While it details non-compliance in meeting a court order that led to Piedmont Behavioral Healthcare being held in contempt of court, a September opinion from the NC Court of Appeals also cites the agency’s arguments that it is literally above the law, at least as far as the state’s mental health statutes are concerned.
And in ruling against PBH’s arguments that it is protected from court action by sovereign immunity, the Appeals judges added yet another interesting twist to the unique and dysfunctional chaos that is the state’s mental health system.
The Court of Appeals findings stem from a March 26, 2010, order from Davidson County District Court that PBH provide PRTF placement and other necessary services to meet the mental health needs of a minor child under DSS guardianship or to appear in court and explain why it was not meeting the order. DSS had been seeking services for the child since August 2009.
The District Court set an April 7, 2010, date for PBH to explain why it was denying services, ordering the appearance of PBH Medical Director Dr. Craig Hummel, then assistant medical director Dr. Kristin Baker, the current clinical director of PBH, or psychiatrists familiar with the case.
On April 5, PBH filed an objection that the court lacked jurisdiction since the issue of services was before the state’s Office of Adminstrative Hearings. It further noted that Hummel was out of the country, that Baker was no longer employed by PBH, that the agency had no clincical director, and that there were no treating psychiatrists familiar with the case on PBH staff.
And on April 7, they simply failed to appear.
The District Court then issued a Show Cause order, ordering then CEO Dan Couglin to appear at a June 2 hearing to show cause why the agency should not be held in contempt. At that hearing, Couglin reiterated previous reasons none of the requested parties attended the April 7 hearing, but during cross-examination testified that PBH had really done nothing to comply.
While Baker was no longer an employee, she did continue to work for the agency as a consultant. Asked if PBH could not have retained Baker’s services for the court appearance, Coughlin replied: “Theoretically, I could; whether she’d accept such an assignment or not, I don’t know.”
As for the agency’s efforts to comply with the Court’s order:
“Q: Okay. What other efforts did you make … in order to comply with the Court’s order?
Couglin: Other than?
Q. Other than just say, ‘Well, Dr. Hummel’s not in the country.’ What else did you do in order to comply with the Court’s order?
A. We didn’t do anything else.”
The court did give PBH another chance at compliance, saying it could purge itself of the contempt charge by producing Hummel or other psychiatrists to explain its original denial of service and paying a $10,000 fine, and on June 17 Hummel made the required appearance. On August 3, 2010, PBH appealed the contempt ruling and fine, that appeal being the one heard this past May by the Court of Appeals.
While the Court of Appeals upheld the lower court’s ruling of willful contempt, it did find the District Court had erred in ordering the $10,000 fine. In August, an Office of Administrative Hearings judge ruled in favor of DSS and its request for services.
While the Circuit Court’s opinion details PBH’s delays, no details are given as to what an unnecessary delay of two years from the original DSS request meant for the child’s mental healthcare.
In its appeal, PBH argued the trial court was in error in holding it in contempt since it contracts with the Division of Medical Assistance and that division’s sovereign immunity extended to it. And, it argued that since it operates under provisions of Medicaid Waivers as a managed care organization, federal rules and regulations supercede those of North Carolina’s mental health statutes, Chapter 122C.
While the arguments are interesting, the Court’s declaration that the agency is an independent contractor has the potential to further confuse the legal status of Local Management Entities in the convulted system unique to North Carolina. And that status could affect LMEs standing in contracts, their liability, and their need to comply with the Public Records Law and other statutes.
North Carolina Mental Hope