D.A. VS. DIVISION OF MEDICAL ASSISTANCE AND HEALTH SERVICES (DIVISION OF MEDICAL ASSISTANCE AND HEALTH SERVICES)

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court." Although it is posted on the
internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.

SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-2570-17T1

D.A.,

Petitioner-Appellant,

v.

DIVISION OF MEDICAL
ASSISTANCE AND
HEALTH SERVICES,

Respondent-Respondent.
___________________________

Submitted December 3, 2019 – Decided January 2, 2020

Before Judges Hoffman and Firko.

On appeal from the New Jersey Department of Human
Services, Division of Medical Assistance and Health
Services.

SB2 Inc., attorneys for appellant (John P. Pendergast,
on the briefs).

Gurbir S. Grewal, Attorney General, attorney for
respondent (Melissa H. Raksa, Assistant Attorney
General, of counsel; Stephen J. Slocum, Deputy
Attorney General, on the brief).
PER CURIAM

D.A. appeals the December 26, 2017 final agency decision of the Director

of the Division of Medical Assistance and Health Services (DMAHS) denying

his fair hearing request as untimely, thereby establishing his eligibility for

Medicaid benefits as of June 1, 2017. Petitioner's designated authorized

representative (DAR) contends that the July 13, 2017 notice from the

Department of Human Services, Division of Aging Services (DoAS) advising

that D.A. was found clinically eligible for nursing facility care, was never

received by the DAR. We affirm.

The following factual and procedural history is relevant to our

consideration of the arguments advanced on appeal. On June 27, 2017, D.A.,

through his DAR, an employee of the nursing facility where D.A. resided,

applied to the Burlington County Board of Social Services, the county welfare

agency (CWA), for Medicaid benefits. Prior to submitting the application, on

May 8, 2017, D.A.'s nursing facility requested pre-admission screening (PAS)

on his behalf in order to establish D.A.'s clinical eligibility for benefits. The

PAS was conducted on June 8, 2017.

On July 13, 2017, the DoAS provided D.A. with written notice that he was

found clinically eligible for nursing facility level of care, effective June 1, 2017.

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The eligibility notice was also hand-delivered to the social service desk and

discharge planning staff at D.A.'s nursing facility on July 13, 2017. On July 27,

2017, the CWA provided D.A. with notice, that was also sent to his nursing

facility, confirming D.A. was found eligible for benefits effective June 1, 2017.

On August 15, 2017, D.A.'s DAR requested a fair hearing in the Office of

Administrative Law (OAL) relative to the July 27, 2017 eligibility notice

forwarded by the CWA. On August 17, 2017, the DMAHS transmitted the

DAR's request to the OAL, and a proceeding ensued.

Thereafter, on December 14, 2017, D.A.'s DAR requested a fair hearing

claiming neither she nor D.A. ever received the July 13, 2017 notice from DoAS

until December 13, 2017, after she contacted the Office of Community Choice

Options. The DAR contended that the appeal "should be treated as timely even

though it was not filed within [twenty] days of the date of the notice," mandated

by N.J.A.C. 10:49-10.3. No proofs or documentation were submitted by the

DAR to show the PAS was not received by her, despite her contention that the

July 13, 2017 notice "was indisputably not received."

On December 26, 2017, the DMAHS denied the DAR's request for a

hearing because it was not timely filed, and found:

N.J.A.C. 10:49-10.3(a) specifically states that:
"requests for hearing(s) shall be made in writing within

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 [twenty] days from the date of the notice of the agency
action giving rise to said complaint or issue." Your
request was received on December 14, 2017 which is
154 days from the July 13, 2017 notice from the
[DoAS]. However, [D.A.'s] August 15, 2017 timely
request for fair hearing regarding the July 27, 2017
notice from Bergen County and disputing the effective
date of eligibility was transmitted to the [OAL] on
August 17, 2017.

On appeal, petitioner presents the following arguments for our

consideration:

I. It Was A Violation Of Federal Law For The
DMAHS To Refuse To Transmit D.A.'s Fair
Hearing Request To The OAL.

II. Respondent Has Unlawfully Denied D.A.'s Fair
Hearing Request.

Petitioner argues that denial of her fair hearing request was arbitrary,

capricious, and unreasonable. Further, petitioner argues that DMAHS can only

refuse a fair hearing request if: (1) the applicant withdraws the request in

writing, or (2) the applicant fails to appear at a scheduled hearing without good

cause. 42 C.F.R. § 431.223. According to petitioner, neither of these

circumstances apply here. We disagree.

"Appellate review of an agency's determination is limited in scope." K.K.

v. Div. of Med. Assistance & Health Servs., 453 N.J. Super. 157, 160 (App. Div.

2018) (quoting Circus Liquors, Inc. v. Governing Body of Middletown Twp.,

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199 N.J. 1, 9 (2009)). "In administrative law, the overarching informative

principle guiding appellate review requires that courts defer to the specialized

or technical expertise of the agency charged with administration of a regulatory

system." In re Virtua-West Jersey Hosp. Voorhees for a Certificate of Need,

194 N.J. 413, 422 (2008). We are thus bound to uphold the administrative

agency decision "unless there is a clear showing that (1) the agency did not

follow the law; (2) the decision was arbitrary, capricious, or unreasonable; or

(3) the decision was not supported by substantial evidence." Ibid. (citing In re

Herrmann, 192 N.J. 19, 28 (2007)).

In fact, "[w]here [an] action of an administrative agency is challenged, 'a

presumption of reasonableness attaches to the action . . . and the party who

challenges the validity of that action has the burden of showing that it was

arbitrary, unreasonable or capricious.'" Barone v. Dep't of Human Servs., Div.

of Med. Assistance & Health Servs., 210 N.J. Super. 276, 285 (App. Div. 1986)

(quoting Boyle v. Riti, 175 N.J. Super. 158, 166 (App. Div. 1980)).

"Deference to an agency decision is particularly appropriate where

interpretation of the Agency's own regulation is in issue." I.L. v. N.J. Dep't of

Human Servs., Div. of Med. Assistance & Health Servs., 389 N.J. Super. 354,

364 (App. Div. 2006); see also Estate of F. K. v. Div. of Med. Assistance &

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Health Servs., 374 N.J. Super. 126, 138 (App. Div. 2005) (indicating that we

give "considerable weight" to the interpretation and application of regulations

by agency personnel within the specialized concern of the agency). "On the

other hand, an appellate court is 'in no way bound by the agency's interpretation

of a statute or its determination of a strictly legal issue.'" R.S. v. Div. of Med.

Assistance & Health Servs., 434 N.J. Super. 250, 261 (App. Div. 2014) (quoting

Mayflower Sec. Co. v. Bureau of Sec. in Div. of Consumer Affairs of Dep't of

Law & Pub. Safety, 64 N.J. 85, 93 (1973)).

"Medicaid was created by Congress in 1965 to 'provide medical services

to families and individuals who would otherwise not be able to afford necessary

care.'" S. Jersey Family Med. Ctrs. Inc. v. City of Pleasantville, 351 N.J. Super.

262, 274 (App. Div. 2002) (quoting Barney v. Holzer Clinic Ltd., 110 F.3d 1207,

1210 (6th Cir. 1997)). The federal government shares the costs of medical

assistance with States that elect to participate in the Medicaid program. Mistrick

v. Div. of Med. Assistance & Health Servs., 154 N.J. 158, 165-66 (1998) (citing

Atkins v. Rivera, 477 U.S. 154, 156-57 (1986)).

New Jersey participates in the federal Medicaid program pursuant to the

New Jersey Medical Assistance and Health Services Act, N.J.S.A. 30:4D-1 to -

19.5. Eligibility for Medicaid in New Jersey is governed by regulations adopted

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in accordance with the authority granted by N.J.S.A. 30:4D-7 to the DHS

Commissioner. DMAHS is the DHS agency that administers the Medicaid

program. N.J.S.A. 30:4D-5, -7; N.J.A.C. 10:49-1.1(a). Accordingly, DMAHS

is responsible for safeguarding the interests of the New Jersey Medicaid

program and its beneficiaries, N.J.A.C. 10:49-11.1(b), and is required to manage

the State's Medicaid program in a fiscally responsible manner. See Dougherty

v. Dep't of Human Servs., Div. of Med. Assistance & Health Servs., 91 N.J. 1,

5 (1982).

In this appeal, the sole issue is whether DMAHS reasonably denied the

DAR's December 14, 2017 hearing request relative to the July 13, 2017 notice

as untimely. N.J.A.C. 10:49-10.3(b)(3) provides:

(b) An opportunity for a fair hearing shall be granted to
all claimants requesting a hearing because their claims
for medical assistance are denied or are not acted upon
with reasonable promptness, or because they believe
the Medicaid Agent or NJ FamilyCare-Plan A program
has erroneously terminated, reduced or suspended their
assistance. The Medicaid Agent or NJ FamilyCare
program need not grant a hearing if the sole issue is one
of a Federal or State law requiring an automatic
termination, reduction or suspension of assistance
affecting some or all claimants. Under this
requirement:

....

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 3. Claimants shall have [twenty] days from
the date of notice of Medicaid Agent or NJ
FamilyCare program action in which to
request a hearing . . . .

Thus, the regulations clearly establish that a petitioner must timely request

a fair hearing, otherwise the opportunity is foreclosed. Here, our careful review

of the record shows that DoAS provided notice to D.A. and hand-delivered the

July 13, 2017 notice to D.A.'s nursing facility on that date. Nothing has been

presented by petitioner to refute service.

We have long held the "fundamental policy consideration of the need for

assurance to litigants of finality in litigation and its relation to the expiration of

the time allowed for appeal." In re Appeal of Syby, 66 N.J. Super. 460, 464

(App. Div. 1961). The goal of the legislation is to allow DMAHS to rely upon

its decisions, which are not contested after expiration of the twenty-day period.

We also reject petitioner's argument that DMAHS cannot enforce the

twenty-day time limit set forth in N.J.A.C. 10:49-10.3. The federal regulation

that is controlling, 42 C.F.R. § 431.221, authorizes states to place time limits on

the submission of hearing requests. The time limit can be less than, but not more

than ninety days. See 42 C.F.R. § 431.221(d). Therefore, the twenty-day limit

is not a violation of the federal regulations.

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 In summary, we conclude that DMAHS did not act arbitrarily,

capriciously, or unreasonably in applying Medicaid eligibility regulations, and

the record contains substantial evidence to support the conclusion reached by

DMAHS.

Affirmed.

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