Maione v. Zucker
| Decision Date | 15 March 2022 |
| Docket Number | 18-CV-7452 (KMK) |
| Parties | SCOTT MAIONE AND TASHA OSTLER, on behalf of themselves and on behalf of their three infant children, Plaintiffs, v. DR. HOWARD A. ZUCKER, et al ., Defendants. |
| Court | U.S. District Court — Southern District of New York |
Louis J. Maione, Esq. Law Offices of Louis J. Maione Counsel for Plaintiffs
John P. Gasior, Esq. Counsel for Defendants Zucker, Hein, and Roberts
Larraine S. Feiden, Esq. Thomas E. Humbach, Esq. Counsel for Defendants Silvestri and Sherwood
Scott Maione (“Maione”) and Tasha Ostler (“Ostler”) (together, “Plaintiffs”) bring this Action, on behalf of themselves and their infant children, against Dr. Howard A. Zucker (“Zucker”), current Commissioner of New York State's Department of Health (“DOH”); Samuel D. Roberts (“Roberts”), former Commissioner of New York State's Office of Temporary and Disability Assistance (“OTDA”) (together, the ); Joan Silvestri (“Silvestri”) current Commissioner of the Rockland County Department of Social Services (“DSS”); and Susan Sherwood (“Sherwood”), former Commissioner of DSS (together, the “County Defendants”), alleging violations of the United States and New York State Constitutions, Title II of the Americans with Disabilities Act (“ADA”), 42 U.S.C. § 12132 et seq., and the Rehabilitation Act of 1973, 29 U.S.C. § 701 et seq., in connection with Medicaid reimbursements.[1] Before the Court are two Motions To Dismiss, one filed by the State Defendants (“the State Motion”), (State Not. of Mot.), and one filed by the County Defendants (“the County Motion” and together “the Motions”), (County Not. of Mot. (Dkt. No. 168)), pursuant Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6). For the following reasons, both Motions are granted in full.
The following legal background is taken from this Court's Order & Opinion in this case dated September 25, 2020. (Sept. 25, 2020 Op. & Order (“2020 Op.”) at 2-3 (Dkt. No. 140).) Medicaid is a publicly funded health insurance program that provides “joint federal and state funding of medical care for individuals who cannot afford to pay their own medical costs.” Sai Kwan Wong v. Doar, 571 F.3d 247, 250 (2d Cir. 2009) (citation and quotation marks omitted). States participating in Medicaid must adopt an approved plan and must administer the program through a “single [s]tate agency.” 42 U.S.C. § 1396a(a)(5); see also 42 C.F.R. § 431.10(b)(1) (same). In New York State, the agency responsible for the administration of the Medicaid program is DOH. See N.Y. Soc. Serv. L. § 363-a(1). While DOH remains ultimately responsible for New York's Medicaid program, it delegates certain functions, including eligibility determinations and appeals, to “local social service districts within New York State.” Dajour B. v. City of New York, No. 00-CV-2044, 2001 WL 830674, at *4 (S.D.N.Y. July 23, 2001) (citation omitted).
As relevant here, Medicaid requires that every participating state “have an Early and Periodic Screening, Diagnosis, and Treatment (EPSDT) program.” Frew ex rel. Frew v. Hawkins, 540 U.S. 431, 433 (2004) (citing 42 U.S.C. §§ 1396a(a)(43), 1396d(r)). As defined by statute, “early and periodic screening, diagnostic, and treatment services” include such “necessary health care, diagnostic services, [and] treatment . . . to correct or ameliorate defects and physical and mental illnesses and conditions discovered by the screening services, whether or not such services are covered under the State plan.” 42 U.S.C. § 1396d(r)(5). Similarly, every state's Medicaid plan must also “[s]pecify that the Medicaid agency will ensure necessary transportation for beneficiaries to and from providers, ” and “[d]escribe the methods that the agency will use to meet this requirement.” 42 C.F.R. § 431.53(a)-(b); see also 42 C.F.R.
§ 440.170(a)(1) (). Additionally, in accordance with federal requirements, New York law provides that Medicaid applicants may challenge a determination denying benefits by requesting an administrative “fair hearing” and, thereafter, by appealing an adverse decision to the state courts in an Article 78 proceeding. N.Y. Soc. Serv. L. § 22; see also 42 U.S.C. § 1396a(a)(3).
Unless otherwise noted, the following factual allegations are drawn from the Second Amended Complaint (“SAC”) and taken as true for the purposes of the instant Motions.[2]
Plaintiffs, residents of Rockland County, have three infant children (“J”, “M”, and “S”; collectively, the “Children”), two of whom (J and M) have disabling and chronic health conditions and are thus recipients of Supplemental Security Income (“SSI”). (SAC. ¶¶ 6, 20 21.) Additionally, Plaintiffs, together with their Children, are all Medicaid recipients. (Id. ¶¶ 20-22.)
In late 2011, Plaintiffs' first child, J, was “born prematurely and disabled, [and] was placed on SSI ....” (Id. ¶ 20.) Around this time, Plaintiffs discovered that the family was possibly eligible for retroactive reimbursement of certain out-of-pocket medical expenses, and they therefore submitted receipts to DSS for reimbursement. (Id. ¶ 23.) Initially, DSS denied that such coverage existed, but then instructed Plaintiffs to “send in [their] receipts to determine coverage.” (Id. ¶ 25 (alteration in original) (italics omitted).) After DSS denied “approximately 99% of the submitted claims, ” and Plaintiffs requested a fair hearing. (Id. ¶ 26.)
The first fair hearing session was held in May 2013. (Id. ¶ 32; see also 2020 Op. at 4.)
At that session, both the Administrative Law Judge (the “ALJ”) and County Attorney Lew Jefferies, Esq. (“Jefferies”) requested that Plaintiffs cease submissions of similar expense reimbursements for J or M until a decision was issued. (SAC ¶ 32.) Both the ALJ and Jefferies stated that additional receipts and invoices would slow the reimbursement process, and that the ALJ's decision would present “guidance and clarity as to what is and is not covered.” (Id. ¶¶ 33-34.) The fair hearing resumed in December 2013, presided over by ALJ Sarah Mariani (“ALJ Mariani”). (Id. ¶ 35; see also 2020 Op. at 4.) On November 13, 2014, ALJ Mariani issued a decision and order (the “Mariani Decision”) in favor of Plaintiffs and reversing DSS's determination denying reimbursements. (SAC ¶ 38.) Following the Mariani Decision, Plaintiffs “were sent a form [with which to indicate] the amount they were to be reimbursed, with instructions to forward more receipts for reimbursement for both of their children.” (Id. ¶ 43 (italics omitted).) Plaintiffs then submitted “receipts for the period through March 2015” and awaited a response. (Id. ¶ 48.) In September 2015, Plaintiffs received a hand-written “log, ” which denied “approximately 99% of submitted expense receipts.” (Id. ¶ 49 (italics omitted).) DSS officials explained that the Mariani Decision applied only to “J's receipts prior to the issuance/receipt of his Medicaid or CIBC card ....” (Id. ¶ 52.)
Plaintiffs, then pro se, commenced an Article 78 proceeding seeking to compel the State to review and process receipts for reimbursement. (Id. ¶ 62.) However, on November 27, 2017, Judge Sherri Eisenpress of the New York State Supreme Court, Rockland County, dismissed Plaintiffs' petition in full, “for failure to exhaust administrative remedies and failure to state a cause of action.” (See Decl. of John Gasior, Esq., in Supp. of Mot. (“Gasior Decl.”) Ex. A (“Eisenpress Decision”), at 15 (Dkt. No. 165-1); see also SAC ¶ 73.) In particular, Judge Eisenpress held that Plaintiffs lacked standing to pursue claims on behalf of M because they failed to name her as a party, that the Mariani Decision (which related solely to J) had no preclusive effect with respect to claims on behalf of M, that Plaintiffs failed to assert any exceptions to a general exhaustion requirement for challenging agency actions, that mandamus was an inappropriate vehicle for directing an agency to reach a certain determination, and that Plaintiffs had failed to allege that the decisions denying reimbursements were “arbitrary and capricious.” (See generally Eisenpress Decision.)
Plaintiffs then returned to the OTDA to continue pursuing the denied medical reimbursements through the fair hearing process. (See SAC ¶ 74.) Prior to the expected hearings Joanne Gerber (“Gerber”) of Office of Administrative Hearings (“OAH”) informed Plaintiffs that the hearings would be administered by ALJ Christopher Gallagher (“ALJ Gallagher”). (Id. ¶ 76.) When Plaintiffs asked why ALJ Gallagher, rather than ALJ Mariani, was presiding, Gerber explained that the ALJs are chosen randomly. (Id.) Subsequently, ALJ Gallagher told Plaintiffs that he was “selected to preside” over their hearings, a statement that Plaintiffs believe contradicts Gerber's representation. (Id.) Relatedly, about six weeks prior to the first hearing before ALJ Gallagher with respect to the transportation matters, Plaintiffs asked Lynn Davidson (“Davidson”), a DSS legal representative who had attended prior hearings, to provide Plaintiffs with the DSS documents which were expected to be used in the upcoming hearings. (Id. ¶ 77.) While Davidson acceded to the request, the documents arrived only two days prior to the hearing. (Id.) Plaintiffs discovered among these documents a communication between OTDA and OAH, authored by...
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