Tulare Local Health Care Dist. v. Cal. Dep't of Health Care Servs.

328 F. Supp. 3d 988
CourtDistrict Court, N.D. California
DecidedJuly 20, 2018
DocketCase No. 15-cv-02711-PJH
StatusPublished
Cited by2 cases

This text of 328 F. Supp. 3d 988 (Tulare Local Health Care Dist. v. Cal. Dep't of Health Care Servs.) is published on Counsel Stack Legal Research, covering District Court, N.D. California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Tulare Local Health Care Dist. v. Cal. Dep't of Health Care Servs., 328 F. Supp. 3d 988 (N.D. Cal. 2018).

Opinion

Second, petitioners argue that both bills were implemented before federal approval, or even the possibility of federal approval, because they were implemented before they were submitted to CMS. Dkt. 69 at 23-24. Petitioners argue that "CMS did not approve any of the rate cuts until October 27, 2011, well after the date that both rate cuts had already been repealed by the California Legislature." Id. at 23.

Respondents argue "that the Medicaid Act's governing regulations expressly permit states to implement SPAs prior to formal approval by the federal government[.]" Dkt. 74 at 9 (citing 42 C.F.R section 447.256(c) (SPA "will become effective not earlier than the first day of the calendar quarter in which an approvable amendment is submitted") ). Respondents argue: "In permitting a SPA amendment to be retroactively 'effective' by up to three months prior to the date that it is submitted to CMS, the Medicaid regulations plainly permit states to implement rate changes prior to federal approval." Id. at 9.

The rule in the Ninth Circuit is clear. "[T]he State was obligated to submit and obtain approval of its SPA before implementation." Developmental Servs. Network v. Douglas, 666 F.3d 540, 545-46 (9th Cir. 2011) (explaining the history of the issue in the Ninth Circuit); accord California Ass'n of Rural Health Clinics v. Douglas, 738 F.3d 1007, 1018 (9th Cir. 2013) ("Before our decision in Developmental Services Network, there may have been a reasonable expectation that the Department would attempt to implement changes to a state plan prior to receiving CMS's approval; Developmental Services Network forecloses that possibility.... We held, unambiguously, that 'the State [is] obligated to submit and obtain approval of its SPA before implementation.' Id. at 546.").

However, even if petitioners can bring a private cause of action to challenge the early implementation, their "claim is moot because CMS retroactively approved [the] amendment to California's Medi-Cal plan. As the wrong that [petitioners] sued to right (CMS's lack of approval of [the amendment] prior to the law's implementation) has been righted by CMS's retroactive approval, [petitioners'] claim has lost 'its character as a live controversy[.]' Accordingly, [petitioners'] prior approval claim is moot." Aids Healthcare Found. v. Douglas, 666 F. App'x 601, 603 (9th Cir. 2016) (citations omitted); see also California Ass'n of Rural Health Clinics, 738 F.3d at 1017. While not precedential, the Aids Healthcare Foundation opinion is highly persuasive under the present facts, and its underlying reasoning applies here. As such, the court finds that petitioners' claim that the SPAs were implemented impermissibly early, if they can bring such a claim, is moot.

3. Declaratory Relief

Respondents argue that petitioners' claim for declaratory relief-framed as their second cause of action-fails for two reasons. First, it is derivative of their first cause of action for mandamus and fails for the same reasons. Second, it fails substantively. Dkt. 66 at 18-19.

Although petitioners do not address the issue, their request for declaratory relief-styled as a standalone claim-is entirely derivative of their petition for a writ of mandate. As such, the cause of action for declaratory relief fails for the same reasons.

Furthermore, the declaratory relief claim fails because that remedy can only operate prospectively, but petitioners *1006seek purely retrospective money damages. See Canova v. Trs. of Imperial Irrigation Dist. Emp. Pension Plan, 150 Cal. App. 4th 1487, 1497, 59 Cal.Rptr.3d 587 (2007) ("[d]eclaratory relief operates prospectively to declare future rights, rather than to redress past wrongs"); Envtl. Def. Project of Sierra Cty., 158 Cal. App. 4th 877, 885, 70 Cal.Rptr.3d 474 (2008) ; Bayer v. Neiman Marcus Grp., Inc., 861 F.3d 853, 868 (9th Cir. 2017) ("declaratory judgment merely adjudicating past violations of federal law-as opposed to continuing or future violations of federal law-is not an appropriate exercise of federal jurisdiction"). Because the statutes are not currently in effect, the limited relief of declaring them invalid or unlawful would provide petitioners no remedy.

4. Other Allegations

Petitioners raise an additional statute and regulation in their petition, but not in their moving or opposition papers. Their petition cites 42 U.S.C. § 1396a(a)(8) and 42 C.F.R. § 447.253(e). FAP ¶¶ 41, 43. Respondents have moved for summary judgment unopposed with respect to each. Dkt. 66 at 24-25.

When CMS approved the SPAs, it "determined that these amendments comply with section 1902(a)(30)(A) of the Act and all other applicable requirements of the Act[.]" Emery Decl., Ex. O at 2. Congress intended that approval "to have the force of law." Managed Pharmacy Care, 716 F.3d at 1249. CMS's approval is owed deference, particularly with respect to the implementing regulation in the Code of Federal Regulations. Additionally, petitioners' claim under 42 U.S.C. § 1396a(a)(8) is entirely unsupported. The complaint is conclusory and lacks factual allegations supporting it, and petitioners' papers ignore the issue entirely, pointing to no evidence supporting the claim in response to respondents' motion. See Celotex, 477 U.S. at 325, 106 S.Ct. 2548

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Bluebook (online)
328 F. Supp. 3d 988, Counsel Stack Legal Research, https://law.counselstack.com/opinion/tulare-local-health-care-dist-v-cal-dept-of-health-care-servs-cand-2018.