In re: Petition of Avilla, Villanueva, and Biddinger v. Ito

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Electronically Filed
Intermediate Court of Appeals
CAAP-XX-XXXXXXX
16-MAR-2023
07:51 AM
Dkt. 114 MO
NO. CAAP-XX-XXXXXXX
IN THE INTERMEDIATE COURT OF APPEALS
OF THE STATE OF HAWAI#I
IN THE MATTER OF THE PETITION OF TEHINE AVILLA,
JOHN VILLANUEVA, AND FRANKLIN BIDDINGER,
Petitioners-Appellants,
v.
GORDON I. ITO, INSURANCE COMMISSIONER, DEPARTMENT OF
COMMERCE AND CONSUMER AFFAIRS, STATE OF HAWAI#I,
Appellees-Appellees,
and
UNITED HEALTHCARE INSURANCE COMPANY, DBA EVERCARE,
Respondent-Appellee
APPEAL FROM THE CIRCUIT COURT OF THE FIRST CIRCUIT
(CIVIL NOS. 18-1-0060-01, 18-1-0061-01, AND 18-1-0062-01)
MEMORANDUM OPINION
(By: Ginoza, Chief Judge, Nakasone, Chan, JJ.)
In this secondary appeal, Appellants-Petitioners/
Appellants Tehine Avilla (Avilla), John Villanueva (Villanueva)
and Franklin Biddinger (Biddinger) (collectively, Appellants)
appeal from separate "Order[s] Correcting and Affirming
Commissioner's Award of Attorney Fees and Costs" and Final
Judgments, entered on September 18, 2018, by the Circuit Court of
the First Circuit (Circuit Court),1 following remand from this
court's prior decision in Harrison v. Ito, Nos. CAAP-XX-XXXXXXX,
1
The Honorable Keith K. Hiraoka presided.
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CAAP-XX-XXXXXXX, CAAP-XX-XXXXXXX, 2015 WL 4067205 (App. June 30,
2015) (mem.), aff'd, Nos. SCWC-XX-XXXXXXX, SCWC-XX-XXXXXXX,
SCWC-XX-XXXXXXX, 2016 WL 5239646 (Haw. Sept. 22, 2016) (SDO).2
Appellants were enrollees in managed care plans
administered by Appellee-Respondent/Appellee United Healthcare
Insurance Company, dba Evercare (Evercare).3 This joint appeal4
arises out of Appellants' respective challenges to the fees and
costs they were awarded by Appellee-Appellee Gordon I. Ito,
Insurance Commissioner, Department of Commerce and Consumer
Affairs, State of Hawai#i (Commissioner), in connection with
external review proceedings.
On appeal, Appellants contend that: (1) the Circuit
Court erroneously applied an abuse of discretion standard of
review to the Commissioner's denial of certain attorney's fees
and costs under Hawaii Revised Statutes (HRS) § 432E-6(e),5
rather than a de novo standard of review; and (2) the
Commissioner's interpretation and application of HRS § 432E-6(e)
2
The previous appeal in this case, Avilla v. Ito, No. CAAP-12-
0000646, was one of three cases in the consolidated appeal of Harrison v. Ito.
In Harrison, we vacated the Circuit Court's dismissal of Appellants' request
for judicial review of the Commissioner's award of attorney's fees for lack of
jurisdiction, and remanded for a decision on the merits. 2015 WL 4067205, at
*4-7.
3
Evercare administers the Quest Expanded Access Medicaid plan that
provides medically necessary covered services for aged, blind, or disabled
enrollees. See Delos Santos v. Ito, No. CAAP-XX-XXXXXXX, 2023 WL 2200585, at
*1 n.5 (App. Feb. 24, 2023) (mem.). Evercare now operates as UnitedHealthcare
Insurance Company, Inc. Id.4
As explained infra, the joint appeal was procedurally improper.
5
The external review statute, HRS § 432E-6, contains an attorney's
fees and costs provision in subsection (e) allowing the insurance commissioner
discretion to award fees and costs "in connection with the external review
under this statute." This section provides:
(e) An enrollee may be allowed, at the commissioner's
discretion, an award of a reasonable sum for attorney's fees
and reasonable costs incurred in connection with the
external review under this section, unless the commissioner
in an administrative proceeding determines that the appeal
was unreasonable, fraudulent, excessive, or frivolous.
HRS § 432E-6(e) (2005) (repealed 2011) (emphasis added).
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to deny the fees and costs at issue was inconsistent with the
purpose and intent of the external review statute.6
We hold that the Circuit Court erroneously affirmed the
Commissioner's denial of certain attorney's fees and costs, where
the Commissioner did not apply the plain language of the statute,
and construed the language inconsistent with the purpose and
intent of the statute, which we recently set forth in Delos
Santos, 2023 WL 2200585, at *10-14.
I. BACKGROUND
The underlying cases share a common background, where
each Appellant appealed Evercare's notice of a proposed reduction
in covered home health services (coverage reduction notice)
through the external review procedure under HRS Chapter 432E.7
Evercare conducted an internal review upholding its coverage
reduction decision in a "final internal determination" against
6
We have restated, reorganized, and consolidated Appellants' points
of error and arguments for clarity. Appellants' Opening Brief does not comply
with Hawai#i Rules of Appellate Procedure (HRAP) Rule 28. The points of error
do not indicate "where in the record" the alleged errors were raised before
the Circuit Court. See HRAP Rule 28(b)(4)(iii) (requiring that each point
"shall state" where in the record "the alleged error was brought to the
attention of the court"). The Opening Brief also contains arguments in the
statement of the case and standard of review sections that are not contained
in their points of error. See HRAP Rule 28(b)(3) and (b)(5) (setting forth
requirements for the statement of the case and standards of review sections,
which do not include argument). In view of the policy of deciding cases on
their merits, we nevertheless address Appellants' arguments to the extent we
can discern them. See Marvin v. Pflueger, 127 Hawai#i 490, 496, 280 P.3d 88,
94 (2012) (internal citations, quotation marks, brackets, ellipses omitted)
(addressing cases on their merits despite noncompliance with HRAP Rule 28,
"where the remaining sections of the brief provide the necessary information
to identify the party's argument").
7
HRS Chapter 432E, entitled the "Patients' Bill of Rights and
Responsibilities Act," governs managed care plans and includes an external
review procedure by which the enrollee may pursue a complaint against the
managed care plan, in HRS § 432E-6. "'External review' means an
administrative review requested by an enrollee under section 432E-6 of a
managed care plan's final internal determination of an enrollee's complaint."
HRS § 432E-1 (2005).
HRS § 432E-6 was repealed by the 2011 Legislature, to comply with
the federal Patient Protection and Affordable Care Act of 2010. See Haw. Med.
Serv. Ass'n v. Adams, No. CAAP-XX-XXXXXXX, 2013 WL 4606314, at *1 n.2 (App.
Aug. 29, 2013) (SDO); 2011 Haw. Sess. Laws Act 230, § 10 at 746. The current
external review law is contained in HRS Chapter 432E, Part IV, entitled
"External Determinations." See HRS §§ 432E-31-432E-44.
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each Appellant.8 After each Appellant requested an external
review9 and while such request was pending the convening of an
external review panel, Evercare issued a May 17, 2011 letter
cancelling its coverage reduction notice in each case. The
Commissioner subsequently dismissed the requests for external
review via a June 27, 2011 Order of Dismissal (Dismissal Order)
in each case, finding there was "no good cause to convene a
review panel" because Evercare was no longer reducing coverage in
each case. The record thus reflects that Avilla's external
review was pending for over four months, from February 16, 2011
to the June 27, 2011 dismissal; Villanueva's external review
request was pending for over three months, from March 16, 2011 to
the June 27, 2011 dismissal; and Biddinger's external review
request was pending for over three months, from March 14, 2011 to
the June 27, 2011 dismissal.
In the December 12, 2017 "Commissioner's Award of
Attorney Fees and Costs" (Fee Award) filed in each case, the
Commissioner awarded attorney's fees and costs to each Appellant,
even though the external review hearing did not occur.10 The
Commissioner reduced attorney's fees for each Fee Award, by
denying fees incurred for the time periods before the final
internal determination, and after Evercare's May 17, 2011
cancellation of the coverage reduction notices. The Commissioner
also denied expert witness costs for each Appellant. The
pertinent background for these disallowed fees and costs follows.
8
"Internal review" is defined as "the review under section 432E-5
of an enrollee's complaint by a managed care plan." HRS § 432E-1. While not
defined in Chapter 432E, a "final internal determination" is a managed care
plan's determination following an internal review. See HRS § 432E-5 (2005).
9
Avilla requested external review on February 16, 2011. Villanueva
requested external review on March 16, 2011. Biddinger requested external
review on March 14, 2011.
10
Avilla was awarded $6,019.48 in attorney's fees and costs,
including tax, and was denied $5,849.83. Villanueva was awarded $8,797.48 in
attorney's fees and costs, including tax, and was denied $3,858.56. Biddinger
was awarded $6,124.73 in attorney's fees and costs, including tax, and was
denied $5,922.83. Appellants were all represented by the same counsel
(Appellants' Counsel).
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Attorney's fees incurred before the final internal
determination
Before the final internal determination was complete,
each Appellant consulted with Appellants' Counsel, who began
working on their cases. Appellants' Counsel hired Wendy
Votroubek (Nurse Votroubek), a registered nurse from Portland,
Oregon, to perform in-home assessments for multiple clients,
including Appellants. Nurse Votroubek visited Villanueva on
Kaua#i and Avilla and Biddinger on O#ahu in March 2011; evaluated
each Appellant's living situation in relation to their
disabilities; and presented reports to Appellants' Counsel.
In Avilla's case, Appellants' Counsel billed for work
done from January 19, 2011 through January 27, 2011, before the
February 2, 2011 final internal determination and Avilla's
February 16, 2011 request for external review.
In Villanueva's case, Appellants' Counsel billed for
work done from February 11, 2011 through February 24, 2011,
before the March 4, 2011 final internal determination and
Villanueva's March 16, 2011 request for external review.
In Biddinger's case, Appellants' Counsel billed for
work done from February 12, 2011 through March 3, 2011, before
the March 8, 2011 final internal determination and Biddinger's
March 14, 2011 request for external review.
Attorney's fees incurred after Evercare's
cancellation of coverage reduction notices
In Avilla's case, Appellants' Counsel billed for work
done on May 18, 2011 and May 20, 2011, after Evercare's May 17,
2011 cancellation notice, and before the Commissioner's June 27,
2011 External Review Dismissal Order.
In Villanueva's case, Counsel billed for work done on
May 19, 2011, after Evercare's May 17, 2011 cancellation notice,
and before the Commissioner's June 27, 2011 External Review
Dismissal Order.
There was no similar billing in Biddinger's case.
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The Fee Awards
Avilla's Fee Award denied attorney's fees incurred from
January 19, 2011 to January 27, 2011, during the period before
the February 2, 2011 final internal determination, as "not
incurred as a result of the external review decision of February
2, 2011 [sic]."11 Avilla's Fee Award denied attorney's fees for
May 18, 2011 and May 20, 2011, during the period after Evercare's
May 17, 2011 cancellation notice, as "not incurred during an
active dispute."
Villanueva's Fee Award denied attorney's fees incurred
from February 11, 2011 through February 24, 2011, during the
period before the March 4, 2011 final internal determination, as
"not incurred as a result of the issuance of the external review
decision of March 4, 2011 [sic]."12 Villanueva's Fee Award
denied attorney's fees for May 19, 2011, during the period after
Evercare's May 17, 2011 cancellation notice, as "not incurred
during an active dispute."
Biddinger's Fee Award denied attorney's fees incurred
from February 12, 2011 through March 3, 2011, during the time
period before the March 8, 2011 final internal determination, as
"not incurred in connection with the external review of the
March 8, 2011, decision" because this time period "was prior to
the issuance of a final internal determination and, thus, before
an external review was triggered."
The Commissioner also denied each Appellant's request
for expert witness costs for identical reasons. In Avilla's and
Villanueva's Fee Awards, the Commissioner denied expert witness
costs because the expert witness was retained "for the external
hearing which did not occur[;]" and because the assessment "was
not recived [sic] by [Evercare] and was not a factor in
[Evercare]'s decision to cancel its decision." Biddinger's Fee
11
Avilla's Fee Award erroneously refers to the February 2, 2011
final internal determination as the "external review decision[.]"
12
Villanueva's Fee Award erroneously refers to the March 4, 2011
final internal determination as the "external review decision[.]"
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Award denied expert witness costs because the expert witness was
retained "for an external hearing which did not occur" and
because the expert witness's assessment was "not presented to
[Evercare] for review and consideration and were not a factor to
[Evercare] canceling its final internal determination."
Appeal to Circuit Court
Each Appellant appealed the Fee Awards to the Circuit
Court, and the Circuit Court affirmed the Fee Awards13 following
an August 31, 2018 hearing. The Circuit Court's September 18,
2018 "Order[s] Correcting and Affirming Commissioner's Award of
Attorney Fees and Costs" found in each Award that the
Commissioner "sufficiently stated his reasons" for disallowing
certain attorney's fees and costs and "did not abuse his
discretion in refusing to award all of the attorney's fees and
costs requested by Appellant."
Joint appeal to this court
Appellants' Counsel filed a Joint Notice of Appeal on
October 17, 2018, citing HRAP Rule 3(b),14 which we note was
procedurally improper. HRAP Rule 3(b) refers to "judgment" and
"order" in the singular form, and applies to multiple appellants
jointly appealing from the same judgment or order from the same
underlying case. See 16A Charles Alan Wright & Arthur R. Miller,
13
The Circuit Court corrected calculation errors in the Awards.
The Circuit Court acknowledged that Commissioner had conceded a clerical error
in calculating the related General Excise Tax (GET) and awarded an adjusted
GET payment to each Appellant.
14
HRAP Rule 3(b), entitled "Joint or consolidated appeals,"
provides:
If two or more parties are entitled to appeal from a
judgment or order and their interests are such as to make
joinder practicable, they may file a joint notice of
appeal and thereafter proceed on appeal as a single
appellant. Appeals may be consolidated by order of
either of the Hawai#i appellate courts upon the court's
own motion, upon motion of a party, or upon
stipulation of the parties to the several appeals and
approval by the court.
(Emphasis added).
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Federal Practice and Procedure § 3949.2 (5th ed. 2022)
(explaining that under the parallel federal rule, "[a]ppellants
entitled to appeal from the same judgment or order may join their
appeals by filing a joint notice of appeal.").
Here, the record reflects that the parties filed a
stipulation for consolidation in the prior appeal, Harrison v.
Ito. Following remand, however, the cases proceeded
unconsolidated under three civil case numbers. The Circuit Court
issued separate orders and judgments in each case, and
thereafter, three separate appeals should have been filed, with
consolidation by motion or stipulation by the parties and upon
approval by this court. See HRAP Rule 3(b). Despite this
procedural flaw, the joint appeal was timely as to each judgment
issued by the Circuit Court, and we have appellate jurisdiction.
Further, as there was no opposition to the joint appeal, and
because the parties briefed the case as if the cases were
consolidated, we consider Appellants' joint appeal on the merits.
See Mark v. Mark, 9 Haw. App. 184, 186, 828 P.2d 1291, 1293
(1992) (recognizing that although two cases were improperly
consolidated by stipulation of the parties under HRAP Rule 3(b)
by the trial court, because the cases were briefed as if they
were consolidated, the appellate court would decide both
appeals).
II. STANDARDS OF REVIEW
A. Secondary Appeals
Review of a decision made by the circuit court upon
its review of an agency's decision is a secondary appeal.
The standard of review is one in which [the appellate] court
must determine whether the circuit court was right or wrong
in its decision, applying the standards set forth in HRS
§ 91-14(g) (1993) to the agency's decision.
HRS § 91-14, entitled "Judicial review of contested
cases," provides in relevant part:
(g) Upon review of the record the court may affirm
the decision of the agency or remand the case with
instructions for further proceedings; or it may
reverse or modify the decision and order if the
substantial rights of the petitioners may have been
prejudiced because the administrative findings,
conclusions, decisions, or orders are:
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(1) In violation of constitutional or statutory
provisions; or
(2) In excess of the statutory authority or
jurisdiction of the agency; or
(3) Made upon unlawful procedure; or
(4) Affected by other error of law; or
(5) Clearly erroneous in view of the reliable,
probative, and substantial evidence on the
whole record; or
(6) Arbitrary, or capricious, or characterized
by abuse of discretion or clearly
unwarranted exercise of discretion.
Under HRS § 91-14(g), conclusions of law are
reviewable under subsections (1), (2), and (4);
questions regarding procedural defects under
subsection (3); findings of fact under subsection (5);
and an agency's exercise of discretion under
subsection (6).
United Pub. Workers, AFSCME, Local 646, AFL-CIO v. Hanneman, 106
Hawai#i 359, 363, 105 P.3d 236, 240 (2005) (brackets omitted)
(quoting Paul's Elec. Serv., Inc. v. Befitel, 104 Hawai#i 412,
416, 91 P.3d 494, 498 (2004)).
B. Conclusions of Law
"Pursuant to HRS § 91-14(g), an agency's conclusions of
law are reviewed de novo." Id. (citation omitted). "A circuit
court's conclusions of law are subject to de novo review."
Paul's Elec. Serv., 104 Hawai#i at 420, 91 P.3d at 502 (citation
omitted).
C. Statutory Interpretation
"Statutory interpretation is a question of law
reviewable de novo." Stout v. Bd. of Trs. of the Emps.' Ret.
Sys., 140 Hawai#i 177, 185, 398 P.3d 766, 774 (2017) (citing
Citizens Against Reckless Dev. v. Zoning Bd. of Appeals,
114 Hawai#i 184, 193, 159 P.3d 143, 152 (2007)).
First, the fundamental starting point for statutory
interpretation is the language of the statute itself.
Second, where the statutory language is plain and
unambiguous, our sole duty is to give effect to its plain
and obvious meaning. Third, implicit in the task of
statutory construction is our foremost obligation to
ascertain and give effect to the intention of the
legislature, which is to be obtained primarily from the
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language contained in the statute itself. Fourth, when
there is doubt, doubleness of meaning, or indistinctiveness
or uncertainty of an expression used in a statute, an
ambiguity exists.
When there is ambiguity in a statute, the meaning of the
ambiguous words may be sought by examining the context, with
which the ambiguous words, phrases, and sentences may be
compared, in order to ascertain their true meaning.
Moreover, the courts may resort to extrinsic aids in
determining legislative intent, such as legislative history,
or the reason and spirit of the law.
Id. (quoting Citizens Against Reckless Dev., 114 Hawai#i at
193-94, 159 P.3d at 152-53).
III. DISCUSSION
A. Under the circumstances of this case, a de
novo standard of review applies rather than
abuse of discretion to the Commissioner's
denials of the fees and costs at issue.
Appellants argue that de novo review under HRS §
91-14(a)(1), (2) and (4) was required, because "the Commissioner
made errors of law in deciding to disallow reasonable attorneys'
fees and reasonable costs" that Appellants incurred in their
respective external reviews. Appellants also claim the Circuit
Court "erroneously applie[d] the abuse of discretion standard"
when it affirmed the Commissioner's "refus[al] to award all of
the attorney's fees and costs requested by Appellant[s]."
Appellants argue that the Commissioner's denial of the attorney's
fees and costs at issue was dependent on the Commissioner's
erroneous interpretations of HRS § 432E-6(e), which necessitate
de novo review.
Appellants' argument regarding the standard of review
is similar to what was presented in Delos Santos. We held there
that a de novo standard of review applied to the Commissioner's
decisions interpretating and applying HRS § 432E-6(e). 2023 WL
2200585, at *7-8. We explained that:
[T]he Commissioner's specific denials of the attorney's fees
and expert costs at issue did not involve the discretionary
areas identified in the statute, i.e. whether to award fees
and costs or not, or what sum would be reasonable. Rather,
the Commissioner interpreted the statutory language, "in
connection with the external review under this statute," to
determine whether attorney's fees incurred during a
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particular time frame were within the scope of the statute.
With respect to expert witness fees, the Commissioner also
interpreted the statute to determine whether specific costs
such as expert witness fees were permissible under the
statute. Because these are conclusions of law interpreting
and applying HRS § 432E-6(e), we apply a de novo,
right/wrong standard of review.
Id. at *8 (citations omitted).
Here, the Commissioner interpreted the statutory
language "incurred in connection with the external review" to
deny attorney's fees because they were incurred during particular
time frames that the Commissioner deemed were not in connection
to the external review. The Commissioner also interpreted HRS §
432E-6(e) to deny expert witness costs. Thus, the Commissioner
interpreted and applied HRS § 432E-6(e), and drew conclusions of
law, for which a de novo, right/wrong standard of review applies.
See id.; Stout, 140 Hawai#i at 185, 398 P.3d at 774; United Pub.
Workers, 106 Hawai#i at 363, 105 P.3d at 240.
B. The Commissioner's interpretation and
application of HRS § 432E-6(e) to deny the
fees and costs at issue were erroneous.
Appellants argue, inter alia, that each Fee Award
"[c]ontravenes the [m]anifest [p]urposes of HRS § 432E-6(e)" and
that "[i]n construing the term 'in connection with the external
review,['] the Commissioner was required to correctly ascertain
and give effect to the intention of the legislature." Applying
the analysis we recently set forth in Delos Santos, the
Commissioner's grounds for denial of the fees and costs at issue
did not follow the plain language of HRS § 432E-6(e), and was
inconsistent with the purpose and intent of the external review
statute.
1. The Commissioner's grounds for denial of
attorney's fees incurred prior to the
final internal determination were
erroneous.
Avilla's and Villanueva's Fee Awards denied attorney's
fees incurred prior to the final internal determination as "not
incurred as a result of the external review decision[.]"
(Emphasis added). The Biddinger Fee Award denied fees for this
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time period because the fees were incurred "before an external
review was triggered." (Emphases added).
In Delos Santos, we explained that the plain language
of "in connection with" is broad –- without temporal, or time-
specific limitations:
HRS § 432E-6(e) does not use temporal, or time-specific
language such as "during the external review," but uses
broader language, "in connection with[.]" Merriam-Webster
defines "in connection with" as "in relation to
(something)." Thus, the phrase "in connection with" --
means the attorney's fees incurred "in relation to" the
external review, without any temporal or time-specific
language like the word "during."
Delos Santos, 2023 WL 2200585, at *9 (citations omitted).
Here, as in Delos Santos, Appellants' Counsel's work
prior to the final internal determination was in connection with,
and related to, the same issue in the subsequent external review
-- Evercare's attempt to reduce covered services for each
Appellant. The statute authorizes fees incurred "in connection
with" an external review –- not "as a result of" an external
review, and not dependent on when external review "was
triggered." The Commissioner's justifications to deny attorney's
fees did not apply the plain language of HRS § 432E-6(e) and were
erroneous.
As we explained in Delos Santos, a broad interpretation
of "in connection with" is also consistent with the liberal
construction that we must afford to a remedial statute like
HRS § 432E-6(e). Id. at *9-10. Such an interpretation is also
consistent with the purpose and intent of the external review
statute, to assist patients of managed care plans like
Appellants, and to afford them rights and protections.15 Id. at
15
In Delos Santos, we examined the legislative history and purpose
of the external review statute, and explained that:
[T]he Legislature's purpose for enacting the external review
statute, HRS § 432E-6, was to assist patients of managed
care plans and to afford them rights and protections. The
external review procedure in HRS § 432E-6 provided a
procedural remedy in the form of a review hearing, and
(continued...)
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*10-11. We conclude that, under a de novo review, the
Commissioner's grounds for denying attorney's fees in each Fee
Award incurred prior to the final internal determination were
erroneous. See United Pub. Workers, 106 Hawai#i at 363, 105 P.3d
at 240.
2. The Commissioner's grounds for denial of
attorney's fees incurred after
Evercare's cancellation of the coverage
reduction notices were erroneous.
Avilla's and Villanueva's Fee Awards denied attorney's
fees incurred after Evercare's cancellation notices because the
fees "were not incurred during an active dispute." This
justification to deny attorney's fees did not apply the plain
language of HRS § 432E-6(e), which authorizes attorney's fees "in
connection with the external review" –- and not contingent upon
"an active dispute." The billing entries in question for May 18,
19 and 20, 2011 were related to, and in connection with the
external reviews for Avilla and Villanueva, which were still
pending and not dismissed until the June 27, 2011 Dismissal
Order. The denial of the attorney's fees incurred after the
cancellation notice was erroneous given the grounds relied upon
by the Commissioner. See id.
15
(...continued)
served to strengthen the consumer rights of patients, to
enforce a patient's rights against unreasonable adverse
determinations regarding health care coverage, and to
protect the health and safety of the patient while cost-
reducing measures were implemented by managed care plans.
The award of reasonable attorney's fees and costs for an
enrollee who mounted a challenge to a managed care plan's
decision through an external review, is remedial because it
facilitates the enforcement of patients' rights through the
external review procedure. The statutory provision allowing
an award of reasonable attorney's fees and costs to an
enrollee promotes the redress of injuries for enrollees who
incur attorney's fees and costs for an external review.
2023 WL 2200585, at *11 (citations omitted).
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3. The Commissioner's denial of expert
witness costs on grounds that the
external review hearing did not occur
was erroneous.
All of the Fee Awards denied expert witness fees
because the external review hearing "did not occur[;]" the expert
witness did not appear or testify; the expert's assessment was
not provided to Evercare; and the expert's assessment was "not a
factor" in Evercare's cancellation notices. These grounds for
denying the expert witness costs are erroneous because they do
not apply the plain language of the statute – allowing costs
incurred "in connection with the external review[.]" HRS §
432E-6(e). The expert witness costs were clearly related to the
external review, as the expert's assessment was Appellants'
attempt to meet their burden of proof at the external review
hearing to show that Evercare's decision to reduce covered
services was unreasonable. See Delos Santos, 2023 WL 2200585, at
*15-16 (rejecting the categorical exclusion of expert witness
fees as costs in view of a conflict of laws provision in HRS
Chapter 432E, and the burden of proof placed upon the enrollee to
demonstrate that the managed care plan's proposed reduction of
services was unreasonable and that the existing level of services
was medically necessary). To the extent the language "in
connection with the external review" is ambiguous as applied
here, where an external review hearing never occurred, HRS §
432E-6(e) must be liberally construed in light of its remedial
purpose and consistent with legislative intent. See id. at *10.
Thus, we conclude that the Commissioner's grounds for denying
expert witness costs under the circumstances of this case were
wrong. See United Pub. Workers, 106 Hawai#i at 363, 105 P.3d at
240.
IV. CONCLUSION
For the foregoing reasons, we vacate the September 18,
2018 separate "Order[s] Correcting and Affirming Commissioner's
Award of Attorney Fees and Costs" and Final Judgments, filed and
entered by the Circuit Court of the First Circuit; and we remand
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NOT FOR PUBLICATION IN WEST'S HAWAI#I REPORTS AND PACIFIC REPORTER
to the Circuit Court, with instructions to remand each
Appellant's case to the Commissioner to consider the attorney's
fees and costs that are the subject of this appeal, consistent
with this Memorandum Opinion.
DATED: Honolulu, Hawai#i, March 16, 2023.
On the briefs: /s/ Lisa M. Ginoza
Chief Judge
Rafael G. Del Castillo
(Jouxson-Meyers & Del /s/ Karen T. Nakasone
Castillo) Associate Judge
for Petitioners-Appellants
/s/ Derrick H. M. Chan
Daniel K. Jacob Associate Judge
Deputys Attorney General
for Appellee-Appellee
Dianne Winter Brookins
(Dentons US LLP)
for Respondent-Appellee
15