The Fifth Circuit Court of Appeals held Thursday that the Department of Health and Human Services violated established administrative law principles by shifting its justification for denying a physician's request to reconsider an adverse administrative action.
In *Doe v. HHS* (5th Cir. 2025), Dr. John Doe, who holds both medical and doctoral degrees, challenged the Department's handling of his petition to remove an Adverse Action Report from his National Practitioner Data Bank file. The three-judge panel, consisting of Circuit Judges Haynes, Ho, and Oldham, unanimously found that HHS's changing position violated the Chenery principle.
Circuit Judge Andrew S. Oldham, writing for the court, explained that Dr. Doe initially requested HHS to reconsider an administrative action regarding his file. The Department initially denied the request on eligibility grounds, stating that Dr. Doe was not eligible for reconsideration under the applicable regulations.
However, when Dr. Doe filed suit in federal court challenging the denial, HHS abandoned its original position. The Department then argued it had actually denied Dr. Doe's reconsideration request because he failed to identify new evidence that would justify reopening his case - a completely different rationale from its initial eligibility-based denial.
The court found this shift in reasoning problematic under the Chenery doctrine, which requires administrative agencies to provide consistent and adequate justifications for their decisions. Named after the Supreme Court's decision in *SEC v. Chenery Corp.*, this principle prevents agencies from defending their actions on grounds different from those they originally relied upon.
"We hold that change in the Department's position violates the venerable Chenery principle," Judge Oldham wrote in the opinion. The ruling emphasizes that federal agencies cannot simply change their legal theories when challenged in court, particularly when defending administrative decisions that affect individual rights.
The underlying dispute stems from an Adverse Action Report that Peconic Bay Medical Center placed in Dr. Doe's National Practitioner Data Bank file more than ten years ago. The National Practitioner Data Bank serves as a repository for information about healthcare practitioners' malpractice payments, adverse licensure actions, and other professional conduct issues. Healthcare facilities and licensing boards use this database to verify practitioners' backgrounds.
Dr. Doe has engaged in what the court characterized as "a prolonged campaign" to remove the AAR from his file. His efforts included filing an initial petition with the Secretary of Health and Human Services, who oversees administration of the databank. When that administrative remedy proved unsuccessful, Dr. Doe pursued federal litigation.
The case was originally filed in the U.S. District Court for the Eastern District of Texas under docket number 1:24-CV-49. The district court proceedings led to the current appeal before the Fifth Circuit.
The Fifth Circuit's decision highlights important principles governing administrative law and agency accountability. The Chenery doctrine serves as a crucial check on administrative power by requiring agencies to articulate clear, consistent rationales for their decisions. This prevents agencies from engaging in post-hoc rationalization when their actions are challenged in court.
For healthcare practitioners, the ruling may have implications beyond Dr. Doe's specific case. The National Practitioner Data Bank significantly impacts physicians' ability to practice medicine, as adverse entries can affect hospital privileges, licensing, and credentialing decisions. The court's emphasis on procedural consistency could influence how HHS handles future reconsideration requests from healthcare providers seeking to challenge or remove adverse entries.
The decision also reflects broader tensions in administrative law regarding agency discretion versus individual due process rights. While agencies typically receive substantial deference in their decision-making, courts maintain oversight authority to ensure agencies follow proper procedures and provide adequate justifications for their actions.
The case demonstrates the ongoing relevance of foundational administrative law principles established decades ago. The Chenery doctrine, first articulated by the Supreme Court in the 1940s, continues to serve as an important limitation on agency power in contemporary regulatory disputes.
The ruling does not address the underlying merits of Dr. Doe's challenge to the Adverse Action Report itself. Instead, the Fifth Circuit focused specifically on the procedural violation arising from HHS's shifting justifications. The case will likely return to lower courts for further proceedings consistent with the appeals court's holding.
This decision adds to a growing body of Fifth Circuit precedent emphasizing administrative agencies' obligation to maintain consistent positions and provide adequate explanations for their decisions. The court's unanimous ruling suggests strong judicial consensus on the importance of procedural regularity in administrative proceedings affecting individual rights.