Title: STATE ex rel. PROTECTIVE HEALTH SERVICES STATE DEPT. OF HEALTH v. VAUGHN
Citation: 2009 OK 61, 222 P.3d 1058
Docket Number: 
State: Oklahoma
Issuer: Oklahoma Supreme Court
Date: September 15, 2009

STATE ex rel. PROTECTIVE HEALTH SERVICES STATE DEPT. OF HEALTH v. VAUGHN Annotate this Case STATE ex rel. PROTECTIVE HEALTH SERVICES STATE DEPT. OF HEALTH v. VAUGHN 2009 OK 61 222 P.3d 1058 Case Number: 104704 Decided: 09/15/2009 As Corrected: November 16, 2009 THE SUPREME COURT OF THE STATE OF OKLAHOMA STATE OF OKLAHOMA ex rel., PROTECTIVE HEALTH SERVICES STATE DEPARTMENT OF HEALTH, Complainant, v. BERNADINE VAUGHN, Nurse Aide, Certification No. 372381800990E, Respondent. ON CERTIORARI FROM THE COURT OF CIVIL APPEALS, DIVISION I ¶0 Plaintiff, a certified nurse aide, photocopied pages of an Epworth Villa nursing home resident's medication record and provided it to the Equal Employment Opportunity Commission in support of her claim against Epworth Villa. When Epworth Villa learned of the incident, it fired the plaintiff and reported the act to the Oklahoma Department of Health. The Department of Health initiated administrative proceedings, alleging that the plaintiff had violated 42 U.S.C. §§ 1396r(e)(2), 1396r(g)(1)(C) and 42 C.F.R. §§ 483.13, 483.156, 488.301 (2003). The Administrative Law Judge found that plaintiff had violated the rules prohibiting the misappropriation of a resident's property and ordered the finding to be placed on the Oklahoma Nurse Aide Registry. The district court and the Court of Civil Appeals affirmed. This Court granted certiorari to review the issue of first impression. COURT OF CIVIL APPEALS' OPINION VACATED; DISTRICT COURT'S JUDGMENT REVERSED; CAUSE REMANDED TO DISTRICT COURT WITH INSTRUCTIONS. Mark Hammons, Tamara Gowens, Hammons, Gowens & Associates, P.C., Oklahoma City, Oklahoma, for appellant. Tom L. Cross, Deputy General Counsel, Oklahoma State Department of Health, Oklahoma City, Oklahoma, for appellee. TAYLOR, V.C.J. ¶1 The first impression issue in this case is whether a certified nurse aide's photocopying a resident's medication record and releasing it to the Equal Employment Opportunity Commission (EEOC) requires the Oklahoma State Health Department (the Department) to make a finding of misappropriation of a resident's property and place the finding on the Oklahoma Nurse Aide Registry pursuant to title 42, sections 1396r(e)(2) and 1396r(g)(1)(C) of the United States Code; title 42, sections 483.13, 483.156, and 488.301 of the Code of Federal Regulations (CFR); title 63, section 1-1951 of the Oklahoma Statutes; and sections 310:677-1-2, 310:677-7-4, and 310:677-7-4 of the Oklahoma Administrative Code (OAC). I. FACTS ¶2 The relevant facts at all stages of the proceedings, including appellate review, are undisputed. While employed by the Epworth Villa (Epworth) nursing home as a certified nursing assistant, Bernadine Vaughn filed a complaint with the EEOC, alleging racial discrimination. Thereafter and while still working at Epworth, Ms. Vaughn saw a patient's medication record on a copier. Ms. Vaughn believed that the medication record showed that Caucasian nurses had made errors for which they were not disciplined, although Ms. Vaughn had been disciplined for similar errors. Ms. Vaughn photocopied two pages of the medication record ¶3 During the EEOC proceeding, ¶4 The Department asserted that Ms. Vaughn, a certified nurse aide, "is required to comply with the rules and other applicable laws as set out in ¶5 Both Ms. Vaughn and the Department filed motions for summary judgment. ¶6 The Department filed a response and counter motion for summary judgment. It argued that the photocopied pages' content was the resident's property, that the content was confidential under the Health Insurance Portability and Accountability Act of 1996 (HIPAA); that Ms. Vaughn took the medical information without entitlement or the resident's consent and distributed it to a third party; and that Ms. Vaughn's actions constituted misappropriation of property as defined by section 310:677-1-2 of the OAC, requiring a confirmed finding of misappropriation to be placed on Ms. Vaughn's record on the Oklahoma Nurse Aide Registry (Registry). At the hearing on the motions, the Department clarified that its position is Ms. Vaughn transferred the resident's medical information to a third party. Ms. Vaughn's response to the Department's position was, among other things, that the state statutes and regulations governing the Registry cannot be extended to cover disclosures of patient information because such disclosures are governed by HIPPA. ¶7 The Administrative Law Judge (ALJ) found Ms. Vaughn "guilty of the act of misappropriation of property belonging to a Resident." He ordered that the "Nurse Aide Registry shall reflect in its official record and registry that [Ms. Vaughn] is found to have committed the act of misappropriation of property of a Resident." Ms. Vaughn petitioned for review in the district court. Without providing reason or analysis, the district court affirmed the ALJ's decision. Ms. Vaughn filed her petition in error in this Court seeking review of the district court's order. The appeal was assigned to the Court of Civil Appeals. The Court of Civil Appeals focused only on the issue of whether a person has a property right in the person's medical information and found such a right exists. Stating that Ms. Vaughn's acts were an "unauthorized disclosure" and without analyzing the other elements of misappropriation, the Court of Civil Appeals affirmed the trial court. II. STANDARD OF REVIEW AND STATUTORY CONSTRUCTION RULES ¶8 Review of an agency decision is governed by the APA, title 75, section 322. It provides that a reviewing court may set aside or modify the order, or reverse it and remand it to the agency for further proceedings, if it determines that the substantial rights of the appellant or petitioner for review have been prejudiced because the agency findings, inferences, conclusions or decisions are: (a) in violation of constitutional provisions; or (b) in excess of the statutory authority or jurisdiction of the agency; or (c) made upon unlawful procedure; or (d) affected by other error of law; or (e) clearly erroneous in view of the reliable, material, probative and substantial competent evidence, as defined in Section 10 of this act, including matters properly noticed by the agency upon examination and consideration of the entire record as submitted; but without otherwise substituting its judgment as to the weight of the evidence for that of the agency on question of fact; or (f) arbitrary or capricious; or (g) because findings of fact, upon issues essential to the decision were not made although requested. 75 O.S.2001, § 322(1). ¶9 In the present case there are no disputed facts, so we must determine if the ALJ's order was free of legal error and was within the Department's authority. Because the issue presented is purely a matter of law, we employ a de novo standard. In re Estate of Jackson, 2008 OK 83, ¶ 9,194 P.3d 1269, 1272. Such review is plenary, independent, and non-deferential. Id. The Department does not posit that there is a longstanding construction of an ambiguous or uncertain statute such that its interpretation is entitled to deference. See Bradshaw v. Oklahoma State Election Bd., 2004 OK 69, n. 5, 98 P.3d 1092 , 1094 ("An agency's longstanding construction of an ambiguous or uncertain statute will not be disturbed without cogent reason."). ¶10 This Court has consistently acknowledged: "Where it is necessary to procure a license in order to carry on a chosen profession or business, the power to revoke a license, once granted, and thus destroy in a measure the means of a livelihood, is penal and therefore should be strictly construed." State ex rel. Okla. State Bd. of Embalmers and Funeral Dirs. v. Guardian Funeral Home, 1967 OK 141, ¶ 19, 429 P.2d 732 , 736 (quoting Moore v. Vincent, 1935 OK 763, ¶ 8, 50 P.2d 388 , 389). The loss of a license which is required to work in a given field negatively impacts both a person's livelihood and reputation. Johnson v. Bd. of Governors of Registered Dentists, 1996 OK 41, ¶ 19, 913 P.2d 1339 , 1345. ¶11 Here the Department's regulations requiring a finding of misappropriation of a resident's property to be placed on the Registry deprives a certified nurse aide of the right to work as such. See Appendix B attached hereto. Such a finding is the equivalent of permanently revoking the certification since there is no statutory or regulatory limit on the employment ban, and we strictly construe the governing statutes and regulations. III. CONTROLLING FEDERAL AUTHORITY ¶12 As part of the participation in federal Medicare and Medicaid programs, title 42, section 1396r(e)(2)(A) of the United States Code requires states to establish and maintain a nurse aide registry. Section 1396r(e)(2)(B) mandates that the registry provide "for the inclusion of specific documented findings by a State under subsection (g)(1)(C) of [section 1396r] of resident neglect or abuse or misappropriation of resident property involving an individual listed in the registry, as well as any brief statement of the individual disputing the findings."12 Section 1396(g)(1)(C) requires states to "investigate and make findings concerning neglect and abuse and misappropriation of resident property by a nurse aide of a resident in a nursing facility . . . ." Misappropriation of resident property, as defined by the federal regulations, is "the deliberate misplacement, exploitation, or wrongful, temporary or permanent use of a resident's belongings or money without the resident's consent." 42 C.F.R. § 488.301 (2003). As used in the definition of misappropriation, the term "money" is self-explanatory, leaving only the term "belongings" for construction. Because the term "belongings" is not defined in title 42 of the United States Code or in the associated regulations, we turn to its plain and ordinary meaning. Garcia v. Teitler, 443 F.3d 202, 207 (2nd Cir. 2006); see Welch v. Crow, 2009 OK 20, ¶ 10, 206 P.3d 599 , 603. ¶13 The term "belongings" is defined as goods or effects. Webster's New International Dictionary of the English Language 250 (2nd ed. 1961). "Effects" means goods or moveables, id. at 818, and "goods" is defined as commodities, wares, and portable personal property. The American Heritage Dictionary 567 (2nd coll. ed. 1982). Thus, "belongings" plain meaning denotes movable items, not an intangible property right in medical information. ¶14 Based on the definition of misappropriation in title 42, section 488.301 of the CFR, federal authority does not include disclosure of medical information within the prohibition against misappropriation of a resident's property. In turn, we do not find congressional intent requires that the disclosure of medical information be listed on a nurse aide registry. Our inquiry would end here except that Ms. Vaughn injected the question of whether she had misappropriated a resident's property under the Department's regulation by quoting the definition found at OAC, section 310:677-1-2 and stating that it applies here. Bd. of Exam'rs of Veterinary Med. v. Mohr, 1971 OK 64, ¶ 26, 485 P.2d 235 , 240 ("[T]he issues in an administrative proceeding are ordinarily limited to those raised by the pleadings."). Thus, we turn to Oklahoma's statutory and regulatory laws. IV. OKLAHOMA STATUTORY AUTHORITY ¶15 In response to the federal mandate to establish a registry, Oklahoma enacted legislation which is codified at title 63, section 1-1951 of the Oklahoma Statutes and which requires the Department to establish and maintain a registry for certified nurse aides and for nurse aide trainees. 1996 Okla. Sess. Laws 1552-1554, ch. 336, § 8. The registry must provide "a process for notification and investigation of alleged abuse, exploitation or neglect of residents of a facility or home, clients of an agency or center, or of misappropriation of resident or client property." 63 O.S.Supp. 2002, § 1-1951(D)(1)(b). Statutorily, the registry must include information on any Department finding of abuse, neglect or exploitation13 by the certified nurse aide or nurse aide trainee, id. § 1-1951(D)(3)(a)(4), including the nature of the allegation, documentation of the investigation, evidence supporting the Department's decision to confirm the allegation, hearing date if one was requested, and any statement by the person disputing the finding. Id. §1-1951(D)(3)(a)(4)(a). This provision does not include a requirement that a finding of misappropriation of resident property must be posted on the registry.14 Because this proceeding is penal in nature and requires a strict construction of the statute, we will not insert such a requirement into the statute.15 ¶16 When the Department receives an allegation of abuse, exploitation or neglect, or an allegation of misappropriation of property, it is to make a note on the Registry that the allegation is pending. Id. §1-1951(D)(5). If the Department finds that the allegation was unsubstantiated, then the pending notation is removed. Id. If the Department finds that there is a basis for the allegation and gives notice, the accused may request a hearing. Id. §1-1951(D)(6). If, after the hearing, the Department finds that the accused has committed abuse, neglect or exploitation of a resident or client, or misappropriation of resident's or client's property, then the Department must send its findings to the accused, to the district attorney where the violation occurred, and to the Medicaid Fraud Control Unit of the Attorney General's Office. Id. §1-1951(D)(7). The Department must notify the accused of ineligibility to work as a nurse aide in certain nursing home type facilities and of the accused's appeal rights. Id. There is no express statutory requirement that a finding of misappropriation of property be placed on the Registry, and again we will not insert one. ¶17 The statutes require a facility to check the Registry before hiring a person to work as a nurse aide. Id. §1-1951(D)(8). The facility is forbidden to hire someone which the Registry indicates is "personally responsible for abuse, neglect or exploitation." Id. Again the statutes do not expressly prohibit a facility from employing someone who has been found to have misappropriated a resident's or client's property. V. STATE REGULATIONS ¶18 The Department has the power and duty under title 63, subsection 1-1951(A)(6) to "[e]xercise all incidental powers as necessary and proper to implement and enforce the provision of this section." Subsection 1-1951(B) requires the State Board of Health to promulgate rules to implement the provisions of section 1-1951. ¶19 The Department's definition of "misappropriation of property" deviates significantly from the federal definition found at title 42, section 488.301 of the CFR and discussed earlier in paragraphs 12 through 14. The Department defines "misappropriation of property" as the taking, misapplication, deprivation, transfer, or attempted transfer to any person not entitled to receive any property, real or personal, or anything of value belonging to or under the legal control of a resident or client without the effective consent of the resident or client or other appropriate legal authority, or the taking of any action contrary to any duty imposed by federal or state law prescribing conduct relating to the custody or disposition of a resident's/client's property. OAC, § 310:677-1-2 (Supp. 2003). ¶20 The Department argued before the ALJ that Vaughn transferred a patient's property in the form of medical information contained in the photocopied pages to the EEOC without the effective consent of the resident.16 The definition of transfer is instrumental to the Department's position. In First Nat'l Bank of Frederick v. Lamb, 1928 OK 189,¶ 14, 267 P.2d 468, 469 , this Court defined "transfer" as the passing of rights in property from one person to another, as the act of delivering or conveying property to another, or as the act of handing over or parting with certain rights in property. This Court also recognized a transfer as the removal of a thing or a right from one place or person to another, the change in control or possession, or a change in title. Id. (quoting In re Peabody, 97 P. 184 (Cal. 1908)). Transfer is also defined as "[a]n act of the parties or law by which the title to property is conveyed from one person to another." Black's Law Dictionary 1342 (5th ed. 1979). Yet another source defines transfer as "[t]o convey or shift from one person or place to another[, or] [t]o make over the possession or legal title of to another. . . ." The American Heritage Dictionary 1286 (2nd coll. ed. 1982). All of these definitions require the removal or severance of the property from one location or from one person to another. ¶21 In contrast to the Department's definition of misappropriation, federal HIPAA regulations prohibit the use and disclosure of medical information by a covered entity except under certain circumstances. 45 C.F.R. § 164.502 (2003). The definition of a covered entity is a health plan, a health care clearinghouse, or a health care provider "who transmits any health information in electronic form in connection with a transaction covered by this subchapter." Id. at 160.103(3). Disclosure is defined as "the release, transfer, provision of, access to, or divulging in any other manner of information outside the entity holding the information." Id. This definition is clear that, although transfer is one component of disclosure, disclosure also includes other methods of divulging information.17 ¶22 Here, Ms. Vaughn may have disclosed resident medical information by divulging it to the EEOC, but she did not transfer a resident's property. The evidence is that Ms. Vaughn took a resident's medical information and disclosed it to the EEOC, but there was no severance of the right to the information or of the information itself from the resident or from Epworth Villa. The Department's definition of misappropriation of property does not include the release or divulging of information. Thus the ALJ erred when it found that Ms. Vaughn had misappropriated a resident's property by transferring information to the EEOC. ¶23 Having erred in finding Ms. Vaughn had misappropriated a resident's property under OAC, section 677:310-1-2, the ALJ also erred in ordering the Registry to reflect that Ms. Vaughn had committed the act of misappropriation of a resident's property.18 VI. SUMMARY AND CONCLUSION ¶24 We find nothing in the federal statutes or regulations governing the implementation or administration of the nurse aide registry which would support a finding that Ms. Vaughn misappropriated a resident's property by photocopying some pages of a resident's medication record and providing the photocopies to the EEOC. The photocopying of medical records and providing the photocopies to the EEOC was not a transfer of a resident's property so that the disclosure would be within the definition the Department's regulation 310:677-1-2, defining misappropriation of property. Because the ALJ erred in finding Ms. Vaughn "guilty" of misappropriation of a resident's property, it was also error to order the finding placed on the Registry. ¶25 The Court of Civil Appeals' opinion is vacated. The judgment of the trial court affirming the ALJ's order is reversed. The cause is remanded to the district court with instructions to reverse and vacate the ALJ's order and enter judgment in favor of Ms. Vaughn and to order the Department to remove all references from the Oklahoma Nurse Aide Registry that Ms. Vaughn is guilty of misappropriation of property or that Ms. Vaughn is guilty of abuse on May 25, 2005. COURT OF CIVIL APPEALS' OPINION VACATED; DISTRICT COURT'S JUDGMENT REVERSED; AND CAUSE REMANDED TO DISTRICT COURT WITH INSTRUCTIONS. Edmondson, C.J., Taylor, V.C.J., Hargrave, Opala, Kauger, Winchester, Colbert, and Reif, JJ., concur. Watt, J., (by separate writing) dissents. FOOT