STATE OF NORTH CAROLINA
IN THE OFFICE OF
ADMINISTRATIVE HEARINGS
06 OSP 1282
COUNTY OF WAKE
Febby Manuel
Petitioner
vs.
Division of Medical Assistance
N. C. Dept of Health and Human Services
Respondent
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DECISION
This matter came before Administrative Law Judge Donald W. Overby, on November 27,
2006 in Raleigh, North Carolina.
APPEARANCES
For Petitioner:
Febby Manuel, Pro Se
For Respondent:
Amy L. Funderburk
Assistant Attorney General
N.C. Department of Justice
P.O. Box 629
Raleigh, NC 27602
Dorothy Powers
Special Deputy Attorney General
N.C. Department of Justice
P.O. Box 629
Raleigh, NC 27602
STATEMENT OF THE CASE
Petitioner, a career state employee, applied for the position of Health Standards Officer I,
salary grade 68, but was not selected for the position. Petitioner filed a petition with the Office
of Administrative Hearings, alleging failure to receive priority consideration for a promotion to
the position of Health Standards Officer I.
ISSUE
Was the Petitioner entitled to receive priority consideration, pursuant to G.S. 126-7.1(c),
over the non-state employee applicant who was selected for the position in question, and if so,
has Petitioner met her burden of establishing that Respondent wrongfully denied her a promotion
to the position of Health Standards Officer I?
APPLICABLE STATUTES AND RULES
N.C. Gen. Stat. §126-7.1
25 N.C.A.C. 1H.0801
WITNESSES
For Petitioner
Gloria Osborne
Gail D. Covington
Marilyn R. Vail
Febby Manuel, Petitioner
For Respondent:
Marilyn Vail
Beverly Todd
EXHIBITS
Petitioner offered no exhibits.
Respondent offered the following Exhibits into evidence:
1.
2.
3.
4.
5.
6.
8.
9.
Petition
Job Posting
Job Description
Beverly Todd’s PD 107
Febby Manuel’s PD 107
Febby Manuel’s cover letter, dated 2-21-06
N.C. Gen. Stat. §127-7.1
25 N.C.A.C 1H.0801
FINDINGS OF FACT
BASED UPON careful consideration of the sworn testimony of the witnesses presented
at the hearing, the documents, and Exhibits received and admitted into evidence, and the entire
record in this proceeding, the undersigned Administrative Law Judge (“ALJ") makes the
following Findings of Fact. In making these Findings of Fact, the ALJ has weighed all the
evidence and has assessed the credibility of the witnesses by taking into account the appropriate
factors for judging credibility, including, but not limited to the demeanor of the witnesses, any
interests, bias, or prejudice the witness may have, the opportunity of the witness to see, hear,
know or remember the facts or occurrences about which the witness testified, whether the
testimony of the witness is reasonable and whether the testimony is consistent with all other
believable evidence in the case.
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Background Information
1.
The parties waived the requirement that they receive notice of the scheduled hearing at
least 15 days in advance of the hearing. (T p 6)
2.
At all times material, Petitioner Febby Manuel (“Petitioner”) was a career state employee
(T pp 9, 35, 124), and the position of Health Standards Officer I would have been a promotion
for her (T pp 9, 35, 127).
3.
Petitioner was subject to the provisions of the State Personnel Act.
4.
On July 17, 2006, Petitioner filed a Petition for Contested Case Hearing with the Office
of Administrative Hearings (OAH) claiming she failed to receive priority consideration when
applying for a position that would have constituted a promotion for her. (Respondent’s Exhibit 1,
T p 40)
5.
The position for which the Petitioner applied, Health Standards Officer I, is located
within the Third Party Recovery (“TPR”) Section of the Division of Medical Assistance
(“DMA”). (Respondent’s Exhibit 2, T pp 29, 42)
6.
The mission of DMA is to seek recovery of Medicaid monies that have been paid out to
providers. More specifically, the TPR unit seeks recovery for sums paid out by Medicaid when a
provider has a credit on their books and that credit is due to be refunded to Medicaid. (T p 74 –
75)
7.
Marilyn Vail (“Vail”) is employed as the Assistant Chief of Third Party Recovery in the
TPR unit within DMA and supervises the casualty unit, the accounts receivable unit and the
support group. Vail has a Master of Science degree and has worked in almost all areas within
TPR including working with credit balances, Medicare recoveries, the Health Insurance
Premium Payment Program, and state recovery in addition to her current position. Vail has been
employed by the Department of Health and Human Services (“DHHS”) for ten years and has
served as Assistant Chief for the past four years. Vail’s duties include handling personnel
matters including hiring, developing work plans, coaching and counseling, ensuring that work is
done correctly, and ensuring that monies collected are disbursed according to state mandate. In
her current position, Ms. Vail supervises 15 – 25 employees. (T p 73-78)
8.
Vail posted a vacancy for a Health Standards Officer I position with a closing date of
February 24, 2006. (Respondent’s Exhibit 2, T p 77)
9.
The Petitioner and Beverly Todd, as well as others, applied for the posted position and
Todd was ultimately offered the position. (Respondent’s Exhibits 4 and 5, T p 77)
10.
Petitioner was an employee of the N.C. Department of Health and Human Services as a
Processing Assistant V with the Comptroller’s Office when she applied for the available Health
Standards Officer I position. (Respondent’s Exhibit 5, T p 31)
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11.
Beverly Todd was not a state employee at the time she applied for the Health Standards
Officer I position (Respondent’s Exhibit 4, T p 8); however, she had worked as a contract
employee in a temporary position doing essentially the exact same duties as the position for
which she was hired and at issue herein. (T. pps85 -86, 109 -110)
12.
Gail Covington and Gloria Osborne testified on behalf of the Petitioner but neither was
involved in the selection process for the Health Standards Officer I position in any way and had
no knowledge as to the selected applicant’s qualifications. (T pp 17-18, 25-26).
Details of the Posted Position
13.
The Health Standards I Officer Position is located in the Casualty Unit of the Third Party
Recovery Section of the North Carolina Division of Medical Assistance. (T p 78)
14.
The position posting specifically stated the purpose of the position was to investigate and
recover third party monies where there was Medicaid involvement in a casualty or tort liability
case. This could include a motor vehicle accident, wrongful death action, medical negligence
case, or a workers compensation case. The posting stated that investigators would be required to
communicate with attorneys and insurance adjusters. (Respondent Exhibit 2, T p 51-52, 78 - 79)
15.
Vail’s perception of a “casualty case” is one where there has been an injury or accident,
and a “tort claim” would involve a wrong that could be remedied by a court. (T p 79)
16.
To recover monies where there is a Medicaid involvement, the Health Standards Officer I
determines what expenditures in the case were accident related based on diagnosis and procedure
codes by looking through the paid history of the Medicaid recipient. The information in the paid
history is then sent to the attorney or adjuster involved. (T p 79)
17.
The Health Standards Officer I is expected to develop and review cases and to
communicate with attorneys, insurance adjusters, medical providers, recipients of Medicaid and
DSS. Such communication could be orally or in writing. (T p 78)
18.
The Health Standards Officer I position required that the selected applicant have a
working knowledge of the insurance industry, particularly liability insurance and subrogation or
the claims processing system in the Medicaid program. (Respondent’s Exhibit 2, T p 87)
19.
The Health Standards Officer I could be called to testify in a court hearing or be deposed
in regards to a case. (T p 81)
20.
The Health Standards Officer I could be required to review diagnosis and procedure
codes of a Medicaid recipient, determine whether or not an expenditure was accident related and
then communicate that information to an insurance adjuster or attorney while processing a case.
(T p 81)
21.
Although specifically referenced in the posting for the position at issue, the Petitioner
did not refer to or use specifically the terms “third-party recovery,” “investigation,” “wrongful
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death,” “medical negligence,” “Workers’ Comp,” “communicate with attorneys and insurance
adjusters” or “tort liability” in her cover letter when applying for the Health Standards Officer I
position. (T p 53-54)
22.
Although specifically referenced in the posting for the position at issue, the Petitioner did
not indicate on her application that she had previously dealt with motor vehicle accidents,
wrongful death, medical negligence and workers’ compensation or that she communicated with
attorneys and insurance adjusters. (T p 48, 50).
23.
The Petitioner erroneously believed that those reviewing her application would have
knowledge of or infer from her application the various duties she had performed which might be
relevant to the position which she sought. (T pp 48 – 50, 54)
24.
Petitioner had not worked previously on casualty matters. (T p 46)
The Hiring Decision and Process
25.
Petitioner was previously employed by the Department Health and Human Services,
Division of Medical Assistance, Third Party Recovery as a Processing Assistant V from August
2001 until May 2003. Petitioner’s duties were largely clerical. (Respondent’s Exhibit 5, T pp 29,
92).
26.
Petitioner had been employed by Dorothea Dix Hospital as a Patient Claims Rep. V from
October 2000 through August 2001. Petitioner’s duties at Dix included communicating with
social workers, Medicare, the Social Security Administration and the Employment Security
Commission. Petitioner was also responsible for gathering patient information to determine if a
patient qualified for state assistance. (Respondent’s Exhibits 5, T p 31-32).
27.
Petitioner had been employed by Rex Healthcare, as a Patient Account Specialist from
November 1997 through October 2000. The Petitioner did not indicate on her application
whether or not she reviewed cases to determine if Medicaid was due a refund while in this
position. The Petitioner did not communicate with attorneys or insurance adjusters in this
position. (Respondent’s Exhibit 5, T pp 29, 49-51).
28.
Petitioner had been employed by Healthsource of North Carolina as a Provider Service
Benefit Representative from May 1995 until October 1997. While at Healthsource, the
Petitioner processed claims for payment and reviewed claims to determine if the claims were
paid correctly. (Respondent’s Exhibit 5, T p 30).
29.
Petitioner had been employed by Wake Medical Center as Patient Account Rep from
May 1987 until May 1995. Petitioner’s duties at Wake Medical Center included processing
Medicaid claims. (Respondent’s Exhibit 5, T p 30-31).
30.
Petitioner claims to have had twenty-five years of relevant work experience but listed ten
years of work experience on her application. (T pp 37-38, 54, Respondent’s Exhibit 5)
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31.
In her cover letter, the Petitioner listed the following items: Several years processing
medical claims, researched Medicaid claims with credit balances to determine refunds, several
years working with Medicaid guidelines in some capacity, public contact with patients and
family members, phone contact with providers and clients, heavy caseload, proficient Microsoft
Word and Excel, Independent worker. (Respondent’s Exhibit 6, T p 93-94)
32.
Todd had been employed by Metropolitan Insurance as a claims investigator from
February 1984 until February 1987. In this position, Todd’s duties included traveling statewide
to investigate accidents, reviewing damage from accidents for documentation, and direct contact
with the insured member, medical professionals, and attorneys. (Respondent’s Exhibit 4, T p
104)
33.
Todd had been employed by Connecticut Transit as a Claims Representative from
December 1987 until December 1999. In this position, Todd handled telephone contacts with
claimants, defendants, medical professionals and attorneys, adjudicated claims in accordance
with state laws, took reports of claims, initiated surveillance, made determinations of fact based
upon physical evidence, witness statements and reports. As a Claims Representative, Todd dealt
with insurance adjusters and attorneys daily and was sometimes called to small claims court.
(Respondent’s Exhibit, T pp 86-87, 107)
34.
Todd had been employed by Connecticut Transit as a Claims Manager from December
1999 until July 2004. In this position, Todd was responsible for assignment and delegation of
3rd party bodily injury and property damage claims, collection of subrogation of 3rd party
property damages and bodily injury claims, the claims department checking account, claims
administration, establishing work flow and schedules, preparing and analyzing monthly and
quarterly reports, having a knowledge of jurisdictional regulations governing claims handling,
balancing heavy work loads, customer service, handling a heavy call volume, monitoring cost
containment, administering performance reviews and developing a claims management tracking
system. (Respondent’s Exhibit 4, T pp 86-87)
35.
Todd had been employed by Public Consulting Group in a temporary position as a
Claims Processor from February 2005 until November 2005. In this position, Todd processed
NC State Employees and Teacher health insurance liens and recovered approximately ten to fifty
thousand dollars daily on accident related medical expenditures incurred by the Plan where a
third party was liable. She pursued subrogation as mandated by statute by direct contact with
plan members, medical professionals and attorneys; determined total lien amounts after research
and review of the case including the review of diagnostic codes and associated costs, and
compilation of statistical data from an electronic data base. She negotiated lien amounts with the
plan member or the member’s attorneys. She queried the system for overpayment and processed
incoming and outgoing mail. While with Public Consulting Group, Todd performed the same
functions as a Health Standards Officer I. Public Consulting group was a vendor for the State of
North Carolina and was working for the State of North Carolina. (Respondent’s Exhibit 4, T p
85-86, 109-110)
36.
Todd is a licensed insurance adjuster in both North Carolina and Connecticut. Todd has
experience in investigative tracking, subrogation, negotiation, basic litigation, and investigating
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and interpreting medical and legal reports. The fact that Todd is a licensed insurance adjuster in
North Carolina and Connecticut shows she has a working knowledge of the insurance industry as
requested in the job posting. (Respondent’s Exhibits 2, 4, T pp 66-67)
37.
In the five years prior to applying for the Health Standards Officer I position, Todd
attended training programs in leadership, customer service, presentation skills, effective
communication, civil treatment for managers, investigation tracking, subrogation, positive
negotiation, basic litigation tips, and interpretation of medical and legal reports and doctrines.
(Respondent’s Exhibit 4, T p 84)
38.
On or about February 21, 2006, Petitioner applied for the position of Health Standards
Officer I, salary grade 68, as set out in the Posting. (Respondent’s Exhibits 2, 5, T p 42).
39.
On or about February 24, 2006, Todd applied for the position of Health Standards Officer
I, salary grade 68, as set out in the Posting. (Respondent’s Exhibits 2, 4, T p 42).
40.
There were ten applications for the position, four of whom received priority
consideration. (T pp 59 – 61)
41.
Vail conducted interviews for the position and discussed her hiring choice with Geoff
Elting who concurred in her decision to hire Beverly Todd. Geoff Elting is the Chief of the
Third Party Recovery Unit (T p 89)
42.
Deborah Crouch, who was a state employee at the time, also applied for the position in
question and was interviewed. Crouch would have been Vail’s second choice to fill the position.
(T p 95).
43.
The Petitioner would not have been Vail’s third choice to fill the Health Standards
Officer I position. (T p 96)
44.
At the time the hiring decision was made, Vail took into account priority consideration
for state employees pursuant to the State Personnel Act. Vail made the determination that
Petitioner did not have equal qualifications to Todd.
45.
Todd’s background and experiences appealed to Vail since it included the background
and experiences specifically requested in the job posting. Todd’s background and experiences
matched well to the job posting. Todd presented herself professionally in the interview. (T pp
86, 88, 91)
46.
Vail determined that Todd had substantially higher qualifications, background, and
experience for this position than did the Petitioner. The job-related qualifications held by Todd
that Vail felt made her significantly better suited for the position include the training programs
she had attended in the five years prior to her application, her licensure as an insurance adjuster,
her experience in casualty, the fact that she had essentially done the job of a Health Standards
Officer I with a previous employer in NC, that she had previously pursued subrogation claims
and reviewed accident related medical expenditures and determined lien amounts after reviewing
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diagnostic codes and compiling costs, that she had seventeen years of experience with
Connecticut Transit working in claims which included liability claims where she worked with
bodily injury and property damage claims, that she had dealt with attorneys, that she had
balanced a heavy workload, that she had adjudicated claims in context with state laws, and that
she had a long period of stability with one employer. (T pp 84 – 86, 95).
47.
Petitioner does not have substantially equal qualifications as those of Todd based upon
past work experience and the requirements of the position. (T p 127)
CONCLUSIONS OF LAW
1.
The Office of Administrative Hearings has jurisdiction over the parties and the subject
matter pursuant to Chapter 126 and Chapters 150B of the North Carolina General Statutes and
has the authority to issue a decision to the State Personnel Commission (“SPC”) which will make
a final decision.
2.
The Petitioner has the burden of proof.
3.
North Carolina General Statute Section 126-7.1 states that a current State employee who
applies for a position shall receive priority consideration over the applicant who is not a State
employee if the position would constitute a promotion and if the State employee has substantially
equal qualification as the applicant who is not a State employee. “Qualifications” consist of
training or experience, years of experience and other skills, knowledge, and abilities that bear a
reasonable and functional relationship to the abilities and skills required in the job vacancy
applied for. N.C.G.S. Section 127.1(d).
4.
The position of Health Standards Officer I which is at issue herein is superior to that of
Petitioner’s current position and, therefore, would have been a promotion.
5.
Petitioner is a career State employee as defined by G.S. Section 126-1.1.
6.
Petitioner is entitled to State employee preference in the hiring decision pursuant to G. S.
Section 126-7.1; however, Petitioner must show by the greater weight of the evidence that the
Petitioner’s qualifications were substantially equal to the applicant who was selected.
7.
The Petitioner has failed to prove by the greater weight of the evidence that she has
substantially equal qualifications as Todd for the position.
8.
Petitioner was not entitled to receive priority consideration pursuant to G.S. 126-7 in that
the greater weight of the evidence presented shows that the Petitioner’s overall qualifications
were not substantially equal to the non-State employee applicant chosen for the Health
Standards Officer I position.
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DECISION
It is recommended that the State Personnel Commission affirm the Department of Health
and Human Service’s hiring decision in this matter and dismiss Petitioner’s claim.
ORDER
It is hereby ordered that the agency serve a copy of the Final Decision on the Office of
Administrative Hearings, 6714 Mail Service Center, Raleigh, North Carolina 27699-6714 in
accordance with N.C. Gen. Stat. § 150B-36(b).
NOTICE
The Decision of the Administrative Law Judge is this Contested Case will be reviewed by
the agency making the final decision according to standards found in N.C. G.S. 150B-36(b)(b1)
and (b2). The agency making the Final Decision in this contested case is required to give each
party an opportunity to file exceptions to this Decision and to present written arguments to those
in the agency who will make the final decision, in accordance with N.C.G.S. § 150B-36(a).
The agency is required by N.C. Gen. Stat. 150B-36(b) to serve a copy of the final
decision on all parties and to furnish a copy to the parties’ attorney of record and to the Office of
Administrative Hearings.
The agency that will make the final decision in this contested case is the North Carolina
State Personnel Commission.
IT IS SO ORDERED.
This the 29th day of January, 2007.
_____________________________________
Donald W. Overby
Administrative Law Judge
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