United States District Court, D. Maryland, Southern Division
W. GRIMM UNITED STATES DISTRICT JUDGE.
plaintiffs in this case are Ohio and Maryland
companies that provide care for elderly and infirm patients.
Each company purports to be acting in its capacity as the
“authorized representative” of a patient who
sought Medicaid benefits from the state of Maryland while in
the company's care. See 42 C.F.R. §
435.923. The companies have brought this suit against two
Maryland state officials, Department of Human Services
Secretary Lourdes Padilla and Department of Health Secretary
Robert Neall,  suing each in his official capacity for
allegedly failing to administer the state's Medicaid
program in accordance with federal law. Am. Compl., ECF No.
broad strokes, Plaintiffs assert that state officials
frustrated three of their patients' attempts to secure
benefits through Maryland's medical assistance program.
They allege, in particular, that program administrators
failed to issue timely eligibility determinations and
unlawfully required the patients to produce financial records
that, because of their mental and physical impairments, they
were ill equipped to locate or supply.
Amended Complaint, ECF No. 18, brings seven claims. To begin,
Plaintiffs seek relief under 42 U.S.C. § 1983 for
violations of the federal Medicaid Act, 42 U.S.C.
§§ 1396a(a)(1)(A), (a)(8), 1396d(a)(4)(A) (Counts
II and III) and deprivations of due process and equal
protection under the Fourteenth Amendment to the U.S.
Constitution (Count VI). They further allege discrimination
under Title II of the Americans with Disabilities Act, 42
U.S.C. § 12132 (Count IV) and under § 504 of the
Rehabilitation Act, 29 U.S.C. § 794(a) (Count V).
Finally, Plaintiffs ask this Court to issue orders for
declaratory relief (Count I) and injunctive relief (Count
have filed a motion to dismiss or, alternatively, for summary
judgment, asserting a host of jurisdictional and merits-based
defenses. As this Memorandum Opinion will explain, I
conclude the doctrine of sovereign immunity requires the
Court to dismiss several of Plaintiffs' claims. I also
conclude Plaintiffs have failed to state a claim under the
Rehabilitation Act. Because none of Plaintiffs' claims
survives scrutiny, the Motion to Dismiss will be granted.
Amended Complaint takes aim at the processes the State of
Maryland has put in place to administer Medicaid benefits
under Title XIX of the Social Security Act, commonly known as
the Medicaid Act, 42 U.S.C. §§ 1396-1396w-5. The
program, which draws funding from both state and federal
sources, offers assistance to individuals who cannot afford
to pay for their medical care. See generally Dep't of
Health & Mental Hygiene v. Campbell, 771 A.2d 1051,
1053-54 (Md. 2001). Federal laws and regulations impose a
number of conditions on states that accept federal funding
for Medicaid, a few of which are especially relevant for
present purposes. First, a state must furnish Medicaid
benefits to eligible applicants “with reasonable
promptness.” 42 U.S.C. § 1396a(a)(8). Federal
regulations go further, requiring states to make eligibility
determinations “promptly and without undue
delay.” 42 C.F.R. § 435.912(b); see also
42 C.F.R. § 435.952(a) (requiring states to
“promptly” evaluate the information they receive
in the course of making an eligibility determination). The
maximum amount of time permitted for determining an
applicant's eligibility is set at 90 days. 42 C.F.R.
§ 435.912(c)(3). Maryland regulations tighten the
timeframe, capping the eligibility-determination period at 30
days. Md. Code Regs. 10.09.24.04(I)(1)(b).
facilitate the eligibility-determination process, Congress
requires states to implement an “asset verification
program, ” through which applicants authorize the state
to obtain relevant financial records from financial
institutions. 42 U.S.C. § 1396w(a)-(b). A state agency
also must solicit information “from other agencies in
the State and other States and Federal programs to the extent
the agency determines such information is useful to verifying
the [applicant's] financial eligibility.” 42 C.F.R.
§ 435.948(a). A federal regulation provides: “An
individual must not be required to provide additional
information or documentation unless information needed by the
agency . . . cannot be obtained electronically or the
information obtained electronically is not reasonably
compatible.” Id. § 435.952(c).
Plaintiffs brought suit on behalf of three Maryland residents
who encountered challenges in their attempts to secure
Medicaid benefits through the state program. I will summarize
their accounts in brief.
Holly Hill Nursing LLC (“Holly Hill”), an Ohio
corporation, here seeks to represent the interests of William
a resident at the Holly Hill Healthcare Center in Towson,
Maryland, since August 2016. Am. Compl. ¶¶ 1, 4.
While at the facility, William H. was suffering from a range
of “severe” illnesses, including pulmonary
hypertension, chronic obstructive pulmonary disease, type 2
diabetes, and acute bronchitis, as well as muscle weakness
and atrophy. Id. ¶¶ 13, 14. Not long after
his arrival at Holly Hill, he designated the facility as his
“authorized representative” for purposes of the
Medicaid application process and “other ongoing
communications” with Maryland Medicaid program
administrators, per 42 C.F.R. § 435.923. Id.
¶ 21. Holly Hill submitted an application for long-term
care Medicaid benefits on his behalf on November 22, 2016.
Id. ¶ 16. Two and a half weeks later, on
December 9, 2016, the State sent Holly Hill “various
requests for verifications.” Id. ¶ 5.
Holly Hill responded that an extension might be necessary.
Id. On April 18, 2017, William H. personally wrote
to the State to ask for extra time to acquire the requested
information. Id. ¶ 17. The State did not
State ultimately denied William H.'s application, issuing
a notice of denial on May 1, 2017. Id. ¶ 19.
However, on March 27, 2018, about four months after Holly
Hill initiated this suit, the State notified William H. that
it had deemed him eligible for Medicaid
benefits. See Notice of Eligibility 3, Mot.
to Dismiss Ex. 1, ECF No. 19-2. The period of eligibility was
to run from November 2017 to October 2018. Id.
second plaintiff, St. Mary's Nursing Center, Inc.
(“St. Mary's”), is here representing the
interests of June H., who resided at the company's
facility in Leonardtown, Maryland, from June 4, 2014, until
her death on February 16, 2016. Am. Compl. ¶¶ 2, 5.
at St. Mary's, June H. suffered from mental illnesses,
including dementia, that impaired her ability to think,
communicate, or care for herself. Id. ¶ 23. She
also suffered from epilepsy, major depressive disorder, and
type 2 diabetes. Id. ¶ 22. These conditions
left her unable to participate in the Medicaid application
process “without assistance.” Id. ¶
H.'s application for long-term care medical assistance is
dated October 3, 2014. Id. At the time, it was her
son, David, who acted as her attorney-in-fact and authorized
representative. Id. June H. and David, whose own
health was in decline after a cancer diagnosis, struggled to
provide verifications. Id.
submitted a second Medicaid application on October 20, 2015,
roughly one year after the first application had been filed.
Id. The government issued a notice of ineligibility
the following month, on November 19, 2015, explaining the
decision was based on her failure to provide required
information. Id. ¶ 26. The notice permitted her
to reactivate her application by submitting requested
verifications by April 20, 2016. Id. The notice
further directed her to explain certain transfers she had
made to her son. Id.
died on December 2, 2015, leaving his widow to take over as
June H.'s secondary attorney-in-fact. Id. ¶
27. David's widow soon named St. Mary's as June
H.'s authorized representative. Id. St.
Mary's submitted “some” verifications to the
government in early February 2016 but, because of June
H.'s physical and mental disabilities, the facility was
unable to provide an explanation about the transfers to her
died February 16, 2016. Id. ¶ 29. St.
Mary's submitted a request for a good faith waiver on
March 9, 2016. Id. The government did not respond to
the request. Id. While a county case worker
initially indicated the application would be approved, the
government soon afterward stated in an email the application
was being denied. Id. ¶ 30. On November 15,
2016, an administrative law judge dismissed an appeal of the
denial, holding the appeal was untimely. Id. ¶
third plaintiff, Howard Leasing Co. (“Howard
Leasing”), is an Ohio company that owns and operates
the Marley Neck Health & Rehabilitation Center in Glen
Burnie, Maryland. Am. Compl. ¶ 3. Howard Leasing is here
representing Christine D., a patient who, like June H.,
suffered from mental illness, including dementia.
Id. ¶ 35. Her illness impaired her ability to
think, communicate, or care for herself. Id.
D.'s application for long-term medical assistance was
dated December 10, 2015. Id. ¶ 36. Two days
later, the State asked her to provide additional information.
Id. She died on January 18, 2016, without having
designated anyone to serve as her authorized representative
for Medicaid benefits. Id. ¶¶ 6, 40.
Nevertheless, the State continued to send requests for
verifications. Id. ¶ 38. These requests
included a revised request for information on February 16,
2016, and a “reminder notice” on May 7, 2016.
Id. The State finally issued a notice of denial on
June 3, 2016, citing Christine D.'s failure to provide
requested verifications. Id. ¶ 39.
personal representative of Christine D.'s estate
unsuccessfully appealed the denial. Id. ¶
42-44. Later, just before this suit was filed, the personal
representative designated Marley Neck as Christine D.'s
authorized representative under 42 C.F.R. § 435.923.
Id. ¶ 41.
Standard of Review
district court assesses a motion to dismiss on the pleadings,
without need of a hearing. Smith v. Montgomery Cty. Corr.
Facility, No. PWG-13-3177, 2014 WL 4094963, at *1 (D.
Md. Aug. 18, 2014). A complaint that “fails to state a
claim upon which relief can be granted” warrants
dismissal under Federal Rule of Civil Procedure 12(b)(6).
Pegues v. Wal-Mart Stores, Inc., 63 F.Supp.3d 539,
541 (D. Md. 2014). Under Rule 8(a)(2), the complaint must
contain “a short and plain statement of the claim
showing that the pleader is entitled to relief.”
Fed.R.Civ.P. 8(a)(2). Beyond that, the Supreme Court has held
that claims for relief must be “plausible, ”
specifying that “[t]hreadbare recitals of the elements
of a cause of action, supported by mere conclusory
statements, do not suffice.” Ashcroft v.
Iqbal, 556 U.S. 662, 678-79 (2009). “A claim has
facial plausibility when the plaintiff pleads factual content
that allows the court to draw the reasonable inference that
the defendant is liable for the misconduct alleged.”
Id. at 663.
reviewing a motion to dismiss, “[t]he court may
consider documents attached to the complaint, as well as
documents attached to the motion to dismiss, if they are
integral to the complaint and their authenticity is not
disputed.” Sposato v. First Mariner Bank, No.
CCB-12- 1569, 2013 WL 1308582, at *2 (D. Md. Mar. 28, 2013);
see also CACI Int'l v. St. Paul Fire & Marine
Ins. Co., 566 F.3d 150, 154 (4th Cir. 2009). However, if
the Court considers matters outside the pleadings, the Court
must treat the motion as a motion for summary judgment.
Fed.R.Civ.P. 12(d); Syncrude Canada Ltd. v. Highland
Consulting Grp., Inc., 916 F.Supp.2d 620, 622-23 (D. Md.