UNITED STAT ES DIS TRICT COURT F OR THE DIS TRICT OF COLUM BIA SW EDI SH AMERI CAN HOSPI TAL , : : Plaintiff, : Civil Action No.: 08-2046 (RMU)

: v. : Re Docume nt Nos.: 4, 13

: KATHL EEN SEBE L IUS, in her off icial : capa city as Secr etar

y of the De partment of : Hea lth and Human Servic es, et al. , : : Def endants. : MEMORAN DUM OP INION G R A N T I N G I N P A R T A N D D E N Y I N G I N P A R T T H E D E F E N D A N T S ’ M O T I O N T O D I S M I S S ; G R A N T I N G T H E P L A I N T I F F ’ S M O T I O N T O C O M P E L P R O D U C T I O N O F T H E A D M I N I S T R A T I V E RE C O R D

I. INTRODUCTION This matter come s befor e the c ourt on the def endants’ motion to dismiss and the plaintiff’s motion to compel production of the a dminist rative r ecor d. On September 30, 2008, the Secr etar

y of the De partment of H ealth and H uman Service s (“the Sec reta ry”) issued a

n administrative rulingthat require d the plaintiff, a hospital in Rockfor d, I llinois , to repa y sever al milli on dollars to the Medica re pr ogram. The plaintiff commenc ed this action cha lleng ing the Secre tary ’s dec ision under the Administrative Proce dure A ct (“ APA”), 5 U .S.C. §§ 701 et seq. , and asse rtingtort claims ag ainst Mutual of Omaha (“Mutual” ), the insura

nce c ompany

that advised the pla intiff with respec t to its Medica re oblig ations, and Wisconsin P hy sicians Service Insuranc e Corporation (“WPS ”), the insurance company to which Mutual’s Medica re business was tra nsfer red in 2007. As discusse d in more deta il below, beca use the c ourt lacks subjec t matter jurisdiction over the plaintiff’s tort cla ims ag ainst the insuranc e compa nies, it gr ants in part the de fenda

nts’ motion to di smiss. The court denie s, howeve r, the portion of the defe ndants’motion that calls for the dismissal of the plaintiff’s A PA claim ag ainst the Secre tary . Finally , the

court grants the plaintiff’ s motion t o compel produc tion of the administrative re cord.

II. BACKG ROUND A. The Medicar e P rogram Medica re pr ovides hea lth insurance to the e lderly and disabled by

entitling elig ible benef iciarie s to have pa

y ment made on their

behalf for the c are and ser

vices re ndere d by hospitals, termed “pr oviders.” See 42 U.S.C. §§ 1395 et seq. Providers, in turn, ar e re imbursed by insurance companies, known as “f iscal intermedia

ries,” that have c ontrac ted with the Depa rtment of He alth and Human Ser vices to aid in administeringthe Medica re pr og ram. See id. § 1395h. Fisca l intermediarie s determine the amount of re imbursement due to provide rs under the Medica

re A ct and a

pplicable r egulations. See id. Providers that train r esidents in approve d residenc y prog rams may

be re imbursed for the costs of “graduate medica l educa tion” (“G ME”) a

nd “indirec t medical educ ation” (“ I ME”). See 42 U.S.C. § 1395ww. One va riable use d to calculate the GME a nd I ME costs to be allocated to a provider is the numbe r of f ull-time equivalent (“ FTE” ) re sidents in that provider’s tra ining prog ram. See id. A hig h GME or IME FTE c ount yields a cor responding ly

high G ME or I ME pay ment for the pr ovider. See id. Providers obtain Medica

re r eimbursement by

submitt ing c ost reports to their fisc al intermediar

y demonstratingthe costs they incurre d duringthe pre vious fiscal y ear and the por

tion of those costs to be a llocated to Medic are . See 42 C.F.R. § 413.20. After rec eivinga provide r’s cost repor t, the fiscal inter

mediary may audit the re port befor e dete rmining the total amount of

2reimburse ment to which the hospital is entitled, which it then memorializes in a Notice of

Prog ram Reimburseme nt (“NPR”). See id. § 405.1803. The fisc al intermedia ry may reope n and revise a cost repor

t within three y ear s after

the date of

the NPR. Id. § 405.1885. In the B alanc ed B udg et Act of 1997 (“B BA ”), Cong ress c apped the amount that providers could be r eimbursed f

or their GME a

nd I ME costs. See id. More spe cifica lly , for c ost reporting periods beg inning on or

afte r Oc tober 1, 1997, tea chinghospitals were limit ed to the number of GME FT Es and I ME FTEs “ for the hospital’s most re cent c ost reportingperiod e nding on or befor e De cembe r 31, 1996” f or the purpose of ca lculatingGME and I ME pay ments. See id. Followingthe ena ctment of the B BA , the Secr etar y promulg ated r egulations impl ementingthe caps imposed by

the statute. See42 C.F.R. §§ 413.86(g )(4) , 412.105(f) (1)( iv) (1997). The Secre tary subsequently

revised the regulations conce rningthe GME and I ME resident c aps in 1998, 1999 and 2001. See42 C.F.R. §§ 413.86, 412.105 (1998); 42 C.F.R. §§ 413.86(g )(8) (1999); 42 C.F.R. §§ 413.86(g )(8) (iii), 412.105(f) (1)( ix ) (2001)

. B. Fac tual and P roce dural Hi story The plaintiff is a c ertified Me dicar e provide r that par ticipates in the F amily

Practice Residency

Prog ram (“ the re sidency

program” ), which is sponsore d by the Univer sity

of I llinois College of Medicine for the pur pose of tra ining r esidents as fa mily prac tice phy sicians. Compl. ¶¶ 12- 14. The plaintiff a lleg es that duringfiscal year s 1995 and 1996, anothe r hospital, St. Anthony Medica l Center (“ St. Anthony ”), a lso participated in the r esidenc y prog ram. Id. ¶¶ 17- 18. In 1996, howeve r, St. Anthony withdrew f

rom the program a

nd the plaintiff absor

bed the residents that St. Anthony would otherwise ha

ve tra ined. Id.

3After the plaintiff took on the re sidents who had pre viously been tr ained by

St. Anthony , the plaintiff conta cted the f iscal intermedia

ry , Mutual, which advised the plaintiff to adjust its GME and I ME FTE r esident ca ps upward to r efle ct the fa ct that the plaintiff ha d assumed the residents for

merly trained by

St. Anthony

. Id. ¶¶ 18- 19. The plaintiff’ s NPRs for fiscal year s 1998 throug h 2002 wer e base d on FTE r esident ca ps that ref

lected both the r esidents traine d by the plaintiff and the residents pre viously trained by

St. Anthony

. Id. ¶ 20. In Fe bruar

y 2005, Mutual reope ned the c ost reports for fiscal year s 1999 throug h 2002 1 and adjusted the plaintiff’s F TE re sident caps downw ard to omit consideration of the reside nts previously

trained by

St. Anthony

. Id. ¶¶ 21- 22. L ikewise, Mutual omitted considera tion of St. Anthony ’s re sidents in the NPR t hat it issued for fisca l y ear 2003. Id. ¶ 23. Afte r the plaintiff appea led Mutual’s dete rmination to the Provider Reimbursement Revie w B oard, the Secre tary issued a rulingaff

irming Mutual’ s adjustments on September 30, 2008. Id. ¶ 25. This deter mination resulted in Medica re r ecoupingnear ly

$5 milli on from the plaintiff. Id. The plaintiff c ommenced the instant action in this court in November 2008 a lleg ing that the Secr etar

y ’s dec ision viol ated the A PA and asser ting e stoppel and other tor t claims ag ainst Mutual and WPS

. See ge nerally id. On April 9, 2009, the de fenda nts filed a motion to dism iss for lac k of subject matter

jurisdiction under F eder al Rule of Civil P roce dure 12( b)(1) and for

As t he NPR forfi sca l year199 8 was is sue d i n Fe bru ar y 2000, see Com pl. ¶ 37, t he t hre e- year 1 li m it at ion per iodon r eop eni ng a cos t r epo rt hadpas sedby the ti m e M utu al is sue d t he No ti ces of Reop eni ng in Fe bru ar y 2005, see id

. ¶ 21.

4failure to state a c laim under F eder al Rule of Civil P roce dure 12( b)(6)

. See ge nerallyDef s.’ 2 Mot. to Dismi ss (“De fs.’ Mot.”) . In response , the plaintiff filed a motion to compel production of the a dminist rative r ecor d, see ge nerally Pl.’s Mot. for Turnover

of the Admin. R. (“Pl.’s Mot.”), as w ell as an opposition to the defe ndants’ motion to dism iss, see ge nerallyPl.’s Opp’n to Defs.’ Mot. (“Pl.’s Opp’n” ). With bot h motions fully briefe d, the cour

t turns now to the applicable leg al standar ds and the pa rties’ a rguments.

III. ANALYSIS A. Legal Standard f

or a Mot ion to Dism iss Pursuant to Rule 12(b)( 1) Fe dera l courts ar e cour

ts of limit ed jurisdiction and the law presumes that “a c ause lies outside this li mited jurisdiction.” Kokkone n v. Guardian Life Ins. Co. of Am. , 511 U.S. 375, 377 (1994); St. Paul Mercury

Indem . Co. v. Red Cab Co. , 303 U.S. 283, 288-89 (1938); see also Gen. Motors Corp. v. Envtl. Prot. Agency , 363 F.3d 442, 448 ( D.C. Cir. 2004) (notingthat “[a]s a court of limited jurisdiction, we beg in, and end, with an e x amination of our jurisdiction”)

. Be cause “subjec t-matter jurisdiction is an ‘Ar t[ icle] I I I as we ll as a statutory require ment[,] no action of the parties c an conf er subjec t-matter jurisdiction upon a f eder al court.’” Akinsey e v. D istrict of Columbia , 339 F.3d 970, 971 ( D.C. Cir. 2003) (quoting Ins. Corp. of Ir., Ltd. v. Compagnie de s Bauxite de G uinea , 456 U.S. 694, 702 (1982)). O n a motion to dismi ss for lac k of subject matter jurisdiction pursuant to Rule 12(b)(1) , the plaintiff bea rs the

T he d ef end ant s a ls o mov ed t o di smiss t he p la int if f’ s c la ims agains t M utu al fo r i nsu ff ic ie nt 2 ser vice o f p roc ess und erFed er al Rul e of Civil Pro cedure 12( b)( 5), see Def s.’ Mo t. t o Di smiss (“ Def s.’ Mo t.” ) a t 2 5, bu t l at erwit hdr ew t hat m oti on, see Def s.’ Repl y in Sup por t o f M ot. to Dis m is s a t 1 7 n.1 4. 5burden of

establishing by

a pre pondera

nce of the evidenc e that the c ourt has subjec t matter jurisdiction. Lujan v. Defende rs of W ildlif e , 504 U.S. 555, 561 (1992). Be cause subject matter jur isdiction focuses on the c ourt’s powe r to hea r the c laim, howeve r, the c ourt must give the plaintiff’s fa ctual alleg ations closer sc rutiny when r esolvinga Rule 12(b)(1) motion than would be require d for a Rule 12(b)(6) motion for failure to state a claim. Macharia v. U

nited States , 334 F.3d 61, 64, 69 ( D.C. Cir. 2003); Grand Lodge of Fraternal Order of Police v . Ashcroft , 185 F. Supp. 2d 9, 13 (D.D .C. 2001). Thus, the cour t is not limi ted to the alleg ations contained in the c omplaint. Hohri v. United States , 782 F.2d 227, 241 (D.C. Cir. 1986), vacate d on other grounds , 482 U.S. 64 (1987). When nec essar y , the cour

t may consider the complaint supplemented by undisputed fac ts evidence d in the rec ord, or the complaint supplemented by undisputed fac ts plus the court’s re solution of disput ed fa cts. Herbe rt v. Nat’l Acad. of Scis. , 974 F.2d 192, 197 ( D.C. Cir. 1992).

B. Legal Stan dard f

or a Mot ion to Dism iss Pursuant to Rule 12(b)( 6) A Rule 12(b)( 6) motion to dism iss tests the lega l sufficienc y of a c omplaint. Browning v. Clint on , 292 F.3d 235, 242 ( D.C. Cir. 2002). The c omplaint need only set forth a

short and plain statement of the c laim, givingthe def endant f air notice of the c laim and the g rounds upon which it rests. Kingman Park Civic Ass’n v. W illiams , 348 F.3d 1033, 1040 (D.C. Cir. 2003) (c iting F E D . R. C I V . P. 8(a) (2) a

nd Conley v. G ibson , 355 U.S. 41, 47 (1957)). “ Such simpli fied notice pleadingis made possible by the libera l opportunity

for discove ry

and the other

pre- trial proce dures e stablished by the Rules to disclose more pre cisely the basis of both cla im and defe nse to define more na rrowly the disputed fac ts and issues.” Conley , 355 U.S. at 47-48 (interna l quotation marks omitted). I t is not necessar y for the pla intiff to plead all ele ments of his
6prima fa cie c ase in the c omplaint, Swierkiewicz v. Sore ma N.A. , 534 U.S. 506, 511-14 (2002), or

“plea d law or match fa cts to ever y element of

a leg al theory ,” Krieger v. Fade ly , 211 F.3d 134, 136 (D.C. Cir. 2000) (inter nal quotation marks and c itation omit ted). Yet, “[t]o s urvive a

motion to di smiss, a complaint must contain sufficient fa ctual matter , acc epted a s true, to state a claim to relief

that is plausible on its face.” Ashcroft v. Iqbal , 129 S. Ct. 1937, 1949 (2009) (interna l quotation marks omitted); Bell Atl. Corp. v. Tw ombly , 550 U.S. 544, 570 (2007) ( abrog atingthe oft-quoted la nguag e fr om Conley , 355 U.S. at 45-56, instructing courts not to dismiss for f ailure to state a

claim unless it appea

rs beyond doubt that “no set of fac ts in support of his claim [ ] would entit le him to relief” ). A c laim is facially plausible when the pleade d fac tual content “a llows the court to dra w the re asonable infere nce that the defe ndant is liable for the misconduc t.” Iqbal , 129 S. Ct . at 1949. “The plausibilit y standard is not akin to a ‘pr obability

require ment,’ but it asks for more than a she er possibility that a def endant ha s acte d unlawfully .” Id

. In resolvinga Rule 12(b) (6) motion, the cour t must t reat the complaint’s fa ctual alleg ations – including mixed questions of law and f act – a s true and dr aw a ll reasona ble infere nces the ref

rom in the plaintiff’s fa

vor. Macharia v. U

nited States , 334 F.3d 61, 64, 67 (D.C. Cir. 2003); Holy Land Found. for Relief &Dev . v. Ashcroft , 333 F.3d 156, 165 ( D.C. Cir. 2003); Browning , 292 F.3d at 242. Whi le many well-plea ded complaints ar e conc lusory , the court ne ed not ac cept a s true infe renc es unsupported by fac ts set out in the complaint or leg al conclusions ca st as fac tual alleg ations. W arren v. District of Columbia , 353 F.3d 36, 40 ( D.C. Cir. 2004); Browning , 292 F.3d at 242. “Thre adbar e re citals of the e lements of a c ause of action, supported by

mere conclusory

statements, do not suffice .” Iqbal , 129 S. Ct . at 1949.

7C. The Court G rants in Par t and Denies in Partthe De fend ants’ Motion to Dism iss and

Gr ants the P laintif

f’s Motion to Com pel P roduction of the Adm inis trat ive Rec ord 1. The Court G rants the De fend ants’ Motion to Dism iss the P laintif f’s Tort Claim s Against Mutual an d WPS Based on Lack of Sub jec t Mat terJurisdi ction This Circuit has noted that courts should re solve Rule 12(b)( 1) jurisdictional cha lleng es befor e conside ringRule 12(b)(6) challeng es. United States ex rel. Settlemire v . District of Columbia , 198 F.3d 913, 920 ( D.C. Cir. 1999) (citing United States ex rel. Kreindler & Kreindler v. United Tec hs. Corp. , 985 F.2d 1148, 1155- 56 (2d Cir. 1993)). Put simply , “if [the court] must di smiss t he complaint for lack of subject matter jur isdiction, the acc ompanying defe nses and objec tions become moot and do not nee d to be deter mined.” Kreindler & Kreindler , 985 F.2d at 1155-56 (citing5 F E D . P R A C . & P R O C . § 1350). Ac cording ly , the cour t will first address the de fenda nts’ argument that the cour t lacks subject matter

jurisdiction over the plaintiff’s tort c laims ag ainst Mutual and WPS

. SeeDef s.’ Mot. at 17-20. The de fenda

nts argue that 42 U.S.C. § 405(h), a s construed in unambiguous Supreme Court prec edent, make s clea r that the Medic are Act provide s no remedy for a n ag g rieve d hospital beyond the re cover

y , throug h the administrative proc ess set for th in the Act, of the Me dicar e reimburse ment to which the hospital is entitled. Id. at 17-18. Thus, the de fenda nts argue, the court’s jurisdiction extends only to the plaintiffs’ APA cla im ag ainst the Secre tary and does not encompa ss a tort ac tion ag ainst Mutual and WPS for a dditional money damag es ar ising out of the Secre tary ’s denial of

the plaintiff’s r equest for reimburse ment. Id. at 18-20. In addition, the defe ndants contend that beca use Mutual and WPS were a ctingas ag ents of the f eder al g overnme nt in committ ing the conduct in question, the c laims asserted a g ainst them as fisca l

8intermediar ies are eff ectively suits aga inst the United States gove rnment, which is immune from the plaintiff’s tort c laims. Id. at 20. The plaintiff takes issue with the def endants’ sug g estion that it is s eeking“additional” funds, pointing out that it seeks only the Medica

re r eimbursement to which it cla ims itis entitled by virtue of ha

ving tr ained St. Anthony ’s forme r re sidents, rather than any “additional” mone y . Pl.’s Opp’n at 18. The pla intiff also draw s fac tual distinctions between this case and the thre e principal c ases upon whic h the def endants re ly

– Shalala v. Illinois Council on Long Term Care, Inc. , 529 U.S. 1 (2000), Schweike r v. Chilicky , 487 U.S. 412 (1988), and Hec kler v . Ringer , 466 U.S. 602 (1984) – by

pointing out that the plaintiffs in Schweike r soug ht money

damag es ag ainst the fe dera l gove rnment for alleg ed constitutional violations, and that the plaintiffs in Illinois Council on Long T

erm Careand Ringer

failed to e x haust their administrative r emedies a nd

asser ted fe dera l question jurisdiction pursuant to 28 U.S.C . § 1331. Pl.’s Opp’n at 18. He re, in contra st, whether the plaintiff exhausted its administ rative r emedies is not in dispute, and the plaintiff “is not trying to invoke jurisdiction under fe dera l question jurisdiction.” Id. at 18-19. I n short, the plaintiff maintains that it “is only seekingrevie w of the [Provider Reimburseme nt Review B oard’ s] decision and rec overy of the amount of reimburseme nt based on its educa ting and tra ining a ll the Progr am re sidents after St. Anthony

discontinued its involvement in the residenc y program.” Id. at 19. Pursuant to 42 U.S.C. § 405(h), as applied to the Me dicar e program by 42 U.S.C. § 1395ii, [n] o finding s of fac t or decision of the [S ecr etar y ] shall be revie wed by any person, tribunal, or gover

nmental age ncy except as herein provided. No action ag ainst the Un ited States, the [S ecr etar y ], or any office r or employ ee there of shall be b ro u gh t

9under section 1331 [(authorizi ng fede ral questi o n ju r is d ic tion)] or 1346 [(authorizi ng fede ral defe ndant jurisdiction)] of Title 28 to rec over on any claim arising under this subchapte r. 42 U.S.C. §§ 405(h), see also id. § 1395ii. Thus, the plaintiff’s tort claims ag ainst Mutual and WP S are ba

rre d if those fisca l intermediarie s are “off icer [s] or employee[s]” of the United States or the Sec reta

ry and if the pla intiff’s tort claims “a ris[e] under” the Medica

re A ct. The c ourt will consider e ach of

these que stions in t urn. First, the r egulations interpretingthe Medica re A ct state that fisc al “[i] ntermedia ries and

car riers act on be half of [the De partment of H ealth and H uman Service s] i n car rying out c erta in [3 ] administrative re sponsibili ties that the law imposes.” 42 C.F .R. § 421.5(b). Sever al other Circuits have c oncluded that f iscal intermedia

ries ser ve as “ office r[s] or employ ee[s]” of the United States and ther efor e fa ll under the scope of § 405(h)

. See United States ex rel. Rahman v. Oncology A ssocs., P.C. , 198 F.3d 502, 510- 11 (4th Cir. 1999) (obser ving that “[n] ot only

are [carrie rs] given a

clea r duty to perfor m official a cts in administeringthe program, they are actua lly considere d ‘off

icer s or employ ees’ of the United States within the mea ning of the Medica re A ct” ( citing Y

our Home Visiting Nurse Servs., Inc . v. Shalala , 525 U.S. 449 (1999)); Midland Psychiatric Assocs., I nc. v. U nited States , 145 F.3d 1000, 1003- 04 (8th Cir. 1998) (conc luding that f

iscal intermedia

ries and c arr iers “a

re g overnme nt ag ents . . . [because ] [ u]nder contra ct with the Secr etar y of He alth and Human Ser vices, they

do the work of

the Gover

nment on the Secr etar

y ’s beha lf”) ( internal c itations omi tted); Bodimetric He alth Servs., Inc . v. Ae tna Life & Cas. , 903 F.2d 480, 487- 88 (7th Cir. 1990) (holdingthat fiscal inter mediarie s serve as

Car ri er s a re comparable to fi sca l i nte rmedia ri es. See Uni te d St ate s e x r el . Rah man v . Onco log y 3 Ass ocs ., P.C. , 198 F.3d502 , 510 n.1 (4t h Ci r. 1 999)

. 10“off

icer [s] or employ ee[s]” of the United States). In addition, this C ircuit has held that f iscal intermediar ies serve as ag ents of the United States. See Pine View Gardens, I nc. v. M utual of Omaha Ins. Co. , 485 F.2d 1073, 1075 ( D.C. Cir. 1973) (notingthat the fisca l intermediary was “an a g ent for the g overnme nt as a disclosed pr incipal”) . Thus, the cour t concludes that Mutual and WPS are “off

icer [s] or employ ee[s]” of the g overnme nt of the purpose s of § 405(h). Second, a c laim “ar is[ es] under” the Medica re A ct for pur

poses of § 405(h) if it is “inextricably

intertwined” with a claim for benef its, Ringer , 466 U.S. at 614-15, re g ardle ss of whether the claim is broug ht under fe dera l question jurisdiction, see Bodimetric He alth Servs., 4 Inc. , 903 F.2d at 487 (holding that “[a] party cannot avoid the Medica re A ct’s jurisdictional bar simply by styling its attac k as a c laim for collate ral damag es instead of a cha lleng e to the underlying de nial of bene fits” bec ause “ [i ]f lit iga nts who have be en denie d benef its could routinely obtain judicial revie w of these decisions by rec hara cter izi ngtheir cla ims under state . . .

cause s of ac tion, the Medicar e Ac t’s g oal of limited judicial review for a substantial number of claims would be seve rely undermined” ). Unde r this standard, the pla intiff’s tort claims ag ainst Mutual and WPS plainly

“aris[ e] under” the Medica re A ct. See R inger , 466 U.S. at 614 (noting that “at bottom, [t he plaintiffs’ c onstitut ional and statutory claims amounted to] a claim that they should be paid” Me dicar e re imbursements). Indeed, the plaintiff in this case a ppear s to conce de that its claims “arise unde r” the Medica re A ct. SeeCompl. ¶ 5 (stating that this “a ction arises out

T he c our t n ote s t hat , co ntr ar y to t he p la int if f’ s a sse rt ion th at it “i s no t t rying to invoke 4 j uri sdi ct ion und er fe der al que st ion j uri sdi ct ion ,” Pl .’s Opp’ n at 18- 19, t he p la int if f i n f act st at es in the complai nt tha t “

j uri sdi ct ion is bas ed o n 28 U.S.C. § 133 1 [ (governi ng fede ra l q ues ti on j uri sdi ct ion )] , 42 U.S.C. § 1395 oo [ (governi ng j udi ci al re view of dec is ion s of

th e Pr ovider Rei m bur sement Review Boa rd) ] a nd 5 U.S.C. § 702 [( gov er nin g j udi ci al re view of agency dec is ion s un derth e Admini st ra ti ve Proc edu re Act )] bec aus e t he a ct ion ar is es out of a f ina l agency act ion of

th e Uni te d St at es Depa rt m ent of Heal th andHum an S er vices ,” Co m pl. ¶ 5. 11of a f

inal ag ency

action of the United States Depa rtment of He alth and Human Ser vices” ). Thus, § 405(h) divests the c ourt of subjec t matter jurisdiction over the pla intiff’s tort claims ag ainst Mutual and WPS

. Cf. In re Series 7 Brok er Qualification Exam Scoring Litig. , 548 F.3d 110, 5 114 (D.C. Cir. 2008) (obse rving , in the context of the Ex chang e Ac t, that “rather than a llowing plaintiffs to sue under

common law theor ies, Congr ess cr eate d a self- contained pr ocess to re view and re medy

such complaints”)

. 2. The Court Denies the D efendan ts’ M otion to Dism iss the P laintif f’s APAClaim Against the Secr etar y and Grants the P laintif f’s Motion to Com pel P roduction of the Adm inis trat ive Rec ord The c ourt turns next t o the def endants’ motion to dismiss the plaintiff’s APA c laim ag ainst the Secre tary . The de fenda nts maintain that the Secre tary proper ly conclude d that St. Anthony ’s re sident caps c ould not be added to the pla intiff’s re sident caps in ca lculatingthe reimburse ment due to the plaintiff. De fs.’ Mot. at 11-17. Mor e spec ifically , the def endants contend that the Sec reta

ry ’s dec ision mustbe g iven broa d defe renc e, id. at 11-12, a nd that under this defer ential standar d of re view the de cision was re asonable , id. at 12-15. The defe ndants also

asser t that to the ext ent the plaintiff a rgues that it may

estop the g overnme nt based on the a dvice g iven to it by

Mutual, the court must reje ct this argument as a ma tter of law

. Id. at 15-17. The plaintiff c ounters that the Sec reta ry ’s dec ision was arbitra

ry and ca pricious and there fore must be overturne d under the APA. Pl.’s Opp’n at 7-12. It first disputes the defe ndants’ conte ntion that the court should aff ord broa d defe renc e to the dec ision, asserting instead that the Sec reta

ry ’s conf licting inter

pretations of the rele vant statutory provisions in

As a re sul t, t he c our t n eednotre ach th e de fe nda nts ’ a lt er nat ive ar gum ent th at Mu tua l a nd W PS 5 ar e i m

m une fr om th e pl ai nti ff

’s to rt cl ai m s. See Def

s.’ Mo t. a t 2 0- 23. 121997, 1998, 2001 and 2002 diminish the deg ree of def ere nce to whic h the Secr etar y ’s dec ision is entitled. Id. at 7-8. In addition, the plaintiff ar gues that the Sec reta ry ’s dec ision conflicted with Congr ess’s intent. Id. at 8-10. F inally , the plaintiff disputes the def endants’ a ssertion that the plaintiff ca

nnot assert e quitable estoppel a g ainst the g overnme nt, arg uing that the court should enter tain the plaintiff’s e stoppel argument ag ainst the g overnme nt and the fisca l intermediarie s in light of the unique fa cts of this case

. Id. at 10-18. After the def endants filed the ir motion to di smiss, t he plaintiff f iled a motion to compel production of the a dminist rative r ecor d, arguing that it shoul d be per mitted to cite to the administrative re cord in pre paringits opposit ion to the defe ndants’ motion to dism iss. See generally Pl.’s Mot. In their opposition to the plaintiff’s motion, the defenda nts note that they 6 purposef ully did not cite to the administrative re cord in their motion to dismiss and argue that “all of Plaintiff’s c laims should be dismi ssed as a matter of la

w base d on the fa ce of

the Complaint, and without refer ence to ext rane ous evidenc e.” D efs.’ Opp’n at 3. In other wor ds, the def endants a ssert, “[t] he Court does not nee d the administrative re cord to re solve [the issues raised in the de fenda

nt’s motion to di smiss] and, ther efor e, the Sec reta ry has not y et produc ed it.” Id. at 2. Wit h respe ct to the def

endants’ motion to dismiss the plaintiff’s tort c laims ag ainst the fiscal inter

mediarie s, the defe ndants are corr ect that the c ourt ca n – and should – resolve the

Desp it e t he f

act th at th e pl ai nti ff

as ser te d t hat it “ha [d] th e r ight t o ci te to th e Admini st ra ti ve 6 Reco rd in pre par ing it s r esp ons e t o” t he d ef end ant s’ m oti on t o di smiss, Pl.’ s M ot. ¶ 24, t wo weeks a ft erfi li ng its m oti on t o co m pel pr oduc ti on o f t he a dm ini st ra ti ve rec ord– be for e t he c our t is sue d a rul ing on t he moti on –th e pl ai nti ff fi le d an opp osi ti on t o t he d ef end ant s’ m oti on t o dis m is s, see gen era ll

y Pl. ’s Opp’ n. T he p la int if f d id not re que st th at th e c our t p er m it it to fi le an oppo si ti on t o t he d ef

end ant s’ m oti on t o di smiss a ft erth e c our t rule d on th e pl ai nti ff’s m oti on t o compel p rod uct ion of

th e a dm ini st ra ti ve rec ord

.

13jurisdictional issues raised in the motion to dismi ss at the ea rliest possible stag e. See, e .g. , Steel Co. v. Citiz ens for a Better Env ’t , 523 U.S. 83, 94 (1998) (noting“[t] he re quirement that jurisdiction be established as a threshold matter” ). As discussed in Part I I I .B.1 supra , the cour t has dete rmined that it lacks subjec t matter jurisdiction over the pla intiff’s tort claims ag ainst the fiscal inter

mediarie s without refe renc e to the administrative r ecor d. The same cannot be said, howeve r, of the c ourt’s consider ation of the de fenda nts’ motion to dismi ss the plaintiff’s APA cla ims ag ainst the Secre tary . For , althoug h the ar guments raised in the def endants’ motion to dismiss are compelling , the cour t’s task is not sim ply

to determine whether the Secr etar

y rea ched the corr ect r esult in denying the plaintiff’s re quest for reimburse ment. Rather, the c ourt must assess whether the Secr etar

y “examined the re levant data and ar ticulated a satisfactory

explanation for its action includinga rational connec tion between the fa cts found and the choice made.” Md. Pharm., Inc . v. Drug Enforce ment Admin. , 133 F.3d 8, 16 (D.C. Cir. 1998) (quoting Motor VehicleMfrs. Ass’n v. State Farm M ut. Auto. Ins. Co. , 463 U.S. 29, 43 (1983)). “ The re quirement that a g ency action not be a

rbitrar y and ca pricious includes a r equire ment that the ag ency adequately

explain it s result.” Appleby v . Harve y , 517 F. Supp. 2d 253, 260 (D.D.C. 2007) (quoting Dickson v . Sec’ y of Def. , 68 F.3d 1396, 1404 ( D.C. Cir. 1995)). “T he ar

bitrary and ca pricious standar d . . . ‘mandat[ es] that an ag ency . . . provide a

n explanation that will enable the cour t to evaluate the ag ency ’s rationale at the time of de cision.’” Id. (citing Dickson , 68 F.3d at 1404). Wit hout the administrative re cord, the court is unable to perf orm this function. Cf. Shays v. Fe d. Election Comm’n , 414 F.3d 76, 97- 100 (D.C. Cir. 2005) (conc luding, ba sed on the a dminist rative r ecor d, that the ag ency had g iven no rational justification for its determination and the deter mination was there fore arbitra ry and ca pricious).

14For this reason, the de fenda

nts’ relianc e on American B ankers Assoc iation v. Nati onal Credit Union Administr ation , 271 F.3d 262 ( D.C. Cir. 2001) is mispl ace d. In American B ankers Association , the Circuit conclude d that the trial cour t did not err by

not directingthe National Credit Union Administration (“the NCUA” ) to produce the administrative re cord be cause the plaintiff’s cha lleng e to the NCUA’ s rule “de pend[ed] entirely on the ar gument that the rule itself violate[d] the statute.” Id. at 267. The Circ uit relied on the a nalog ous case of Sierra Club v. United States Fish &W

ildlif e Serv ice , 245 F.3d 434 ( 5th Cir. 2001), in which the F ifth Circuit conclude d that production of the a dminist rative r ecor d was not nec essar y beca use the Circuit’s “re view [was] li mited to interpretingthe extent to which the regulation [ was] consistent with the statute.” Id. at 440 n.37. Her e, in contra st, viewingthe complaint in the light most favor able to the plaintiff, the plaintiff is c halleng ing not just whethe r the Sec reta ry ’s re gulations were consistent with the statute, but also whether the Secr etar

y ’s adjudicatory

proce ss was re asonable and whe ther the de cision was consistent with Cong ressional intent. SeeCompl. ¶¶ 81-85. In other wor ds, the plaintiff is challeng ing not only the administrative dec ision, but also the process that led to that decision. The c ourt is unable to assess the me rits of these a rguments without consideringthe administrative re cord. See M d. Pharm., Inc . v. Drug Enforce ment Admin. , 133 F.3d 8, 16 ( D.C. Cir. 1998) (direc ting the c ourt to determine whether the ag ency

“examined the rele vant data a

nd articulated a satisfactory explanation for its action includinga rational

connec tion between the fac ts found and the c hoice made ”); Dickson v . Sec’ y of Def. , 68 F.3d 1396, 1404 (D.C. Cir. 1995) (dire ctingthe cour t to assess the ag ency ’s explanation for its deter mination). As a re sult, the court denies the defe ndants’ motion to dism iss the plaintiffs’ APA claim and grants the plaintiff’ s motion t o compel produc tion of the administrative re cord.
15IV. CONCLUSION

For the fore g oing r easons, the c ourt g rants in par t and denies in pa

rt the def endants’ motion to di smiss and gr ants the plaintiff’s motion to compel produc tion of the administrative

rec ord. An Or der c onsistent with thi s Memorandum Opinion is separ ately and contempora

neously issued this 5th day

of Mar ch, 2010.

RI CARDO M. URBI

NA United States District J udg e

16