Administrative Law

• Publication year: 2021

Administrative Law

Chelsea M. Lamb

Moses M. Tincher

Matthew M. White

Hannah M. Couch

Administrative Law

Chelsea M. Lamb^*

Moses M. Tincher^**

Matthew M. White^***

Hannah M. Couch^****

I. Introduction

This Article surveys cases from the Georgia Supreme Court and the Georgia Court of Appeals from June 1, 2020, through May 31, 2021, in which principles of administrative law were a central focus of the case.¹ Review of decisions by administrative agencies will be the first topic discussed, followed by cases discussing discretionary appeals, followed by cases discussing procedural requirements, with scope of authority to follow. The Article will conclude with cases discussing statutory construction.

II. Review of Decisions by Administrative Agencies

In Trejo-Valdez v. Associated Agents,² Jose Trejo-Valdez (the Worker) injured his back while working for Associated Agents (the Company) and filed a worker's compensation claim for his injuries. The injury occurred as the Worker was carrying a marble bathtub up a flight of stairs and the

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bathtub fell on him. After having two back surgeries, the Worker's doctor recommended a spinal cord stimulator placement (the Treatment).³

Two doctors suggested the Treatment, two believed there was no basis for the Treatment, and one suggested a temporary trial of the Treatment. The Worker's Compensation Board (the Board) Administrative Law Judge (the ALJ) initially rejected the recommended Treatment because the preponderance of the evidence did not establish that the Worker needed the Treatment "at this time."⁴ The ALJ then designated a new doctor, recognizing that the Worker was entitled to ongoing medical benefits and that the course of his treatment could change. The new doctor subsequently recommended a temporary trial of the Treatment, which the ALJ approved.⁵

Upon approval, the Company filed a notice of controvert arguing (1) res judicata barred the Treatment because the ALJ initially denied it, and (2) regardless of whether the Treatment was denied, it was neither reasonable nor necessary. The ALJ held (1) res judicata did not bar the claims because worker's compensation cases constantly evolve with new questions of fact, and (2) the Company bore the burden of proof as to whether the treatment was reasonable and necessary. The Company appealed and the Board's Appellate Division affirmed the ALJ's decision.⁶

The Company then appealed the decision to the Superior Court of Dekalb County. The superior court reversed the Board's decision, holding (1) the Board erroneously placed the burden of proof upon the Company, and (2) res judicata barred the claims regardless.⁷

After the Georgia Court of Appeals granted the Worker's application for discretionary appeal, the Worker appealed the superior court's decision. The Georgia Court of Appeals held (1) res judicata did not bar the Worker's claims, and (2) the Company bore the burden of proving the treatment was not reasonable or necessary.⁸

As to the first issue, while the court stated that, although res judicata applies to worker's compensation claims where the issues are identical, the issues here (decided by the ALJ in two separate orders) were not identical—although the same treatment was considered in each—because new medical issues arose, including a new doctor and new suggested courses of treatment, and holding otherwise would "foreclose

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any additional treatment following an ALJ's award."⁹ The court stated that this position would "confound[] the underlying purpose of the Worker's Compensation Act[,]" which should be liberally construed.¹⁰

Regarding the second issue, the court of appeals stated the plain language of State Board of Worker's Compensation Rule 205(d)(1)¹¹ placed the burden of proof on the Company.¹² Citing O.C.G.A. § 34-9-104(b),¹³ the court stated: "In issues concerning a change in condition for the worse . . . the burden of proof rests with the claimant."¹⁴ But in cases like this in which "medical treatment is controverted on the grounds that the treatment is not reasonably necessary,"¹⁵ the court, citing State Board of Worker's Compensation Rule 205(d)(1), stated that "'the burden of proof shall be on the employer.'"¹⁶ The court thus reversed the superior court's ruling.¹⁷

In Doctors Hospital of Augusta, LLC v. Department of Community Health,¹⁸ the Georgia Department of Community Health (the Department) granted MCG Health, Inc. d/b/a/ Georgia Regents Medical Center (Georgia Regents) a Certificate of Need (CON) to build a new short-stay hospital. Doctors Hospital of Augusta, LLC (DHA) had competed against Georgia Regents for the CON and lost. "Although the applications differed in terms of location, size, and overall cost, each proposed construction of a new, 100-bed short-stay facility" in Columbia County, which did not have a hospital and whose government pledged to fund more than twenty percent of the costs. DHA petitioned the Superior Court of Fulton County for review, which affirmed the Department's

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holding.¹⁹ After granting the Department's application for discretionary appeal, the Georgia Court of Appeals heard the case.²⁰ It held the Department correctly awarded the CON to Georgia Regents based in part on tie-breaker considerations.²¹

"Entities seeking to establish a new healthcare service or facility in Georgia generally must apply for a CON."²² The Department, which administers Georgia's CON program, reviews CON applications "in light of 17 general considerations"²³ listed under O.C.G.A. §§ 31-6-42(a).²⁴ The Department has adopted administrative rules and regulations regarding these considerations,²⁵ including an exception when the facility "is a sole community provider and more than twenty percent (20%) of the capital cost of any new, replacement or expanded facility is financed by the county governing authority[,]" pursuant to O.C.G.A. § 31-6-21(b)(8).²⁶

DHA made multiple arguments considered on appeal. First, DHA argued the Department's county-financed exception contravened the CON statutory scheme and was unreasonable because it did not further the health-planning purposes of the CON program, rendering the exception invalid.²⁷ The court was not convinced.²⁸ It held that nothing in the CON statutory scheme forbade such an exception. Although the Department normally must abide by a numerical need methodology, the court held that the Department correctly applied the county-financed exception.²⁹ Further, the court found that the exception has been part of the scheme "since the rule became effective in 2005," and that the General Assembly's acquiescence to the rule "is evidence that the rule came within its intent as expressed by the Code[.]"³⁰ The court also held the purpose behind the exception was to balance many policy considerations, and the county-funded exception "reflects commitment to economic development and a desire to make communities more attractive places to live and work."³¹

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Second, DHA argued MCG Health's application did not meet the needs of the hospital because the Department previously denied CON applications for a free-standing emergency room in the area.³² However, the court held the Department "was authorized to conclude that Georgia Regent's CON application met the general need requirements for a new short-stay hospital" because considerations for an acute care hospital differ from considerations regarding a free-standing emergency room, and the evidence supported that finding.³³

Third, DHA argued that the Department failed to conduct an alternatives analysis—required under O.C.G.A. § 31-6-42 and the Department's accompanying regulation—to see whether alternatives to the hospital might suffice.³⁴ But the court noted the Department found that "[t]here [were] no existing alternatives to [Georgia Regents'] project except for maintaining the status quo, which would not adequately serve the needs of the service area."³⁵ The court refused to "substitute [its] own judgment for that of the Department" and held the Department "conducted a detailed existing alternatives analysis."³⁶

Fourth, DHA argued that the Department improperly applied the "tie breaker" considerations required when, such as here, all CON applications meet the general and service-specific CON criteria.³⁷ Tie breaker or "priority" considerations include the past and present records of the facility and other facilities in Georgia owned by the same parent organization "regarding the provision of service to all segments of the population, particularly including Medicare, Medicaid, minority patients and those patients with limited or no ability to pay[.]"³⁸ The Department found that Georgia Regents should receive three grounds of priority consideration, while DHA received none. The court held the Department considered all relevant records and found "no error" made by the Department.³⁹

Finally, DHA argued the superior court applied the wrong standard of review, but the court of appeals found that any error made by the lower court was immaterial because the appellate court reviews the final

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agency decision, not the superior court's review of that decision. ⁴⁰ Accordingly, the court affirmed the Department's decision.⁴¹

III. Discretionary Appeals

In CKCG Healthcare Services v. Georgia Department of Community Health,⁴² the Georgia Department of Community Health investigated two licensed private home providers and found that the providers improperly used nursing assistants against department rules and state law, both of which prevent "the use of unlicensed independent contractors to provide home care services."⁴³

The two providers jointly filed a declaratory judgment action in Fulton County Superior Court to argue that the relevant statute—O.C.G.A. § 31-7-300⁴⁴ —does not prohibit the use of nursing assistants to provide home care services and that the Department's regulations conflicted with the relevant statute.⁴⁵ The superior court denied the petition, holding "that the...