Kuntz v. Kaiser Foundation Hospital ( 2021 )

Filed 4/12/21
CERTIFIED FOR PARTIAL PUBLICATION*
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
THIRD APPELLATE DISTRICT
(Sacramento)
----
EDWARD WILLIAM KUNTZ et al., C087967
Plaintiffs and Appellants, (Super. Ct. No.
34201400165348CUPOGDS)
v.
KAISER FOUNDATION HOSPITAL et al.,
Defendants and Respondents.
APPEAL from a judgment of the Superior Court of Sacramento County,
Christopher E. Krueger, Judge. Affirmed.
The Law Office, Edward P. Dudensing, Jay P. Renneisen and Andrew J. Collins
for Plaintiffs and Appellants.
Muro & Lampe, Inc., Mark A. Muro, Marion’s Inn LLP, Mark Palley, Yvonne M.
Pierrou and Denise Ngo for Defendants and Respondents.
* Pursuant to California Rules of Court, rules 8.1105 and 8.1110, this opinion is certified
for publication with the exception of Parts I – II.
1
Plaintiffs, consisting of the estate of decedent Edward William Kuntz (decedent),
his wife, and his three children, sued, among others, the Kaiser Foundation Hospital and
the Permanente Medical Group, Inc. (collectively Kaiser), asserting against Kaiser causes
of action sounding in elder abuse, negligent infliction of emotional distress, and wrongful
death. Kaiser filed a petition to stay the action and compel arbitration. The trial court
granted the petition as to the elder abuse cause of action, staying the other causes of
action. Ultimately, the trial court entered judgment in favor of Kaiser.
On appeal, plaintiffs assert that (1) Kaiser failed to satisfy its burden of producing
a valid agreement to arbitrate, and (2) Kaiser failed to comply with the mandatory
requirements of Health and Safety Code section 1363.1 concerning the disclosure of
arbitration requirements.1
We affirm.
FACTUAL AND PROCEDURAL BACKGROUND
Plaintiffs commenced this action against Kaiser, among others, by filing a
complaint alleging causes of action to recover damages, inter alia, for elder abuse (Welf.
& Inst. Code, § 15600 et seq.), negligent infliction of emotional distress,2 and wrongful
death. Decedent’s estate asserted the elder abuse cause of action, while decedent’s wife
and children asserted the negligent infliction of emotional distress and wrongful death
causes of action. We dispense with the underlying factual allegations because they are
not relevant to any issue presented on appeal.
1 Further undesignated statutory references are to the Health and Safety Code.
2 “ ‘[T]he negligent causing of emotional distress is not an independent tort but the tort
of negligence . . . .’ ” (Marlene F. v. Affiliated Psychiatric Medical Clinic, Inc. (1989) 48
Cal.3d 583, 588; accord, Burgess v. Superior Court (1992) 2 Cal.4th 1064, 1072.)
2
Petition to Stay Action and Compel Arbitration
Kaiser filed a petition to stay the action and compel arbitration. Kaiser asserted
that decedent was enrolled as a member of the Kaiser Foundation Health Plan, Inc.
(Health Plan), pursuant to his wife’s employment under an “Agreement for Group
Coverage” (CalPERS Agreement) between Health Plan and the Board of Administration
of the California Public Employees’ Retirement System (CalPERS). Decedent and his
wife enrolled under the CalPERS Agreement by an enrollment process administered
exclusively by CalPERS.
According to Kaiser, an arbitration provision required binding arbitration of all of
plaintiffs’ claims. The arbitration provision was contained in the versions of the
CalPERS Combined Evidence of Coverage and Disclosure Form for the Basic Plan
operative in 2012 and 2013, the time period relevant to plaintiffs’ claims. This document
is incorporated into the CalPERS Agreement.
Kaiser included a copy of the Combined Evidence of Coverage and Disclosure
Form for the Basic Plan, effective January 1, 2013, as an exhibit in support of its petition.
The arbitration provision in that document, under the heading, “Binding Arbitration,”
stated, in part, “For all claims subject to this ‘Binding Arbitration’ section, both
Claimants and Respondents give up the right to a jury or court trial and accept the use of
binding arbitration.”3 The 2012 version of the Combined Evidence of Coverage and
Disclosure Form for the Basic Plan contained essentially the same arbitration provisions.
Kaiser further asserted that section 1363.1, which requires that the enrollment
form signed by the subscriber contain a prominently displayed arbitration notice, did not
3 We need not set forth the applicable arbitration provisions in any further detail. No
issue is raised on appeal concerning, for example, the scope of disputes subject to the
arbitration provisions or the definitions of Member Parties or Kaiser Parties.
3
apply to CalPERS enrollments.4 Kaiser relied on Government Code section 22869,
which states that information disseminated by the CalPERS Board pursuant to section
22863 “shall be deemed to satisfy the requirements of Chapter 2.2 (commencing with
Section 1340) of Division 2 of the Health and Safety Code.” Chapter 2.2, known as the
Knox-Keene Health Care Service Plan Act of 1975 (Knox-Keene Act) (§ 1340), includes
section 1363.1. Kaiser asserted that CalPERS administers its own enrollment process
with its own enrollment forms, and that Health Plan is not allowed to substitute its own
enrollment form or modify CalPERS’s enrollment forms. Thus, because the enrollment
materials at issue are disseminated pursuant to Government Code section 22869 by the
CalPERS Board and not by Kaiser, those materials are deemed to satisfy the requirements
of the Knox-Keene Act, and specifically section 1363.1.
In a declaration submitted with Kaiser’s petition, Angela Kohls, Area Vice
President, Strategic Accounts, described CalPERS’s practice of providing enrollment
publications to CalPERS members prior to the open enrollment period each year. Kohls
also stated that these publications were available through the CalPERS website. The
Health Benefit Summary advised CalPERS members that the Kaiser plan required
binding arbitration of claims, and indicated that the applicable arbitration provision was
set forth in the Kaiser Evidence of Coverage, which was posted on the CalPERS website.
Kohls also stated that, each year, prior to open enrollment, CalPERS mailed to its
4 As will be discussed in greater detail post, section 1363.1 addresses binding arbitration
provisions included as a contract term. Such a disclosure “shall appear as a separate
article in the agreement issued to the employer group or individual subscriber and shall
be prominently displayed on the enrollment form signed by each subscriber or enrollee.”
(§ 1363.1, subd. (b).) Subdivision (d) of section 1363.1 requires that, “[i]n any contract
or enrollment agreement for a health care service plan, the disclosure required by this
section shall be displayed immediately before the signature line provided for the
representative of the group contracting with a health care service plan and immediately
before the signature line provided for the individual enrolling in the health care service
plan.”
4
members an open enrollment packet that included a newsletter, a Health Benefit
Statement, and a business reply card for requesting a written copy of the Health Benefit
Summary and other information. Further, CalPERS’s agreement with Health Plan
required Health Plan to mail subscribers an Evidence of Coverage after confirmation of
enrollment, which Health Plan routinely did. Additionally, beginning in 2009, each year,
Health Plan sent subscribers a card that could be submitted to request a copy of the new
Evidence of Coverage. The card also instructed subscribers how to view and download
the Evidence of Coverage online. Kohls stated that Health Plan could not unilaterally
amend the Evidence of Coverage, and that any change Health Plan proposed had to be
approved by CalPERS.
In another declaration, Alice E. Davis, Operations Manager of Special Accounts at
Kaiser Permanente California Service Center, stated that her responsibilities included
verifying eligibility of past and present members of the Health Plan. Davis stated that she
accessed Health Plan’s membership records for decedent. Those records indicated that
decedent “was continuously enrolled as a Health Plan member, as either a subscriber or a
spousal dependent, on various accounts, since 1983.” Davis stated that Health Plan’s
records showed that, as of October 1, 2008, decedent was enrolled as a member “by way
of his spouse’s employment, under an agreement between Health Plan and” CalPERS.
Decedent “remained continuously enrolled on that account, though with a change in sub-
group, until his death.” Davis stated that Health Plan had no involvement in the
CalPERS enrollment process, and that CalPERS administered its own enrollment process
with its own enrollment forms. She further stated that Health Plan had never been
permitted to substitute its enrollment forms, or to modify CalPERS enrollment forms.
Plaintiffs’ Opposition
Plaintiffs opposed Kaiser’s petition to stay the action and compel arbitration.
Plaintiffs asserted that Kaiser failed to meet its burden of producing a valid agreement to
arbitrate because Kaiser had not “produced an enrollment form demonstrating that
5
[decedent] was a Kaiser member, let alone that he or anyone else connected with him
agreed to arbitration.” According to plaintiffs, Kaiser presented no evidence to establish
that decedent or a family member was a CalPERS employee or received health care
benefits through CalPERS. Plaintiffs repeatedly referred to Kaiser’s failure to produce an
enrollment form.
Plaintiffs further asserted that Kaiser had not complied with the mandatory
requirements of section 1363.1. Again, plaintiffs emphasized that Kaiser produced no
enrollment form, and therefore asserted that Kaiser failed to establish that any such
enrollment form complied with the requirement of section 1363.1 that an arbitration
agreement be prominently displayed on the enrollment form. Plaintiffs disputed Kaiser’s
contention that it was not required to satisfy the requirements of section 1363.1.
Plaintiffs maintained that Kaiser failed to prove that the CalPERS board satisfied the
requirements of Government Code section 22863 such that it could invoke Government
Code section 22869. Additionally, plaintiffs asserted that “section 22869 does not
exempt Kaiser from complying with . . . section 1363.1” (Italics added.) Plaintiffs
further asserted that there was no evidence that CalPERS prohibited Kaiser from
complying with section 1363.1, and therefore there was no evidence that compliance was
impossible.
Kaiser’s Reply
Kaiser filed a reply, asserting that it had shown the existence of a valid arbitration
agreement through the authenticating declarations, the agreements between Health Plan
and CalPERS, the Evidence of Coverage documents, the arbitration provision in the 2012
Evidence of Coverage, and Davis’s declaration stating that decedent’s membership
records indicated that he had been enrolled as a Health Plan member since 1983 and had
been enrolled through his wife’s employment since October 1, 2008. With the reply
papers, Kaiser included a supplementary declaration by Davis and a printout of
decedent’s membership records. In her supplemental declaration, Davis explained certain
6
data from the printout: “Attached as Exhibit A is a true and correct copy of a screen print
of Health Plan’s computerized membership history records screen for [decedent], with
[decedent’s] birth date, medical record number, Social Security number, and home
address redacted for privacy. The purchaser ID number ‘3’ indicates that [decedent] was
a CalPERS enrollee. Group 3 is CalPERS. This is also shown by the reference to ‘State
of California.’ ”
Kaiser reiterated its position that the requirements of section 1363.1 do not apply
to CalPERS enrollments such as decedent’s. Kaiser asserted that Government Code
sections 22869 and 22863 exempt CalPERS enrollments from the section 1363.1
requirements. And Kaiser again asserted it had no authority to require a different
enrollment form than what CalPERS employs.
Tentative Ruling
In a tentative ruling, the trial court granted Kaiser’s motion to compel arbitration
as to the elder abuse cause of action asserted against Kaiser. The court stayed
proceedings as to the other causes of action.
The trial court concluded that Kaiser’s records showed that decedent was
continuously enrolled as a Health Plan member, either as a subscriber or a spousal
dependent, since 1983. As of October 1, 2008, decedent was enrolled as a member
through his wife’s employment under an agreement between Health Plan and CalPERS,
and he remained continuously enrolled as such until his death. The court concluded that
Kaiser’s evidence, including the Davis declarations and the membership records printout,
were sufficient to demonstrate the existence of a valid arbitration agreement.
The trial court agreed with Kaiser that CalPERS enrollments were exempt from
the requirements of section 1363.1. The court concluded that CalPERS was required to
disclose certain information to each enrollee in a health benefit plan, that Kaiser did not
have the ability to modify or substitute the CalPERS forms, and that the enrollment forms
CalPERS employed were exempt from the requirements of section 1363.1.
7
Oral Argument in the Trial Court
At the hearing in the trial court, plaintiffs’ attorney stated he did not “see how you
can input [sic] an agreement to arbitration when we don’t have a signed agreement by
anyone agreeing to any terms of anything.” The trial court asked, “He was covered by
CalPERS; right?”, to which plaintiffs’ attorney responded that he did not know whether
the evidence supported that conclusion. The trial court responded: “Tell you what, I’m
not going to play games with it. . . . You can file additional papers to prove what his
enrollment was, or what his employment was, because the problem is . . . he either was or
was not. If you want to go and try the case and try to prove that up, I’ll let you do that.”
Plaintiffs’ attorney stated his argument was that an enrollee has to sign an enrollment
form, and no enrollment form was produced in this case. The court noted, “you should
know, and your client should know whether or not [decedent] was a CalPERS enrollee.
If you’re not willing to admit that, . . . you can try that issue and they can put in evidence.
. . . Maybe how it comes out is that he really was not covered, but from what I have seen,
I think there is sufficient proof to show, at least on the papers, that the Kaiser plan that he
was covered under was pursuant to a CalPERS employment.” Plaintiffs’ attorney stated
his argument was more narrow: “It’s just a question of whether an enrollment form was
signed, because the enrollment form is what incorporates the whole evidence of
coverage.”
Kaiser’s attorney emphasized Davis’s declaration, stating that, as of October 1,
2008, decedent was enrolled as a member through his wife’s employment under an
agreement between Health Plan and CalPERS, and he remained continuously enrolled as
such, with only a change in sub-group, until his death.
As plaintiffs’ attorney continued to argue that an enrollment form was required,
the trial court stated it would give plaintiffs the opportunity to prove that at trial.
However, the court also stated that “I think that the evidence that was submitted is
certainly sufficient to raise the issue and carry the day on a motion like this, but if the
8
plaintiff wants to challenge the custodian’s rendition of the contents of various records
. . . and probe further . . . .” Kaiser’s attorney then emphasized the computer printout of
decedent’s member history and Davis’s supplemental declaration.
Plaintiffs’ attorney stated, “I’m not arguing so much about whether he’s a
CalPERS or CalPERS Kaiser member. I’m saying you’ve got to sign an enrollment
form.” The trial court asked if there were cases stating that “a CalPERS-covered member
of a Kaiser plan, that every CalPERS member has to sign an enrollment form every time
they switch coverage, or anything in order to be subject to the arbitration plan?”
Plaintiffs’ attorney stated that there was “no case on CalPERS, period.”
Turning to the other issue, plaintiffs’ attorney asserted that the court in its tentative
ruling “has taken a very broad view of the scope of those provisions as saying that the
Knox-Keene Act does not apply to CalPERS.” The court responded that “22863 says
that information disseminated under 22869 according to 22863[5] . . . ‘shall be deemed to
satisfy the requirements of Chapter 2.2.’ [¶] Now, I’m not sure how they could state it
any more broadly . . . .”
Plaintiffs’ attorney asserted that what mattered was whether CalPERS
disseminated the relevant information; “if CalPERS had disseminated information
relating to the arbitration issue, then that would be subject to 22869.”
Kaiser’s attorney asserted that Kaiser submitted ample evidence to establish that
the relevant material was disseminated pursuant to Government Code section 22863, so
as to comply with the requirements of the Knox-Keene Act. Kaiser’s attorney
emphasized that the CalPERS Board did mention arbitration, and notified potential
5The trial court appears to have reversed reference to the section numbers. Government
Code section 22869 provides that information disseminated pursuant to Government
Code section 22863 shall be deemed to satisfy the requirements of Chapter 2.2, the Knox-
Keene Act.
9
enrollees that there were arbitration notices in various documents and referred enrollees
and potential enrollees to the Evidence of Coverage documents. Moreover, Kaiser’s
attorney noted the evidence concerning the distribution of the Evidence of Coverage
documents, which contained the arbitration provisions. Therefore, according to Kaiser,
the exemption applied. Kaiser’s attorney further asserted: “[t]he regulation . . . says that
the contracting agency, the employing agency has to give people the enrollment form that
is prescribed by the Board.[6] That is in our re[p]ly brief. Prescribed by the Board. So
that means the Board is controlling the shots here. It’s controlling the information. It
does so and Kaiser can’t change the forms, can’t change anything about that. The
exemption applies.”
Ruling on the Submitted Matter
Following argument and submission of the matter, the trial court adopted the
tentative ruling. The court added the following: “At oral argument, Plaintiffs argued that
[Kaiser] failed to satisfy their burden to demonstrate: (1) that [decedent] was enrolled as
a member of Kaiser, and (2) that CalPERS disseminated the information required by
Gov’t Code §22863. [¶] The Court disagrees. Here, [Kaiser] ha[s] proffered sufficient
evidence showing that [decedent] was enrolled with Kaiser. (Declaration of Alice E.
Davis; Supplemental Declaration of Alice E. Davis and Exhibit A [membership history
printout].) [Kaiser] ha[s] also demonstrated that each year CalPERS mails or delivers
enrollment applications to CalPERS members prior to the open enrollment period.
(Declaration of Angela Kohls.) CalPERS also disseminates the information required by
Gov’t Code § 22863 via its website. (Id., Ex. F.) Thus, the Court finds that [Kaiser has]
satisfied [its] burden.”
6 Kaiser’s attorney was referring to California Code of Regulations, title 2, section
599.515, which we shall discuss in part III.D. of the Discussion, post.
10
Arbitration Award, Dismissal of Remaining Causes of Action, and Judgment
Upon granting Kaiser’s motion for summary judgment as to the elder abuse cause
of action, the only cause of action before him, the arbitrator issued the final award in
favor of Kaiser, denying the claim asserted by plaintiffs. The trial court granted Kaiser’s
unopposed petition to confirm the arbitration award and lifted the stay previously
imposed.
Plaintiffs filed a first amended complaint, asserting only causes of action to
recover damages for negligent infliction of emotional distress and wrongful death. The
trial court sustained Kaiser’s demurrer without leave to amend as to the negligent
infliction of emotional distress cause of action, and overruled the demurrer as to the
wrongful death cause of action. Subsequently, plaintiffs voluntarily dismissed, without
prejudice, the wrongful death cause of action insofar as asserted against Kaiser.
Thereafter, the trial court entered judgment in favor of Kaiser.
DISCUSSION
Plaintiffs seek reversal of the trial court’s order granting Kaiser’s motion to
compel arbitration as to plaintiffs’ elder abuse cause of action.7 Plaintiffs seek reversal
on two grounds: (1) Kaiser failed to satisfy its burden of producing a valid agreement to
arbitrate, and (2) Kaiser failed to comply with the mandatory requirements of section
1363.1.
I. Arbitration Agreements and Standards of Review
“California courts ‘have consistently found a strong public policy favoring
arbitration agreements.’ [Citation.] ‘Although “[t]he law favors contracts for arbitration
7 Plaintiffs’ notice of appeal stated that they appeal from the judgment of dismissal after
an order sustaining a demurrer and from a judgment entered after arbitration and order
sustaining demurrer. On appeal, the only issues raised by plaintiffs are addressed to the
trial court’s order compelling arbitration.
11
of disputes between parties” [citation], “ ‘there is no policy compelling persons to accept
arbitration of controversies which they have not agreed to arbitrate . . . .’ ” [Citations.]’
[Citation.] ‘The party seeking to compel arbitration bears the burden of proving the
existence of a valid arbitration agreement. [Citations.] Petitions to compel arbitration are
resolved by a summary procedure that allows the parties to submit declarations and other
documentary testimony and, at the trial court’s discretion, to provide oral testimony.
[Citations.] If the facts are undisputed, on appeal we independently review the case to
determine whether a valid arbitration agreement exists.’ ” (Goldman v. Sunbridge
Healthcare, LLC (2013) 220 Cal.App.4th 1160, 1169.)
“[W]e . . . review the order compelling arbitration de novo.” (Abramson v.
Juniper Networks, Inc. (2004) 115 Cal.App.4th 638, 650, citing NORCAL Mutual Ins.
Co. v. Newton (2000) 84 Cal.App.4th 64, 71-72 & Herman Feil, Inc. v. Design Center of
Los Angeles (1988) 204 Cal.App.3d 1406, 1414.) “ ‘ “[T]o the extent the trial court’s
determination that the arbitration agreement was [valid] turned on the resolution of
conflicts in the evidence or on factual inferences to be drawn from the evidence, we
consider the evidence in the light most favorable to the trial court’s ruling and review the
trial court’s factual determinations under the substantial evidence standard.” ’ ” (Brown
v. Ralphs Grocery Co. (2011) 197 Cal.App.4th 489, 497 (Brown).) “ ‘ “Substantial
evidence” is evidence of ponderable legal significance, evidence that is reasonable,
credible and of solid value.’ ” (Markow v. Rosner (2016) 3 Cal.App.5th 1027, 1045.)
II. Validity of the Arbitration Agreement
A. Parties’ Contentions
Plaintiffs assert that Kaiser failed to meet its burden of establishing that decedent
agreed to arbitration. According to plaintiffs, Kaiser’s efforts to force arbitration are
premised on the facts that (1) decedent or a family member was a CalPERS employee, (2)
decedent or a family member agreed to pay for and receive health care benefits through
CalPERS, and (3) decedent or a family member elected to use Kaiser and agreed to be
12
bound by Kaiser’s agreement with CalPERS with regard to the terms and conditions of
the health care coverage. Plaintiffs assert that Kaiser failed to offer admissible evidence
to support any of these premises. Plaintiffs claim that there is no evidence in the record
to establish that decedent or a family member was a CalPERS employee or received
health care benefits through CalPERS. Plaintiffs emphasize that Kaiser produced no
enrollment form.
Kaiser responds that it provided ample evidence, through Davis’s two declarations
and the business records she authenticated, to prove decedent was enrolled as a member
through CalPERS. Kaiser asserts that its evidence constituted sufficient proof and that it
was not required to furnish an enrollment form, which would not reflect that the would-
be enrollee was actually enrolled or the dates of enrollment. Kaiser emphasizes that the
material terms of a writing were not at issue here; it was decedent’s status as an enrollee
that was at issue.
B. Analysis
Kaiser offered the declaration of Davis. In it, she stated that she “accessed Health
Plan’s membership records for [decedent]. Health Plan’s membership records show that
[decedent] was continuously enrolled as a Health Plan member, as either a subscriber or a
spousal dependent, on various accounts, since 1983. Health Plan’s membership records
show that effective October 1, 2008, [decedent] was enrolled as a member by way of his
spouse’s employment, under an agreement between Health Plan and [CalPERS]. He
remained continuously enrolled on that account, though with a change in sub-group, until
his death.”
In its reply papers, Kaiser included a supplementary declaration by Davis, who
repeated the foregoing representations from her original declaration. Davis also stated
that, “[b]ecause CalPERS administers its own enrollment process with its own enrollment
forms, Health Plan does not have an enrollment form signed by [decedent’s wife] for the
CalPERS enrollment beginning October 1, 2008. As explained in my previous
13
declaration, CalPERS reports enrollment information to Health Plan by electronic means
rather than by providing Health Plan with copies of paper enrollment forms.”
Along with the supplemental Davis declaration, Kaiser submitted a printout of
decedent’s computerized membership history. In their reply brief on appeal, plaintiffs
assert that the printout “should be rejected as it was new evidence produced on reply.”
As stated in the case on which plaintiffs rely, “[n]ew evidence is generally not permitted
with reply papers.” (Valentine v. Plum Healthcare Group, LLC (2019) 37 Cal.App.5th
1076, 1089.) Plaintiffs are correct that this evidence was offered in the trial court with
Kaiser’s reply papers in further support of the petition to compel arbitration. However,
plaintiffs failed to object, including at oral argument when Kaiser made arguments based
directly on this evidence, and despite the fact that the trial court relied on this evidence in
its tentative ruling. Because plaintiffs failed to raise this contention before the trial court,
it is forfeited. (Evid. Code, § 353, subd. (a); In re D.D. (2019) 32 Cal.App.5th 985, 992
[party forfeited challenge by failing to object to the evidence in the trial court].)
Moreover, even on appeal, plaintiffs failed to raise this issue in their opening brief.
(Citizens for Positive Growth & Preservation v. City of Sacramento (2019) 43
Cal.App.5th 609, 630, fn. 9 (Citizens for Positive Growth), quoting Allen v. City of
Sacramento (2015) 234 Cal.App.4th 41, 52 (Allen) [“ ‘[w]e do not consider points raised
for the first time in the reply brief absent a showing of good cause for the failure to
present them earlier’ ”].)
Taking this evidence into consideration, the membership history records are what
Davis relied on in making her representations concerning decedent’s status as a Health
Plan enrollee through CalPERS. We conclude that the foregoing was relevant and
sufficient to prove decedent was enrolled with Health Plan through CalPERS at the
relevant times. (See generally Evid. Code, § 351 [“[e]xcept as otherwise provided by
statute, all relevant evidence is admissible”].)
14
Despite their insistence that an enrollment form was required, plaintiffs fail to
identify any statutory or case law requiring a provider to produce an enrollment form to
prove an individual was enrolled in a health care plan. Nor have we, in our independent
research, discovered any such requirement applicable to the circumstances presented
here.
Citing Evidence Code section 1523, subdivision (a), plaintiffs assert, as they did
before the trial court, that the evidence Kaiser produced was insufficient under the
secondary evidence rule, and consequently, Kaiser was required to produce the
enrollment form. Evidence Code section 1523, subdivision (a), provides: “Except as
otherwise provided by statute, oral testimony is not admissible to prove the content of a
writing.” However, to make its showing that decedent was a Health Plan member
enrolled through CalPERS, Kaiser was not required to prove the contents of an
enrollment form, which would prove only that the prospective enrollee at a particular
time sought to enroll in the subject health plan.
The most probative proof of decedent’s enrollment would be the provider’s
enrollment records, which is what Kaiser produced in reply papers with Davis’s
supplemental declaration. We note here that, a “printed representation of computer
information or a computer program is presumed to be an accurate representation of the
computer information or computer program that it purports to represent.” (Evid. Code,
§ 1552, subd. (a).) Other than asserting that Kaiser was required to produce the
enrollment form, plaintiffs did not object to the membership history records printout as
inaccurate or unreliable. (Ibid. [“If a party to an action introduces evidence that a printed
representation of computer information or computer program is inaccurate or unreliable,
the party introducing the printed representation into evidence has the burden of proving,
by a preponderance of evidence, that the printed representation is an accurate
representation of the existence and content of the computer information or computer
program that it purports to represent”].)
15
Moreover, under the Secondary Evidence Rule, subject to exceptions, “[t]he
content of a writing may be proved by otherwise admissible secondary evidence.” (Evid.
Code, § 1521, subd. (a).) Plaintiffs did not argue in the trial court that a “genuine dispute
exists concerning material terms of the writing and justice requires the exclusion,” or that
“[a]dmission of the secondary evidence would be unfair.” (Id., subd. (a)(1)-(2).) Indeed,
beyond asserting that an enrollment form was required, plaintiffs did not object to the
Davis declarations and the computer printout of membership history records, and, as
such, have forfeited any other objection to that evidence. (Evid. Code, § 353, subd. (a);
In re D.D., supra, 32 Cal.App.5th at p. 992.) Plaintiffs’ assertion in their opening brief
that Kaiser presented no admissible evidence to establish that decedent was enrolled with
Health Plan through CalPERS at the relevant times is unsupported by citation to
authority, forfeited, and without merit. Additionally, plaintiffs’ objection to the computer
printout of the membership history records as incompetent evidence was forfeited as it
was not made in the trial court (In re D.D., at p. 992) or in their opening brief, but instead
is raised for the first time in their reply brief with no showing of good cause for the
failure to raise it earlier. (Citizens for Positive Growth, supra, 43 Cal.App.5th at p. 630,
fn. 9; Allen, supra, 234 Cal.App.4th at p. 52.)
Kaiser’s evidence in the form of Davis’s declaration and supplemental declaration
and the membership history records were competent evidence, relevant and probative to
prove that decedent was a Health Plan member enrolled through CalPERS at all relevant
times. To the extent that the issue of decedent’s status as an enrollee in Health Plan
through CalPERS turned on factual issues, we conclude Kaiser’s evidence constituted
substantial evidence supporting the trial court’s determination. (Brown, supra, 197
Cal.App.4th at p. 497.)
Furthermore, Kaiser submitted its Combined Evidence of Coverage and
Disclosure Form for the Basic Plan. It also submitted Kohls’s declaration detailing
CalPERS’s practices of furnishing enrollment materials and publications to members and
16
Health Plan’s practices of providing Evidence of Coverage publications. This evidence
established the existence of the arbitration provision to which decedent was subject as a
Health Plan subscriber enrolled through CalPERS and the dissemination of these
materials.
Kaiser met its burden of proving the existence of a valid arbitration agreement.
III. Section 1363.1
A. Plaintiffs’ Contentions
Plaintiffs assert that, even if Kaiser established that decedent was a CalPERS
Kaiser patient, Kaiser’s motion to compel arbitration should have been denied because
Kaiser failed to comply with section 1363.1. Plaintiffs assert that section 1363.1
requires, among other things, that any agreement to arbitrate must be “ ‘prominently
displayed’ ” on the enrollment form and must clearly state whether the enrollee is
waiving the right to a jury trial, and all disclosures must appear “ ‘immediately before the
signature line.’ ” According to plaintiffs, because Kaiser did not produce any enrollment
form, Kaiser has necessarily failed to establish compliance with section 1363.1.
Addressing Kaiser’s position that section 1363.1 does not apply because decedent
was enrolled through CalPERS, and provisions of the Government Code state that
dissemination of certain information shall be deemed to satisfy the requirements of the
Knox-Keene Act, plaintiffs assert Kaiser has failed to demonstrate that the Government
Code provisions apply. Specifically, plaintiffs assert that Kaiser has not established that
the CalPERS Board satisfied the requirements of Government Code section 22863 such
that Government Code section 22869 applied. According to plaintiffs, Kaiser’s evidence,
in the form of a declaration stating CalPERS general practices, rather than what it
actually did, does not satisfy the applicable requirements. Further, plaintiffs assert that
Government Code section 22869 does not exempt Kaiser from complying with section
1363.1.
17
B. Applicable Statutory Provisions
Section 1363.1 provides: “Any health care service plan that includes terms that
require binding arbitration to settle disputes and that restrict, or provide for a waiver of,
the right to a jury trial shall include, in clear and understandable language, a disclosure
that meets all of the following conditions: [¶] (a) The disclosure shall clearly state
whether the plan uses binding arbitration to settle disputes, including specifically whether
the plan uses binding arbitration to settle claims of medical malpractice. [¶] (b) The
disclosure shall appear as a separate article in the agreement issued to the employer group
or individual subscriber and shall be prominently displayed on the enrollment form
signed by each subscriber or enrollee. [¶] (c) The disclosure shall clearly state whether
the subscriber or enrollee is waiving his or her right to a jury trial for medical
malpractice, other disputes relating to the delivery of service under the plan, or both, and
shall be substantially expressed in the wording provided in subdivision (a) of Section
1295 of the Code of Civil Procedure. [¶] (d) In any contract or enrollment agreement
for a health care service plan, the disclosure required by this section shall be displayed
immediately before the signature line provided for the representative of the group
contracting with a health care service plan and immediately before the signature line
provided for the individual enrolling in the health care service plan.”
Government Code section 22863, subdivision (a), provides: “The [CalPERS]
board[8] shall make available to employees and annuitants eligible to enroll in a health
benefit plan information that will enable the employees or annuitants to exercise an
informed choice among the available health benefit plans. Each employee or annuitant
enrolled in a health benefit plan shall be issued an appropriate document setting forth or
summarizing the services or benefits to which the employee, annuitant, or family
8 “ ‘Board’ means the Board of Administration of the Public Employees’ Retirement
System” (Gov. Code, § 22762), or the CalPERS Board.
18
members are entitled to thereunder, the procedure for obtaining benefits, and the principal
provisions of the health benefit plan.”
Government Code section 22869 provides: “Information disseminated by the
board pursuant to Section 22863, and compliance with regulations of the board adopted
pursuant to subdivision (a) of Section 22846 and Sections 22800 and 22831, shall be
deemed to satisfy the requirements of Chapter 2.2 (commencing with Section 1340) of
Division 2 of the Health and Safety Code.” Section 1363.1 is part of Chapter 2.2.
C. Principles of Statutory Interpretation
“ ‘ “Under settled canons of statutory construction, in construing a statute we
ascertain the Legislature’s intent in order to effectuate the law’s purpose. [Citation.] We
must look to the statute’s words and give them their usual and ordinary meaning.
[Citation.] The statute’s plain meaning controls the court’s interpretation unless its words
are ambiguous.” [Citations.] ’ ” (People v. Lucero (2019) 41 Cal.App.5th 370, 394-395,
quoting People v. Arias (2008) 45 Cal.4th 169, 177; accord, Union of Medical Marijuana
Patients, Inc. v. City of San Diego (2019) 7 Cal.5th 1171, 1183-1184.)
D. Analysis
There is no ambiguity here. The plain language of Government Code section
22869 provides that information disseminated by the CalPERS board pursuant to
Government Code section 22863 “shall be deemed to satisfy the requirements of Chapter
2.2 (commencing with Section 1340) of Division 2 of the Health and Safety Code ” – the
Knox-Keene Act. (Gov. Code, § 22869.) Section 1363.1 is part of Chapter 2.2, the
Knox-Keene Act. (§ 1340 [“[t]his chapter,” which includes section 1363.1, “shall be
known . . . as the Knox-Keene Health Care Service Plan Act of 1975”].) Thus, under the
plain meaning of Government Code section 22869, information disseminated by the
CalPERS Board pursuant to Government Code section 22863 shall be deemed to satisfy
the requirements of, among other things, section 1363.1.
19
Kohls, Area Vice President, Strategic Accounts, stated in her declaration that
CalPERS provided enrollment publications to CalPERS members prior to open
enrollment. These publications were also available on the CalPERS website. The Health
Benefit Summary advised CalPERS members that the Kaiser plan required binding
arbitration of claims, and indicated that the applicable arbitration provision was set forth
in the Kaiser Evidence of Coverage, which was posted on the CalPERS website. Kohls
also stated that, each year, prior to open enrollment, CalPERS mailed to its members an
open enrollment packet that included a newsletter, a Health Benefit Statement, and a
business reply card for requesting a written copy of the Health Benefit Summary and
other information. Further, CalPERS’s agreement with Health Plan required Health Plan
to mail subscribers an Evidence of Coverage after confirmation of enrollment. Beginning
in 2009, each year, Health Plan sent subscribers a card for use in requesting a copy of the
new Evidence of Coverage. The card also instructed subscribers how to view and
download the Evidence of Coverage online. Health Plan could not unilaterally amend the
Evidence of Coverage.
Davis, in her declaration, stated that Health Plan was not involved in the CalPERS
enrollment process, and that CalPERS administered its own enrollment process with its
own enrollment forms. She further stated that Health Plan had never been permitted to
substitute its enrollment forms, or to modify CalPERS enrollment forms.
According to Kohls, the material that CalPERS disseminates to would-be and
current enrollees, constitutes information disseminated pursuant to Government Code
section 22863, subdivision (a), the text of which is set forth in part III.B. of the
Discussion, ante.
We further note that the applicable regulations (Cal. Code Regs., tit. 2, § 599.500
et seq.) provide, with regard to enrollment, that the “contracting agency shall make
available to its employees and annuitants information concerning health benefit plans and
procedures for enrollment and the enrollment forms prescribed by the Board.” (Cal.
20
Code Regs., tit. 2, § 599.515, subd. (c), italics added.) Further, as Kaiser notes, the
applicable regulations define “ ‘[e]nroll’ ” as “to file with the employing office a properly
completed Health Benefits Plan Enrollment Form electing to be enrolled in a health
benefits plan,” and define “ ‘[e]mploying office,’ ” in pertinent part, as “any office of the
state or contracting agency to which jurisdiction and responsibility for health benefits
action for the employee concerned have been delegated.” (Cal. Code Regs., tit. 2,
§ 599.500, subds. (f), (b), italics added.) As asserted by Kaiser, the regulatory scheme
indicates that Kaiser has no option to unilaterally insist on any enrollment materials or
collect enrollment forms, and Davis’s and Kohls’s declarations support this view.
Because the enrollment forms are those prescribed by the CalPERS Board, as Kaiser
asserts, it would not be possible, nor necessary, for Kaiser to comply with the
requirements of section 1363.1.
Thus, the trial court correctly concluded that the plain and unambiguous language
of Government Code section 22869 exempts CalPERS enrollments from the requirements
of section 1363.1 where the CalPERS Board disseminates information pursuant to
Government Code section 22863. We further conclude that the evidence submitted by
Kaiser established that decedent’s enrollment with Kaiser was through CalPERS, and
that, in connection with that enrollment, the CalPERS Board disseminated relevant
information pursuant to Government Code section 22863, which included, among other
things, notice of the arbitration requirement. Accordingly, we conclude that the trial
court correctly determined that the arbitration agreement was not invalid for failure of
Kaiser to satisfy the requirements of section 1363.1.9
9 Kaiser filed a request that we take judicial notice of documents pertaining to the
legislative history of section 1363.1. Decision on the request was deferred pending
calendaring and assignment of the panel. We deny Kaiser’s request for judicial notice on
the ground that the subject documents are not necessary to our resolution of the issues
presented on appeal. (San Diego City Firefighters, Local 145 v. Board of Administration
21
We disagree with plaintiffs’ contentions that Kaiser has not offered sufficient
evidence to demonstrate that CalPERS disseminated information, including the
arbitration notification, pursuant to Government Code section 22863, and that it has not
laid an adequate foundation for this evidence. We do not agree that, to make this
showing, Kaiser was required to produce a declaration from a CalPERS employee.
Rather, the declaration of Kohls, Area Vice President, Strategic Accounts, describing
CalPERS’s practices in connection with Health Plan enrollments of providing enrollment
publications to CalPERS members, was sufficient to make this showing. She stated that
her statements in the declaration, including her descriptions of CalPERS’s and Health
Plan’s practices concerning the dissemination of relevant information to enrollees and
would-be enrollees, was within her personal knowledge.
Also unavailing are plaintiffs’ assertions that Kaiser’s disclosures in the CalPERS
Agreement are deficient for failure to comply with section 1363.1, and that “Kaiser’s
interpretation of these government code sections makes no sense when one considers that
1363.1 requires Kaiser to make the disclosures not only to the enrollees but also directly
to CalPERS.” Assuming this is relevant to plaintiffs’ circumstances and that they have
standing to raise it, the section 1363.1, subdivision (b) requirement that the disclosure be
“prominently displayed” applies to the section 1363.1 enrollment form, not the contract
between the health care service plan and the employer group. Subdivision (b)’s only
requirement applicable to an agreement between the health care service plan and the
employer group is that the disclosure “appear as a separate article in the agreement . . . .”
(§ 1363.1, subd. (b).) The arbitration provision is indeed a separate article, article 9.7, in
the CalPERS Agreement.
of San Diego City Employees’ Retirement System (2012) 206 Cal.App.4th 594, 600, fn. 3
[judicial notice denied because “the document at issue is not necessary to our resolution
of this appeal”].)
22
Subdivision (d) of section 1363.1 requires that, in the contract, the disclosure
“shall be displayed immediately before the signature line provided for the representative
of the group contracting with a health care service plan . . . .” (§ 1363.1, subd. (d).) On
the signature page of the CalPERS Agreement, immediately before the lines reciting that
the parties were executing the agreement by their respective officers’ signatures, appears
the following disclosure: “By entering this Agreement, the parties agree to have certain
member disputes (including medical malpractice) decided by neutral, binding arbitration.
Both of the parties recognize that this may constitute a waiver of the right to a jury or
court trial for these disputes for members who elect to enroll in the plan. See Section 9.
General Provisions, Item 9.7. Arbitration, and Attachment 1, the Combined Evidence of
Coverage & Disclosure Form for the Basic Plan and the Managed Medicare Plan of this
Agreement.” We conclude that this complies with the requirement in section 1363.1,
subdivision (d), that, in the contract, the arbitration disclosure is displayed immediately
before the signature line. (Contra, Robertson v. Health Net of California, Inc. (2005) 132
Cal.App.4th 1419, 1424-1428 [three paragraphs intervene between the arbitration
provision on the enrollment form and the signature line; enrollment form failed to comply
with requirement of section 1363.1, subd. (d)]; Malek v. Blue Cross of California (2004)
121 Cal.App.4th 44, 62 [arbitration provision on enrollment form not immediately before
signature line, but, instead, immediately before signature line is a paragraph authorizing
the release of medical information and the arbitration provision is on the left side of the
form while the signature line is on the right side].)
Thus, Kaiser’s disclosures to CalPERS comply with the requirements of section
1363.1. Plaintiffs fail to adequately and persuasively explain why the fact that
Government Code section 22869 says nothing about the disclosures that must be made by
Kaiser to CalPERS and does not act to remedy any deficiencies in agreements between
health plans and CalPERS means that Kaiser’s, and our, interpretation of these provisions
“makes no sense.” Government Code section 22869 is not addressed to agreements
23
between health plans and CalPERS; it is concerned with information disseminated by the
CalPERS Board to employees and annuitants. (§§ 22869, 22863.)
As they did in the trial court, plaintiffs rely on Medeiros v. Superior Court (2007)
146 Cal.App.4th 1008 (Medeiros). However, that case is inapposite. In that case, the
writ petitioners (Medeiros) challenged the trial court’s order compelling them to arbitrate
a dispute with their health insurer, Health Net. (Id. at p. 1010.) They asserted that the
arbitration provision was not enforceable because Health Net failed to comply with the
requirements of section 1363.1. Health Net countered that, “as a member of a group
health plan negotiated between Health Net and Medeiros’s employer,” Medeiros was not
entitled to the protection of these section 1363.1 requirements, “the requirements of
section 1363.1 do not apply to the ‘benefits election form’ Medeiros signed and
submitted to his employer in order to enroll in the group health plan,” and “section
1363.1’s disclosure obligations would only have been triggered if [Health Net] had
required Medeiros to sign an ‘enrollment form’ in order to enroll in the health plan.”
(Medeiros, at p. 1011.) The Court of Appeal reversed the trial court’s order compelling
Medeiros to arbitrate and directed the court to issue an order denying Health Net’s
motion to compel arbitration. (Id. at p. 1019.) The court determined that the
requirements of section 1363.1 were mandatory, and that Medeiros “was entitled to the
same disclosure from Health Net concerning the arbitration provisions as any individual
subscriber who signed an enrollment form.” (Medeiros, at p. 1019.)
Medeiros is not helpful to plaintiffs. CalPERS was not involved in Medeiros and,
as such, Government Code sections 22863 and 22869 had no applicability. Under the
circumstances of this case, these sections are dispositive to plaintiffs’ claim concerning
section 1363.1.
Plaintiffs also rely on Consumer Watchdog v. Department of Managed Health
Care (2014) 225 Cal.App.4th 862, 880 (Consumer Watchdog), for the proposition that
“[r]ecent case law has explicitly held that CALPERS is indeed subject to certain
24
provisions of the Knox-Keene Act,” and that Kaiser reads Government Code section
22869 too broadly. Without delving into the rather complicated details of Consumer
Watchdog, while plaintiffs may correctly cite Consumer Watchdog for the proposition
that a state government agency is “subject to certain provisions of the Knox-Keene Act,”
that fact does not help plaintiffs. Kaiser is not contending that no aspect of the Knox-
Keene Act applies to enrollments through CalPERS, a contention to which Consumer
Watchdog could theoretically be relevant. Rather, Kaiser is simply relying on the express
language of Government Code section 22869. The plain language of that section
controls, and provides that “[i]nformation disseminated by the [CalPERS] board pursuant
to Section 22863 . . . shall be deemed to satisfy the requirements of” the Knox-Keene
Act. This is not to say that CalPERS is not subject to any provisions of the Knox-Keene
Act, an issue we need not address here. Our more narrow conclusion, based on the plain
language of the relevant Government Code provisions, is that information the CalPERS
Board disseminates pursuant to Government Code section 22863 shall be deemed to
satisfy those requirements of the Knox-Keene Act, including those found in section
1363.1, applicable to the disseminated information. (Gov. Code, § 22869.) Consumer
Watchdog is silent on, and does not undermine, this proposition, and does not support
plaintiffs’ position to the extent that they assert that a CalPERS-administered plan must
satisfy the requirements of section 1363.1.
Ultimately, we agree with Kaiser that, pursuant to the plain language of
Government Code section 22869, the information that CalPERS disseminated pursuant to
Government Code section 22863, which includes the arbitration provisions and
disclosures, shall be deemed to satisfy the requirements of the Knox-Keene Act. None of
the legal or factual arguments advanced by plaintiffs persuade us otherwise.
Accordingly, we conclude that plaintiffs’ contention that the order to compel arbitration
of the elder abuse claim should be reversed for Kaiser’s failure to satisfy the requirements
of section 1363.1 is without merit.
25
DISPOSITION
The judgment is affirmed. Kaiser is awarded its costs on appeal. (Cal. Rules of
Court, rule 8.278, subd. (a)(1), (2).)
/s/
MURRAY, J.
We concur:
/s/
ROBIE, Acting P. J.
/s/
KRAUSE, J.
26