                             District of Columbia
                              Court of Appeals
No. 14-AA-328
                                                                  SEP   15 2016
MEDSTAR HEALTH, INC.,
                                  Petitioner,

        v.                                                        DOH-14-13

DISTRICT OF COLUMBIA DEPARTMENT OF HEALTH,
STATE HEALTH PLANNING AND DEVELOPMENT AGENCY, et al.,
                        Respondents.


                           On Petition for Review of an Order
             of the District of Columbia Office of Administrative Hearings

      BEFORE: EASTERLY and MCLEESE, Associate Judges; and KING, Senior Judge.

                                   JUDGMENT

              This case came to be heard on the administrative record, a certified copy of
the agency hearing transcript and the briefs filed, and was argued by counsel. On
consideration whereof, and as set forth in the opinion filed this date, it is now hereby

               ORDERED and ADJUDGED that the order issued by the Office of
Administrative Hearings (“OAH”) Administrative Law Judge, directing the State Health
Planning and Development Agency (“SHPDA”) to issue the District Hospital Partners
(“DHP”) a certificate of need, is reversed. The matter is remanded to OAH with
instructions to remand to SHPDA to determine whether to modify or retract the
certificate of need that it issued to DHP.

                                   For the Court:




Dated: September 15, 2016.

Opinion by Associate Judge Catharine Easterly.
Notice: This opinion is subject to formal revision before publication in the
Atlantic and Maryland Reporters. Users are requested to notify the Clerk of the
Court of any formal errors so that corrections may be made before the bound
volumes go to press.

              DISTRICT OF COLUMBIA COURT OF APPEALS

                                   No. 14-AA-328                         9/15/16


                       MEDSTAR HEALTH, INC., PETITIONER,

                                          v.

              DISTRICT OF COLUMBIA DEPARTMENT OF HEALTH,
   STATE HEALTH PLANNING AND DEVELOPMENT AGENCY, et al., RESPONDENTS.


    Petition for Review of a Decision of the Office of Administrative Hearings
                                  (DOH-14-13)

(Argued February 4, 2016                               Decided September 15, 2016)

      Daniel W. Wolff, with whom Kathleen M. Stratton and Laurel Pyke Malson
were on the briefs, for petitioner, MedStar Health, Inc.

      Mary L. Wilson, Senior Assistant Attorney General, with whom Karl A.
Racine, Attorney General, Todd S. Kim, Solicitor General, and Loren L. AliKhan,
Deputy Solicitor General, were on the brief, for respondent, District of Columbia
Department of Health, State Health Planning and Development Agency.

      Amandeep S. Sidhu, with whom H. Guy Collier and Mary D. Hallerman
were on the briefs, for respondent, District Hospital Partners, LP.1

      1
        We pause at the outset to discuss the identities of the parties to this appeal.
It is somewhat odd that the State Health Planning and Development Agency
(SHPDA) is the named respondent in this case. The subject of this appeal is
MedStar’s challenge to an order of the Office of Administrative Hearings (OAH)
overturning SHPDA’s decision. This court’s rules require a petitioner seeking to
                                                                        (continued…)
                                         2

      Before EASTERLY and MCLEESE, Associate Judges, and KING, Senior Judge.

      EASTERLY, Associate Judge: This case requires us to interpret the health

services planning statute, D.C. Code §§ 44-401 to -421 (2013 Repl.), which regulates

the volume and distribution of health services in the District. The statute requires

any entity seeking to offer a new health service in the District to first obtain a

certificate of need from the Statewide Health Planning and Development Agency

(SHPDA). The statute directs appeals of SHPDA’s certificate of need decisions to

the Office of Administrative Hearings (OAH). But the nature of this appellate



(…continued)
challenge an agency ruling to “specify the [agency] order . . . to be reviewed” and
to “name the agency as a respondent.” D.C. App. R. 15 (a)(3) (2016). This
suggests OAH should be the respondent to this appeal. But D.C. Code § 2-1831.16
(h) (2016 Supp.) expressly prohibits OAH from being named as “a party in any
proceeding brought by a party in any court seeking judicial review of any order of”
OAH and provides that “[o]nly the parties before [OAH] or any other party
permitted to participate . . . shall be parties in any such proceeding for judicial
review.” Thus, if any agency is to be named as a respondent, it seems SHPDA is
the only option.
       Similarly, the status of District Hospital Partners (DHP) as a respondent is
uncertain. DHP is a limited partnership between for-profit entity University Health
Services, Inc., a healthcare management company, and non-profit entity George
Washington University, which lost before SHPDA but prevailed before OAH.
This court’s rules indicate that such an entity should be an intervenor, not a
respondent. See D.C. App. R. 15 (a)(3)(B) (requiring the petitioner to “name the
agency as a respondent”); D.C. App. R. 15 (d) (providing intervention-as-of-right
to any “party to the agency proceeding” on appeal). But in the caption of its
Petition for Review by this court, MedStar designated DHP as the
“Petitioner/Respondent,” and no one has objected, at any point in this appeal, to
DHP participating as a respondent.
                                        3

review is unclear. In this case, we must determine the scope of OAH’s authority to

take new evidence and to overturn a decision made by SHPDA.



      District Hospital Partners (DHP) applied for a certificate of need to build a

new kidney and pancreas transplant facility in the District. SHPDA denied its

application and DHP appealed to OAH. OAH overturned SHPDA’s denial and

ordered it to issue a certificate of need to DHP. In this court, MedStar Health,

Inc.,2 a competing kidney and pancreas transplant provider, and SHPDA both

challenge OAH’s decision. They argue that OAH “overstepped its [statutory]

authority” by failing to give deference to SHPDA’s fact finding and conclusions.

DHP counters that OAH acted lawfully by taking new evidence and assessing the

propriety of SHPDA’s decision-making in light of the augmented record.



      The state health planning statute does not clearly specify the standard of

review OAH should employ when reviewing SHPDA’s certificate of need

decisions.   Instead, the pertinent provision, D.C. Code § 44-413, contains

seemingly conflicting language regarding the amount of deference, if any, OAH

owes to SHPDA. Interpreting this ambiguous provision, we conclude that OAH is

      2
         D.C. Code § 44-414 permits “[a]ny person” to contest, before this court, a
final decision on a certificate of need application.
                                          4

not empowered to do what it did in this case, i.e., conduct an evidentiary do-over

and effectively assume de novo decision-making authority over the issuance of

certificates of need.



         Because OAH exceeded these bounds in reviewing SHPDA’s decision to

deny DHP a certificate of need, we reverse. But we decline MedStar’s request that

we reinstate SHPDA’s order denying DHP a certificate of need.              Instead,

consistent with SHPDA’s request to this court, we remand to OAH with

instructions to remand to SHPDA so that it may determine, in light of current

circumstances, whether it should adhere to its prior denial or allow DHP’s

certificate of need to remain in place.



    I.      Overview of Certificate of Need Application and Review Process




         The Council of the District of Columbia created SHPDA to be “responsible

for health systems development in the District.” D.C. Code § 44-401 (19); see

also id. § 44-402 (b). SHPDA is statutorily required to establish, update, and

administer a Health Systems Plan, D.C. Code §§ 44-402 (b)(1), -404 (a), (e), which

is the “planning and development blueprint” for provision of health services in the

District, Bio-Medical Applications v. District of Columbia Bd. of Appeals &
                                           5

Review, 829 A.2d 208, 210 (D.C. 2003). In the Plan, SHPDA identifies health

services needs in the District and sets priorities for limitation or expansion of these

services, D.C. Code § 44-404 (a)(1)-(5), in order to “ensure that health care

resources are allocated appropriately.”3 Bio-Medical, 829 A.2d at 210 (citing D.C.

Code § 44-404 (a)). The certificate of need program, administered by SHPDA,4 is

essential to its implementation of the Plan. “[A]ll persons proposing to offer or

develop . . . a new institutional health service” must obtain a certificate of need

“prior to proceeding with that offering, development, or obligation.” D.C. Code

§ 44-406 (a).




      Pursuant to its statutory authority, SHPDA promulgated regulations setting

forth the comprehensive procedure by which applications for a certificate of need

are vetted.5 See 22-B DCMR §§ 4000.1-4599.1 (2014). First, when an entity is

planning to submit a certificate of need application, it must give notice to SHPDA,6


      3
          SHPDA is accordingly also required to gather, maintain, and analyze
comprehensive data on the District’s health services. D.C. Code §§ 44-402 (b)(2),
-405 (a), (d), (e).
      4
          See D.C. Code § 44-402 (b)(3).
      5
          D.C. Code § 44-409 (c) (requiring SHPDA to “establish, adopt, and
publish procedures and criteria for the review of certificate of need applications”).
      6
            The prospective applicant must also give public notice. 22-B DCMR
§ 4003.3.
                                        6

22-B DCMR § 4003.4, at which point SHPDA must assign a staff member to

provide the prospective applicant with “technical assistance” in preparing its

application, 22-B DCMR § 4003.6, 4003.10.          Once an entity submits an

application, SHPDA staff reviews it along with any evidence presented at a public

hearing.7    SHPDA staff then issues a “staff analysis”—a preliminary

recommendation on whether to grant a certificate of need—and transmits this

analysis, along with the application, to the Statewide Health Coordinating Council

(SHCC), an independent body of health industry stakeholders.8 22-B DCMR

§ 4303.1.   Next, SHCC, pursuant to its own statutory obligations, makes a

recommendation regarding whether to approve or deny a certificate of need. D.C.

Code § 44-403 (b)(3); see 22-B DCMR § 4303.3, 4303.7. Finally, the application,

the SHPDA staff analysis, and the recommendation of SHCC are submitted to the

SHPDA Director for his consideration. See 22-B DCMR §§ 4303.8, 4308.1 (b).


      7
          “[A]n affected person” may seek a public hearing on an application for a
certificate of need, 22-B DCMR § 4302.2, or SHPDA may call a hearing “on its
own initiative,” 22-B DCMR § 4302.1.
      8
          D.C. Code §§ 44-401 (18), -403 (c) (membership must include four health
services consumers; three public members; two representatives from health care
facilities; one physician, one nurse, and one member of the insurance industry,
each representing an unincorporated association of individuals from their
respective professions; and the director of the Department of Mental Health or his
designee). In addition to assisting SHPDA in the evaluation of certificate of need
applications, SHCC must also assist SHPDA in the development of the Health
Systems Plan. D.C. Code § 44-403 (b)(1)-(3).
                                         7

Pursuant to statutory requirements and criteria set forth in the Health Systems Plan9

and SHPDA’s regulations,10 the Director makes a decision to grant or deny the

application for a certificate of need. D.C. Code § 44-410 (c).




      The Director is required by statute to “provide . . . a detailed explanation of

any decision” in writing. D.C. Code §§ 44-409 (e), -410 (a).11 “[A]ny person”

dissatisfied with the Director’s decision may, “for good cause shown,” seek

reconsideration at a public hearing. D.C. Code § 44-412 (a). “Good cause” is

limited to:

      (1)     Presentation of significant and relevant information not previously
              considered by the SHPDA;
      (2)     Demonstration of a significant change in a factor or circumstance
              relied upon in reaching the decision;
      (3)     Demonstration of a material failure to follow SHPDA review
              procedures; or
      9
          STATE HEALTH PLANNING AND DEVELOPMENT AGENCY, DISTRICT OF
COLUMBIA DEPARTMENT OF HEALTH, STATE HEALTH PLAN 41 (2012),
http://doh.dc.gov/node/104362 (explaining that under SHPDA’s “health planning
framework,” the agency and SHCC evaluate certificate of need applications by
analyzing “six health system characteristics” of a proposed service: need,
accessibility, quality, acceptability, continuity of care, and financial viability).
      10
           See 22-B DCMR §§ 4012, 4307.
      11
           SHPDA’s regulations likewise specify that the Director must issue a
written decision, 22-B DCMR § 4308.1, containing “findings of fact,” 22-B
DCMR § 4308.2, “based on . . . the record [that] shall include SHPDA staff
research, testimony from a public hearing, and the information the applicant has
provided,” 22-B DCMR § 4308.1.
                                           8

      (4)    Presentation of another basis for a public hearing such as when the
             SHPDA determines that a hearing is in the public interest.

D.C. Code § 44-412 (b); see also 22-B DCMR § 4310.3 (interpreting the good

cause factors and explaining that “information not previously considered by

SHPDA” under D.C. Code § 44-412 (b)(1) does not include “[i]nformation that

could have been presented during the course of review with reasonable diligence”).




      If SHPDA grants reconsideration, it must hold a public hearing, D.C. Code

§ 44-412 (c); see also 22-B DCMR § 4310.4, after which SHPDA must issue a

new decision in writing “affirm[ing], modify[ing], or revers[ing]” and “giving the

basis for its decision,” D.C. Code § 44-412 (d); see also 22-B DCMR § 4310.21

(requiring the Director’s written decision after reconsideration to include “findings

of fact and conclusions of law”). This “final decision shall not be reconsidered.”

D.C. Code § 44-412 (d); see also 22-B DCMR § 4310.23 (“[This] decision shall

constitute the final decision of SHPDA for all purposes.”). But this decision does

not conclude administrative proceedings.




      The health services planning statute authorizes an “[a]dministrative appeal”

to OAH after reconsideration or if SHPDA denies or fails to timely respond to a

request for reconsideration.    D.C. Code § 44-413 (a); see also 22-B DCMR
                                           9

§ 4311.1. OAH “shall review the record and any additional evidence presented on

behalf of the parties to the appeal.” D.C. Code § 44-413 (b). In so doing, OAH

“shall take due account of the presumption of official regularity, [and] the

experience[] and specialized competence of the SHPDA.”              Id.   OAH is also

directed to conduct “[a]ny contested case hearing required by § 2-509” of the

District’s Administrative Procedure Act (APA).12 D.C. Code § 44-413 (c). Upon

completing its review, OAH must issue a “written decision,” which “shall be

considered the final decision of the SHPDA.” D.C. Code § 44-413 (b). “Any

person who contests the final decision on an application for a certificate of need

. . . is entitled to judicial review” by this court “upon filing . . . a written petition

for review pursuant to § 2-510” of the APA. D.C. Code § 44-414; see also 22-B

DCMR § 4311.2 (acknowledging that “after exhausting all administrative remedies

including an appeal to [OAH],” “[a] person adversely affected by a SHPDA

decision may appeal” to this court).




      12
           D.C. Code §§ 2-501 to -510 (2016 Supp.).
                                         10

                       II.    Facts and Procedural History




      In late 2012, DHP submitted a lengthy application for a certificate of need to

allow it to establish a new kidney and pancreas transplant facility.13 In early 2013,

SHPDA held a public hearing on the application. DHP presented testimony from

nine witnesses in an effort to demonstrate that there was a need for a new

transplant facility, and in particular, that its proposed transplant program would

increase the number of donors (and thus available organs) and expand access to

transplant services in the District. After DHP concluded its presentation, affiliates

of petitioner MedStar, which was the District’s only provider of kidney and

pancreas transplants to “non-military, non-pediatric” patients, voiced its

opposition.14     MedStar’s witnesses explained that, although there was

unquestionably a high demand for kidney and pancreas transplants in the District,

the impediment to meeting that demand was a shortage of organs, rather than a

shortage of transplant services.    They further questioned whether DHP could

increase organ donation rates locally, contrary to national trends, and indicated that


      13
           The application was 109 pages with 326 pages in attachments.
      14
         At that time, MedStar’s transplant program, the MedStar Georgetown
Transplant Institute, operated out of two separate facilities in the District:
Washington Hospital Center and Georgetown University Hospital.
                                         11

even if the supply of organs available for transplant increased, MedStar could meet

the corresponding demand for services.




      SHPDA staff concluded that DHP had failed to demonstrate a need for a

new kidney and pancreas transplant facility in the District, particularly in light of

the shortage of transplantable organs, and issued a twenty-seven-page report that

recommended denying DHP a certificate of need. Subsequently, a committee of

SHCC reviewed the application and held its own public hearing, at which a central

focus was on DHP’s ability to enlarge the pool of organ donors through

community outreach.      At the conclusion of the hearing, a majority of the

committee voted to conditionally recommend granting DHP a certificate of need;

SHCC, without discussion, orally voted to adopt the committee’s conditional

recommendation. SHCC did not issue a written report.




      The SHPDA Director then reviewed DHP’s application for a certificate of

need (including supplemental materials submitted after the SHPDA staff and
                                         12

SHCC hearings15), SHPDA’s staff analysis, and SHCC’s recommendation, and he

issued his findings in May 2013. In a thirty-page decision, he concluded that DHP

had met all but one of SHPDA’s criteria16 for grant of a certificate of need for its

proposed facility: DHP had not demonstrated that the already-available facilities

in the District were inadequate to meet the demand for transplant services as

limited by the supply of organs. He explained that DHP had failed to demonstrate

that it could sufficiently increase the number of organ donations, particularly from

living donors, so as to justify the establishment of a new transplant facility. Thus,

the Director denied DHP’s application for a certificate of need.




      DHP requested reconsideration of the Director’s decision, asserting that

there was “good cause” under all four permissible grounds listed in D.C. Code

§ 44-412 (b). DHP attached a number of exhibits to support its request, including a

2011 research report, a community outreach plan for 2014-15, and a letter of

commitment by a managed care business that promised to direct its patients to



      15
          Among DHP’s materials was a Memorandum of Understanding between
DHP and the Minority Organ and Tissue Transplant Education Program; the two
entities pledged to work together to do community outreach to promote organ
donation.
      16
           See supra notes 9, 10.
                                        13

DHP for transplant services.17 The Director denied DHP’s request, concluding that

it had failed to show good cause and reiterating his assessment that DHP had not

“demonstrated how it will be able to obtain the organs.” He noted that deceased

donor transplants in the District and around the country have remained stable, and

that “living donor transplants have been declining.”




      DHP appealed to OAH. MedStar moved to intervene in the appeal, but an

OAH Administrative Law Judge (ALJ) denied MedStar’s request.18 OAH only

accepted briefing and evidence from DHP as the petitioner and SHPDA as the

respondent.




      17
          Although the Director acknowledged this evidence in his reconsideration
decision, he had no obligation to do so under SHPDA’s regulations because it all
could have been submitted with DHP’s initial application. See 22-B DCMR
§ 4310.3 (a).
      18
          OAH regulations do not provide for intervention as of right, even to
parties that participated in the agency proceeding on appeal at OAH. See 1 DCMR
§ 2816.2 (2010) (amended 2016). It seems problematic for OAH, in conducting an
administrative appeal of a SHPDA decision, to deny intervenor status to a party
who participated in SHPDA proceedings and has a concrete interest in the
certificate of need decision. As OAH’s decision has not been challenged on this
basis, however, we do not address it.
                                       14

      The parties preliminarily litigated whether DHP could submit new evidence

to OAH. SHPDA moved in limine to exclude any new evidence, arguing that

permitting new evidence would “vitiate the deference this Administrative Court is

required by statute and case law to give to SHPDA,” and noting that all the

information proffered in DHP’s prehearing statement could have been presented in

the SHPDA proceedings. DHP opposed SHPDA’s motion, arguing that OAH was

authorized by D.C. Code § 44-413 to “review the record and any additional

evidence presented on behalf of the parties to the appeal.”      The OAH ALJ

concluded that DHP’s understanding of D.C. Code § 44-413 comported with the

“plain meaning” of the statute and denied SHPDA’s motion. Thus, at the OAH

hearing, the ALJ allowed DHP to present a variety of evidence not previously

presented to SHPDA. This included both documentary evidence and testimonial

evidence from some witnesses who were testifying anew and others who had not

previously testified.




      The OAH ALJ issued a “Final Order” in January 2014. At the outset of her

order she stated that in compliance with D.C. Code § 44-413 (b), she would

“review the record and any additional evidence presented on behalf of the parties”

and “take due account of the presumption of official regularity, the experience,

and specialized competence of the SHPDA.” The OAH ALJ further stated that her
                                           15

objective was only to determine if SHPDA’s denial of a certificate of need was

“arbitrary, capricious, an abuse of discretion or otherwise not in accordance with

the law.”19 But thereafter she made “findings of fact and conclusions of law”

“[b]ased on the testimony of the witnesses, [her] evaluation of their credibility, the

documents admitted into evidence and the entire record.” The OAH ALJ found

that the new evidence DHP had presented on appeal “better clarified” its argument

that, if granted a certificate of need, it would be able to increase kidney donation

rates. She ultimately concluded that DHP had “presented substantial evidence of

need [for a new transplant facility] and SHPDA’s conclusion to the contrary can no

longer be supported.” Accordingly, the OAH ALJ reversed and ordered SHPDA

to issue a certificate of need to DHP.20




      After SHPDA moved for and was denied reconsideration by OAH, MedStar

filed a petition for review in this court. In their initial briefs, MedStar and DHP

addressed21 whether SHPDA’s decision to deny a certificate of need was

      19
          For this proposition, the OAH ALJ cited Brown v. Watts, 993 A.2d 529,
532 (D.C. 2010), but that case discussed this court’s review of a decision by the
Office of Employee Appeals (OEA), not OAH’s review of a decision by SHPDA.
      20
            In compliance with the OAH ALJ’s order, SHPDA issued DHP a
certificate of need in April 2014.
      21
           SHPDA did not participate in the initial briefing in this court.
                                       16

reasonable and supported by substantial evidence; whether OAH had improperly

substituted its judgment for that of SHPDA; and whether OAH’s decision that

DHP had demonstrated a need for a new pancreas and kidney transplant facility

was “supported by reliable, probative, and substantial evidence.” At this court’s

request, MedStar, DHP, and SHPDA submitted supplemental briefs specifically

addressing “the relationship between SHPDA and OAH, and in particular (a) the

scope of OAH’s fact-finding ability, and (b) OAH’s standard of review for

SHPDA’s decisions regarding Certificates of Need.”




      In their supplemental briefs, MedStar and SHPDA assert that OAH does not

possess broad authority to reopen the record and that it may only review new

evidence “rarely, for compelling reasons like illuminating or explaining SHPDA’s

decision . . . and ascertaining whether SHPDA complied with the applicable

procedural requirements where the existing record is inadequate.” MedStar and

SHPDA further argue that OAH should defer to SHPDA, the expert body, and

review its decisions only to ensure they are supported by substantial evidence and

are not arbitrary or capricious. DHP counters that OAH is entitled to hear “all

evidence a party wishes to present to OAH, in addition to whatever evidence that

party . . . presented during SHPDA’s review.” DHP also argues that OAH is

“statutorily required” to make independent findings of fact because the health
                                            17

services planning statute characterizes the OAH proceeding as a “contested

case,”22 which, by definition, must be resolved with written “findings of fact and

conclusions of law,” D.C. Code § 2-509 (e).




                                     III.   Analysis




      This case comes to this court pursuant to D.C. Code § 44-414, which

authorizes “[a]ny person who contests the final decision on an application for a

certificate of need” to obtain judicial review under the APA, “after the exhaustion

of all administrative remedies.” The scope of our review under the APA turns on

the nature of the issues raised on appeal.23 MedStar and SHPDA argue that OAH

acted in excess of its statutory authority under D.C. Code § 44-413 because, rather

than deferring to SHPDA’s decision-making, it took new evidence and considered

anew whether DHP should be given a certificate of need. DHP counters that,

whatever deference OAH owes SHPDA, this deference cannot override OAH’s




      22
           D.C. Code § 44-413 (c).
      23
           See D.C. Code § 2-510 (a)(3) (listing several standards available to this
court for reviewing agency action).
                                          18

authority to hear “any additional evidence.”24 Because the dispute between the

parties in this case requires us to decide the proper interpretation of a statute, a

question of law, our review is de novo. See District of Columbia Office of Tax &

Revenue v. Shuman, 82 A.3d 58, 69 (D.C. 2013); see also D.C. Code § 2-510 (a)(3)

(authorizing this court to set aside agency decisions that are “not in accordance

with law” and that are made “[i]n excess of statutory . . . authority”).




      24
           In its supplemental brief, DHP also argues that this case is moot because,
in December 2014, SHPDA issued a “Letter of Completion,” which terminates the
certificate of need review process. See 22-B DCMR § 4006.6, 4006.7. We
disagree. Once SHPDA had complied with the OAH order and issued DHP a
certificate of need—after a petition for review was filed with this court, and after
we had denied SHPDA’s motion for a stay—SHPDA had no authority, in the
absence of a directive from this court, to take further action and terminate the
certificate of need review process with a Letter of Completion. See D.C. Code § 2-
510 (a) (“Upon the filing of a petition for review, the Court shall have jurisdiction
of the proceeding . . . .”). Additionally, DHP argues that this case is moot because
DHP’s facility has been developed and is “fully operational.” This argument also
fails. By commencing operations while its certificate of need was still under
judicial review and therefore vulnerable to revocation or modification, DHP
proceeded “solely at its own risk” of being shut down for lack of proper
authorization to operate. See 22-B DCMR § 4000.4; cf. D.C. Code § 44-409 (j);
22-B DCMR § 4006.1, 4006.6 (prohibiting operation of facility without
certification from SHPDA that it is “in compliance with the [certificate of need]
requirements”).
                                        19

      A. OAH’s Reviewing Authority under the Health Services Planning
         Statute




      We begin our analysis with the plain language of D.C. Code § 44-413. See

District of Columbia Office of Tax & Revenue v. Sunbelt Beverage, LLC, 64 A.3d

138, 145 (D.C. 2013). Section 44-413 (a) sets forth standing and exhaustion

requirements for seeking review by OAH.         Section 44-413 (b) contains rules

governing OAH’s review. Specifically, it directs that OAH “shall review the

record and any additional evidence presented on behalf of the parties to the appeal”

and “shall take due account of the presumption of official regularity, [and] the

experience[] and specialized competence of the SHPDA.” Section 44-413 (b)

further provides that OAH’s decision “shall be considered the final decision of the

SHPDA.” Lastly, section 44-413 (c) states that “[a]ny contested case hearing

required by [D.C. Code] § 2-509, shall be conducted by” OAH.




      We note at the outset that the Council, in drafting D.C. Code § 44-413, did

not use familiar standard-of-review language to explain the scope of an agency’s
                                        20

reviewing authority.25 The statute does not say whether OAH is empowered to

decide de novo whether a certificate of need should be issued, or instead whether

OAH owes some amount of deference to SHPDA’s decision-making and, if so, by

what measure.




      Arguably, the directive that OAH take “any additional evidence” suggests

that it can make independent findings of fact, an element of de novo review in the

agency context. See 6 JACOB A. STEIN ET AL., BENDER’S ADMINISTRATIVE LAW §

51.04, at 308-09 (2016). And we recognize that holding evidentiary hearings and

making de novo decisions are common functions of OAH in the District’s

administrative system, typically when it provides the first opportunity to be heard

after a regulatory agency has already made a less formal adjudicative




      25
          See, e.g., D.C. Code § 2-360.03 (a) (designating the Contract Appeals
Board as the “exclusive hearing tribunal” for protests of solicitations or awards of
government contracts and defining its review as “de novo”); id. § 2-510 (a)(3)
(enumerating the limited grounds on which this court may “hold unlawful and set
aside” an agency decision); id. § 8-101.05h (2016 Supp.) (providing that in air
pollution control cases OAH “shall provide a de novo hearing and shall determine
whether the [regulatory agency’s] action was legally proper”); id. § 38-
1802.13 (c)(6)(B) (2013 Repl.) (directing that “[a] decision by an eligible
chartering authority to revoke a charter shall be upheld” by a reviewing court
“unless the decision is arbitrary and capricious or clearly erroneous”).
                                        21

determination.26




      But other language in D.C. Code § 44-413 points in a different, more

deferential direction. First, the statute does not permit OAH to clean the factual

slate; rather, OAH must “review the record” developed before SHPDA. D.C. Code

§ 44-413 (b). Second, suggesting that OAH is not broadly authorized to augment

the record so that it can assess for itself whether a certificate of need should be

issued, OAH must “take due account of the presumption of official regularity,

[and] the experience[] and specialized competence of the SHPDA.”27 Id. Third,

the statute characterizes the proceeding before OAH as an “appeal” from “the final

[SHPDA] decision.” D.C. Code § 44-413 (a), (b). At least in judicial proceedings,




      26
        See, e.g., D.C. Code § 7-2341.17 (2013 Repl.) (appeals of Department of
Health suspension or revocation of a license or certification for provision of
emergency medical services); id. § 8-101.05h (appeals of Department of the
Environment penalties for violations of the District’s air pollution control
program); D.C. Code § 47-4312 (2016 Supp.) (appeals of Office of Tax and
Revenue proposed tax assessments).
      27
           Our cases provide no guidance on the amount of deference that
corresponds, in the administrative context, to “due account.” But analogous
language in other contexts, such as the “due regard” this court gives to a trial
court’s credibility determinations, indicates that the “due account” clause steers
OAH review in a deferential direction. See, e.g., Jenkins v. Strauss, 931 A.2d
1026, 1032 (D.C. 2007).
                                          22

an appeal is not a forum for new fact-finding28 or first-hand decision-making;29

rather, the appellate inquiry is whether an already-made decision withstands some

level of scrutiny based on the already-developed record.




      In light of its omission of familiar standard-of-review language and its

inclusion of facially conflicting directives, we conclude that the plain language of

D.C. Code § 44-413 is ambiguous.          Thus, to discern OAH’s proper role in

reviewing SHPDA’s certificate of need decisions—i.e., whether OAH owes any

deference to SHPDA and if so, how much—we “broaden our inquiry to examine

the statute as a whole, pertinent case law, and the legislative history.”30 District of

      28
           See Hamilton v. Hojeij Branded Food, Inc., 41 A.3d 464, 473 (D.C.
2012) (explaining that in reviewing a decision arising from agency adjudication,
“[i]t is incumbent upon [the reviewing tribunal] . . . to eschew appellate fact-
finding”).
      29
         See Dankman v. District of Columbia Bd. of Elections & Ethics, 443 A.2d
507, 524 n.15 (D.C. 1981) (en banc) (Ferren, J., concurring in the result)
(“Ordinarily, in reversing administrative agency rulings, we should merely declare
the law and remand for the agency to proceed in light of our decision.”).
      30
          Once we have determined that an administrative statute is ambiguous, we
may defer to an agency’s interpretation of that ambiguity. Nunnally v. District of
Columbia Metro. Police Dep’t, 80 A.3d 1004, 1010 (D.C. 2013) (citing Chevron,
U.S.A., Inc. v. Nat. Res. Def. Council, 467 U.S. 837, 842-43 (1984)). But here, it is
not readily apparent that we have an agency interpretation of D.C. Code § 44-413
that is entitled to deference. Recognizing that this court is the “final authority on
issues of statutory construction,” the degree of our deference, if any, to an agency
interpretation turns on whether it is reasonable, consistent with the legislature’s
                                                                       (continued…)
                                          23




(…continued)
intent, and within the scope of the agency’s delegated, expert decision-making so
as to merit deference. See id. at 1010-1012; United States v. Mead Corp., 533 U.S.
218, 227-28 (2001) (“The fair measure of deference to an agency administering its
own statute has been understood to vary with circumstances, and courts have
looked to the degree of the agency’s care, its consistency, formality, and relative
expertness, and to the persuasiveness of the agency’s position.”) (noting that
“agencies charged with applying a statute necessarily make all sort of interpretive
choices” and “not all of those choices bind judges to follow them”).
       We might defer to SHPDA’s interpretation of D.C. Code § 44-413, as
SHPDA argues we should. But SHPDA’s expertise is in health services planning;
it is not an expert in administrative review, the subject matter of § 44-413.
Moreover, even if we were to defer to SHPDA on this issue, it is not clear how
much weight we would give to SHPDA’s interpretation of this statute as
articulated in the brief submitted on its behalf by the Office of the Attorney
General. See Euclid Street, LLC v. District of Columbia Water & Sewer Auth., 41
A.3d 453, 460 & n.8 (D.C. 2012) (“[C]ourts ‘have declined to give deference to an
agency counsel’s interpretation of a statute where the agency itself has articulated
no position on the question.’” (quoting Bowen v. Georgetown Univ. Hosp., 488
U.S. 204, 212 (1988))); Washington Gas Light Co. v. Pub. Serv. Comm’n, 982
A.2d 691, 711 n.80 (D.C. 2009) (citing Bowen, 488 U.S. at 212, for the proposition
that courts do not defer to agency positions “taken for the first time in a brief”); cf.
Johnson v. District of Columbia Dep’t of Emp’t Servs., 111 A.3d 9, 11 (D.C. 2015)
(“In a Chevron analysis, consistent and longstanding agency interpretations, such
as those enacted in regulations, merit the most deference.”).
       Alternatively, we might defer to OAH, the agency charged with actually
administering § 44-413. But all we have from OAH addressing the scope of its
reviewing authority over SHPDA is a single ALJ’s decision in which she
announced her review would be deferential but then effectively reviewed DHP’s
certificate of need application de novo.
       Ultimately, we need not address how much, if any, deference either SHPDA
or OAH should receive. This court defers only to an agency’s reasonable
interpretation of its operative statute, and as we explain, the statute cannot
reasonably be interpreted to permit OAH to conduct an evidentiary do-over as it
did in this case. See District of Columbia Office of Tax & Revenue v. BAE Sys.
Enter. Sys., 56 A.3d 477, 481 (D.C. 2012).
                                           24

Columbia v. Reid, 104 A.3d 859, 868 (D.C. 2014).




      Considering first whether OAH owes any deference to SHPDA, we conclude

that it does. Examining the health services planning statute as a whole, we see that

SHPDA is the statutorily designated expert body “for health systems development

in the District.” D.C. Code § 44-402 (b). It is SHPDA’s job to closely monitor

healthcare needs and the provision of medical services in the District, to collect

and analyze associated data, and to develop and implement a responsive Health

Systems Plan. See D.C. Code §§ 44-402 (b)(1)-(2), -404 (a), -405 (a). SHPDA’s

ability to effectively oversee and shape the District’s health services landscape, as

it is statutorily required to do, is inextricably linked to its authority to grant or deny

certificates of need—this is a key mechanism SHPDA uses to expand or limit the

availability of a health service in the District. See D.C. Code § 44-402 (b)(3).

Moreover, because granting or denying a certificate of need impacts the entire

community,31 SHPDA must ensure that these decisions not only advance its policy



      31
           Although SHPDA’s certificate of need decisions are technically
adjudicative in nature, directly affecting only the individual applicant’s rights to
develop a new facility, the considerations behind and impacts of these decisions
are much broader. Cf. Donnelly Assocs. v. District of Columbia Historic
Preservation Review Bd., 520 A.2d 270, 277-78 (D.C. 1987) (distinguishing
adjudicative agency actions, which are “directed at the rights of specific
                                                                     (continued…)
                                         25

goals but also balance the interests of the applicant, existing providers, District

residents, and any other “affected person” who seeks to participate in the review

process.32 SHPDA “has been entrusted with the difficult task of deciding among

many competing arguments and policies,” and SHPDA’s expertise in this

“complex, esoteric” area of regulation is of the sort that induces the highest levels

of deference. See Office of People’s Counsel v. Pub. Serv. Comm’n, 610 A.2d 240,

243 (D.C. 1992) (explaining that because the Public Service Commission’s

ratemaking decisions involve a “complex, esoteric” area of regulation, the statute

permits only the “narrowest [judicial] review”).33




(…continued)
individuals,” from “policy decision[s],” which are “directed toward the general
public”).
      32
          See D.C. Code § 44-412 (a) (permitting “any person” the opportunity to
request reconsideration of a certificate of need decision); 22-B DCMR § 4302.2
(requiring SHPDA to call a public hearing on a certificate of need application if
any “affected person” so requests). By contrast, OAH has no obligation to accept
input from the public, from industry stakeholders, or even from any party that
participated in SHPDA’s certificate of need review. See 28 DCMR § 2816.2.
      33
           See also, e.g., Kamit Inst. for Magnificent Achievers v. District of
Columbia Pub. Charter Sch. Bd., 55 A.3d 894, 899 (D.C. 2012) (acknowledging
special deference owed to the Public Charter School Board in light of its expertise
in education policy); cf. MorphoTrust USA, Inc. v. District of Columbia Contract
Appeals Bd., 115 A.3d 571, 582 (D.C. 2015) (holding that the Contract Appeals
Board, the expert appellate agency, was required to conduct de novo review and
not defer to non-expert executive decision-makers); Union Dominion Mgmt. Co. v.
District of Columbia Rental Hous. Comm’n, 101 A.3d 426, 430 (D.C. 2014)
                                                                    (continued…)
                                        26

      The alternative, reading the statute not to require any OAH deference to

SHPDA’s decision, would make little sense, as OAH is a generalist body with no

subject-matter expertise in the provision of health care services in the District.34

Reading the statute to not require deference would also yield an extremely

inefficient regulatory scheme.   The Council gave SHPDA broad discretion to

design as comprehensive a process as necessary for thoughtful consideration of

certificate of need applications.35 See D.C. Code § 44-409 (c) (containing no

limitations on SHPDA’s authority to design the process for reviewing certificate of

need applications). Additionally, the Council mandated that SHCC review each

certificate of need application and submit a recommendation to SHPDA. D.C.

Code § 44-403 (b). We do not think the Council meant to authorize such a

resource-intensive review process at the SHPDA level—whereby the SHPDA


(…continued)
(holding that the Rental Housing Commission, an expert agency, should not defer
to determinations of an OAH ALJ).
      34
          See District of Columbia Dep’t of the Env’t v. E. Capitol Exxon, 64 A.3d
878, 881 (D.C. 2013) (acknowledging that OAH reviews decisions by many
different agencies); Shuman, 82 A.3d at 69 (declining to impute to OAH “the
degree of expertise possessed by more specialized administrative bodies”).
      35
           SHPDA developed a comprehensive process, see, e.g., 22-B DCMR
§§ 4302.1, 4302.2 (providing for a public hearing at SHPDA); id. § 4303.1
(requiring SHPDA staff review application and submit analysis to SHPDA
Director)—one that begins even before an application has been submitted, see id.
§ 4003.6, 4003.10 (designating a SHPDA staff member to provide prospective
applicants with “technical assistance” in preparing application).
                                          27

Director obtains the recommendations of both its staff and SHCC, after each

conducts its own independent review and holds public hearings to get input from

interested parties—and then allow OAH to scrap the result of that process, conduct

an evidentiary do-over, and decide anew whether to issue or deny a certificate of

need.



        Indeed, there are affirmative indicators in the statute that the Council does

not want OAH to disregard all of the work culminating in SHPDA’s decision.

First, the directive in D.C. Code § 44-413 that OAH “shall take due account of the

presumption of official regularity, [and] the experience[] and specialized

competence of the SHPDA” is some indication that OAH should give substantial

weight to all that has transpired at the SHPDA level. Second, before OAH may

even conduct its “appellate” review, the health services planning statute requires

that any person dissatisfied with SHPDA’s decision first go back to SHPDA and

attempt to show good cause for reconsideration, which includes new evidence and

changed circumstances. D.C. Code §§ 44-412, -413.36 This obligation to seek



        36
           See also Bio-Medical, 829 A.2d at 214 (“A party who wishes to challenge
. . . a [certificate of need] decision ‘may not bypass the reconsideration process.’”
(quoting Capitol Hill Hosp. v. District of Columbia State Health Planning & Dev.
Agency, 600 A.2d 793, 799 n.14 (D.C. 1991))); id. at 214 (highlighting the integral
role that requests for reconsideration play in the administrative appeal process for
                                                                       (continued…)
                                         28

reconsideration upon a showing of good cause is not simply an exhaustion

requirement; by channeling factual presentations and substantive arguments to

SHPDA in the first instance, the Council signaled that it intended SHPDA to be the

primary decision-maker.




      On the other side of the ledger, we see no indication that the Council

intended to elevate the decision-making authority of OAH over that of SHPDA. It

would be unusual to give OAH de novo reviewing authority over agency decisions

regarding matters within that agency’s technical expertise.37        Were this the

Council’s intent, one might well expect some discussion in the legislative history.

Instead, there is legislative silence. Even the reason for OAH’s involvement in the

(…continued)
certificates of need, and the fact that D.C. Code § 44-412 (d) refers to SHPDA’s
decision on reconsideration as its “final decision” on the application).
      37
           Instead, when OAH interacts with other District agencies with subject-
matter expertise, either OAH defers to the agency, see, e.g., E. Capitol Exxon, 64
A.3d at 881 (holding that OAH must defer to the District of Columbia Department
of the Environment’s interpretation of the laws and regulations it administers, as
reflected in its charging decisions), or the roles are reversed and OAH is the first-
level adjudicator, over whom the expert agency has appellate reviewing authority,
see, e.g., D.C. Code §§ 2-1831.03 (b-1) (authorizing OAH ALJs to serve the Rent
Administrator’s function), 42-3502.02 (a)(2) (2013 Repl.) (providing that OAH
decisions made under authority to act as Rent Administrator are subject to review
by the Rental Housing Commission); see also D.C. Code § 2-1831.16 (b) (allowing
certain agencies for which OAH conducts hearings to retain jurisdiction to review
OAH orders on appeal).
                                         29

certificate of need program is unexplained.38 There is certainly no indication that

OAH’s review was meant to be a central component of the District’s certificate of

need program—which would be the effect of giving OAH the authority to conduct

de novo review.




      Having concluded that OAH must defer to SHPDA’s certificate of need

decisions, we must still make sense of the statutory language that OAH “shall”

consider “any additional evidence” beyond the administrative record, even as it

conducts its review with “due account of the presumption of official regularity,

      38
            As best we can tell, OAH’s role appears to be a holdover from the
District’s first health services planning statute. That statute was enacted in 1978 so
that the District could qualify for federal funding. Under a then-applicable federal
statute, certificate of need decisions had to be appealable to an independent
administrative agency. National Health Planning and Resources Development Act
of 1974, Pub. L. No. 93-641, § 13 (A), 88 Stat. 2225 (1975) (repealed 1986). To
comply with this requirement, the Council designated OAH’s predecessor, the
Board of Appeals and Review, to review SHPDA’s decisions (though notably, it
said nothing about the Board’s standard of review or authority to hear new
evidence). See District of Columbia Certificate of Need Act, D.C. Law 2-43, § 10
(1978) (repealed 1980); Comm. on Human Resources & Aging, D.C. Council,
Report on Bill 2-54 at 1, 10 (July 7, 1977). Although the 1978 health services
planning statute was subsequently repealed (and two successor statutes were also
repealed), the Council, without discussion, retained the administrative appeal
component when it passed the iteration of the District’s health services planning
statute that is in force today. See Health Services Planning Program Re-
Establishment Act of 1996, D.C. Law 11-191, § 14 (1996) (amended 1997, 2005)
(current version at D.C. Code §§ 44-401 to -421); Comm. on Human Services,
D.C. Council, Report on Bill 11-86 at 8 (May 2, 1996).
                                         30

[and] the experience[] and specialized competence of the SHPDA.” D.C. Code

§ 44-413 (b).    We consider only whether OAH’s authorization to hear any

additional evidence permitted it to do what it did here, i.e., conduct an evidentiary

do over. 39




      If OAH can hear any evidence without limitation, even evidence on the

merits of the certificate of need decision that was previously available and could

have been presented to SHPDA, it effectively becomes a co-equal decision-maker

regarding the issuance of certificates of need. But we see no support for that

conception of OAH’s role.       As detailed above, SHPDA is the expert body

regarding state health planning; OAH is not.       Moreover, except for the “any

additional evidence” provision in D.C. Code 44-413(b), the statutory scheme puts

OAH in a reviewing posture, and one that is deferential at that. Relatedly, there is

no indication in the legislative history that the “additional evidence” provision was


      39
           We leave for another day questions such as whether the state health
planning statute permits OAH to (1) hear new evidence, not reasonably available
when SHPDA ruled, to determine whether the case should be remanded to SHPDA
for further consideration rather than decided outright on the record before SHPDA;
(2) consider whether undisputed new evidence, not previously available, would
compel any reasonable decision-maker to rule for one party; or (3) take new
evidence if SHPDA either unreasonably refused to hear that evidence or if
SHPDA’s regulations do not permit presentation of that evidence.
                                       31

intended to transform OAH into a first-line fact-finder or co-equal decision-maker

with SHPDA.40




      Thus we conclude that OAH may not effectively retry a certificate of need

decision by hearing evidence that could have been but was not submitted to

SHPDA. At least where there is no new or newly available evidence on the merits

of SHPDA’s decision, OAH’s review must resemble this court’s standard of

review under the APA. See D.C. Code § 2-510 (a)(3)(A), (E). Accordingly, OAH

should “defer to [a SHPDA] decision so long as it flows rationally from the facts

and is supported by substantial evidence.” See Durant v. District of Columbia

Zoning Comm’n, No. 15-AA-979, 2016 WL 3031384, at *2 (D.C. May 26, 2016)

(quoting Levy v. District of Columbia Rental Hous. Comm’n, 126 A.3d 684, 688

(D.C. 2015)); see also D.C. Code § 2-510 (a)(3)(E). OAH should also assess

whether SHPDA’s decision is “[a]rbitrary, capricious, an abuse of discretion, or

      40
          These provisions first appeared, without any explanation, in the 1980
health services planning statute—the second iteration of this law. See Comm. on
Human Services, D.C. Council, Report on Bill 3-289 at 14 (May 29, 1980);
compare D.C. Law 2-43, supra note 38, § 10, with District of Columbia Certificate
of Need Act of 1980, D.C. Law 3-99 § 10 (b) (1980) (repealed 1992). Although the
1980 statute was later repealed, Health Services Planning Program Act of 1992,
D.C. Law 9-197, § 22 (1992) (repealing D.C. Law 3-99, supra note 38), this
language reappeared, again without explanation, when the law was reinstated, see
D.C. Law 11-191, supra note 38, § 14.
                                         32

otherwise not in accordance with law.” See D.C. Code § 2-510 (a)(3)(A). This

limitation on OAH’s ability to take additional evidence preserves SHPDA’s

decision-making authority within the area of its expertise. See Axiom Res. Mgmt.

v. United States, 564 F.3d 1374, 1380 (Fed. Cir. 2009) (explaining that “limiting

review to the record actually before the agency . . . guard[s] against . . . using new

evidence to convert the [deferential] ‘arbitrary and capricious’ standard into

effectively de novo review”).      And this limitation appears to align with the

reviewing authority exercised by the Board of Appeals and Review, OAH’s

predecessor, when it reviewed SHPDA decision-making.41 See Bio-Medical, 829

A.2d at 213, 216 (noting that the Board of Appeals and Review affirmed SHPDA’s

decision because it “was supported by the evidence and was not materially

inconsistent” with the draft Health Systems Plan).




      B. OAH’s Order to Issue a Certificate of Need to DHP


      Having clarified OAH’s standard of review of SHPDA decisions as well as
      41
          This conclusion is not in tension with D.C. Code § 44-413 (c), which
DHP incorrectly reads as a directive to OAH to hold a full-blown evidentiary
hearing in every administrative appeal of a SHPDA decision. Section 44-413 (c)
provides only that when OAH holds a contested case hearing, it must follow the
procedures set forth in D.C. Code § 2-509; it does not speak to OAH’s authority to
conduct such hearings.
                                        33

its evidence-gathering authority, we turn to the review it conducted in this case.

Under the standards set forth above, it is clear that OAH exceeded its statutory

authority.   The OAH ALJ did not limit herself to the administrative record

developed before SHPDA.        Instead, her review was in effect de novo; it

incorporated evidence from DHP—some new, some repackaged, but all previously

available—regarding the merits of its application. And rather than deferring to

SHPDA’s decision, the OAH ALJ made her own determination that DHP had

“presented substantial evidence of need” for a new transplant facility and thus

should receive a certificate of need.     Because OAH exceeded its reviewing

authority, we must reverse.




                                IV.   Conclusion




      For the foregoing reasons, we reverse the OAH ALJ’s order directing

SHPDA to issue DHP a certificate of need. Ordinarily, if an agency fails to

employ the proper standard of review, as OAH did in this case, we remand to the

agency to conduct its review anew under the correct standard. See, e.g., E. Capitol

Exxon, 64 A.3d at 882. But recognizing that a substantial amount of time has

passed since SHPDA, at the direction of OAH, issued the certificate of need, and
                                         34

with the understanding that DHP is currently operating its transplant facility, we

remand to OAH with instructions to remand this matter to SHPDA to determine

whether to modify or retract the certificate of need that it issued to DHP. See, e.g.,

District of Columbia Dep’t of Emp’t Servs. v. Smallwood, 26 A.3d 711, 716 (D.C.

2011) (remanding to OAH with instruction to remand to expert agency for further

proceedings).




                                                    So ordered.
