RICARDO M. URBINA, District Judge.
The plaintiff is a hospice care provider participating in Medicare, a federal program administered by the Department of Health and Human Services ("HHS"). It commenced this action pursuant to the Administrative Procedure Act ("APA"), 5 U.S.C. §§ 701 et seq., challenging HHS's demands for the repayment of funds distributed to the plaintiff in fiscal years 2006 and 2007 purportedly in excess of the lawful cap on such distributions. The plaintiff contends that the regulation pursuant to which HHS calculated these repayment amounts conflicts with the governing statute and must be set aside. The plaintiff has moved for summary judgment on its challenge to the fiscal year 2007 repayment demand, seeking an order declaring that the regulation is unlawful and enjoining HHS from enforcing it. In response, the defendant has moved to remand the plaintiff's claims regarding the fiscal year 2007 repayment to the agency for additional fact-finding. In the alternative, the defendant moves for summary judgment as to the plaintiff's 2007 repayment demand. Furthermore, the defendant has moved to dismiss the plaintiff's claims regarding the 2006 repayment demand for lack of subject matter jurisdiction.
For the reasons discussed below, the court grants the plaintiff's motion for summary judgment regarding the 2007 repayment demand and denies the defendant's motion to remand that claim or, in the alternative, for partial summary judgment. The court, however, grants the defendant's motion to dismiss the plaintiff's claims regarding the 2006 repayment demand based on the absence of subject matter jurisdiction.
Medicare provides health insurance to the elderly and disabled by entitling eligible
If the intermediary's action involves a question of law that it lacks the authority to address, the Medicare statute provides that the PRRB may grant expedited judicial review of that question. See id. Specifically, the statute states that "[p]roviders shall ... have the right to obtain judicial review of any action of the fiscal intermediary which involves a question of law or regulations relevant to the matters in controversy whenever the Board determines... that it is without authority to decide the question, by a civil action commenced within sixty days of the date on which notification of such determination is received." Id.
Among other services, Medicare covers hospice care for individuals who are "terminally ill,"
The Medicare statute, however, places a cap on the total amount that Medicare may distribute to a hospice provider in a single fiscal year (November 1 through October 31). See id. § 1395f(i)(2)(A). Payments made to a hospice care provider in excess of the statutory cap are considered overpayments that the hospice care provider must refund to the government. Id.
More specifically, the statute provides that the total yearly payment to a hospice provider may not exceed the product of the annual "cap amount"
Id. § 1395f(i)(2)(C) (emphasis added). Thus, the Medicare statute directs HHS to account for the fact that an individual may receive care in more than one fiscal year by requiring HHS to count that individual as a beneficiary in each year in which he or she receives hospice care benefits, with that number proportionally reduced to reflect care provided in previous or subsequent years. See id.
To implement the statutory cap provision, HHS promulgated a reimbursement regulation governing the calculation of the statutory cap amount. See 42 C.F.R. § 418.309. In pertinent part, the regulation provides that the "number of beneficiaries" portion of the statutory cap calculation includes
Id. § 418.309(b) (emphasis added). The regulation does not provide for the proportional allocation of beneficiaries, providing instead that an individual is counted as a beneficiary only in a single year, depending on when he or she first elects to receive hospice benefits. See id.
HHS's justification for the regulation begins with the observation that the average length of a hospice stay is seventy days. See Def.'s Mot. at 7 n. 7. If a patient elects hospice care on or before September 27 of a particular year (thirty-five days before the end of the fiscal year), the hospice care provider will receive 100% of the statutory cap amount attributable to that beneficiary in the current fiscal year because in the average case, the majority of the patient's hospice care will be provided in that fiscal year. See 42 C.F.R. § 418.309(b)(1). If, on the other hand, the patient elects hospice care after September 27, the hospice care provider will receive 100% of the statutory allowance for that patient in the following fiscal year, because in the average case, the majority of the patient's hospice will be provided in the following year. Thus, although the regulation does not provide for the proportional allocation of cap amounts, it attempts to approximate the proportional allocation by setting up a system in which beneficiaries are, on average, counted in the year in which they receive the majority of their hospice care. See id.
The plaintiff is a Medicare-certified hospice care provider operating in El Reno, Oklahoma. Compl. ¶ 1. In September 2008, the plaintiff received a demand for repayment of $946,732 for funds distributed to it in fiscal year 2006 purportedly in excess of the statutory cap. Id. ¶ 3. In April 2009, the plaintiff received a repayment demand of $398,630 for funds distributed to it in fiscal year 2007 purportedly in excess of the statutory cap. Id. ¶ 9. The plaintiff appealed both repayment demands to the PRRB in September 2009, challenging the validity of 42 C.F.R. § 418.309(b)(1). Id. ¶¶ 7-9.
The plaintiff subsequently commenced this action challenging the validity of the repayment demands for fiscal years 2006 and 2007 on the grounds that 42 C.F.R. § 418.309(b)(1), the regulation pursuant to which the demands were calculated, conflicts with 42 U.S.C. § 1395f(i)(2), the statutory provision the regulation purports to implement. Compl. ¶¶ 13, 28-37. Had HHS applied a lawful calculation of its cap liability, the plaintiff contends, its cap liability for fiscal years 2006 and 2007 would have been materially reduced. Id. ¶ 42. The plaintiff seeks an order declaring the regulation invalid, vacating the 2006 and 2007 repayment demands issued to the plaintiff, enjoining HHS from using the regulation in calculating the hospice cap liability of the plaintiff or any other hospice and directing HHS to compensate the plaintiff for the amounts paid to HHS pursuant to the allegedly unlawful regulation. Id. ¶ 14.
In January 2010, the plaintiff filed a motion for summary judgment on its claim that the fiscal year 2007 demand must be set aside because the reimbursement regulation violates the Medicare statute. See generally Pl.'s Mot. for Partial Summ. J. ("Pl.'s Mot."). The motion does not seek adjudication of the plaintiff's claim regarding the fiscal year 2006 repayment demand, which, according to the plaintiff, "raises certain secondary issues (such as equitable tolling) which may be more efficiently determined following a ruling on [the plaintiff's] clean legal challenge to the validity of the regulation." Id. at 4.
The defendant has moved to dismiss the plaintiff's claim regarding the fiscal year 2006 repayment demand for lack of subject matter jurisdiction, arguing that the plaintiff failed to commence a timely administrative appeal. See Def.'s Mot. for Partial Dismissal & for Partial Remand, or in the Alternative, for Partial Summ. J. ("Def.'s Mot.") at 15-21. The defendant has also moved to remand the plaintiff's claim regarding the fiscal year 2007 repayment demand for further administrative proceedings, arguing that the plaintiff failed to obtain necessary factual determinations from the PRRB prior to commencing suit. Id. at 21-34. In the alternative, the defendant seeks summary judgment on the plaintiff's challenge to the fiscal year 2007 repayment demand and the validity of the reimbursement regulation. Id. at 34-44.
The parties' motions are now ripe for adjudication. The court therefore turns to the applicable legal standards and the parties' arguments.
The defendant contends that the court lacks jurisdiction to review the plaintiff's claim regarding the fiscal year 2006 repayment demand because the plaintiff failed to commence a timely administrative appeal of that demand. See Def.'s Mot. at 15-21. More specifically, the defendant asserts that the plaintiff failed to appeal the fiscal year 2006 repayment demand to the PRRB within 180 days of receiving notice of the demand, as required by the Medicare statute. Id. at 17-18. The defendant argues that because the PRRB's dismissal of an appeal on timeliness
The plaintiff concedes that it did not file its appeal within the 180-day deadline set forth in the statute. Pl.'s Opp'n to Def.'s Partial Mot. to Dismiss at 6. The plaintiff maintains, however, that the PRRB's dismissal of the plaintiff's administrative appeal on timeliness grounds, stemming from its determination that no "good cause" existed for granting the plaintiff leave to late file, constituted a final agency decision subject to judicial review.
To obtain judicial review for claims arising under the Medicare statute, a provider must channel its complaints through the administrative review procedures set forth in the statute. See 42 U.S.C. § 1395ii (applying 42 U.S.C. § 405(h) to Medicare);
The procedures for obtaining administrative and judicial review of a fiscal intermediary's determination are set forth in 42 U.S.C. § 1395oo. The statute states that a provider dissatisfied with a determination of a fiscal intermediary may pursue an administrative appeal before the PRRB by filing a request for a hearing within 180 days after receiving notice of the determination. 42 U.S.C. § 1395oo (a).
This Circuit has stated that "a decision by the PRRB not to hear a case" based on the provider's failure to file a timely appeal "is, by definition, not a `final decision'" for purposes of 42 U.S.C. § 1395oo. Athens Cmty. Hosp., Inc. v. Schweiker, 686 F.2d 989, 994 n. 4 (D.C.Cir.1982) (citing John Muir Mem'l Hosp., Inc. v. Califano, 457 F.Supp. 848, 853 (N.D.Cal.1978)), modified on other grounds on reh'g, 743 F.2d 1 (D.C.Cir.1984). In Athens, a provider who
As another court in this district recently noted in a thoughtful and thorough discussion of Athens,
Auburn Reg'l Med. Ctr. v. Sebelius, 686 F.Supp.2d 55, 64-65 (D.D.C.2010) (Bates, J.) (holding that because there was no dispute that the plaintiffs' appeals to the PRRB were untimely, "under Athens, the Board decision dismissing their appeals as untimely [was] not a `final decision' within the meaning of § 1395oo (f), and [was] accordingly not subject to judicial review"). Judge Bates's reading of Athens is in keeping with the conclusions reached by the majority of courts that have addressed the issue. See Saline Cmty. Hosp. Ass'n v. Sec'y of Health & Human Servs., 744 F.2d 517, 520 n. 4 (6th Cir.1984) (observing that "[u]nder the statute, a P.R.R.B. refusal to hear a case because it was not timely is not a `final decision'"); Lenox Hill Hosp. v. Shalala, 131 F.Supp.2d 136, 141 n. 5 (D.D.C.2000) (noting that a majority of courts that have addressed the issue have concluded that the PRRB's denial of a good cause extension does not constitute a "final decision" under 42 U.S.C. § 1395oo); S. Miami Hosp. v. Bowen, 658 F.Supp. 544, 546-47 (S.D.Fla.1987) (concluding that because the plaintiff failed to request a hearing before the PRRB within the 180-day time limit, "no final Board decision issued and this Court lacks jurisdiction to review the claims"); Miami Gen'l Hosp. v. Bowen, 652 F.Supp. 812, 814 (S.D.Fla.1986) (concurring "with the majority of courts which have taken up this question" and concluding that it was "without jurisdiction to consider the plaintiff's appeal of the Board's refusal to exercise its discretion on the plaintiff's behalf, as such an action [was] not a `final decision' of the Board"); Arcadia Valley Hosp. v. Bowen, 641 F.Supp. 190, 192 (E.D.Mo.
In this case, there is no dispute that the plaintiff failed to file a timely administrative appeal of the fiscal year 2006 repayment demand. See Compl. ¶¶ 8-9. It is equally undisputed that this failure resulted in the PRRB's dismissal of the plaintiff's appeal. See Pl.'s Mot., Ex. G. Athens compels the conclusion that the PRRB's decision to dismiss the plaintiff's appeal, rather than excuse the plaintiff's untimeliness for "good cause," is not a final decision subject to judicial review.
The court now turns to the claim concerning the fiscal year 2007 repayment
The plaintiff responds that the fact that it is subject to an unlawful regulation is sufficient to establish its standing to challenge that regulation. Pl.'s Opp'n to Def.'s Mot. & Reply in Support of Pl.'s Mot. ("Pl.'s Reply") at 6-9; Pl.'s Mot. at 11-13. The plaintiff further notes that there is substantial evidence, such as the PRRB's determination that the amount in controversy exceeded the $10,000 threshold, demonstrating that the challenged regulation has resulted in the overstatement of its 2007 cap liability. Pl.'s Reply at 9-10; Pl.'s Mot. at 13. The plaintiff also contends that it would be inappropriate to remand the matter for a determination regarding whether the $10,000 threshold was satisfied, arguing that because the fiscal year 2007 repayment demand was calculated pursuant to an unlawful regulation, the entirety of that demand is in dispute. Pl.'s Reply at 3-5.
The court first considers whether remand is necessary to establish the plaintiff's standing. As the party invoking federal jurisdiction, the plaintiff bears the burden of establishing its standing. Steel Co. v. Citizens for a Better Env't, 523 U.S. 83, 104, 118 S.Ct. 1003, 140 L.Ed.2d 210 (1998); Lujan v. Defenders of Wildlife, 504 U.S. 555, 561, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992); City of Waukesha v. Envtl. Prot. Agency, 320 F.3d 228, 233 (D.C.Cir. 2003) (per curiam). The extent of the plaintiff's burden varies according to the procedural posture of the case. Sierra Club v. Envtl. Prot. Agency, 292 F.3d 895, 898-99 (D.C.Cir.2002). At the pleading stage, general factual allegations of injury resulting from the defendant's conduct will suffice. Id. On a motion for summary judgment, however, the "plaintiff can no longer rest on such mere allegations, but must set forth by affidavit or other evidence specific facts which for purposes of the summary judgment motion will be taken to be true." Id. at 899 (citing FED. R.CIV.P. 56); accord Fla. Audubon, 94 F.3d 658, 666 (D.C.Cir.1996).
To demonstrate standing, a plaintiff must satisfy a three-pronged test. Sierra Club, 292 F.3d at 898 (citing Lujan, 504 U.S. at 560, 112 S.Ct. 2130). First, the plaintiff must have suffered an injury in fact, defined as a harm that is concrete and actual or imminent, not conjectural or hypothetical. Byrd v. Envtl. Prot. Agency, 174 F.3d 239, 243 (D.C.Cir.1999) (citing Steel Co., 523 U.S. at 103, 118 S.Ct. 1003). Second, the injury must be fairly traceable to the governmental conduct alleged. Id. Finally, it must be likely that the requested relief will redress the alleged injury. Id.
The defendant contends that without a determination that the plaintiff's cap liability
Lujan, 504 U.S. at 561-62, 112 S.Ct. 2130 (emphasis added); see also Fund for Animals, Inc. v. Norton, 322 F.3d 728, 733-34 (D.C.Cir.2003) (observing that a party's standing to seek review of administrative action is typically "self-evident" when the party is the object of the action (citing Sierra Club v. Envtl. Prot. Agency, 292 F.3d 895, 899-900 (D.C.Cir.2002))); cf. Simon v. E. Ky. Welfare Rights Org., 426 U.S. 26, 38, 96 S.Ct. 1917, 48 L.Ed.2d 450 (1976) (noting that the purpose of the Article III standing requirement is to ensure that a litigant has a sufficient personal stake in the outcome of the controversy). In this case, the plaintiff clearly was the object of the governmental action at issue—the challenged regulation and the resulting 2007 repayment demand. Regardless of the extent to which the challenged regulation ultimately affected the plaintiff's fiscal year 2007 repayment obligation, the fact that the challenged regulation was directly applied to the plaintiff strongly supports the conclusion that it has standing to challenge that regulation.
Furthermore, the defendant's argument presupposes that the plaintiff must establish economic injury to demonstrate injury in fact. Yet, it is well-established that less tangible forms of injury, such as the deprivation of statutory rights, may be sufficiently particularized and concrete to demonstrate injury in fact. See Zivotofsky ex rel. Ari Z. v. Sec'y of State, 444 F.3d 614, 619 (D.C.Cir.2006) (stating that "[a]lthough it is natural to think of an injury in terms of some economic, physical, or psychological damage, a concrete and particular injury for standing purposes can also consist of the violation of an individual right conferred on a person by statute"); Byrd v. Envtl. Prot. Agency, 174 F.3d 239, 243 (D.C.Cir.1999) (concluding that the plaintiff established injury in fact by showing that he was denied access to information to which he was entitled under federal statute).
In bringing this action before the court, the plaintiff is exercising its express statutory right to seek administrative review of a fiscal intermediary's determination involving a question of law that the PRRB lacks the authority to resolve. See 42 U.S.C. § 1395oo(f)(1). Accordingly, the court concurs with those courts that have held that apart from any economic harm caused by the application of the challenged regulation, "[t]he use of [42 C.F.R.] § 418.309(b)(1) constitutes an injury-in-fact because the amounts plaintiff must refund were calculated using a method other than the method specified by Congress." Lion Health Servs., Inc. v. Sebelius, 689 F.Supp.2d 849, 855 (N.D.Tex.2010) (holding that the plaintiff was not required to prove that its cap repayment would "certainly be less if calculated under lawful regulations" because "[t]he legal right asserted by plaintiff ... [was] the right to
Lastly, the plaintiff has established a substantial probability that the application of the challenged regulation resulted in an increase in the plaintiff's 2007 cap liability. See Sierra Club v. Envtl. Prot. Agency, 292 F.3d 895, 899 (D.C.Cir.2002) (noting that at the summary judgment stage, the plaintiff must demonstrate a "substantial probability" that it has suffered injury in fact); see also S. Coast Air Quality Mgmt. Dist. v. Envtl. Prot. Agency, 472 F.3d 882, 895 (D.C.Cir.2006) (concluding that the plaintiff had demonstrated a substantial probability of injury because it was "inconceivable that EPA's comprehensive reworking of an Act that specifically controls the requirements for industrial pollution would fail to affect the requirements of even a single NPRA member"), modified on other grounds, 489 F.3d 1245 (D.C.Cir. 2007). The plaintiff has offered evidence that if HHS had calculated the cap figure using a proportional allocation, as specified in the Medicare statute, rather than applying the methodology set forth in the challenged regulation, the plaintiff's cap liability would have been reduced by over $300,000. See Pl.'s Mot., Ex. A ("Myers Decl.") ¶¶ 14-17; Ex. I (spreadsheet documenting the plaintiff's calculation).
The remaining elements of standing—traceability and redressability— receive scant attention from the parties and, indeed, merit little discussion here. However one conceives of the injury suffered by the plaintiff, it is fairly traceable to the government conduct challenged— the application of the challenged regulation to assess the plaintiff's cap liability. And even if the court cannot directly award damages to the plaintiff, it can direct HHS to calculate and refund to the plaintiff any amounts overpaid. See Compassionate Care Hospice v. Sebelius, 2010 WL 2326216, at *5 (W.D.Okla. Jun. 7, 2010) (invalidating the reimbursement regulation and ordering HHS to calculate and refund any amounts overpaid by the plaintiff hospice); see also Hospice of N.M., LLC v. Sebelius, 691 F.Supp.2d 1275, 1295 (D.N.M.2010) (concluding that "HHS' application of the allegedly invalid regulation is an integral part of the injury suffered by Plaintiff, and if the Court were to find that the regulation is invalid, this would at least partially redress Plaintiff's injury"); cf. Larson v. Valente, 456 U.S. 228, 243 n. 15, 102 S.Ct. 1673, 72 L.Ed.2d 33 (1982) (noting that a plaintiff "need not show that a favorable decision will relieve his every injury" to establish redressability).
Thus, the plaintiff has established that it has Article III standing to maintain this action. Accordingly, the court declines to remand this matter for additional administrative fact-finding on the plaintiff's standing.
In granting the plaintiff's request for expedited judicial review of the 2007
The "amount in controversy" requirement set forth § 1395oo (a)(2) "is nothing more than a jurisdictional provision, comparable to the $75,000 amount-in-controversy provision applicable to diversity cases under 28 U.S.C. § 1332." Baystate Med. Ctr. v. Leavitt, 545 F.Supp.2d 20, 40 n. 26 (D.D.C.2008), amended on other grounds, 587 F.Supp.2d 37 (D.D.C.2008). The Circuit has made clear, in the comparable context of diversity jurisdiction, that no extensive fact-finding is necessary to determine that the amount in controversy exceeds the jurisdictional threshold. See Rosenboro v. Kim, 994 F.2d 13, 16-17 (D.C.Cir.1993) (stating that dismissal for failure to satisfy the jurisdictional amount is justified only if "from the face of the pleadings, it is apparent, to a legal certainty, that the plaintiff cannot recover the amount claimed" and that the sum claimed by the plaintiff controls so long as the claim is made in good faith (quoting St. Paul Mercury Indem. Co. v. Red Cab Co., 303 U.S. 283, 288-89, 58 S.Ct. 586, 82 L.Ed. 845 (1938))). To require the PRRB to gather data and perform a detailed calculation of the specific amount in controversy simply to establish its jurisdiction to hear an appeal would represent a significant departure from the established scope of jurisdictional fact-finding, a departure for which the defendant has offered no authority. See IHG Healthcare v. Sebelius, 717 F.Supp.2d 696, 705-06, 2010 WL 2380743, at *8 (S.D.Tex. June 13, 2010) (rejecting the defendant's request for remand and noting that "the court can find no reason, or authority, for requiring the PRRB to undertake more arduous fact-finding in evaluating its jurisdiction than this court does when evaluating its own subject matter jurisdiction").
The PRRB stated that it reviewed the documentation submitted by the plaintiff, which contained the fiscal year 2007 cap calculation performed by the fiscal intermediary, as well as an explanation of the plaintiff's challenge to that calculation. Pl.'s Mot., Exs. F, H. Based on that documentation, the PRRB "estimated" that the amount in controversy exceeded the statutory threshold. Pl.'s Mot., Ex. H. The defendant did not challenge this determination at the administrative level
The court turns at last to the merits of the plaintiff's claim regarding the 2007 repayment demand. The plaintiff contends that that repayment demand must be set aside because the regulation on which it was based, 42 C.F.R. § 418.309(b)(1), impermissibly conflicts with 42 U.S.C. § 1395f(i)(2)(C), the statutory provision it purports to implement. See Pl.'s Mot. at 5-9, 16-21. The plaintiff argues that whereas the Medicare statute requires HHS to allocate the cap amount across years of service by proportionally adjusting the "number of beneficiaries" in any given year to reflect hospice services provided to an individual in previous and subsequent years, the regulation provides that an individual is counted as a beneficiary only in a single year, depending on when he or she first elects hospice benefits. Id. The plaintiff notes that every court to have addressed the issue has concluded that the regulation is invalid because it conflicts with the statute. Id. at 2; see generally Pl.'s Notice of Status of Related Cases. The defendant maintains that the regulation does not conflict with the statute and that its promulgation and application falls within the agency's considerable discretion to administer the Medicare program. Def.'s Mot. at 36-44.
The Supreme Court set forth a two-step approach to determine whether an agency's interpretation of a statute is valid under the APA. Chevron, U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984). This approach, commonly referred to as the "Chevron analysis," requires the court to first look to "whether Congress has spoken to the precise question at issue." Id. at 842, 104 S.Ct. 2778. If so, the court ends its inquiry. Id. But, if the statute is ambiguous or silent, the second step requires the court to defer to the agency's position, so long as it is reasonable. Id. at 843, 104 S.Ct. 2778; Sea-Land Serv., Inc. v. Dep't of Transp., 137 F.3d 640, 645 (D.C.Cir.1998) (holding that "[Chevron] deference comes into play of course, only as a consequence of statutory ambiguity, and then only if the reviewing court finds an implicit delegation of authority to the agency").
Like every court to have addressed the issue to date, this court need not advance beyond the first step of the Chevron analysis. The Medicare statute plainly states that in determining the "number of beneficiaries," the fiscal intermediary and HHS
Indeed, at the time HHS proposed the challenged regulation, it acknowledged that it was not implementing the statute's proportional allocation provision:
48 Fed. Reg. 38146, 38158 (Aug. 22, 1983) (emphasis added). Thus, the regulation sought to effectuate the intent of the statute by applying an "alternative" methodology to the one specified in the statute. See id.
The defendant maintains that its alternative methodology results from a reasonable interpretation of ambiguities in the statute and that the regulation accomplishes the legislative intent underlying the proportional allocation provision. See Def.'s Mot. at 37-42; Def.'s Reply at 1420. Yet, as every court to have addressed these issues has concluded, the plain and unambiguous language of the statute clearly establishes a methodology for determining the "number of beneficiaries," one that is fundamentally different from the methodology set forth in 42 C.F.R. § 418.309(b)(1).
Accordingly, the court concludes that 42 C.F.R. § 418.309(b)(1) fails the first prong of the Chevron analysis and constitutes an abuse of agency discretion. The court, therefore, grants the plaintiff's motion for partial summary judgment and denies the defendant's cross-motion for partial summary judgment.
The plaintiff requests the following relief: a declaration that 42 C.F.R. § 418.309(b)(1) is unlawful and set aside; a declaration that the repayment demand issued to the plaintiff for fiscal year 2007 is unlawful and set aside; an order requiring
The APA plainly authorizes the court to grant the declaratory relief sought by the plaintiff. See 5 U.S.C. § 706(2) (providing that a reviewing court shall hold unlawful and set aside agency action, findings and conclusions found to be arbitrary, capricious, an abuse of discretion or otherwise not in accordance with law). Accordingly, the court declares that 42 C.F.R. § 418.309(b)(1) and the fiscal year 2007 repayment demand issued to the plaintiff are unlawful and hereby set aside.
The APA also authorizes the court to enjoin unlawful agency action and direct the agency to remedy harm resulting from such action. See 5 U.S.C. § 702 (waiving the government's sovereign immunity to suits by individuals suffering a legal wrong because of agency action and "seeking relief other than money damages"); Hospice of N.M., 691 F.Supp.2d at 1295 (enjoining the application of the challenged regulation against the plaintiff and remanding the matter to the agency for a calculation of any amounts to be refunded to the plaintiff); accord Lion Health Servs., 689 F.Supp.2d at 858; Compassionate Care Hospice, 2010 WL 2326216, at *5. The Supreme Court has, however, cautioned that "injunctive relief should be no more burdensome to the defendant than necessary to provide complete relief to the plaintiffs." Califano v. Yamasaki, 442 U.S. 682, 702, 99 S.Ct. 2545, 61 L.Ed.2d 176 (1979); see also State of Neb. Dep't of Health & Human Servs. v. Dep't of Health & Human Servs., 435 F.3d 326, 330 (D.C.Cir.2006) (noting that injunctive relief "must be narrowly tailored to remedy the specific harm shown" (quoting Aviation Consumer Action Project v. Washburn, 535 F.2d 101, 108-09 (D.C.Cir.1976))); Meinhold v. U.S. Dep't of Defense, 34 F.3d 1469, 1480 (9th Cir.1994) (concluding that the district court erred in enjoining the defendant from applying the invalid regulation to all military personnel (citing Califano, 442 U.S. at 702, 99 S.Ct. 2545)). Accordingly, the court prospectively enjoins HHS from applying the challenged regulation to the plaintiff and remands this case to the HHS for a recalculation of the plaintiff's cap liability for fiscal year 2007. The court, however, declines the plaintiff's request for a nationwide injunction of the challenged regulation.
For the foregoing reasons, the court grants the plaintiff's motion for partial summary judgment, denies the defendant's motion for partial remand or, in the alternative, cross-motion for summary judgment, grants the defendant's motion for partial dismissal and denies the defendant's motion to strike. An Order consistent with this Memorandum Opinion is separately and contemporaneously issued this 20th day of July, 2010.
