Title: MASSENGALE v. OKLAHOMA BD. OF EXAMINERS IN OPTOMETRY

State: oklahoma

Issuer: Oklahoma Supreme Court

Document:

MASSENGALE v. OKLAHOMA BD. OF EXAMINERS IN OPTOMETRY  MASSENGALE v. OKLAHOMA BD. OF EXAMINERS IN OPTOMETRY 2001 OK 55 29 P.3d 558 72 OBJ 1945 Case Number: 92854 Decided: 07/03/2001 Mandate Issued: 07/31/2001 CURT MASSENGALE, O.D., Appellant v. OKLAHOMA BOARD OF EXAMINERS IN OPTOMETRY, Appellee CERTIORARI TO THE COURT OF CIVIL APPEALS, DIVISION IV Honorable Daniel L. Owens, Trial Judge ¶0 The appellee, Oklahoma Board of Examiners in Optometry (Board), brought a disciplinary proceeding against the appellant, Curt Massengale (Massengale/optometrist). On review of the hearing examiner's recommendations, the Board found that Massengale's agreements with the optical supplier, LensCrafters, had so integrated his practice with the optical company as to exhibit the appearance of commercialism in a manner which might degrade or reduce the quality of patient care in violation of 59 O.S. 1991 §593. Further, the Board determined that by allowing LensCrafters to negotiate third-party provider agreements, the doctor had entered into a referral agreement prohibited by 59 O.S. 1991 §595 and OAC 505:10-5-4. The Board suspended the doctor's license for one-year with a proviso that ten months of the suspension be deferred during a three-year probationary period if Massengale severed all contractual arrangements with LensCrafters. The trial judge, Honorable Daniel L. Owens, affirmed. The Court of Civil Appeals affirmed in part and reversed in part remanding with instructions. We hold that: 1) the optometrist's agreement to allow LensCrafters to negotiate third-party provider contracts subject to mutually agreed upon terms does not constitute a prohibited referral agreement under 59 O.S. 1991 §595 or OAC 505:10-5-4; and 2) under the facts presented in the absence of any evidence of substandard clinical practices, unsatisfied patients, or testimony indicating that any of the optometrist's employees actually participated in an incentive program sponsored by the optical supplier, the optometrist's association with the optical supplier has neither degraded nor reduced the quality of visual care in violation of 59 O.S. 1991 §593. COURT OF CIVIL APPEALS OPINION VACATED; TRIAL COURT REVERSED; CAUSE REMANDED WITH INSTRUCTIONS. Graydon Dean Luthey, Jr., Mark K. Blongewicz, Ronald A. White, Tulsa, Oklahoma,for Appellant Daniel J. Gamino, Todd Markum, Oklahoma City, Oklahoma, for Appellee KAUGER, J.: [29 P.3d 559] ¶1 Certiorari was granted to [29 P.3d 560] address two issues: FACTS ¶2 In 1991, the appellee, Oklahoma Board of Examiners in Optometry (Board), sought an opinion from the Attorney General of Oklahoma addressing the issue of whether a licensed optometrist could lease or sublease office space from a retail optical supplier or seller. On December 5, 1991, the Attorney General issued an opinion¶3 Having given notice of the Attorney General's opinion, the Board voted in May of 1992 to conduct disciplinary hearings against the appellant, Curt Massengale (Massengale/optometrist) and three other optometrists.10 All of the optometrists subleased offices in shopping malls from LensCrafters or a similar optical supplier. Massengale challenged the Board's authority in federal court. On January 21, 1993, the cause was [29 P.3d 562] dismissed for failure to exhaust administrative remedies.11 However, LensCrafters was successful in challenging the Attorney General's opinion in state court in March of 1995, the district court ruled that the opinion did not correctly reflect Oklahoma law and that it should be considered null and void. Although no longer bound by the opinion,12 the Board did not issue notice of the district court's ruling to Oklahoma optometrists. Rather, on January 13, 1997, a disciplinary hearing commenced against the four optometrists. ¶4 Following a hearing and a review of the hearing examiner's recommendations, the Board found that Massengale's agreements with LensCrafters had so integrated his practice with the optical company as to exhibit the appearance of commercialism in a manner which might degrade or reduce the quality of patient care in violation of 59 O.S. 1991 §593. Further, the Board determined that by allowing LensCrafters to negotiate third-party provider agreements, the optometrist had entered into a referral agreement prohibited by 59 O.S. 1991 §595 and OAC 505:10-5-4. The Board suspended the optomistrist's license for one year with a proviso that ten months of the suspension be deferred during a three-year probationary period if Massengale severed all contractual arrangements with LensCrafters. The trial judge, Honorable Daniel L. Owens, affirmed. The Court of Civil Appeals upheld the Board's determination that patients had received substandard care under the doctor's arrangements with LensCrafters. Nevertheless, it reversed on the issues of commercialism and unlawful referral arrangements for lack of sufficient evidence and remanded with instructions. We granted certiorari to petitions filed by Massengale and by the Board on March 27, 2001. I. ¶5 AN OPTOMETRIST'S AGREEMENT TO ALLOW AN OPTICAL SUPPLIER TO NEGOTIATE THIRD-PARTY PROVIDER CONTRACTS SUBJECT TO MUTUALLY AGREED UPON TERMS IN WHICH THE OPTOMETRIST APPEARS AS ONE OF AN APPROVED LIST OF SERVICE PROVIDERS AND IN WHICH THERE IS NO INTERFERENCE WITH THE OPTOMETRISTS PROFESSIONAL JUDGMENT DOES NOT CONSTITUTE A PROHIBITED REFERRAL AGREEMENT UNDER 59 O.S. 1991 §595 OR OAC 505:10-5-4. ¶6 The Board does not challenge the Court of Civil Appeals determination that there is insufficient evidence in the record to support a finding that Massengale violated the prohibition in 59 O.S. 1991 §59313 against the appearance of commercialism. Although the Board asserts in the conclusion to its petition for certiorari that there is clear and convincing evidence in the record sufficient to support discipline under the statute and that the language of the statute does not suffer from constitutional infirmity, it does not argue in either its petition for certiorari or in its objection to Massengale's certiorari plea that the doctor should be disciplined for having allowed his practice to have the "appearance of commercialism". Nevertheless, we note that courts have had difficulty in reducing the term "commercialism" to a finite definition or a simple formula. It may be equated with: the solicitation of money or business;14 location;15 advertising;16 or [29 P.3d 563] connotations of profit.17 ¶7 The sole issue upon which the Board seeks certiorari concerns prohibited referral agreements under 59 O.S. 1991 §595 and OAC 505:10-5-4. It argues that the statute and the rule prohibit all agreements for referrals between an optical supplier and an optometrist including third-party provider agreements negotiated by an optical supplier on behalf of an optometrist. Massengale contends that there is nothing either in the plain language of the statute or the rule prohibiting LensCrafters from negotiating an agreement resulting in a patient being provided with a list of optometrists approved to provide services under an insurance plan. We agree. ¶8 Section 595 prohibits any agreement, contract, arrangement, practice or understanding with an optical supplier which provides for referrals between optometrists and optical suppliers.18 OAC 505:10-5-4 restricts optometrists from using a commercial business as a "feeder".19 Neither provision specifically addresses third-party provider agreements nor their negotiation. The Board does not assert that optometrists are prohibited by either the statute or the rule from allowing themselves to be listed as service providers if the third-party provider agreements are negotiated by an entity other than an optical supplier20 or that all referrals even those from an optical supplier to an optometrist are prohibited. Rather, the clear language of §595 prohibits only "agreement[s], contract[s], arrangement[s], practice[s], or understanding[s]" that the referrals will be made. ¶9 Research reveals no case in which the issue of whether allowing an optical supplier or some other entity to negotiate a third-party provider agreement equates to an agreement for the referral of a particular physician or service provider. However, an examination of the nature of third-party provider agreements renders the Board's assertion that allowing an optical supplier to act as an optometrist's agent in negotiating such contracts equates to an agreement to make referrals unconvincing. ¶10 Third-party provider agreements are agreements between an insurer and a provider of goods or services such as a hospital, doctor, optometrist or dentist. The third-party provider is not a party to the insurance contract but agrees to provide, through the third-party provider agreement, a good or service to a policyholder of the insurance company for a set fee with reimbursement to come from the insurer.21 Some type of a provider agreement is necessary for insurance companies to provide insureds with a service benefit plan. Policyholders are basically unconcerned with the contract between the provider and the insurer except to the extent that these agreements ultimately inure to the policyholders benefit in the form of lower premiums.22 ¶11 A referral is the act of directing attention to something or someone.23 If a referral exists in the third-party provider context, it is through the listing of the provider on the insurance company's approved list. Here, [29 P.3d 564] although LensCrafters may have negotiated the contract or administered its provisions, the agreement was between the insurance company and Massengale. It is the insurer rather than LensCrafters which ultimately contracted with the optometrist for the listing. The Board does not contend that a referral by the insurance company of the optometrist is prohibited under either 59 O.S. 1991 §595 or OAC 505:10-5-4. ¶12 Massengale did not compromise, through his agreement with the optical supplier, the overriding goal of the Legislature in regulating optometrists to assure and protect the personal and professional relationship between an optometrist and a patient with the individual's visual care being the prime consideration.24 Pursuant to the operating agreement between Massengale and LensCrafters, the optometrist agreed to cooperate in third-party programs arranged by the optical supplier provided LensCrafters could negotiate terms upon which the parties mutually agreed.25 ¶13 The record indicates that LensCrafters was successful in negotiating a third-party contract on Massengale's behalf with CIGNA. It appears that, as a result of this contract negotiation, the optometrist was to appear as one of a number of providers under CIGNA's Vision Care Network.26 Although LensCrafters provided guidance to Massengale on certain codes to be utilized when dealing with the insureds seeking services under plans it negotiated, LensCrafters did not request that the optometrist alter his protocol or administer an examination not complying with the optometrist's general practice.27 There is no indication that Massengale compromised his professional ethics or that any patient suffered inferior care as a result of his listings as an accepted service provider on the LensCrafters' negotiated agreements. ¶14 No convincing reason has been suggested, and we can find none, as to why a third-party provider agreement negotiated by an optical supplier should be singled out from similar agreements negotiated by other parties.28 Thirdparty provider agreements are not specifically addressed by 59 O.S. 1991 §595 or OAC 505:10-5-4. Further, the term "referral" or "feeder" is not defined in either provision. We determine that an [29 P.3d 565] optometrist's agreement to allow an optical supplier to negotiate third-party provider contracts subject to mutually agreed upon terms in which the optometrist is listed as one of a number of approved service providers and in which there is no interference with the optometrist's professional judgment are not prohibited referral agreements under 59 O.S. 1991 §595 or OAC 505:10-5-4. II. ¶15 IN THE ABSENCE OF ANY EVIDENCE OF SUBSTANDARD CLINICAL PRACTICES, UNSATISFIED PATIENTS, OR TESTIMONY INDICATING THAT ANY OF THE OPTOMETRIST'S EMPLOYEES ACTUALLY PARTICIPATED IN AN INCENTIVE PROGRAM SPONSORED BY THE OPTICAL SUPPLIER, THE OPTOMETRIST'S ASSOCIATION WITH THE OPTICAL SUPPLIER HAS NEITHER DEGRADED NOR REDUCED THE QUALITY OF VISUAL CARE IN VIOLATION OF ¶16 Massengale contends that no evidence was presented indicating that his association with the optical supplier in any way degraded or reduced the quality of visual care his patients received in violation of 59 O.S. 1991 §593. The determination that the facts will not support professional discipline makes it unnecessary to address Massengale's assertion that the reference in 59 O.S. 1991 §593 to the "appearance of commercialism" is so vague and ambiguous as to be unconstitutional. The Board argues that there is clear and convincing evidence to support a finding that the optometrist's relationship with LensCrafters adversely affected patient care. We disagree. ¶17 Massengale testified that: although LensCrafters had asked him to lower his exam fees, he refused and ultimately increased charges;29 despite the request of LensCrafters to automatically add a UV-400 requirement on all his prescriptions, he declined to do so;30 and although he was aware that LensCrafters would like for him to refer patients to their location next door and that LensCrafters had sent him patients, neither he nor any of his office staff recommended LensCrafters or any other optical supplier. Further, the optometrist insisted that he had taken steps to ensure no referrals occurred.31 [29 P.3d 566] ¶18 Massengale recalled one incident in which LensCrafters offered his employees a cash incentive program for the employee who had the most prescriptions filled by the optical supplier. The Court of Civil Appeals relied upon a statement by Massengale that he was unsure what his employees had said to his patients during the time the incentive program was in place as evidence in support of professional discipline.32 However, a thorough and exhaustive review of the record produced no evidence that any of Massengale's employees actually participated in this program or that any award was ever made.33 When asked about whether or not he altered prescriptions for LensCrafters' benefit, Massengale explained that optical suppliers may not have the precise prescription power ordered in stock. If not, the optical supplier whether LensCrafters or another vendor may contact him to see if a different power prescription will serve the patient as well as the one recommended. The optometrist emphasized that if the change will not be detrimental to the patient, he allows it. If Massengale does not believe the altered prescription is beneficial to the patient, he refuses the optical supplier's request.34[29 P.3d 567] ¶19 Massengale has been licensed in Oklahoma since 1989. During the seven days of testimony, no patient was called and no evidence was presented that any patient was unsatisfied with Massengale's services. Nothing in the record indicates any patient was ever confused about whom they were being treated by or why Massengale recommended a particular prescription or course of treatment. Further, the optometrist has never been charged with malpractice and the Board has not notified him of any concern associated with patient care. There was no testimony from Massengale's employees, from the doctor, from a LensCrafter representative or employee, or any other party that referrals had been made by Massengale to LensCrafters or that a referral agreement, express or implied, existed.35 ¶20 In matters involving the revocation of a professional license, the standard of proof is clear and convincing.36 Great [29 P.3d 568] weight is accorded an administrative entity in the exercise of its expertise.37 Nevertheless, in determining whether administrative findings and conclusions are supported by substantial evidence, the reviewing court considers all the evidence including that which fairly detracts from its weight.38 ¶21 Title 59 O.S. 1991 §593 requires that optometrists: practice in an ethical, professional matter; avoid the appearance of commercialism; and refrain from associating with nonprofessionals in any manner which might degrade or reduce patients' visual care. Here, the Court of Civil Appeals determined that there was insufficient evidence to support a finding that Massengale had failed to keep his practice free from any appearance of commercialism the Board does not challenge the finding on certiorari.39 The Court of Civil Appeals rested its decision that Massengale was subject to discipline because his agreement with LensCrafters might degrade or reduce the quality of visual care within the meaning of §593. The determination was based on findings that the optometrist had, at LensCrafters' request, altered prescriptions and allowed his employees to participate in a rewards program sponsored by the optical supplier. Nevertheless, Massengale testified that he changed prescriptions for LensCrafters and other optical suppliers only when his patients would not be aversely affected and no evidence was presented tht any of Massengale's employees either participated in the incentive offered by LensCrafters or benefitted from the program. Under these facts in the absence of any evidence of substandard clinical practices, unsatisfied patients, either an express or an implied agreement relating to referrals or testimony from any patient or employee of the optometrist or the optical supplier that the optometrist referred patients to the optical supplier, we determine that the optometrist's association with the optical supplier has neither degraded nor reduced the quality of visual care in violation of 59 O.S. 1991 §593. CONCLUSION ¶22 It is for the Legislature, not this Court, to balance the advantages and disadvantages of regulations dealing with visual care.40 As the Legislature has recognized, optometry is a public health issue.41 We hold that: 1) the optometrist's agreement to allow LensCrafters to negotiate third-party provider contracts subject to mutually agreed upon terms does not constitute a prohibited referral agreement under 59 O.S. 1991 §595 or OAC 505:10-5-4; and 2) under the facts presented in the absence of any evidence of substandard clinical practices, unsatisfied patients, or testimony indicating that any of the optometrist's employees actually participated in an incentive program sponsored by the optical supplier, the optometrist's association with the optical supplier has neither degraded nor reduced the quality of visual care in violation of 59 O.S. 1991 §593. ¶23 Our decision today should not be heralded as a departure from the general recognition that regulations relating to visual care are within the state's police power.42 However, no clear and convincing evidence of unprofessional behavior was presented and no prohibited referrals were made. Therefore, the trial court's order is reversed and the cause is remanded with instructions to vacate the Board's order.43COURT OF CIVIL APPEALS OPINION VACATED; TRIAL COURT REVERSED; CAUSE REMANDED WITH INSTRUCTIONS. ¶24 HARGRAVE, C.J., WATT, V.C.J., HODGES, LAVENDER, OPALA, KAUGER, SUMMERS, BOUDREAU, JJ. concur. ¶25 WINCHESTER, J. dissents. FOOT