, 25 (Tex.2003)). An agency has exclusive jurisdiction when the legislature expressly grants the agency exclusive jurisdiction or when a “pervasive regulatory scheme” reflects legislative intent that an agency have the sole power to make the initial determination in the dispute. Id.;Thomas, 207 S.W.3d at 340.

The DWC's Exclusive Original Jurisdiction

The Workers' Compensation Act gives the DWC exclusive jurisdiction over certain workers' compensation disputes relating to entitlement to medical benefits, preauthorization of medical care, and reimbursement of medical expenses. SeeTex. Lab.Code Ann. §§ 409.021, 413.031 (West 2011); see also Am. Motorists Ins. Co. v. Fodge, 63 S.W.3d 801, 803 (Tex.2001). “Through the workers' compensation statutory scheme, the legislature has given a health care provider the right to a review when the provider has rendered a medical service but has been paid a reduced amount for that service.” HealthSouth Med. Ctr. v. Emp'rs Ins. Co. of Wausau, 232 S.W.3d 828, 831 (Tex.App.-Dallas 2007, pet. denied) (citing Tex. Lab.Code Ann. § 413.031(a)(1)). “By granting the Division the sole authority to make an initial determination of a medical fee dispute, the Legislature has given the Division exclusive jurisdiction over such a dispute.” Id.3

While the DWC's exclusive jurisdiction expressly extends to disputes over a workers' compensation insurer's denial of some or all of the amount of a health care provider's bills for medical services rendered, seeTex. Lab.Code Ann. § 413.031(a)(1), there is a carve-out for disputes over medical fees for health care provided by certified workers' compensation networks. SeeTex. Ins.Code Ann. §§ 1304.401–405 (West 2009). Original jurisdiction over fee disputes relating to health care provided by a certified workers' compensation network is vested in the certified network's own complaint resolution system, which is required and governed by statute. See id.

Park Plaza argues that this action—in which it disputes the amount Mid–Century has paid on its bills for medical services rendered—falls outside the DWC's exclusive jurisdiction because it is a “private network contract dispute.” According to Park Plaza, the DWC's jurisdiction extends only to non-network disputes, and this is a network dispute.4 We disagree with Park Plaza's contention because the Beech Street network is not a certified “network” and thus its services are “non-network health care,” as those terms are statutorily defined.

A. The DWC has exclusive jurisdiction over non-network medical fee disputes

“The Legislature has granted extensive authority to the Division to regulate the amounts of reimbursement health care providers may receive under the workers' compensation system.” Main Rehab. & Diagnostic Ctr., LLC v. Liberty Mut. Ins. Co., 376 S.W.3d 825, 830 (Tex.App.-Dallas 2012, no pet. h.) (citing Tex. Lab.Code Ann. § 413.011 (West Supp.2011) and Apollo Enters., Inc. v. ScripNet, Inc., 301 S.W.3d 848, 860 (Tex.App.-Austin 2009, no pet.)). Section 413.011 of the Labor Code requires the DWC to “adopt health care reimbursement policies and guidelines that reflect the standardized reimbursement structures found in other health care delivery systems with minimal modifications to those reimbursement methodologies as necessary to meet occupational injury requirements” and to “adopt the most current reimbursement methodologies, models, and values or weights used by the federal Centers for Medicare and Medicaid Services, including applicable payment policies relating to coding, billing, and reporting, and may modify documentation requirements as necessary to meet the requirements of Section 413.053.” Tex. Labor Code Ann. § 413.011(a). Under subsection (d), the DWC's fee guidelines “must be fair and reasonable and designed to ensure the quality of medical care and to achieve effective medical cost control.” Id. at § 413.011(d).

The Labor Code recognizes certain exceptions from the DWC's health care reimbursement policies and guidelines for health care provided pursuant to health care networks that are certified under Chapter 1305 of the Insurance Code. See id. § 413.011(d–4), (g).5Section 413.011 provides no such exceptions for uncertified health care networks. See id.

The DWC has created a dispute resolution process, called medical dispute resolution (MDR), for resolving medical disputes within its jurisdiction. See28 Tex. Admin. CodeE § 133.305(a)(4) (2008) (Tex. Dep't of Ins., MDR—General). MDR divides disputes into two categories: disputes over the amount of payment for health care services and disputes over the necessity of health care services provided. See id. The first category, disputes of the amount of payment for health care services, is labeled “medical fee disputes.” Id. But not all disputes over the amount of payment for workers'-compensation-related health care services constitute “medical fee disputes”; instead, that term is defined to include only disputes over payment for “non-network health care,” which is any health care not provided by a certified health care network. See id. § 133.305(a)(5) (defining “medical fee disputes” to include disputes involving “an amount of payment for non-network healthcare”), (a)(7) (defining non-network health care as [h]ealth care not delivered or arranged by a certified workers' compensation network as defined in Insurance Code Chapter 1305 and related rules”). Thus, Rule 133 treats disputes differently depending on whether the health care services at issue were provided by a certified or uncertified network. See id.; Osborn v. Ace Am. Ins. Co., No. 10–09–00046–CV, 2011 WL 4089995, at *3 (Tex.App.-Waco Sept. 14, 2011, no pet.) (mem. op.) (observingdistinct treatment for network and non-network health care); see alsoTex. Ins.Code § 1305.004(a)(16) (West 2009) (defining “network” as an organization that is certified under Chapter 1305 of the Insurance Code).

Fee disputes over non-network health care—i.e., “medical fee disputes”—are resolved by the DWC “pursuant to division rules, including § 133.307 of this subchapter (relating to the MDR of fee disputes).” 28 Tex. Admin. CodeE § 133.305(a)(5). In such disputes, “the role of the [DWC] is to...

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