Title: In the Matter of State and School Employees' Health Benefits Commissions' Implementation of I/M/O Philip Yucht
Citation: N/A
Docket Number: 
State: new-jersey
Issuer: new-jersey Supreme Court
Date: May 8, 2018

Annotate this Case Justia Opinion Summary The New Jersey State Health Benefits Commission (SHBC) and the School Employees’ Health Benefits Commission (SEHBC) (collectively, the Commissions) administered the New Jersey State Health Benefits Program (SHBP) and the School Employees’ Health Benefits Program (SEHBP), respectively. At issue was the method used by the Commissions to correct erroneously tiered reimbursement rates previously applied to members’ out-of-pocket expenses for out-of-network behavioral health services. In a separate matter involving a single plan member, the tiered reimbursement schedule was determined to have violated N.J.S.A. 52:14-17.46.7, which addressed the calculation of reimbursement rates for out-of-network health benefit services. Following that decision, the Commissions permitted members who paid for out-of-pocket behavioral health services and did not receive a proper reimbursement to obtain retroactive reimbursement for charges incurred between May 2009 and March 2014. The challenge before the New Jersey Supreme Court centered on the reasonableness of the Commissions’ notice to members who may have been affected by the application of the erroneous reimbursement rates. The Supreme Court reversed the Appellate Division’s holding and remanded the matter to the Commissions for further proceedings. “Significant questions exist concerning the extent of the notice actually provided, either by the Commissions or through their agents to active employees, former employees, and retirees, a hearing is necessary.” Read more Want to stay in the know about new opinions from the Supreme Court of New Jersey? Sign up for free summaries delivered directly to your inbox. Learn More › You already receive new opinion summaries from Supreme Court of New Jersey. Did you know we offer summary newsletters for even more practice areas and jurisdictions? Explore them here . SYLLABUS(This syllabus is not part of the opinion of the Court. It has been prepared by the Office of the Clerk for the convenience of the reader. It has been neither reviewed nor approved by the Supreme Court. Please note that, in the interest of brevity, portions of any opinion may not have been summarized.) In the Matter of State and School Employees’ Health Benefits Commissions’ Implementation of I/M/O Philip Yucht (A-21-17) (079966)Argued February 26, 2018 -- Decided May 8, 2018LaVECCHIA, J., writing for the Court. This appeal involves review of administrative action by the State Health Benefits Commission (SHBC) and the School Employees’ Health Benefits Commission (SEHBC) (collectively, the Commissions). The Commissions administer the State Health Benefits Program (SHBP) and the School Employees’ Health Benefits Program (SEHBP), respectively. The Court considers the reasonableness of the Commissions’ notice to members who may have been affected by the application of erroneous reimbursement rates. On May 4, 2009, the Commissions established adjusted reimbursement rate percentages for out-of-network behavioral health services. Under the new reimbursement scheme, the Commissions determined a usual and customary charge reimbursement rate (the UCR) for outpatient behavioral health services from medical doctors and agreed to pay medical doctors one-hundred percent of that UCR. However, they determined to reimburse other behavioral health service providers at lesser percentages of that UCR. An SEHBP member, Philip Yucht, who received behavioral health services, challenged the reimbursement he received for his out-of-pocket expenses. The SEHBC denied Yucht’s challenge. Yucht appealed and the Appellate Division held that the tiered rates of reimbursement for non-medical-doctor behavioral health services were contrary to the legislative policies expressed in N.J.S.A. 52:14-17.46.7. After the Appellate Division decision, the Commissions each determined to reimburse plan members— those who did not receive proper reimbursement for incurred out-of-pocket expenses—retroactive to May 2009. The Commissions attempted to notify members of the reimbursement opportunity in two ways. The Commissions placed a link (the link) on the website of the Division of Pensions and Benefits (the Division), which was labeled with a notice that stated simply, “Behavioral Health Services Claim Reconsideration—for SHBP and SEHBP members.” The Commissions also sent a letter, dated July 22, 2014 (the letter), to certifying officers, human resources directors, and benefits administrators for public employers participating in the SHBP and SEHBP. The subject of the letter stated “Behavioral Health Claim Reimbursements Reconsidered.” The letter advised the officers that members “who received reimbursement for behavioral health claims for services provided by an out-of-network provider between May 4, 2009 and March 23, 2014, may be entitled to a reconsideration of their claims.” The letter instructed that plan members should complete a specific form to request adjustment and submit it with supporting documents to Horizon no later than December 31, 2014. It also stated that requests received after that date would not be considered. The second page of the letter, under the heading “EMPLOYER RESPONSIBILITIES,” stated: “Please make this information available to your location’s employees and forward this letter and attachment to your human resources staff, benefit administrators, and any other staff members responsible for the administration of health benefits for your location’s employees.” It is undisputed in the record before us that the Commissions themselves did not send any form of individualized notice to potentially affected members. In December 2014, the Communication Workers of America, AFL-CIO and the Clinical Social Work Guild 49 (the Unions) petitioned the Commissions to extend the deadline for the submission of requests for reimbursement. The Unions asserted that the notice provided was neither adequate nor meaningful and that the Commissions should either send individualized notice to all potentially affected members or to all SHBP and SEHBP members. The Commissions informed the Unions that their petition was denied. The Appellate Division affirmed the Commissions’ refusal to extend the deadline and provide further notice to affected members. In reaching its conclusion, the panel applied a highly deferential standard of review and held that the Commissions’ notice was adequate both in form and substance. The Court granted the Unions’ petition for certification to consider whether the Commissions’ method of implementing reimbursement for the involved out-of-network charges “provided adequate notice to potentially affected members.” 231 N.J. 414 (2017). 1 HELD: Because significant questions exist concerning the extent of the notice actually provided, either by the Commissions or through their agents to active employees, former employees, and retirees, a hearing is necessary. The hearing is to be conducted in accordance with the principles outlined in this opinion and, at the hearing, the adequacy of the content of the notice can be raised.1. Agency action will not be overturned unless the action is arbitrary, capricious, or unreasonable. The arbitrary, capricious, and unreasonable standard is generally understood to involve inquiry into whether the decision conforms with relevant law, whether there is substantial credible evidence in the record as a whole to support the agency’s decision, and whether in applying the relevant law to the facts, the agency clearly erred in reaching its conclusion. When the challenged agency action arises in a setting where the record is too meager to permit meaningful review, supplementation of the record may be necessary. The Court Rules provide that a reviewing court may remand, on its own motion, for supplementation of the record in order to permit meaningful review. R. 2:5-5(b). (pp. 14-16)2. Whenever an administrative agency acts, be that act mandatory or strictly voluntary, it must do so reasonably and in a manner calculated to achieve the policies expressed in the agency’s organic statute. Therefore, because the Commissions determined to reimburse affected members, they were necessarily required to do so reasonably and in a non-arbitrary manner. Here, that means that the Commissions were required to provide reasonable notice in order that the retroactive benefit would fairly be made known and, thus, made available in a non-arbitrary manner to affected members. As with most agency action, there is room for debate over what is reasonable. To be reasonable, an agency’s choice of action for providing notice does not require adoption of a perfect practice. Here, the intended purpose of the action challenged—the Commissions’ attempted notice—was to reach persons who might have been affected by the wrongfully calculated reimbursement rate, to notify those persons of the availability of supplemental reimbursement, and to inform them of the procedures for requesting supplemental reimbursement. (pp. 16-19)3. The problem in this dispute over the adequacy of notice is that the evidence thus far produced has the capacity to support the claim that the methods of notice—the letter and website link—were not reasonably designed to likely reach the categories of members who may have been affected by the erroneous reimbursement rates. The Unions have advanced some evidence on which there could be based a finding that the notice was not reasonably designed to give notice to the proper universe of individuals affected. Against that presentation, based on the present record, the Court cannot conclude that either the website’s ten-word, cryptically described notice and link or the letter to the certifying officers provides sufficient evidence to support deferring to the agency’s choice of notice as reasonable. With the thin record available, it is not known what action, if any, certifying officers generally took in response to the Commissions’ letter. Nor does the record disclose what notice, if any, former employees and retirees received of the potential for supplemental reimbursement in light of the Commissions’ apparent reliance on the link. Accordingly, the Court orders a remand for the development of a proper record to permit meaningful judicial review. In that remand hearing, both the form and substance of the notice may be examined. (pp. 19-23)4. The Court directs that the parties bear the following burdens in the remand to take place following issuance of this decision. Because the Unions have come forward with some evidence to support questioning the reasonableness of the notice, the burden of moving forward with the evidence has shifted to the Commissions to respond. Therefore, the Commissions shall be required on remand to respond with evidence of efforts made by certifying officers, or others with responsibility to provide notice, on behalf of participating employers to publish the required notice to members. The Court notes that the Commissions are in a superior position to produce the necessary information for creation of a meaningful record and emphasizes that the record need not plumb the efforts of each and every certifying officer to share the substance of the letter with members. No doubt, the Commissions have various means at their disposal to use in order to paint a picture of employer responsiveness through their letter to certifying officers since that is, in part, what the Commissions rely upon. Finally, although the burden of moving forward has shifted to the Commissions for the remand proceeding, the ultimate burden of persuasion remains squarely and solely on the Unions’ shoulders. Because the Unions brought this challenge, it is for the Unions to demonstrate that the notice, as implemented, was not adequate for its purpose and hence unreasonable. (pp. 23-27) The judgment of the Appellate Division is REVERSED. The matter is REMANDED for further proceedings consistent with this opinion. CHIEF JUSTICE RABNER and JUSTICES ALBIN, PATTERSON, FERNANDEZ-VINA, SOLOMON, AND TIMPONE join in JUSTICE LaVECCHIA’s opinion. 2 SUPREME COURT OF NEW JERSEY A- 21 September Term 2017 079966IN THE MATTER OF STATE AND SCHOOL EMPLOYEES’ HEALTH BENEFITS COMMISSIONS’ IMPLEMENTATION OF I/M/O PHILIP YUCHT. Argued February 26, 2018 – Decided May 8, 2018 On certification to the Superior Court, Appellate Division. Ira W. Mintz argued the cause for appellants Communications Workers of America, AFL-CIO and Clinical Social Workers Guild 49 (Weissman & Mintz, attorneys; Ira W. Mintz, on the briefs). Eileen S. Den Bleyker, Deputy Attorney General, argued the cause for respondents State Health Benefits Commission and School Employees’ Health Benefits Commission (Gurbir S. Grewal, Attorney General, attorney; Melissa H. Raksa, Assistant Attorney General, of counsel, and Danielle P. Schimmel, Deputy Attorney General, on the briefs). Flavio L. Komuves argued the cause for amicus curiae New Jersey Education Association (Zazzali, Fagella, Nowak, Kleinbaum & Friedman, attorneys; Richard A. Friedman, of counsel, and Flavio L. Komuves and Marissa A. McAleer, on the brief). JUSTICE LaVECCHIA delivered the opinion of the Court. This appeal involves review of administrative action by theState Health Benefits Commission (SHBC) and the School 1 Employees’ Health Benefits Commission (SEHBC) (collectively, theCommissions). The Commissions administer the State HealthBenefits Program (SHBP) and the School Employees’ HealthBenefits Program (SEHBP), respectively. The subject matter of the appeal involves the method usedby the Commissions to correct erroneously tiered reimbursementrates previously applied to members’ out-of-pocket expenses forout-of-network behavioral health services. In a separate matterinvolving a single plan member, the tiered reimbursementschedule was determined to have violated N.J.S.A. 52:14-17.46.7,which addresses the calculation of reimbursement rates for out-of-network health benefit services. Following that decision,the Commissions permitted members who paid for out-of-pocketbehavioral health services and did not receive a properreimbursement to obtain retroactive reimbursement for chargesincurred between May 2009 and March 2014. The challenge here isto the reasonableness of the Commissions’ notice to members whomay have been affected by the application of the erroneousreimbursement rates. For the reasons that follow, we reverse the AppellateDivision’s holding and remand the matter to the Commissions forfurther proceedings. Because we determine that significantquestions exist concerning the extent of the notice actuallyprovided, either by the Commissions or through their agents to 2 active employees, former employees, and retirees, a hearing isnecessary. The hearing is to be conducted in accordance withthe principles outlined in this opinion and, at the hearing, theadequacy of the content of the notice can be raised. I. By way of background, we first address the prior decisionof the Appellate Division that was the impetus for theCommissions’ actions under review. The following facts, gleanedfrom that unpublished opinion, provide helpful background inthis appeal, which comes to us without its own hearing record. A. On May 4, 2009, the Commissions established adjustedreimbursement rate percentages, calculated from a base rate forusual and customary charges, applicable to SHBP and SEHBPmembers for out-of-network behavioral health services. Underthe new reimbursement scheme, which was made retroactive toJanuary 1, 2009, the Commissions determined a usual andcustomary charge reimbursement rate (the UCR) for outpatientbehavioral health services from medical doctors and agreed topay medical doctors one-hundred percent of that UCR. However,they determined to reimburse other behavioral health serviceproviders at lesser percentages of that UCR. For example, theCommissions determined that a psychologist with a Ph.D. would bereimbursed at eighty-five percent of the UCR for medical 3 doctors. A range of lower reimbursement-rate percentages wereassigned to the charges of other professionals.1 That new tiered rate scheme resulted from a recommendationmade to the Commissions by Magellan Health Services (Magellan),the contractor used by the Commissions’ third-partyadministrator, Horizon Blue Cross Blue Shield of New Jersey(Horizon), for health plans pertinent to this action. Horizonforwarded Magellan’s recommendation to the Commissions, whichapproved the change for implementation. Significantly, forpurposes of N.J.S.A. 52:14-17.46.7, neither Magellan nor Horizonare nationally recognized databases for purposes of determiningUCR. The statute requires that plan participants be reimbursedat eighty percent of reasonable and customary charges, definedas “charges based upon the 90th percentile of the [UCR] feeschedule determined by the Health Insurance Association ofAmerica [now Prevailing Healthcare Charges System] or a similarnationally recognized database of prevailing health carecharges.” N.J.S.A. 52:14-17.46.7. An SEHBP member, Philip Yucht, who received behavioralhealth services after the Commissions’ adjusted reimbursement1 By way of further example, the rate for a clinical nurse specialist was set at seventy percent of the UCR, a thirty percent reduction. The rates for a licensed clinical social worker, a licensed marriage family therapist, and a licensed professional counselor were each set at sixty-five percent of UCR, a thirty-five percent reduction. 4 rates took effect, challenged the reimbursement he received forhis out-of-pocket expenses. Under the new tiered reimbursementrates, Yucht’s treatment by a licensed clinical social workerwas reimbursed at sixty-five percent of the UCR described above.The reimbursement rate formerly was one-hundred percent for thatservice. In a final agency determination, the SEHBC deniedYucht’s challenge to the amount of his reimbursement after thenew rates took effect. Yucht appealed and the Appellate Division held that thetiered rates of reimbursement for non-medical-doctor behavioralhealth services were contrary to the legislative policiesexpressed in N.J.S.A. 52:14-17.46.7. In declaring the adjustedreimbursement rates arbitrary, capricious, and unreasonable, thepanel stated that “[t]he statute’s clear and unambiguouslanguage revealed the Legislature’s intent that a [plan]participant be reimbursed” at a statutorily prescribed ratedetermined by reference to a “nationally recognized database ofprevailing health care charges.” Here, because the Commissionsrelied on a non-nationally recognized database as the basis forthe new rates, the adopted tiered scheme -- applied in Yucht’scase -- imposed a rate of reimbursement for out-of-networkprofessional behavioral health services not permitted under thestatute. B. 5 Importantly for the present appeal, after the afore-described Appellate Division decision, the Commissions eachdetermined by resolution to reimburse plan members -- those whodid not receive proper reimbursement for incurred out-of-pocketexpenses -- at the appropriate rate, retroactive to May 2009. The minutes of the meeting of the SEHBC held on March 7,2014 state as follows: [Philip] Yucht vs. SEHBC -- This Appellate Court decision concerned the payment of out- of-network behavioral health claims. Commissioner Kelleher made a motion to apply the court decision back to the date of the change of the payment structure -- May 2009 - - and reimburse payment of behavioral health claims incurred since that date using the Reasonable and Customary allowance set forth in the national database of charges; and if the Deputy Attorney General believes it is necessary, to require that the member provide proof of loss.The motion passed by a vote of four to three. The next week, the SHBC met on March 12, 2014, and theminutes of that meeting reveal unanimous approval of thefollowing action: Philip Yucht vs. SEHBC: [The Acting Secretary] advised the Commission that the draft resolution before the Commission would achieve the same result as the resolution that had been passed by the SEHBC. Commissioner Burdge made a motion to approve the resolution as drafted -- Where a member provides proof of payment of coinsurance and amounts above the reasonable and customary charge, the Division of Pensions and Benefits and Horizon shall apply the Yucht decision retroactively and 6 reimburse payment of behavioral health claims using the reasonable and customary allowance set forth in the national database of charges to claims incurred on or after January 1, 2009. The Commissions attempted to notify members of thereimbursement opportunity in two ways. The Commissions placed alink (the link) on the website of the Division of Pensions andBenefits (the Division), which was labeled with a notice thatstated simply, “Behavioral Health Services Claim Reconsideration-- for SHBP and SEHBP members.” The Commissions also sent aletter, dated July 22, 2014 (the letter), to certifyingofficers, human resources directors, and benefits administratorsfor public employers participating in the SHBP and SEHBP. Thesubject of the letter stated “Behavioral Health ClaimReimbursements Reconsidered.” In pertinent part, the letter advised the officers to whomit was directed that the Commissions “have directed [Horizon] toreconsider certain out-of-network claims for professionalbehavioral health services, reimbursed between May 4, 2009 andMarch 23, 2014.” It stated, under the heading of “FILING ACLAIM RECONSIDERATION,” that members who received reimbursement for behavioral health claims for services provided by an out- of-network provider between May 4, 2009 and March 23, 2014, may be entitled to a reconsideration of their claims. Employees that want to pursue adjustments of these claims must provide proof that they paid the 7 difference between Horizon BCBSNJ reimbursement and the provider’s full charge.The letter instructed that plan members should complete aspecific form to request adjustment and submit it withsupporting documents to Horizon no later than December 31, 2014.It also stated that requests received after that date would notbe considered. A copy of the form was enclosed with the letterand the officers were informed that the form also was availableon the Division’s website. The second page of the letter, under the heading “EMPLOYERRESPONSIBILITIES,” stated: Please make this information available to your location’s employees and forward this letter and attachment to your human resources staff, benefit administrators, and any other staff members responsible for the administration of health benefits for your location’s employees.It is undisputed in the record before us that the Commissionsthemselves did not send any form of individualized notice topotentially affected members. C. In December 2014, the Communication Workers of America,AFL-CIO and the Clinical Social Work Guild 49 (the Unions)petitioned the Commissions to extend the deadline for thesubmission of requests for reimbursement. The Unions assertedthat the notice provided was neither adequate nor meaningful andthat the Commissions should either send individualized notice to 8 all potentially affected members or, if a list of those memberswas not readily available, send notice to all SHBP and SEHBPmembers. Subsequently, the SEHBC asked Horizon for informationconcerning the total amount of supplemental reimbursements made.After a review, the Commissions informed the Unions that theyestimated that, including both SHBP and SEHBP members, therewere approximately 1.4 million out-of-network behavioral healthvisits under the tiered reimbursement plan. That number wasexclusive of services provided by a medical doctor, which didnot qualify for further reimbursement. Combined, theCommissions received 857 claims for reimbursementreconsideration, of which 481 were denied for lack of proof.All told, the Commissions reimbursed roughly $350,000. Claimsreceived after the deadline were all denied. By letter dated June 9, 2015, the Commissions informed theUnions that their petition was denied and the deadline forsubmission of requests for reimbursement was not extended. The Unions appealed the Commissions’ final action to theAppellate Division. See R. 2:2-3(a)(2). The Unions challengedthe adequacy of both the form and substance of the noticeprovided by the Commissions concerning the opportunity forreimbursement. The Unions added, in their argument to theAppellate Division, that all members who were subjected to the 9 inappropriate out-of-network reimbursement schedule shouldreceive automatic supplemental reimbursement without having toprovide proof of reimbursement at the wrongful amount. During the appeal’s pendency, the Unions’ counsel submitteda request to the Division under the Open Public Records Act(OPRA), N.J.S.A. 47:1A-1 to -13. The OPRA request sought copiesof all notices provided to retirees informing them of theability to file a claim for additional reimbursement, as well ascopies of all notices from certifying officers to employeesnotifying them of the ability to file a claim for additionalreimbursement. The Commissions responded by providing the webaddress containing the aforementioned link on the Division’swebsite as well as a web address containing the aforementionedletter to certifying officers. In an unpublished opinion, the Appellate Division affirmedthe Commissions’ refusal to extend the deadline and providefurther notice to affected members. In reaching its conclusion,the panel applied a highly deferential standard of review. Concerning notice, the panel found that the Commissions hadprovided two forms: the link on the Division’s website and theletter to certifying officers and like officials “directing themto make the reimbursement protocol available to employees.”Although acknowledging that those communications were “perhapsnot the most effective form of notice,” the appellate panel 10 nevertheless could not “conclude that the notification procedureimplemented . . . was not reasonably calculated to adviseeligible members of their right to seek supplementalreimbursement.” Thus, the panel held that the Commissions’notice was adequate both in form and substance. Concerning theUnions’ additional appellate argument that the Commissionsshould simply provide automatic supplemental reimbursement, thepanel refused to consider the issue because it was not raisedbefore the Commissions. We granted the Unions’ petition for certification toconsider whether the Commissions’ method of implementingreimbursement for the involved out-of-network charges “providedadequate notice to potentially affected members.” 231 N.J. 414(2017). We also granted amicus curiae status to the New JerseyEducation Association (the NJEA). II. A. The Unions argue that the Commissions failed to giveadequate notice of their determination to provide affected planmembers with supplemental reimbursement for wrongly reimbursedout-of-network behavioral health professional services. Theycontend that the methods of providing notice were not reasonablefor the purpose to be achieved; rather, they contend that thenotice had to be reasonably calculated to reach potentially 11 affected members. The Unions assert that, here, the Commissionsused means of notice not reasonably likely -- if not actuallyunlikely -- to reach members, as evidenced by the fact that lessthan one-tenth of one percent of visits were accounted for inthe number of claims filed as requests for reimbursement. The Unions argue that the Division’s website link providednotice of the potential for such supplemental reimbursement onlyif a number of things coalesced. A plan member would have to(1) find the link on the website, (2) decide from the crypticdescription that the link potentially applied to him or her, and(3) proceed through a series of “clicks” to arrive at thereimbursement form with its instructions, from which the planmember would have to (4) decipher what the “reimbursementreconsideration” means and requires. According to the Unions,that form of notice was simply unclear and ineffective. Likewise, in respect of the letter, the Unions argue thatthe Commissions provided no evidence that certifying officers,or any like official, actually notified plan members inaccordance with the letter. According to the Unions, theletter’s terms end with a request, as opposed to any mandatorylanguage, and therefore lack clarity concerning the imperativeof reaching plan members. Further, there are categories ofmembers who may have been affected by the wrongfully calculatedreimbursement rates who are not addressed at all in the letter 12 directed to participating employers. For example, the Unionsemphasize that the Commissions have provided no evidence ofnotice to retirees who may have been affected by theinappropriately tiered reimbursement rates. Finally, the Unions also contend that the hurdles forreimbursement are unreasonable. They point to the difficulty ofexpecting members to remember, with specificity, the exact datesof services received nine years ago. They assert that it isunreasonable to require members to provide information that theCommissions, or Horizon, may already have concerning out-of-network professional services and to require proof of members’payments when, they contend, that is not required for otherreimbursements. B. Relying on their Appellate Division brief, the Commissionsprimarily argue that notice was adequate because, aside fromproviding a notification and link on the Division’s website, theCommissions also sent a letter to participating employers’certifying officers directing that they share information aboutthe supplemental reimbursement with plan members at theirlocation. The Commissions argue that they were entitled to relyon N.J.S.A. 52:14-17.43 and N.J.A.C. 17:9-1.9 in assuming thattheir responsibility for notice was discharged by shifting thatobligation, through the letter, to certifying officers. 13 Moreover, the Commissions assert that they have a duty toadminister the SHBP and SEHBP efficiently and thatindividualized notice would be too burdensome. Finally, the Commissions argue that the Unions’ reliance onthe number of claims for reimbursement as proof of the chosenforms’ inadequacy for providing notice is misplaced. Theycontend that there is not a one-to-one ratio of claims forreimbursement to visits adjusted. Each claim for supplementalreimbursement involves payment for at least one, or more thanone, visit. Thus, they contend that the number of actual visitswhose rate of reimbursement may have been adjusted is likelyhigher than is reflected in the record. C. Amicus curiae the NJEA generally supports the argumentsadvanced by the Unions in this appeal. In addition, the NJEAadvances arguments peripheral to those advanced by the Unions,including application of the “turn square corners,” “fundamentalfairness,” and “fairness and rightness” doctrines; applicationof a de novo review standard based on an argument for nodeference to the agency action in these circumstances; andapplication of a due process analysis. III. Our Court Rules codify the principle that finaladministrative agency action is subject to appellate review.14 See R. 2:2-3(a)(2). In such appeals, a deferential standard ofreview applies. Henry v. Rahway State Prison, 81 N.J. 571, 579-80 (1980). Agency action will not be overturned unless theaction is arbitrary, capricious, or unreasonable. Barrick v.State, 218 N.J. 247, 259 (2014) (applying standard in challengeby unsuccessful bidder to administrative award of contract forlease of office space); N.J. SPCA v. Dep’t of Agric., 196 N.J. 366, 384-85 (2008) (applying standard in challenge to agencyrulemaking); In re Herrmann, 192 N.J. 19, 27-28 (2007) (applyingstandard in quasi-judicial setting). The arbitrary, capricious, and unreasonable standard isgenerally understood to involve inquiry into whether thedecision conforms with relevant law, whether there issubstantial credible evidence in the record as a whole tosupport the agency’s decision, and whether in applying therelevant law to the facts, the agency clearly erred in reachingits conclusion. In re Carter, 191 N.J. 474, 482-83 (2007)(relying on Mazza v. Bd. of Trs., 143 N.J. 22, 25 (1995)).Ordinarily for quasi-judicial or rule-making final agencyaction, there is a substantial body of material comprising therecord. In appeals from final agency action outside of suchsettings, there similarly must be a sufficiently developedrecord to permit a reviewing court to engage in meaningfulreview. See In re Issuance of Permit by DEP, 120 N.J. 164, 173 15 (1990) (relying on State v. Atley, 157 N.J. Super. 157, 163(App. Div. 1978)) (noting necessity of agency fact-finding tofacilitate appellate review). When the challenged agency actionarises in a setting where the record is too meager to permitmeaningful review, supplementation of the record may benecessary. The Court Rules provide that a reviewing court mayremand, on its own motion, for supplementation of the record inorder to permit meaningful review. R. 2:5-5(b). In this instance, we consider whether the record presentedhere permits meaningful review and is therefore sufficient togive the agency’s challenged final action the deference accordedto it by the Appellate Division. We conclude that it does notand therefore are compelled to order a remand to the Commissionsin order for a hearing to be conducted. IV. A. No doubt, the Commissions acted with a sense of justice andrightness when, after the unpublished Appellate Divisiondecision involving a single SEHBC member issued, they determinedto provide potentially affected SHBP and SEHBP members with theopportunity to make claims for supplemental reimbursement at theproper amount. That Appellate Division decision informed the Commissionsthat the dictates of N.J.S.A. 52:14-17.46.7 had not been 16 followed in the adjustment to the rates of reimbursement formembers’ out-of-network behavioral health services. Thatrendered the adjusted rates, as applied to Yucht’s case,inconsistent with the statute. Although the decision in Yucht’scase did not speak in terms of retroactivity, the Commissions’resolutions established that the agencies would apply thedecision retroactively to members seeking to obtain thereimbursement at the rate they should have received for out-of-pocket expenses. That administrative action by the Commissionsavoided the potential for future applications by other affectedindividuals seeking to have the decision applied retroactively. However, having determined to take the corrective action tobring their reimbursement rates for out-of-network chargesincurred by plan members in line with the statute that theCommissions were charged to implement, the agency had to providethe benefit of that corrective action in a reasonable and non-arbitrary or capricious manner to those affected. See In reCarter, 191 N.J. at 482-83. Indeed, whenever an administrativeagency acts, be that act mandatory or strictly voluntary, itmust do so reasonably and in a manner calculated to achieve thepolicies expressed in the agency’s organic statute. See 37Steven L. Lefelt et al., N.J. Practice: Administrative Law &Practice § 7.17 (2d ed. 2000) (“When an agency has exercised itsdiscretion unreasonably, a court will invalidate the action.”). 17 Therefore, because the Commissions determined to reimburseaffected members, they were necessarily required to do soreasonably and in a non-arbitrary manner. See ibid. Here, thatmeans that the Commissions were required to provide reasonablenotice in order that the retroactive benefit would fairly bemade known and, thus, made available in a non-arbitrary mannerto affected members. See In re Pub. Hearings on AmendedDetermination of Commuter Operating Agency for Fiscal Year 1975-1976, 142 N.J. Super. 136, 161 (App. Div. 1976) (orderingCommuter Operating Agency to reimburse railway commuters forovercharge resulting from procedurally defective fare raise andfurther ordering Agency to provide notice of right to requestreimbursement and procedure for doing so). As with most agency action, there is room for debate overwhat is reasonable. To be reasonable, an agency’s choice ofaction for providing notice does not require adoption of aperfect practice. But, like the means an agency chooses forpurposes of meeting a public need contemplated by a statute theagency is charged with implementing, the means of notice infulfillment of that statutory policy similarly must be designedto reasonably achieve its intended purpose. Cf. N.J. Chapter,Am. Inst. of Planners v. Bd. of Prof’l Planners, 48 N.J. 581,600 (1967) (noting that regulatory actions must be “reasonablycalculated to satisfy the [felt public] need”). Here, the 18 intended purpose of the action challenged -- the Commissions’attempted notice -- was to reach persons who might have beenaffected by the wrongfully calculated reimbursement rate, tonotify those persons of the availability of supplementalreimbursement, and to inform them of the procedures forrequesting supplemental reimbursement. From a pure reasonableness perspective, the Unions’preference for individualized notice by Horizon wouldundoubtedly constitute a best practice under thesecircumstances; but, that is not the standard by which theCommissions’ action must be measured. In this circumstance, wereview the agency’s action for reasonableness but must alsoallow room for agency discretion in determining how to proceedwith the implementation of statutory policy now that the formertiered reimbursement scheme has been found lacking and theagency has undertaken corrective action to provide a remedy to abroader group of affected individuals. The problem we find in this dispute over the adequacy ofnotice is that the evidence thus far produced has the capacityto support the claim that the methods of notice -- the letterand website link -- were not reasonably designed to likely reachthe categories of members who may have been affected by theerroneous reimbursement rates. The Unions have advanced someevidence on which there could be based a finding that the notice 19 was not reasonably designed to give notice to the properuniverse of individuals affected. The Unions’ presentation ispremised on problems with the website’s notice and the letter,as well as inferences from what is known about the small numberof claims filed as compared to the universe of member claimsthat might have been affected by impermissibly reducedreimbursement rates. Against that presentation, based on thepresent record, we cannot conclude that either the website’sten-word, cryptically described notice and link or the letter tothe certifying officers provides sufficient evidence to supportdeferring to the agency’s choice of notice as reasonable. Concerning the website, assuming that it is scanned bycurrent and former plan members in a timely fashion to respondto its substance, the notice’s wording is brief, technical, andlacking in detail about the essence of this reimbursement“reconsideration.” The notice’s wording and accompanyingreference to a link does not appear, on its face, reasonablycalculated to give a member notice that the out-of-pocketexpense for out-of-network professional services for behavioralhealth counseling needs might have been underpaid, and thatthere is a process for providing evidence in order to obtain anadjusted reimbursement. With regard to the letter sent to certifying officers, ittoo standing alone does not suffice to persuade, on this record, 20 that the Commissions’ attempted notice was reasonably calculatedto provide actual notice to potentially affected members,including former employees and retirees. There is too much thatis unknown. There is no evidence demonstrating whether or howcertifying officers complied with the letter’s request. Therecord is silent on whether certifying officers sent any noticeto individuals, and if so, how it was accomplished. Indeed, theletter’s closing direction to the certifying officers is notablysoft in its command, unlike the earlier wording in the letterdescribing the Commissions’ action in ordering the retroactivereimbursement. The closing language of the letter is framed asa request, and then only asks that the newly opened avenue forreimbursement reconsideration be made available to members atthe certifying officers’ work locations. Further, the referenceto the “work location” in no way suggests, let alone commands ordirects, that former employees or retirees be notified of theavailability of seeking reimbursement. We reject the Commissions’ reliance on N.J.S.A. 52:14–17.43, defining the duties of a certifying officer of aparticipating employer in the SHBP and SEHBP, as sufficient toassume that notice was given by those officers. Thus, withoutknowing more, we cannot conclude that the Commissions actedreasonably in choosing to direct notice in this fashion. We do 21 not find that statute to confer such clarity of purpose in thesetting we find here. N.J.S.A. 52:14–17.43 provides: The certifying agent of each participating employer shall submit to the Division of Pensions such information and shall cause to be performed in respect to each of the employees of such employer such duties as would be performed by the State in connection with the program. The division shall have the power and authority to make such verification of the employment and other records of any participating employer as the division may deem necessary in connection with the program.See also N.J.A.C. 17:9–1.9(b), (c) (describing duties ofcertifying officer, which include “providing documentationrequested by the Commission or the Division in a timely manner”and “be[ing] responsible for all other duties relating tomatters concerning the SHBP”). Simply put, that statute and itsimplementing regulation are insufficiently specific to beunderstood to command the certifying officers to provide thenotice that would be reasonably calculated to reach the broadgroup of individuals involved here. As noted, the letter’s command is subject to debate that isbest left to a fact-finding hearing. With the thin recordavailable, we do not know what action, if any, certifyingofficers generally took in response to the Commissions’ letter.Nor, for that matter, does the record disclose what notice, ifany, former employees and retirees received of the potential forsupplemental reimbursement in light of the Commissions’ apparent 22 reliance on the link posted to the Division’s website. While wedo not foreclose the possibility that there may have beenelectronic follow-up with employees, past and present, or hardcopy communication, as the Commissions suggest may havehappened, the record is silent on the subject. In sum, we cannot conclude that the website notice and linkare sufficient to have provided notice to either presentemployees or former employees -- either retired or those whosimply moved on to other employment -- that they might beentitled to enhanced reimbursement for previous member-incurredexpenses for out-of-network mental health, or “behavioralhealth,” professional services. And, we know little to nothingabout the effectiveness of the letter sent by the Commissions interms of it providing a basis for reasonable notice.Accordingly, we order a remand for the development of a properrecord to permit meaningful judicial review. In that remandhearing, both the form and substance of the notice may beexamined. B. Ordinarily, the burden of proof is on a challenger todemonstrate that an agency’s action is arbitrary, capricious, orunreasonable. See, e.g., Lavezzi v. State, 219 N.J. 163, 171(2014) (noting that in challenge to administrative action burdenis on challenger); Worthington v. Fauver, 88 N.J. 183, 208 23 (1982) (same). The burden of proof is often said to be composedof two elements: (1) the burden of moving forward with someevidence sufficient to establish a prima facie case; and (2) theburden of persuading the trier of fact. McCann v. George W.Newman Irrevocable Tr., 458 F.3d 281, 287 (3d Cir. 2006); 9Wigmore on Evidence § 2487(a), (b), (c) (Chadbourn rev. 1981)(discussing placement of burdens of moving forward andpersuasion and differences between them). Traditionally, when a party bearing the ultimate burden ofproof submits to a trier of fact a sufficient quantum ofevidence to make out a prima facie case, that party isconsidered to have satisfied the burden of moving forward withevidence, which burden then shifts to the other party, requiringthat party to produce some evidence in rebuttal. See, e.g.,Ryan v. Mayor & Council of Demarest, 64 N.J. 593, 604-05 (1974)(holding, in challenge to Borough’s refusal to consent todeannexation, that plaintiff’s bringing forward of sufficientevidence to make out claim shifted burden of production todefendant); accord 2 McCormick on Evidence § 338 (Broun ed., 7thed. 2013) (noting that where plaintiff presented prima faciecase, “it is frequently said that . . . the duty of goingforward has shifted to the adversary, and this isunobjectionable if we bear in mind that the penalty for silenceis very different here from that which was applied to the 24 original proponent” (footnotes omitted)). The burden shiftresults in an efficient presentation of relevant proofs andlogical analysis of the parties’ positions. For similar efficiency motivations, we also have not shiedaway from shifting the burden of moving forward to the non-challenging party in circumstances where, because of somedisparity in access to evidence and information, fairness and aneed for a record encompassing all relevant information dictatedthat such shifting was necessary to reach a correct result. SeeJ.E. ex rel. G.E. v. State, 131 N.J. 552, 570 (1993) (shiftingburden to Division of Developmental Disabilities to prove thatits transfer of developmentally disabled child was appropriatebecause agency kept extensive records and had unique expertisein area and access to information that challengers lacked). “Wegenerally have imposed the burdens of persuasion and productionon the party best able to satisfy those burdens.” Id. at 569. Those two considerations impel us to direct that theparties bear the following burdens in the remand to take placefollowing issuance of this decision. Because the Unions have come forward with some evidence tosupport questioning the reasonableness of the notice, we regardthe burden of moving forward with the evidence to have shiftedto the Commissions to respond. That this matter comes before usas a challenge to final agency action and not in the context of, 25 for example, a civil damages suit does not alter theapplicability of traditional burden shifting. As discussed, theUnions bore the burden of bringing forward some evidence onwhich it can be reasonably found that the Commissions’ attemptednotice to affected SHBP and SEHBP members was inadequate.Although the record before us does not permit us to determinewhether notice was adequate as a matter of ultimate fact, itnevertheless permits us to find that the Unions have broughtforth sufficient evidence of inadequacy to require theCommissions to respond with evidence to the contrary.Therefore, the Commissions shall be required on remand torespond with evidence of efforts made by certifying officers, orothers with responsibility to provide notice, on behalf ofparticipating employers to publish the required notice tomembers. In imposing that evidential obligation in these unusualcircumstances, we note that the Commissions are in a superiorposition to produce the necessary information for creation of ameaningful record on which to determine whether the notice givenhere was reasonably calculated to inform potentially affectedmembers of the availability of supplemental reimbursement. Weemphasize that the record need not plumb the efforts of each andevery certifying officer to share the substance of the letterwith members. For example, reliance on customary practices 26 employed by the individuals in public positions at the time, andwhether customary practice was being followed, has been usedreliably in the creation of administrative records in othersettings. See SSI Med. Servs., Inc. v. Dep’t of Human Servs.,146 N.J. 614, 622-23 (1996) (discussing use of custom andpractice in administrative agency’s mailing of reimbursementforms). No doubt, the Commissions have various means at theirdisposal to use in order to paint a picture of employerresponsiveness through their letter to certifying officers sincethat is, in part, what the Commissions rely upon. Finally, although the burden of moving forward has shiftedto the Commissions for the remand proceeding, the ultimateburden of persuasion remains squarely and solely on the Unions’shoulders. See Worthington, 88 N.J. at 208 (noting in challengeto Executive-branch acts that burden of persuasion rests onattacking party). Because the Unions brought this challenge, itis for the Unions on remand to bear the burden of persuasion anddemonstrate that the notice, as implemented, was not adequatefor its purpose and hence was an unreasonable exercise of theCommissions’ discretionary authority. V. The judgment of the Appellate Division is reversed and thematter remanded for further proceedings consistent with thisopinion. 27 CHIEF JUSTICE RABNER and JUSTICES ALBIN, PATTERSON, FERNANDEZ-VINA, SOLOMON, AND TIMPONE join in JUSTICE LaVECCHIA’s opinion. 28