FILED IN MY OFFICE
DISTRICT COURT CLERK
10/23/2015 1:09:42 PM
STEPHEN T. PACHECO

ANO

STATE OF NEW MEXICO
COUNTY OF SANTA FE
FIRST JUDICIAL DISTRICT COURT

No. 

THE COUNSELING CENTER, INC,
Appellant,

vs.

NEW MEXICO HUMAN SERVICES
DEPARTMENT,

Respondent.
DECISION REVERSING THE DECISION OF THE NEW MEXICO
HUMAN SERVICES DEPARTMENT AND REMANDING
THIS MATTER came on the Appeal of The Counseling Center, Inc. of the
Hearing Decision of the New Mexico Human Services Department dated December
8, 2014, pursuant to Rule 1-074, neither Party has requested oral argument, and the
Court having reviewed the pleadings and all matters of record and being fully advised in the
premises, ?nds the Decision of the New Mexico Human Services Department should be
reversed and the matter remanded for further proceedings consistent with this Decision.
Based upon the pleadings and all matters of record, this Court ?nds:
1. This Court has jurisdiction over the parties hereto and the subject matter hereof.
2. This review is governed by Rule 1-074, NMRA.
3. The Decision appealed from is arbitrary, capricious or otherwise not in accordance with
law.
4. The Court cannot reverse a Decision because it may disagree with the result.
Such a ruling ?is arbitrary and capricious if it is unreasonable or without a

rational basis, when viewed in light of the whole record.? Id. 11 17
(internal quotation marks and citation omitted). Though we must perform

 

a whole record review, must be careful not to substitute our own
judgment for that of the agency . . . Id Rather, ?we must consider all
evidence bearing on the ?ndings, favorable or unfavorable, to determine if
there is substantial evidence to support the result.? Tom Growney Equip.
Co. v. Jouett, 2005-NMSC-015, 11 13, 137 NM. 497, 113 P.3d 320
(internal quotation marks and citation omitted). ?Where the testimony is
con?icting, the issue on appeal is not whether there is evidence to support
a contrary result, but rather whether the evidence supports the ?ndings of
the trier of fact.? Id. (internal quotation marks and citation omitted).

Sais v. NM Dept. of Corrections, 2012-NMSC-009, 1116, 275 P.3d 104.

5. In resolving ambiguities in a statute or regulation which an agency is charged with
administering, the Court will generally defer to the agency?s interpretation if it implicates
agency expertise but not to its statutory interpretation which is reviewed as a matter of
law.

A ruling by an administrative agency is arbitrary and capricious if it is
unreasonable or without a rational basis, when viewed in light of the
whole record. Snyder Ranches, Inc. v. Oil Conservation Comm 110
NM. 637, 639, 798 P.2d 587, 589 (1990); see Hobbs Gas Co. v. NM
Serv. Comm?n, 115 NM. 678, 680, 858 P.2d 54, 56 (1993) (stating that
burden on review of administrative decision under arbitrary and capricious
standard is to show that the decision is ?unreasonable or unlawful?) In
making these determinations, we must remain mindful that ?in resolving
ambiguities in the statute or regulations which an agency is charged with
administering, the Court generally will defer to the agency's interpretation
if it implicates agency expertise.? Atlixco, 11 30, 125
NM. 786, 965 P.2d 370; see Chavez, 1] 21, 122 NM.
579, 929 P.2d 971. Further, ?[t]raditionally, cases have uniformly held the
hearing of an administrative appeal at the district court level is an
appellate procedure, not a trial de novo.? Groendyke ransp., Inc. v. NM
State Corp. Comm 101 NM. 470, 476, 684 P.2d 1135, 1141 (1984)
(emphasis added). ?It is not the function of the trial court to retry the case
admit new evidence unless under an [statutory] exception or
substitute its judgment for that of [an administrative agency].? Id. (internal
citations omitted). However, we will not defer to the Commission's or the
district court's statutory interpretation, as this is a matter of law that we
review de novo. See Mutz v. Mun. Boundary Comm 101 NM. 694, 697?
98,688 P.2d 12, 15?16 (1984).

Rio Grande Chapter of the Sierra Club v. New Mexico [Wining Commission, 2003-

NMSC-OOS, 1 17, 133 NM. 97, 61 P.3d 806.
2

 

6. The burden of persuasion remains with HSD even after it made a prima facie case. The
discussion of the respective burdens of the parties in an employment discrimination case
is instructive.

The burden of establishing a prima facie case of disparate treatment is not
onerous. The plaintiff must prove by a preponderance of the evidence that
she applied for an available position for which she was quali?ed, but was
rejected under circumstances which give rise to an inference of unlawful
discrimination. The prima facie case serves an important function in the
litigation: it eliminates the most common nondiscriminatory reasons for
the plaintiff?s rejection. See Teamsters v. United States, 431 U.S. 324, 358,
and n. 44, 97 1843, 1866, n. 44, 52 L.Ed.2d 396 (1977). As the Court
explained in Furnco Construction Corp. v. Waters, 438 U.S. 567, 577, 98
2943, 2949, 57 L.Ed.2d 957 (1978), the prima facie case ?raises an
inference of discrimination only because we presume these acts, if
otherwise unexplained, are more likely than not based on the consideration
of impermissible factors.? Establishment of the prima facie case in effect
creates a presumption that the employer unlawfully discriminated against
the employee. If the trier of fact believes the plaintiffs evidence, and if the
employer is silent in the face of the presumption, the court must enter
judgment for the plaintiff because no issue of fact remains in the case.

The burden that shifts to the defendant, therefore, is to rebut the
presumption of discrimination by producing evidence that the plaintiff was
rejected, or someone else was preferred, for a legitimate,
nondiscriminatory reason. The defendant need not persuade the court that
it was actually motivated by the proffered reasons. See Sweeney, supra, at
25, 99 at 296. It is suf?cient if the defendant?s evidence raises a
genuine issue of fact as to whether it discriminated against the plaintiff.
To accomplish this, the defendant must clearly set forth, through the
introduction of admissible evidence, the reasons for the plaintiff's
rejection. The explanation provided must be legally suf?cient to justify a
judgment for the defendant. If the defendant carries this burden of
production, the presumption raised by the prima facie case is rebutted, and
the factual inquiry proceeds to a new level of speci?city. Placing this
burden of production on the defendant thus serves simultaneously to meet
the plaintiffs prima facie case by presenting a legitimate reason for the
action and to frame the factual issue with suf?cient clarity so that the
plaintiff will have a full and fair opportunity to demonstrate pretext. The
suf?ciency of the defendant's evidence should be evaluated by the extent
to which it ful?lls these functions.

The plaintiff retains the burden of persuasion. She now must have the
opportunity to demonstrate that the proffered reason was not the true
reason for the employment decision. This burden now merges with the

3

 

ultimate burden of persuading the court that she has been the victim of

intentional discrimination. She may succeed in this either directly by

persuading the court that a discriminatory reason more likely motivated

the employer or indirectly by showing that the employer?s proffered

explanation is unworthy of credence. See McDonnell Douglas, 411 U.S.,

at 804?805, 93 at 1825?1826.
Texas Department of Community A?airs v. Burdine, 450 US. 248,253-256,
101 S. Ct. 1089 (1981). See International Minerals Chem. Corp. v. New Mexico Pub.
Serv. Comm 1970-NMSC-032, 1110, 81 NM. 280, 283, 466 P.2d 557, 560 (1970)
(applying common-law rule that movant bears burden of proof to administrative
proceedings).
. The HSD Decision concludes at Paragraph 1 and 2 that ?[w]hile TCC did put forward a
certain amount of credible evidence in opposition, it failed to provide for the hearing
record the requisite 100 percent audit of the universe of provider records? in support of
its position. This point goes in favor of These conclusions or not in accordance
with law as the Decision shifts burden of proof to TCC. The HSD Decision
applies the burden of TCC had TCC sought to resolve the dispute at the Audit stage
pursuant to 8.351 .2.13 NMCA as opposed to exercising its right to have a hearing
pursuant to 83523.10, et seq., NMCA.
. To require TCC to engage and complete a 100 percent audit for the purpose of pursuing
its rights at a hearing is unreasonable, especially considering the reasonable time
necessary time necessary to meet the audit requirements of 8.351.213 NMCA and in
light of 8.352.3.12 (A) NMCA, which does not mention such a requirement. It also

ignores burden of proof by a preponderance of the evidence and shifts the burden

of proof to TCC by clear and convincing evidence.

 

9. The HSD Decision further concludes in Paragraphs 3 and 4 that the evidence established
that TCC did not bill Medicaid for code H0031 (with no modi?er) and H0031 with the
modi?er of HA, but it further concludes that TCC was credited in Medicaid ?mds. These
Conclusions are based substantially on the testimony of Robert Stevens, but Mr. Stevens
admitted his lack of knowledge with contract with Optum. He also admitted the
he only knew the requirements of Medicaid reimbursement and that there were different
funding sources for New Mexico Corrections Department; Children Youth Families
Department and Behavioral Health Services, all of which did not use Medicaid funds. He
further admitted that all the disputed claims were paid by Optum. These Conclusions are
not supported by substantial evidence.

IT IS THEREFORE ORDERED, ADJUDGED AND DECREED BY THE COURT that
the Decision of the Human Services Department is REVERSED in its entirety, and this matter is
REMANDED for further proceedings with respect to Conclusions 1 and 2, applying the burden
of proof in accordance with this Decision. Any monies withheld with respect to Conclusions 3
and 4 shall be paid to the Appellant.

IT IS SO ORDERED.

    

Francis J/Mathelgv, Dismrt Judge

 

xc: Bryan Davis, Esq., 124 Wellesley Drive, SE, Albuquerque, NM 87106
John R. Emery, Assistant General Counsel, New Mexico Human Services Department,
2009 Pacheco Street, Santa Fe, NM 87505
[Counsel electronically served]