Medical Management & Rehabilitation Services, Inc. v. Maryland Department of Health & Health Hygiene

124 A.3d 1137, 225 Md. App. 352, 2015 Md. App. LEXIS 148
CourtCourt of Special Appeals of Maryland
DecidedOctober 28, 2015
Docket2386/13
StatusPublished
Cited by5 cases

This text of 124 A.3d 1137 (Medical Management & Rehabilitation Services, Inc. v. Maryland Department of Health & Health Hygiene) is published on Counsel Stack Legal Research, covering Court of Special Appeals of Maryland primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Medical Management & Rehabilitation Services, Inc. v. Maryland Department of Health & Health Hygiene, 124 A.3d 1137, 225 Md. App. 352, 2015 Md. App. LEXIS 148 (Md. Ct. App. 2015).

Opinion

KENNEY, J.

October 26, 2015 Medical Management and Rehabilitation Services, Inc., and its owner, Carolyn Miller (collectively “MMARS”), challenge the Maryland Department of Health and Mental Hygiene’s (“the Department’s”) award of a case management contract to The Coordinating Center (“TCC”). The Circuit Court for Talbot County granted the Department’s Motion to Dismiss for Failure to State a Claim. MMARS presents a single question for our review, which we have reworded as follows: Did the circuit court err in granting the motion to dismiss the complaint for failure to exhaust administrative remedies? 1 For the reasons that follow, we shall affirm.

FACTUAL AND PROCEDURAL BACKGROUND

Under Section 15-103(a) of the Health-General Article of the Maryland Code (1982, 2009 RepLVol.) (“HGA”), the Secretary of Health and Mental Hygiene is charged with the administration of Maryland’s Medicaid program, which provides health care services to qualifying low-income individuals and families throughout Maryland. Medicaid participants with specified rare, expensive, or medically complex conditions 2 can enroll in the Rare and Expensive Case Management (“REM”) program, which is a case managed fee-for- *356 service reimbursement system. Approximately 4000 Medicaid participants obtain medical care through the REM program.

At the inception of the REM program in 1997, the Department contracted for the necessary case management services with several different individual agencies to facilitate the recipients’ medical needs. The case managers from the participating agencies would conduct an individual needs assessment, educate the recipient, provide family support, develop treatment plans, coordinate provider services, and monitor the recipient’s progress. MMARS was one of the case management agencies selected in 1997 and has continued as a REM program case management provider for fifteen years. When the contract at issue was awarded, MMARS was providing services to over 1000 REM participants.

In 2012, the Department decided to reduce the number of agencies providing REM program case management services from four to one, after both the American Academy of Pediatrics and the Maryland State Medical Society had expressed concern about the REM program’s use of multiple case management providers and its effect on efficiency and quality. It was their recommendation that one provider coordinate the case management services.

On December 20, 2012, the Department published a Request for Proposals (“RFP”) notifying case management providers of the Department’s intent to award the July 1, 2013 through June 30, 2016 contract for case management services to a single provider whose proposal it deemed most advantageous to the State. The RFP also set forth the procedures for protesting or disputing the RFP or the subsequent contract award, 3 in addition to those procedures already established in *357 10.01.03 of the Code of Maryland Regulations (“COMAR”). It further stated that any appeals would not stay the starting date of the contested contract.

The prior REM contracts fell under the state procurement regulations, and case management providers were selected through the competitive bid process set forth in COMAR 21.05.03. 4 But, because the Department, in 2009, set the rates for case management services by regulation 5 subsequent contracts for case management services were not procurement contracts governed by its competitive sealed proposal selection procedures. 6

*358 Five case management providers submitted proposals in response to the December 20, 2012 RFP, none of which objected to the procedures or to the reduction in the number of providers to one. A three-person evaluation committee concluded that TCC best addressed the evaluation factors provided in the RFP by offering a combination of a superior work plan, corporate qualifications, and experience.

After the Department notified MMARS, on April 12, 2013, that it had not received the contract award, MMARS challenged the award of the contract to TCC concurrently in multiple venues, including the Office of Administrative Hearings (“OAH”), the Maryland State Board of Contract Appeals (“the Board”), and the Circuit Court for Talbot County.

The Department and OAH

On April 15, 2013, MMARS, via email to the Department, objected to the award of the case management contract to TCC, asserting that its proposal was the most advantageous to the State based on the criteria listed in the RFP. MMARS, on April 25, 2013, supplemented its initial objection, asserting that “[the Department’s] evaluations were tainted by bias in favor of [TCC].” Based on its objections, the Department gave MMARS the opportunity to discuss its proposal (although it could not discuss competing proposals) in a debriefing on May 8, in which a procurement officer 7 explained the weaknesses *359 and deficiencies in MMARS’s proposal. Following that debriefing, MMARS supplemented its objections with additional complaints.

The Department, on May 6, 2013, delegated its authority to issue a proposed decision regarding MMARS’s objections to OAH. See COMAR 10.01.03.07. The Administrative Law Judge (“ALJ”) conducted hearings on October 2, 3, 4, and 31, and November 1, and issued a proposed decision on December 27, 2013. The ALJ concluded that the Department did not improperly reject MMARS’s proposal in response to the RFP and recommended that MMARS’s appeal of the contract award be dismissed. MMARS filed exceptions to the ALJ’s proposed decision with the Secretary of the Department, but, in March of 2014, it dismissed those exceptions.

The Board of Contract Appeals

On June 24, 2013, MMARS filed a bid protest with the Board challenging the contract award. The Board, finding that the RFP fell outside the definition of a procurement contract, dismissed the protest for lack of jurisdiction on September 6, 2013. MMARS filed a petition for judicial review of that decision in the Circuit Court for Talbot County on October 1, 2013, but dismissed that petition on April 9, 2014. 8

The Declaratory Judgment Action

On September 4, 2013, MMARS filed a Complaint and Motion for Temporary Restraining Order in the Circuit Court for Talbot County. The Department filed a Motion to Dismiss for Failure to State a Claim (“Motion to Dismiss”) and Opposition to Plaintiffs Motion for Temporary Restraining Order on September 20. On October 1, 2013, MMARS withdrew its *360 Motion for a Temporary Restraining Order and filed a response to the Department’s Motion to Dismiss. MMARS filed an additional response on October 25, 2013.

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Cite This Page — Counsel Stack

Bluebook (online)
124 A.3d 1137, 225 Md. App. 352, 2015 Md. App. LEXIS 148, Counsel Stack Legal Research, https://law.counselstack.com/opinion/medical-management-rehabilitation-services-inc-v-maryland-department-mdctspecapp-2015.