Judge: James C. Chalfant, Case: 23STCP03955, Date: 2024-10-01 Tentative Ruling

Case Number: 23STCP03955    Hearing Date: October 1, 2024    Dept: 85

Petitioner Stephen Grey (“Grey”), on behalf of his son Jackson Grey (“Jackson”), seeks mandamus compelling Respondents Kim Johnson, Director of the California Department of Social Services (“DSS”) to set aside its two Hearings Division decisions.

            The court has read and considered the moving papers, opposition, and reply, and renders the following tentative decision.

            A. Statement of the Case

            1. Third Amended Petition

            On January 9, 2024, Petitioner Grey filed the Third Amended Petition (“TAP”) against Respondent DSS and Real Parties-in-Interest California Department of Health Care Services (“DHCS”), Kaiser Permanente (“Kaiser”), and Los Angeles County’s Department of Mental Health (“LACDMH”), alleging causes of action for administrative mandamus and/or traditional mandamus. The verified TAP alleges in pertinent part as follows.

            In early December 2017, Petitioner Grey became concerned because his two-and-half-year-old son, Jackson, was increasingly hitting, pushing, and dangerously hurting other children at his pre-school.  TAP, ¶1.  Jackson’s preschool suggested that he should have an aide with him at school for the foreseeable future who would be able to help him and also ensure other children were not at risk.  TAP, ¶1.  The school warned that Jackson would be asked to leave the school if an aide was not secured, and Jackson’s behavior continued.  TAP, ¶1.

            On December 4, 2017, Grey spoke with Geri Wexler (“Wexler”), Kaiser’s insurance provider administering Jackson’s health care plan.  TAP, ¶2.  Grey asked if Kaiser would be able to help with Jackson’s dangerous behavioral issues.  TAP, ¶2.  Wexler stated that Kaiser is not equipped to provide behavioral therapy for children as young as Jackson, nor is Kaiser equipped to provide aide assistance for any child whatever their age.  TAP, ¶2.  Wexler informed Grey that his only option would be to work with Beacon, the company with which Kaiser outsources services not offered directly in-house at Kaiser.  TAP, ¶2. 

When Grey spoke to Beacon, it stated that it does not work with children under five years old.  TAP, ¶2.  Grey was told that his only option would be to pay out-of-pocket for those services from a third party.  TAP, ¶2.  At no point did Wexler or Beacon mention LACDMH or Special Services for Groups (“SSG”) as options.  TAP, ¶2.  Wexler recommended that Grey meet with Manuel Fonseca of Kaiser (“Fonseca”) on December 5, 2017.  TAP, ¶2. 

            On December 5, 2017, Grey met with Fonseca and asked if Kaiser would be able to help with Jackson’s dangerous behavioral issues.  TAP, ¶3.  Fonseca reiterated that Kaiser is not equipped to provide behavioral therapy for children as young as Jackson, nor is Kaiser equipped to provide aide assistance for any child, and that Grey’s only option was to pay out-of-pocket for those services from a third party.  TAP, ¶3.  Fonseca similarly failed to mention LACDMH or SSG as options.  TAP, ¶3.  Fonseca recommended that Grey take Jackson to meet with Kaiser’s Nancy Brown (“Brown”) on January 10, 2018.  TAP, ¶3.  

            On January 10, 2018, Grey met with Brown, who provided the same information as Fonseca.  TAP, ¶4.   Brown also provided Grey with some valuable information and asked that he connect with her in a couple of months for an update.   TAP, ¶4. 

Grey contends that if any Kaiser representative had suggested before March 22, 2018 that he seek help from LACDMH or SSG, he would have done so.   TAP, ¶6.  Since different mental health professionals at Kaiser told him that his only option was to pay-out-of-pocket, that is what he did.  TAP, ¶7. 

On March 22, 2018, Grey had his first appointment with Marilee Hartling (“Marilee”) of third-party Early Childhood Development Associates (“ECDA”), who continued three types of therapy for Jackson thereafter on a regular basis: (1) ongoing one-on-one behavioral health and play therapy for Attention Deficit Hyperactivity Disorder (“ADHD”) and Sensory Processing Disorder; (2) ongoing social skills group therapy; and (3) an aide to attend school with Jackson to observe and correct his behavior.   TAP, ¶7. 

            Since Jackson was still under the age of three at the time, it took several difficult sessions until he was comfortable enough to make progress with Marilee and her staff.  TAP, ¶8.  Eventually, he became comfortable and started making progress.  TAP, ¶8.  

Between May 9 and December 2018, in addition to the behavioral sessions, Grey took Jackson for regular occupational therapy with Kaiser’s Judith Shari Ungar (“Ungar”) to help with his Sensory Processing Disorder.  TAP, ¶9.  Eventually, Judith informed Grey that she would not be able to justify Jackson’s continued occupational therapy at Kaiser.  TAP, ¶9.  As a result, Jackson went without any occupational therapy for some time.  TAP, ¶9. 

On May 15, 2018, Grey had a follow-up call with Brown from Kaiser and explained that progress had been going well with Marilee.  TAP, ¶10.  Brown suggested that Grey and Jackson meet with Kaiser’s in-house child psychologist, Lilian Honanian (“Honanian”).  TAP, ¶10. 

On May 17, 2018, Grey met with Honanian.  TAP, ¶11.  Since Jackson was making progress with Marilee, and because Honanian could only offer bi-weekly treatment to patients, she suggested that Jackson continue with Marilee.  TAP, ¶11.  Grey continued to pay out-of-pocket for Marilee’s services to maintain continuity of care for Jackson.  TAP, ¶11. 

On August 17, 2018, Grey filed a grievance with Kaiser to reimburse him for all aforementioned services, as well as a request to authorize continued care for Jackson with Marilee.  TAP, ¶20.  On August 31, 2018, Kaiser informed Grey by mail that it would reimburse him for those services through August 2018.  TAP, ¶21.  The amount would be $6,650 (later corrected to $7,430).  TAP, ¶21.  Also on August 31, 2018, Kaiser informed Grey that it would not reimburse him for services after August 31, 2018, and would not be authorizing Jackson’s continued care with Marilee.  TAP, ¶22.  Grey should seek these services through LACDMH.  TAP, ¶22. 

At this point, three different people -- (1) Marilee from ECDA, (2) Eileen from L.A. Child Guidance Clinic, and (3) Honanian from Kaiser -- all told Grey in some way that switching Jackson’s therapists after he had spent months building a rapport was not a good idea.  TAP, ¶19.

Grey filed an appeal with Kaiser to reimburse him for all new services paid for since August 2018, as well as to authorize continued care for Jackson with Marilee.  TAP, ¶24.  On October 15, 2018, Kaiser informed Grey by telephone, and later by mail, that it would not reimburse him for services after August 31, 2018 and would not authorize continued care with Marilee.  TAP, ¶26.

Grey was told that if he wished to pursue things further, he could request an Independent Medical Review with DHCS.  TAP, ¶26.  On October 15, 2018, Grey did so.  TAP, ¶27.  On May 20, 2020, Erin Sullivan-Pico, Assistant Chief Counsel at DHCS, informed Grey that, even if Kaiser providers Brown, Wexler, and Manuel gave him incorrect information, it was outside DHSC’s jurisdiction.  TAP, ¶34.

In December 2020, Grey was referred to a LACDMH provider, Children’s Institute, that claimed it would be equipped to handle Jackson’s mental health needs.  TAP, ¶65.  During an initial call on December 17, 2020, Colleen Flores from the Children’s Institute informed Grey that it was only seeing patients remotely at that time.  TAP, ¶65.  Grey explained that this would be difficult for Jackson but he decided to try anyway.  TAP, ¶65.  Between January 6 and February 2, 2021, Jackson met remotely with Colleen Flores but Jackson threw tantrums, left the room, and was generally disinterested in the remote sessions.  TAP, ¶65. 

Grey decided to work with a highly recommended in-person therapist, Jacqueline Steinberg (“Steinberg”) who was seeing patients in-person.  TAP, ¶66.  Jackson started working with Jacqueline in person in February 2021.  TAP, ¶66.  While it took a couple of sessions for Jackson to feel comfortable with her, it was highly effective.  TAP, ¶66.  Jackson has been working with Steinberg for some time and Grey has seen significant improvements in his demeanor and his behavior.  TAP, ¶66. 

On October 26, 2021, Grey formally submitted a Medi-Cal Claim Form For Beneficiary Reimbursement to DHCS in an amount of $50,054.  TAP, ¶70.  DHCS split this claim up, reviewing some of it directly and forwarding the rest to LACDMH.  TAP, ¶70.  On March 21, 2022, Grey received DHCS’s denial of reimbursement for its portion.  TAP, ¶71.  On May 31, 2022, Grey received LACDMH’s denial of reimbursement for its portion.  TAP, ¶72.

On October 4, 2022, Grey participated in DSS’s administrative hearing process to dispute these denials.  TAP, ¶73.  

On November 9, 2022, the first Administrative Law Judge (“ALJ”) issued a decision which stated: (a) the first administrative hearing would only address two portions of the $50,054 claim; (b) the $7,960 and $3,514 portions are denied for reimbursement; (c) that the remaining $38,580 is under the jurisdiction of LACDMH; and (d) the remaining $38,580 portion would be assigned to a second administrative hearing to take place on a different date in the future.  TAP, ¶74.  Grey submitted a request for rehearing and, on December 29, 2022, DHCS denied the rehearing request.  TAP, ¶¶ 75-76.

On February 21, 2023, Grey participated in the second administrative hearing.  TAP, ¶77.  On April 28, 2023, the second ALJ issued a decision denying the $38,580 for reimbursement.  TAP, ¶78.  Grey submitted a request for rehearing and, on July 13, 2023, DHCS denied the rehearing request.  TAP, ¶¶ 79-80.

2. Course of Proceedings

            On April 30, 2024, Petitioner Grey filed the TAP.

            On June 3, 2024, the County filed its Answer.

            On July 24, 2024, Kaiser, DSS, and DHCS filed their Answer.

B. Governing Law

            1. Medicaid/Medi-Cal

            The Medicaid program is a federal/state program authorized under title XIX of the Social Security Act whereby states provide health care to individuals who qualify for Medicaid benefits if they are aged, blind, or disabled, and their income and resources are insufficient to meet the costs of health care.  42 U.S.C. §1396a.  The Secretary of the United States Department of Health and Human Services is responsible for administering Medicaid and has delegated that authority to the Centers for Medicare and Medicaid Services (“CMS”).  See 42 U.S.C. §§ 1301(a)(6), 1396-1; Arkansas Dept. of Health & Human Servs. v. Ahlborn, (2006) 547 U.S. 268, 275. 

            To qualify for the program, a state must submit a state plan, and that state plan must be approved by CMS.  Douglas v. Indep. Living Ctr. Of So. Cal., Inc., (2012) 565 U.S. 606, 610-11.  An approved state plan authorizes the state to implement the Medicaid insurance program within that state, including the creation of standards for its implementation.  42 U.S.C. §1396(a)(1), (13).  Such a plan must comply with the provisions of applicable federal Medicaid law.  42 U.S.C. §1396(a)(5); 42 Code of Federal Regulations (“C.F.R.”)  §§ 430.10, 431.10.

            California’s State Plan has been approved by CMS, and the Legislature enacted the Medi-Cal program (Welfare and Institutions (“W&I”) Code section 14000 et seq.) to implement Medicaid and provides for medical assistance to certain low-income persons.  Orthopaedic Hospital v. Belshe, (9th Cir. 1997) 103 F.3d 1491, 1493. 

DHCS is the state agency charged with administration of the Medi-Cal program.  W&I Code §§ 14063, 10721, 10740; 22 Cal. Code Regs. (“CCR”) §50004.  DHCS’s regulations in 22 CCR implement and interpret the laws it enforces and also prescribe policies for administration of the Medi-Cal program.  In implementing the Medi-Cal program, DHCS must comply with federal and state statutes.  Olszewski v. Scripps Health, (2003) 30 Cal.4th 798, 804; American Federation of Labor v. Unemployment Ins. Appeals Bd., (1996) 13 Cal.4th 1017, 1042.  DHCS also must comply with California’s State Plan.  See Douglas v. Indep. Living Ctr. of So. Cal., Inc., supra, 565 U.S. at 610-11.

DHCS has ultimate responsibility for the Medi-Cal program.  42 U.S.C. §1396a(a)(5); 42 CFR §431.10; W&I Code §10740.  DHCS is responsible for ensuring that DSS and all local district offices that handle Medi-Cal cases comply with state and federal laws. 42 CFR §431.10.  DHCS must furnish Medicaid promptly to beneficiaries without any delay caused by the agency's administrative procedures, continue to furnish Medicaid regularly to all eligible persons until they are found to be ineligible, and make arrangement to assist applicants and beneficiaries to get emergency medical care when needed, 24 hours a day and seven days a week.  42 CFR §435.930.

Every person administering aid under any public assistance program shall conduct himself with courtesy, consideration, and respect toward applicants for and recipients of aid under that program, and shall endeavor at all times to perform his duties in such manner as to secure for every person the amount of aid to which he is entitled, without attempting to elicit any information not necessary to carry out the provisions of law applicable to the program, and without comment or criticism of any fact concerning applicants or recipients not directly related to the administration of the program.  W&I Code §10500.  This statute imposes a ministerial duty to give notification to individuals of their right to make an application for welfare benefits, regardless of the applicant’s eligibility for aid.  Diaz v. Quitoriano, (1969) 268 Cal. App. 2d 807, 810. 

A county shall (1) perform redeterminations of eligibility for Medi-Cal beneficiaries every 12 months and (2) promptly redetermine eligibility whenever the county receives information about changes in a beneficiary’s circumstances that may affect eligibility for Medi-Cal benefits.  W&I Code §14005.37(a).  Medi-Cal eligibility shall continue during the redetermination process and a beneficiary’s Medi-Cal eligibility shall not be terminated until the county makes a specific determination based on facts clearly demonstrating that the beneficiary is no longer eligible for Medi-Cal benefits under any basis.  W&I Code §14005.37(d).

1.   Managed Care

The Medi-Cal program provides health care coverage to beneficiaries on either a fee-for-service or managed care basis.  W&I Code §14016.5(b).  Under fee-for-service, the Medi-Cal beneficiary gets care from any provider(s) willing to treat the beneficiary and accept reimbursement from DHCS at a set amount for the services provided.  W&I Code §14016.5(b)(1). With managed care, DHCS contracts with plans to provide health care to Medi-Cal beneficiaries. W&I Code §14204. The plans are reimbursed on a capitated basis -- a predetermined amount per person, regardless of the number of services provided to a particular person. W&I Code §14301(a).  Where DHCS requires management care enrollment, it shall not terminate an enrollee’s access to fee-for-service Medi-Cal until the enrollee has been assigned to a managed care health plan.  Ibid.  The purpose of managed care programs is to “reduce costs, prevent unnecessary utilization, reduce inappropriate utilization, and assure adequate access to quality care for Medicaid recipients.”  Life Care Centers of America v. Cal Optima (2005) 133 Cal.App.4th 1169, 1174.

In exercising its authority to require persons on Medi-Cal to have managed care, DHCS is required to ensure that managed care plans provide for a continuity of care by permitting fee-for-service providers with an ongoing relationship with a new managed care member to continue that relationship for up to 12 months if the provider will accept Medi-Cal rates and there are no quality of care issues.  W&I Code §14182(b)(13), (14).  DHCS must “[e]nsure that the [medical exemption request (“MER”)] criteria applied in counties operating under Chapter 4.1 (commencing with Section 53800) or Chapter 4.5 (commencing with Section 53900) of Subdivision 1 of Division 3 of Title 22 of the California Code of Regulations are applied to seniors and persons with disabilities served under this section.” W&I Code §14182(b)(15). 

2. Conlan I and II

In Conlan v. Bonta, (“Conlan I”) (2002) 102 Cal.App.4th 748 and Conlan v. Shewry, (“Conlan II”) (2005) 131 Cal.App.4th 1354, the appellate courts directed DHCS to ensure that Medi-Cal recipients entitled to reimbursement for covered services receive notification and are promptly reimbursed.  DHCS is required to provide recipients reimbursement for medically necessary services received and paid for during the following periods: (1) a retroactive period up to three months prior to the date of application for Medi-Cal; (2) the evaluation period, which is the period between the date of application for Medi-Cal eligibility and the date it was approved; and (3) the post-approval period covering excess co-payments and excess Medi-Cal Share of Cost expenses paid after the recipient was approved for Medi-Cal.

3. Continuity of Care

In effect since 2000, 22 CCR section 53887 sets forth the criteria for a temporary MER from managed care plan enrollment:  “An eligible beneficiary ... who satisfies the requirements in (1)^[1] or (2) below, may request fee-for-service Medi-Cal for up to 12 months as an alternative to plan enrollment by submitting a request for exemption from plan enrollment to the Health Care Options Program ....” 22 CCR §53887(a). 

A MER may be granted for continuity of care with a fee-for-service provider for a complex medical condition: “An eligible beneficiary who is receiving fee-for-service Medi-Cal treatment or services for a complex medical condition, from a physician, a certified nurse midwife, or a licensed midwife who is participating in the Medi-Cal program but is not a contracting provider of either plan in the eligible beneficiary's county of residence, may request a medical exemption to continue fee-for-service Medi-Cal for purposes of continuity of care.”  22 CCR §53887(a)(2).

 “For purposes of [22 CCR section 53887], conditions meeting the criteria for a complex medical condition include, and are similar to, the following: (1) an eligible beneficiary is pregnant; (2) an eligible beneficiary is under evaluation for the need for an organ transplant; has been approved for and is awaiting an organ transplant; or has received a transplant and is currently either immediately post-operative or exhibiting significant medical problems related to the transplant ...; (3) an eligible beneficiary is receiving chronic renal dialysis treatment; (4) an eligible beneficiary has tested positive for HIV or has received a diagnosis of acquired immune deficiency syndrome (AIDS); (5) an eligible beneficiary has been diagnosed with cancer and is currently receiving chemotherapy or radiation therapy or another course of accepted therapy for cancer that will continue for up to 12 months or has been approved for such therapy; (6) an eligible beneficiary has been approved for a major surgical procedure by the Medi-Cal fee-for-service program and is awaiting surgery or is immediately post-operative; (7) an eligible beneficiary has a complex neurological disorder, such as multiple sclerosis, a complex hematological disorder, such as hemophilia or sickle cell diseases, or a complex and/or progressive disorder not covered in 1 through 6 above, such as cardiomyopathy or amyotrophic lateral sclerosis, that requires ongoing medical supervision and/or has been approved for or is receiving complex medical treatment for the disorder, the administration of which cannot be interrupted; and (8) an eligible beneficiary is enrolled in a Medi-Cal waiver program that allows the individual to receive sub-acute, acute, intermediate or skilled nursing care at home rather than in a sub-acute care facility, an acute care hospital, an intermediate care facility or a skilled nursing facility.”  22 CCR §53887(a)(2)(A).

A MER based on complex medical condition may be denied in certain circumstances where managed care plan provider services are available: “A request for exemption from plan enrollment based on complex medical conditions shall not be approved for an eligible beneficiary who has: 1. Been a member of either managed care plan on a combined basis for more than 90 calendar days, 2. A current Medi-Cal provider who is contracting with either plan, or 3. Begun or was scheduled to begin treatment after the date of plan enrollment.” 22 CCR §53887(a)(2)(B).

The duration of a MER is limited: “Except for pregnancy, any eligible beneficiary granted a medical exemption from plan enrollment shall remain with the fee-for-service provider only until the medical condition has stabilized to a level that would enable the individual to change physicians and begin receiving care from a plan provider without deleterious medical effects, as determined by a beneficiary’s treating physician in the Medi-Cal fee-for-service program, up to 12 months from the date the medical exemption is first approved by the Health Care Options Program.”  Id.  A beneficiary granted a medical exemption due to pregnancy may remain with the fee-for -service Medi-Cal provider through delivery and the end of the month in which 90 days post-partum occurs.

A MER based on a complex medical condition must be requested on the “request for Medical Exemption from Plan Enrollment” form (HCO Form 7101) available from the Health Care Options Program. 22 CCR §53887(b). 

C. Standard of Review

A party may seek to set aside an agency decision by petitioning for either a writ of administrative mandamus (CCP §1094.5) or of traditional mandamus. CCP §1085.  CCP section 1094.5 is the administrative mandamus provision which structures the procedure for judicial review of adjudicatory decisions rendered by administrative agencies.  Topanga Ass’n for a Scenic Community v. County of Los Angeles, (“Topanga”) (1974) 11 Cal.3d 506, 514-15. 

CCP section 1094.5 does not in its face specify which cases are subject to independent review, leaving that issue to the courts.  Fukuda v. City of Angels, (1999)20 Cal.4th 805, 811.  In cases reviewing decisions which affect a vested, fundamental right the trial court exercises independent judgment on the evidence. Bixby v. Pierno, (1971) 4 Cal.3d 130, 143.  See CCP §1094.5(c).  In administrative mandamus actions to review decisions denying applications for public assistance, the trial court exercises independent judgment on the evidence.  Ruth v. Kizer, (1992) 8 Cal.App.4th 380, 385; see also Frink v. Prod, (1982) 31 Cal.3d 166, 171 (applying independent judgment standard to decisions terminating welfare).

Under the independent judgment test, “the trial court not only examines the administrative record for errors of law but also exercises its independent judgment upon the evidence disclosed in a limited trial de novo.”  Id. at 143.  The court must draw its own reasonable inferences from the evidence and make its own credibility determinations.  Morrison v. Housing Authority of the City of Los Angeles Board of Commissioners, (2003) 107 Cal.App.4th 860, 868.  In short, the court substitutes its judgment for the agency’s regarding the basic facts of what happened, when, why, and the credibility of witnesses.  Guymon v. Board of Accountancy, (1976) 55 Cal.App.3d 1010, 1013-16.

“In exercising its independent judgment, a trial court must afford a strong presumption of correctness concerning the administrative findings, and the party challenging the administrative decision bears the burden of convincing the court that the administrative findings are contrary to the weight of the evidence.”  Fukuda v. City of Angles, supra, 20 Cal.4th at 817.  Unless it can be demonstrated by petitioner that the agency’s actions are not grounded upon any reasonable basis in law or any substantial basis in fact, the courts should not interfere with the agency’s discretion or substitute their wisdom for that of the agency.  Bixby v. Pierno, supra, 4 Cal.3d at 150-51; Bank of America v. State Water Resources Control Board, (1974) 42 Cal.App.3d 198, 208.

            Where an agency’s hearing procedure is attacked as a due process violation, the issue is one of law.  Mohilef v Janovici, (1996) 51 Cal.App.4th 267, 285; Hall v. Superior Court, (2016) 3 Cal.App.5^th 792, 808.Whether there was a fair trial at the administrative level is a question for the trial court to determine independently.  Western Air Lines, Inc. v Schutzbank, (1968) 258 Cal.App.2d 218, 226.  See Zurn Eng’rs v State ex rel Department of Water Resources, (1977) 69 Cal.App.3d 798, 835.  The trial court’s independent evaluation of the fair trial issue is not a trial de novo; the court renders its independent judgment on the basis of the record.  City of Fairfield v Superior Court, (1975) 14 Cal.3d 768, 776.

The agency’s decision must be based on a preponderance of the evidence presented at the hearing.  Board of Medical Quality Assurance v. Superior Court, (1977) 73 Cal.App.3d 860, 862.  The hearing officer is only required to issue findings that give enough explanation so that parties may determine whether, and upon what basis, to review the decision. Topanga, supra, 11 Cal.3d at, 514-15.  Implicit in CCP section 1094.5 is a requirement that the agency set forth findings to bridge the analytic gap between the raw evidence and ultimate decision or order.  Id. at 115.

An agency is presumed to have regularly performed its official duties (Ev. Code §664), and the petitioner therefore has the burden of proof.  Steele v. Los Angeles County Civil Service Commission, (1958) 166 Cal.App.2d 129, 137.  “[T]he burden of proof falls upon the party attacking the administrative decision to demonstrate wherein the proceedings were unfair, in excess of jurisdiction or showed prejudicial abuse of discretion.  Afford v. Pierno, (1972) 27 Cal.App.3d 682, 691.

D. Statement of Facts[2]

            1. Background

            Jackson, a minor, has been diagnosed with Disruptive Behavior Disorder since the age of three.  AR 1024.  After an evaluation by his school district, he received an Individualized Education Plan (“IEP”) under the eligibility of “Other Health Impairment/ADHD.”  AR 1023. 

During the period at issue, Jackson was eligible for full-scope Medi-Cal benefits through L.A. Care Health Plan as the managed care plan.  AR 7.  Jackson’s health plan requires a referral for specialized treatments, including occupational therapy. AR 317-18.  Additionally, the health plan requires prior authorization for services not available from network providers to determine whether the services are medically necessary.  AR 319. 

2. Grey’s Communications With Kaiser

Starting in early December 2017, Grey attempted to seek services for Jackson through his assigned provider Kaiser.  AR 52, 122.  Kaiser repeatedly gave Grey incorrect information, stating that these services were not covered under the plan, and that Grey must instead seek and pay for these services out-of-pocket from a third party, which Grey proceeded to do.  AR 52, 122.

Grey filed a grievance with Kaiser.  AR 123.  On August 31, 2018, Kaiser informed Grey that the services he sought for Jackson are considered to be specialty mental health services that are excluded from Jackson’s coverage.  AR 80.  He must get these services through LACDMH.  AR 123.  

In or around June 2018, a clinical program manager at Kaiser provided Grey with referrals to LACDMH, L.A. Child Guidance Clinic, and SSG.  See AR 54.  Grey declined services from SSG on October 9, 2018.  See AR 1016.

On August 31, 2018, Kaiser reimbursed Grey for the out-of-network services Jackson received from EDCA for the period of March 22 to the July 31, 2018 date when Kaiser’s clinical manager provided the in-network referrals.  AR 54-55, 290, 383.  Kaiser informed Grey that this reimbursement was a one-time courtesy, and it would not reimburse him for any future treatment with out-of-network providers. AR 55, 290, 383.  Grey filed an appeal which Kaiser denied on October 15, 2018.  AR 55-56.

3. The DHCS Independent Medical Review 

On October 15, 2018, Grey requested an Independent Medical Review with DHCS.  AR 396.  On November 16, 2018, DHCS informed Grey that Jackson’s health plan required him to receive non-emergency treatment from in-network providers.  AR 396.  If none are available, an out-of-network provider can be authorized.  AR 396.  However, Kaiser indicated that no in-network provider had referred Jackson to an out-of-network provider and ECDA’s services are not covered benefits.  AR 396.  In addition, specialty mental health services are not provided by Medi-Cal managed care plans and are only available through LACMHD.  AR 396.  DHCS cannot compel Kaiser to authorize the requested services with ECDA.  AR 396.  DHCS noted that Kaiser had called LACMHD and Jackson had been referred to SSG.  AR 396.

4. LACDMH Referrals

By this time, Jackson was making progress with the third-party providers, and several medical professionals advised that it would be medically unsound to switch providers.  AR 54-55, 1075.  Although Grey received in-network referrals for Jackson’s treatment, he declined to change providers because he felt it would be detrimental to Jackson’s progress.  AR54-55.  From 2018 to 2021, Jackson received mental and behavioral health treatment from multiple providers for his disruptive behaviors.  ECDA, the principal provider treating Jackson, was not a Medi-Cal provider.  AR 1027.  Grey paid for these treatments without authorization from Jackson’s health insurance.  

When LACDMH learned of Grey’s reimbursement request, it contacted ECDA and inquired whether it would be interested in contracting with LACDMH as a Medi-Cal provider.  AR1017.  ECDA declined the offer.  AR1017. 

LACDMH also learned that Grey had reached out to an LACDMH-operated clinic for a letter in support of Jackson remaining with his current providers.  AR 1016.  According to Grey, everyone at the clinic told him that the safest and most sound medical decision was to continue therapy with the out-of-network provider.  See AR 1020.  When the LACDMH-operated clinic requested to assess Jackson, Grey declined the assessment.  AR 1016, 1028.

5. The Joint LACDMH and Kaiser Assessment

To assist Grey with locating an in-network provider for Jackson, LACDMH and Kaiser conducted a joint assessment on April 8, 2020.  AR 1017.  The assessors determined that LACDMH was the best agency to service Jackson’s needs because he needed specialty mental health services.  AR 1017.  LACDMH orally communicated its findings to Grey and sent a follow-up letter explaining the findings, recommendation, and referral information.  AR 1017.  The letter identified five in-network clinics for Jackson to obtain services.  AR 1017.

After several unsuccessful attempts to communicate with Grey regarding LACDMH services, LACDMH sent him a July 16, 2020 letter explaining that his non-responsiveness indicated that he was not interested in LACDMH services.  AR 1017.   Should he change his mind, LACDMH included contact information and a copy of the Guide to Medi-Cal Mental Health Services.  AR 1017.

6. The LACDMH and Kaiser Denials

On November 12, 2021, DHCS received Grey’s request for reimbursement for $50,054 for services by ECDA and provider Ms. J, LCSW incurred for Jackson from March 22, 2018 to September 27, 2021.  AR 1013-14.  DHCS referred a portion of the claim to Kaiser and another portion to LACDMH.  AR 224.  The agencies denied Grey’s reimbursement request because Jackson used out-of-network providers and did not seek the appropriate referral to authorize reimbursement for their services.  AR 291, 378. 

Grey orally requested a DSS fair hearing to appeal the decisions.  AR375-76.

7. The First Administrative Hearing

On October 4, 2022, the first administrative hearing took place and addressed DHCS’s denial of reimbursement for services provided from October 18, 2020 to September 30, 2021.  AR 856.  A representative from Kaiser, a representative from Medi-Cal, and Grey were present.  AR 856-57.

On November 9, 2022, the ALJ upheld DHCS’s denial of Grey’ request for reimbursement of $7,960 for services J, LCWS from October 18, 2020 through September 30, 2021.  AR 16-17.  Reimbursement is only permitted when the services received during the post-approval period were rendered by a provider enrolled with the Medi-Cal program or with an approved Treatment Authorization Request (“TAR”) if medical necessity is established.   AR 17.  J, LCWS was not an enrolled Medi-Cal provider, and the services rendered were not Medi-Cal covered services, as required under the Conlan Plan criteria.  AR 17.  There was no evidence in the record that Jackson’s need for mental health services was a medical necessity or there was an approved TAR.  AR 17.  Therefore, DHCS correctly denied the reimbursement claim in the amount of $7,960 for services rendered by provider J, LCWS for the period of October 18, 2020 to September 30, 2021.  AR 17.

The ALJ dismissed without prejudice Grey’s reimbursement claim against Kaiser for $3,514 by providers ECDA and Play 2 Progress during the period of June 7, 2018 through September 27, 2021.  AR 17.  AR 17-18.  Kaiser had never received a DHCS referral for Play 2 Progress’s services and Kaiser had not denied the $330 claim for ECDA.  AR 18.

DHCS had referred to LACMHD Grey’s claim for imbursement for $38,580 for services provided during the period of March 22, 2018 through September 28, 2020.  AR 18.  Grey asked to continue the hearing to add LACMHD as a party to address that reimbursement claim, as well his claim for continuation of services beginning October 2021.  AR 6-7.  DHCS and Kaiser did not agree to add continuation of services as an issue.  AR 7. 

The ALJ opened a second hearing request on Grey’s behalf.  AR 19.  The ALJ stated that there was no evidence that LACMHD had denied any reimbursement claim for those dates of service.  AR 19.  Since more than 120 days had passed since DHCS had referred the claim to LACMHD, and because there was no evidence of a denial, the State Hearings Division would open a hearing request on Grey’s behalf regarding this claim.  AR 19.  As a result, the remaining $38,580 portion of Grey’s reimbursement claim would have a separate hearing to take place on February 21, 2023.  AR 1010-12.

On December 8, 2022, Grey submitted a request and statement for a rehearing. AR 853.  On December 28, 2022, DHCS denied the rehearing request, stating that it did not meet any of the statutory criteria necessary to obtain a rehearing.  AR 853-54.

8. The Second Administrative Hearing

The second administrative hearing took place on February 21, 2023 to address LACDMH’s denial of reimbursement for services by EDCA, Ms. J, LCWS, and Play 2 Progress from March 22, 2018 through September 28, 2020.  AR 1010-12, 1049.  Grey and a County representative appeared telephonically.   

On April 28, 2023, the ALJ issued a decision upholding LACDMH’s denial of Grey’s request for reimbursement.  AR 1050.  The ALJ first determined that, while Grey had not filed an appeal with LACDMH before seeking a DSS fair hearing, LACDMH had notice of Grey’s request for a fair hearing and Grey was deemed to have exhausted this requirement by LACDMH’s delay.  AR 1048.

Grey testified that he contacted all five providers listed by LACDMH in its July 16, 2020 letter, and each of the providers was not able to provide services based on Jackson’s age.  AR 1020.  In response, the LACDMH representative testified that the providers likely declined to provide services because Grey incorrectly referred to his son’s sensory disorder to explain Jackson’s need for services from these providers.  AR 1032. 

The ALJ determined that Jackson obtained services from mental health therapists who were not enrolled as Medi-Cal providers and therefore Grey’s reimbursement claim for $38,580 failed to meet the requirements under the Conlon Beneficiary Reimbursement Plan.  AR 1049.  The ALJ acknowledged that Grey tried to obtain mental health services based on his contention that various professionals, including LACDMH representatives, recommended continuity of care.  AR 1049.  However, the ALJ did not have authority to disregard the requirements of the Medi-Cal Program and Conlan Beneficiary Reimbursement Plan.  AR 1049.  There is no express exemption in that respective Program or Plan for extenuating circumstances. AR 1049.  The ALJ noted that this decision is entirely consistent with the decision in the first administrative hearing.  AR 1049.

Regarding the issue of continuity of care under the Medi-Cal Program, a beneficiary receiving fee-for-service Medi-Cal may request an exemption from mandatory enrollment in a Medi-Cal managed care plan pursuant to 22 CCR section 58377(a).  AR 1050.  The fee-for-service Medi-Cal beneficiary may submit a MER to continue under fee-for-service Medi-Cal for the purposes of continuity care to receive treatment or services for the beneficiary’s complex medical condition.  AR 1050.  There was no showing that Jackson is a fee-for-service Medi-Cal beneficiary, and his provider did not a submit a MER form with supporting medical supporting evidence either.  AR 1050.   Therefore, continuity of care is not applicable in this case.  AR 1050.  Additionally, LACMDH offered a contract to EDCA to be a network provider and the offer was declined.  AR 1050.

On May 19, 2023, Grey submitted a request for rehearing.  AR 1122.  On July 10, 2023, DHCS denied the rehearing request.  AR 1129.

E. Analysis

As argued in the joint opposition of Respondent DSS and Real Party DHCS (Opp. at 9-10),

Grey’s reimbursement request was required to follow the Conlan Plan, which requires that treatment eligible for a post-approval reimbursement request must be provided by a Medi-Cal provider.  Grey submitted requests for reimbursements in the post-approval period for treatment from non-Medi-Cal providers. 

Grey does not dispute the ALJs’ findings that he failed to meet the reimbursement criteria under the Conlan Plan that the providers at issue were not Medi-Cal-affiliated.  Grey raises only two issues: (1) he did not receive a fair trial when his administrative hearings were split; and (2) the doctrine of equitable estoppel applies and the ALJs did not address this issue.[3]

1. Equitable Estoppel

Equitable estoppel applies in circumstances where a party has induced another into forbearing to act.  Lantzy v. Centex Homes, (2003) 31 Cal.App.4th 363, 383.  The doctrine is “founded on notions of equity and fair dealing and provides that a person may not deny the existence of a state of facts if that person has intentionally led others to believe a particular circumstance to be true and to rely upon such belief to their detriment.”  Steinhart v. County of Los Angeles, (2010) 47 Cal.4th 1298, 1315. 

The elements of estoppel are: (1) the party to be estopped must be appraised of the facts; (2) he must intend that his conduct shall be acted upon; (3) the other party must be ignorant of the true state of facts; and (4) he must rely upon the conduct to his injury.  Driscoll v. City of Los Angeles (1967) 67 Cal.2d 297, 305.  The doctrine applies to a public entity in the same manner as a private party when the elements of equitable estoppel have been shown, and when the injustice which would result from a failure to estop the agency is sufficient to justify any adverse effect upon public interest or policy which would result.  City of Long Beach v. Mansell, (1970) 3 Cal.3d 462, 496-97.

            Grey notes that his written statement for one of the administrative hearings provided as follows:

“Our family has been through the wringer, for more than four years now, trying to secure mental health care services for our son, through all channels under the DHCS umbrella. He was only two and a half when this process began. He’s seven now, and we still don’t have the care that he needs, unless we’re paying for it out-of-pocket. We’ve taken every reasonable step, and then some, to secure these services through DHCS-affiliated channels. Unfortunately, literally none of these services turned out to be readily available to us, or otherwise, the options were inappropriate (or worse, medically hazardous) for our son. Every door we’ve tried to open has been slammed in our face. And so, as a result, we’ve done what any reasonable parent should do: We’ve instead paid out-of-pocket for appropriate services, even though we never should have had to, since our son is on a Medi-Cal plan … To conclude, back before March 22, 2018, there were other options (i.e. having the services we needed covered by LACDMH) that nobody from Kaiser told me about, even when I desperately asked and pleaded for other options besides paying out-of-pocket. But after we had been paying out of pocket (as multiple Kaiser representatives had incorrectly told me I must) for more than two years, there was no turning back without risking severe damage to Jackson’s progress, and it’s clear that’s something that no competent health care professional thought we should do. (We’ve now received recommendations from eight professionals, who all said, pre-pandemic, that Jackson should not switch providers, four in writing.) And even when we did consider switching providers (when remote, pandemic-era sessions were proving ineffective with Jackson’s long-time provider, Marilee Hartling), for months, LACDMH didn’t offer Jackson all the services that he needed anyway. And when they eventually did offer us something more appropriate, but remotely as well, it proved unsuccessful too. Further, we were told, if we were ever to lose Medi-Cal coverage, Jackson would be forced to switch again to a new provider anyway, again in contrast with recommendations that we received from several mental health care providers. Further, the DHCS (run by the State of California – Health and Human Services Agency) echoes the erroneous stances posited by Kaiser and LACDMH. It is unfathomable to me that my child, as a Medi-Cal recipient, would be unable to receive his needed services within the program, and still be stuck with a $50,000+ bill that resulted from reliance on erroneous information given by the three agencies, as well as several Medi-Cal referred providers who themselves told me that their services were inadequate for our son’s needs. In closing, we again respectfully request that, in accordance with The California Code, Health and Safety Code - HSC § 1374.72, these entities should be made to (a) reimburse us for all medical costs to date related to our son’s mental health care, (b) continue to reimburse us for all future medical costs related to our son’s mental health care with his current providers, and (c) be subject to some kind of review process to ensure that this type of situation stops happening to our child, and to other children, as well.” AR 51 (emphasis added).

            Grey also stated: “From April 10, 2019 onward, we sought out additional medical opinions and letters to find out if they thought it was medically sound for Jackson to switch providers, without any transition period supplemented by a continuity of care plan. Every medical professional agreed that continuing with Marilee Hartling’s treatment made sense, with some going so far as to say that switching providers could be dangerous, echoing previous medical opinions offered to us”.  AR 58.  Pet. Op. Br. at 14-15.

            Essentially, Grey testified or provided written statements that he was misled by Kaiser, which did not tell him that LACMHD could provide the mental health services for Jackson, and that he could not change providers without endangering Jackson’s progress once he was informed of those covered services.

            Grey’s moving papers add that his equitable estoppel claim is based in part on the Right to Be Free from Hazardous Procedures.  The ALJs’ decisions failed to administer 17 CCR section 50510(9), which allows “each person with a developmental disability … A right to be free from hazardous procedures.”  Pet.  RJN.[4] Pet. Op. Br. at 14.

            Grey’s equitable estoppel claim is procedurally defective.  First, he does not identify which agency should be estopped: Kaiser, LACMHD, or DHCS.  Assuming Grey contends that Kaiser is the entity to be estopped, Grey presents only his own testimony and fails to present evidence supporting Kaiser.  The petitioner is obligated to lay out the evidence favorable to the other side and show why it is lacking. The "[f]ailure to do so is fatal" to any substantial evidence challenge and "is deemed a concession that the evidence supports the findings."  Defend the Bay v. City of Irvine, (2004) 119 Cal.App.4th 1261, 1266.  The reviewing court should "not independently review the record to make up for appellant's failure to carry his burden."  Ibid.  

At a minimum, Grey was required to present the following evidence to meet this obligation: (1) a clinical program manager at Kaiser provided Grey with referrals to LACDMH, L.A. Child Guidance Clinic, and SSG, and Grey declined services from SSG, (2) Kaiser reimbursed Grey as a one-time courtesy for the out-of-network services Jackson received from EDCA for the period of March 22 to the July 31, 2018 date when Kaiser’s clinical manager provided the in-network referrals, (3) DHCS informed Grey that specialty mental health services are not provided by Medi-Cal managed care plans and are only available through LACMHD, (4) ECDA, the principal provider treating Jackson, was not a Medi-Cal provider, (5) when LACDMH learned of Grey’s reimbursement request, it contacted ECDA about whether it would be interested in contracting with LACDMH as a Medi-Cal provider and ECDA declined, (6) Grey declined an assessment by a LACDMH-operated clinic, (7) LACDMH and Kaiser conducted a joint assessment on April 8, 2020 which determined that LACDMH was the best agency to service Jackson’s needs and LACDMH identified five in-network clinics for Jackson to obtain services, (7) LACDMH tried unsuccessfully to communicate with Grey regarding such services to which he was unresponsive, and (8) Jackson successfully has switched to another provider, Steinberg.  TAP, ¶66. 

Second, Grey fails to show that he presented an estoppel claim to the ALJs.  “Exhaustion requires ‘a full presentation to the administrative agency upon all issues of the case and at all prescribed stages of the administrative proceedings.’”  City of San Jose v. Operating Engineeers Local Union No. 3, (2010) 49 Cal.4^th 597, 609 (citations omitted).  The exhaustion doctrine includes issue exhaustion as well as exhaustion of administrative remedies.  The agency must be given the opportunity to reach a reasoned and final conclusion on each and every issue upon which it has jurisdiction to act before it is raised in a judicial forum.  Hill RHF Housing Partners, L.P. v. City of Los Angeles, (“Hill”) (2021), 12 Cal.5th 458, 479 (citation omitted).  The exact issue raised in the lawsuit must have been presented to the administrative agency.  Tahoe Vista Concerned Citizens v. County of Placer, (2000) 81 Cal.App.4^th 577, 594.  Otherwise, a litigant could present narrow arguments or even omit them before the final administrative authority in hopes of obtaining a more favorable decision from a trial court.  Id.

            Grey argues that, for both the administrative hearings and the rehearing requests, he referenced Kaiser’s offering of incorrect information, followed by events resulting in a deep injustice affecting a child’s health care and worthy of the application of equitable estoppel. Yet, both the ALJs’ decisions and the denials of the rehearing requests did not address equitable estoppel.  Pet. Op. Br. at 11.

This is inadequate.  Grey fails to cite any mention of equitable estoppel at either administrative hearing or in the rehearing requests.  The only conclusion possible is that equitable estoppel was not expressly raised.  The ALJs cannot be faulted for failing to address a legal issue that was never raised.  See Pet. Op. Br. at 15.[5] 

Grey’s only argument at the administrative hearings was that he was misled for a time and did not want to change when he was given LACDMH providers. The ALJ at the second administrative hearing addressed this issue.  The ALJ acknowledged that Grey tried to obtain mental health services based on his contention that various professionals, including LACDMH representatives, recommended continuity of care.  AR 1049.  However, the ALJ stated that he did not have authority to disregard the requirements of the Medi-Cal Program and Conlan Beneficiary Reimbursement Plan.  AR 1049.  This ruling therefore addressed Jackson’s argument that he was misled, which was the only issue presented.

Assuming, arguendo, that the ALJs should have addressed the doctrine of equitable estoppel, the joint opposition is correct that the evidence does not support this claim.  See Opp. at 10.

            The first element of equitable estoppel is that the party to be estopped must be appraised of the facts.  According to Grey, Kaiser informed him that it would not provide behavioral therapy for children as young as Jackson and would not provide aide assistance for any child.  Grey was told that his only option would be to pay out-of-pocket for those services from a third party.  Kaiser did not mention that LACDMH and its contracting entities such as SSG were an option.  The court accepts that, while Kaiser may not have intentionally misled Grey, it should have known that services could be provided through LACDMH.

            The second element of equitable estoppel is that the party to be estopped must intend that his conduct shall be acted upon.  The court also accepts that, when Kaiser informed Grey that his only option would be to pay out-of-pocket for those services from a third party, it intended Grey to act upon this option.

            The third element of equitable estoppel is that the other party must be ignorant of the true state of facts.  The court accepts that Grey initially did not know that LACDMH was an option.

            The fourth element is that the other party must rely upon the conduct to his injury.  This is where Grey’s claim fails.  On August 31, 2018, Kaiser reimbursed Grey for the out-of-network services Jackson received from EDCA for the period of March 22 to the July 31, 2018 date when Kaiser’s clinical manager provided the in-network referrals.  AR 54-55, 290, 383.  Kaiser informed Grey that this reimbursement was a one-time courtesy, and it would not reimburse him for any future treatment with out-of-network providers. AR 55, 290, 383. 

            Kaiser’s action essentially cured any failure to refer Grey to LACDMH services.  Yet, Grey chose to continue treating with out-of-network providers even after Kaiser’s clarification.  AR 55, 57, 58.  Jackson’s health plan requires a referral for specialized treatments and prior authorization for services not available from network providers to determine whether the services are medically necessary.  AR 319.  Grey chose to continue with out-of-network providers without obtaining the necessary approval and authorization required by his health insurance.  Grey’s decision not to switch to an in-network provider, and to continue with an out-of-network provider, to avoid regression in his son’s disruptive behaviors is understandable but still a voluntary choice.[6]  At that stage, he cannot be deemed to have detrimentally relied on Kaiser’s advice.  The doctrine of equitable estoppel is not a tort rule supporting all consequential damages.

            Grey’s equitable estoppel claim fails both procedurally and substantively. 

2. Fair Trial

            At the first administrative hearing, Kaiser and DHCS were present, and LACDMH was not.  At the second administrative hearing, LACDMH was present and the other two entities were not.  Grey argues that the ALJ’s decision to split the cases resulted in an unfair hearing. 

            The principles of due process determine whether the hearing granted by an agency was fair.  Hall v. Superior Court, (2016) 3 Cal.App.5^th 792, 808.  The question whether the trial was “fair” encompasses pre-hearing and post-hearing events or procedures affecting the due process requirements of adequate notice and a meaningful opportunity to be heard.  See Vollstedt v City of Stockton, (1990) 220 Cal.App.3d 265, 273. Under Govt. Code section 11513(b), each party has the right to call and examine witnesses, cross-examine opposing witnesses, and impeach any witness regardless of which party called him or her.  If the trial court determines that the petitioner was denied a fair hearing, the court should issue a judgment remanding the case for proper proceedings.  See English v City of Long Beach (1950) 35 Cal.2d 155, 159; Wood v City Civil Serv. Comm’n, (1975) 45 Cal.App.3d 105, 111 (existence  of substantial evidence where administrative hearing was unfair does not affect requirement for remand).      

            Grey argues that Kaiser created his detrimental reliance.  At the first hearing, Kaiser submitted testimony concerning LACDMH, which was not present for Grey to cross-examine.  Similarly, LACDMH presented testimony at the second administrative hearing concerning Kaiser and DHCS, neither of which were present for Grey to cross-examine.  The facts between the two split hearings prevented a fair hearing of Grey’s equitable estoppel claim.  Pet. Op. Br. at 9; Reply at 4.

            In both of his rehearing requests, Grey contended that the hearing split led to unfair circumstances that prevented the parties from being able to address the other’s testimony.  His rehearing request for the first administrative hearing argued:

“The decision also states, ‘[Grey] requested that this hearing be continued to add this agency [LACDMH] as a party,” however, this is never addressed again in the decision, and apparently, the judge determined – for reasons that aren’t mentioned in the decision – that this hearing should not be continued to include representatives from LACDMH, and that, instead, a new hearing should be convened to address only the LACDMH portion of the claim. However, since then, LACDMH has already submitted new documents, making claims about what Kaiser and DHCS did and said, so it is essential that all parties be present simultaneously, so that all information on this matter can be revealed, discussed, and questioned, per the original intent of my hearing request. LACDMH was not present at the hearing, and therefore, a rehearing – which must include representatives from (1) Kaiser, (2) DHCS, and (3) LACDMH – is the only way to ensure that this situation is made right. The full claim is absolutely inter-connected between these three parties”.  AR 593-94. 

            Grey argues that both rehearing requests were denied without any reference to this specific point.  At a minimum, the case should be remanded to DSS’s Administrative Hearings Division to consider whether splitting the hearing violated Grey’s right to due process.  Pet. Op. Br. at 11.         

            In reply, Grey notes that the joint opposition fails to address the fair hearing issue and argues that it tacitly concedes the issue that he did not receive a fair hearing.  Reply at 4.  Without a fair hearing, it is not possible to fully appreciate Grey’s equitable estoppel claim.  Acting on the advice of the medical professionals he consulted, Grey acted appropriately to require Kaiser and as authorized agent for LACDMH to be accountable for the wrongful advice given in the beginning of the course of treatment.   There was a wrong by Kaiser for which there ought to be fair and equable remedy imposed and the lack of a fair hearing prevented presentation of evidence on these facts.  Reply at 5.

Grey’s fair hearing argument is based solely on his equitable estoppel claim.  As that claim fails, it follows that Grey necessarily was not denied a fair hearing.  Nor does Grey adequately show why he needed all of Kaiser, DHCS, and LACDMH present at the same hearing. It is insufficient to contend that he could not cross-examine LACDMH at the first hearing and could not cross-examine Kaiser and DHCS at the second hearing.  Cross-examine on what issues?  Particularly since all three entities were present at the hearings collectively, what testimony would have been elicited that was not?  How would the evidence have changed?  Grey does not say.

Moreover, a due process violation requires a showing of prejudice.  Krontz v. City of San Diego, (2006) 136 Cal.App.4^th 1126, 1141 (delay in notice and opportunity to be heard requires prejudice).  Prejudice will not be presumed; actual prejudice must be shown in order to be balanced against a due process violation.  People v. Belton, (1992) 6 Cal.App.4^th 1425, 1433 (delay in filing criminal charges requires balancing of prejudice against justification for delay).  “Reversible error requires demonstration of prejudice arising from the reasonable probability the party ‘would have obtained a better outcome’ in the absence of the error”.  Fisher v. State Personnel Bd., (2018) 25 Cal.App.5th 1, 20.  

Grey’s claims in the first hearing were for DHCS’s denial of his request for reimbursement of $7,960 for services J, LCWS from October 18, 2020 through September 30, 2021 and against Kaiser for $3,514 by providers ECDA and Play 2 Progress during the period of June 7, 2018 through September 27, 2021.  DHCS had referred to LACMHD Grey’s claim for imbursement for $38,580 for services provided during the period of March 22, 2018 through September 28, 2020.  AR 18.  Grey asked to continue the first hearing to add LACMHD as a party to address that reimbursement claim, as well his claim for continuation of services beginning October 2021.  AR 6-7.  DHCS and Kaiser did not agree to add continuation of services as an issue.  AR 7.  Instead, the ALJ opened a claim against LACMHD for a second hearing.  The ALJ’s decision to split the hearings makes sense and Grey fails to show any prejudice from the decision. 

            F. Conclusion

The Petition is denied.  Counsel for Respondent DSS and Real Party DHCS is ordered to prepare a proposed judgment, serve it on Grey’s counsel for approval as to form, wait ten days after service for any objections, meet and confer if there are objections, and then submit the proposed judgment along with a declaration stating the existence/non-existence of any unresolved objections.  An OSC re: judgment is set for November 12, 2024 at 9:30 a.m.