Court Opinion

ID: 7805594
Source: CourtListenerOpinion
Date Created: 2022-09-01 14:02:37.363189+00
Date Added: 2024-06-11T16:30:02.065010
License: Public Domain

Notice: This opinion is subject to formal revision before publication in the
Atlantic and Maryland Reporters. Users are requested to notify the Clerk of the
Court of any formal errors so that corrections may be made before the bound
volumes go to press.

             DISTRICT OF COLUMBIA COURT OF APPEALS
                                 No. 17-AA-590
                            EBONY COE, PETITIONER,
                                        V.

    DISTRICT OF COLUMBIA DEPARTMENT OF HUMAN SERVICES, RESPONDENT.
                    On Petition for Review of an Order of the
             District of Columbia Office of Administrative Hearings
                                  (DHS-859-16)

(Argued May 16, 2019                                 Decided September 1, 2022)

       Chelsea Sharon, Legal Aid Society for the District of Columbia, with whom
David Carpman, Jonathan H. Levy, and Jennifer Mezey, Legal Aid Society for the
District of Columbia, were on the brief, for petitioner.

       Richard S. Love, Senior Assistant Attorney General, with whom Karl
A. Racine, Attorney General for the District of Columbia, Loren L. AliKhan,
Solicitor General at the time the brief was filed, and Caroline S. Van Zile, Deputy
Solicitor General, were on the brief, for respondent.

      Before BECKWITH, Associate Judge, and RUIZ and FISHER, ∗ Senior Judges.

      Opinion of the court by Associate Judge BECKWITH.

      Dissenting opinion by Senior Judge FISHER at page 12.

      ∗
       Judge Fisher was an Associate Judge at the time of argument. His status
changed to Senior Judge on August 23, 2020.
                                         2

      BECKWITH, Associate Judge: In early December 2016, the District of

Columbia Department of Human Services (DHS) notified petitioner Ebony Coe

that her Medicaid benefits would be terminated at the end of the month. Ms. Coe

appealed the agency’s determination to the Office of Administrative Hearings

(OAH). She argued that DHS erred in terminating her benefits and that the error

was part of an unlawful policy of terminating Medicaid coverage without

conducting the pretermination assessment required by federal law.                An

Administrative Law Judge (ALJ) found that DHS erroneously terminated Ms.

Coe’s benefits due to a misapplication of federal law, but ruled that he lacked

authority to order the mayor to correct the unlawful policy. He determined that

such an order could be issued only by a judge of the Superior Court upon a request

for equitable relief made in that court.       DHS argues that this is a proper

interpretation of the relevant statutes and Ms. Coe contends that it is not. We agree

with Ms. Coe and we reverse and remand for further proceedings.

                                         I.

      States that participate in Medicaid must comply with federal requirements in

administering the program. See Naccache v. Taylor, 199 A.3d 181, 187 (D.C.
                                          3

2018). 1 Medicaid provides health care benefits to, among others, people who are

“aged, blind, or disabled,” as well as people whose Modified Adjusted Gross

Income (MAGI) falls below a certain level. See 42 U.S.C. § 1396-1. Some people

qualify for Medicaid under more than one provision. The District must reevaluate

the eligibility of individuals who are enrolled in Medicaid due to disability at least

every twelve months. See 42 C.F.R. § 435.916(b). Before terminating an enrolled

person from Medicaid, the Department of Human Services (DHS) “must consider

all bases of eligibility.” Id. § 435.916(f)(1). Until DHS has found an enrolled

individual to be ineligible, it must “[c]ontinue to furnish Medicaid regularly” to

that person. 42 C.F.R. § 435.930(b).

      Ms. Coe was receiving Medicaid coverage due to her disability when she

received a notice that she would “not be eligible for medical assistance of any

type” as of January 2017 because she was “neither aged or disabled.” The notice

also stated, “[Y]ou can apply for Medicaid at DC Health Link.” Believing that she

might qualify for Medicaid based on her MAGI, Ms. Coe began the online DC

Health Link application. She was stopped by an error message that said she could

not apply because she had active Medicaid coverage.             A DHS caseworker

      1
        The term “state” includes the District of Columbia.           See 42 C.F.R.
§ 400.203 (2021).
                                          4

confirmed that she could not apply until her current benefits expired, and a DHS

supervisor suggested that she apply once her disability-based coverage ended.

      Ms. Coe filed a request for a hearing with OAH, seeking reversal of the

agency’s termination decision on the ground that DHS had failed to screen her for

MAGI eligibility as it was legally required to do. She also requested an order

pursuant to D.C. Code § 4-210.16 directing DHS to correct its policy of

terminating non-MAGI Medicaid coverage without conducting the necessary

pretermination review of MAGI eligibility.       DHS conceded that it failed to

evaluate alternate bases for Ms. Coe’s Medicaid eligibility because of a

“technological barrier”—namely, a “built-in failsafe to prevent fraud and duplicate

case creation.” DHS asserted that it would address cases “on an ad-hoc basis as

they are brought to the Agency’s attention” while it modified the certification

process. DHS also stated that it would help Ms. Coe obtain a determination of her

income-based eligibility and “ensur[e] that she [would] not experience a break in

coverage” if she still qualified for Medicaid.

      The ALJ reversed DHS’s termination of Ms. Coe’s benefits because DHS

violated Ms. Coe’s right under 42 C.F.R. § 435.930(b) to receive benefits until

“found to be ineligible.” The ALJ also found that the termination was “based on ‘a

misapplication of law’ within the meaning of [s]ection 4-210.16.” It declined,
                                          5

however, to issue an order directing the mayor to take corrective action. Stating

that ALJs have “expressly-defined statutory and regulatory powers” that are

distinct from the “broad, equitable powers of a court,” the ALJ concluded that an

order directing the mayor to correct the unlawful policy would constitute “purely

declaratory relief that may overstep the boundaries of [his] authority as an

administrative law judge.”

                                          II.

      On petition for review, Ms. Coe argues that D.C. Code § 4-210.16(b) gives

ALJs authority to issue an order directing the mayor to correct a policy that does

not comply with federal law. DHS counters that § 4-210.16(b) does not confer

such authority and that in the absence of explicit statutory authorization, ALJs are

limited to sustaining or reversing a mayoral action. 2

      “The proper construction of a statute raises a question of law, and our review

is de novo.” Washington v. District of Columbia Dep’t of Pub. Works, 954 A.2d

945, 948 (D.C. 2008). “Because the OAH is simply an all-purpose adjudicatory

body, without a particular subject-matter focus, its legal interpretations do not

command deference.” United Dominion Mgmt. Co. v. District of Columbia Rental

      2
          DHS did not appeal the ALJ’s decision reversing the notice of termination.
                                         6

Hous. Comm’n, 101 A.3d 426, 430 (D.C. 2014) (citing Williams v. District of

Columbia Dep’t of Pub. Works, 65 A.3d 100, 104 (D.C. 2013)).

      The OAH Establishment Act gives ALJs the power to issue “interlocutory

orders and orders.” D.C. Code § 2-1831.09(b)(5). (An order is defined as “the

whole or any part of the final disposition (whether affirmative, negative,

injunctive, or declaratory in form) of the Mayor or of any agency in any matter

other than rulemaking, but including licensing.” 3 See id. § 2-1831.01(12) (stating

that for purposes of the act establishing OAH, “order” has the “meaning provided

that term in § 2-502(11)”). D.C. Code § 2-1831.09(e) provides that an ALJ, “or a

party in interest in an adjudicated case, may apply to” a Superior Court judge “for

an order issued on an expedited basis to show cause why a person should not be

held in civil contempt for refusal to comply with an order or an interlocutory order

issued by an Administrative Law Judge.” Further, a “party in interest may also

bring an action for any other equitable or legal remedy authorized by law to

compel compliance with the requirements of an order or interlocutory order of an

Administrative Law Judge.”      Id.   The government argues that this language

signifies that the Superior Court is the only proper forum for requesting and

      3
        The OAH Establishment Act incorporates this definition from a statute that
also discusses the authority of the D.C. Council and other bodies. In this context,
the phrase “of the Mayor or of any agency” is a vestige of the original statute and
has no independent meaning in this context.
                                         7

receiving equitable relief relevant to an OAH order. That the Superior Court is

empowered to provide relief, however, does not mean an ALJ is barred from doing

so, as long as the ALJ’s actions are authorized by statute. See Paschall v. District

of Columbia Dep’t of Health, 871 A.2d 463, 467, 469 n.6 (D.C. 2005).

      The Public Assistance Act allows any aggrieved applicant for or recipient of

public assistance to request a hearing, which will “be conducted in accordance with

the provisions of this subchapter.” D.C. Code § 4-210.01. One such provision

instructs that “the Mayor will correct” a challenged policy when (1) the petitioner

“challenges a departmental policy”; (2) the petitioner’s claim for relief is granted;

and (3) the relief is based on “a misapplication of law contained in the policy.” Id.

§ 4-210.16(b).

      It is undisputed that the ALJ who heard Ms. Coe’s case found that all three

requirements were met:      (1) Ms. Coe challenged the departmental policy 4 of

terminating Medicaid benefits without conducting the pretermination review

      4
        DHS argued before the ALJ that a “technological barrier,” not DHS policy,
was responsible for the misapplication of law that jeopardized Ms. Coe’s benefits.
DHS concedes, however, that the ALJ “found that the misapplication of law was
contained in a District ‘policy.’” The ALJ found a policy because DHS was aware
of the problem but rather than “declining to issue the Medicaid termination
notice—and continuing to provide benefits—until it was able to perform the
legally required eligibility determination,” it instead “chose to issue a notice of
termination in violation of federal law.”
                                           8

required by 42 C.F.R. § 435.930(b); (2) the ALJ granted Ms. Coe’s request for

relief by reversing her termination from Medicaid; and (3) the ALJ granted such

relief because DHS had terminated Ms. Coe’s benefits “based on a misapplication

of the law.” The question, then, is whether the statutory scheme authorizes an ALJ

to order the Mayor to “correct” the proscribed policy. D.C. Code § 44-1003.09.

      DHS argues that the ALJ here was limited to either “sustaining or reversing

the challenged mayoral action aggrieving Ms. Coe—the proposed termination of

benefits.” It posits this as the logical extension of the principle that “administrative

law tribunals . . . do not have the inherent ‘equitable authority’” of courts in the

judicial branch. District of Columbia Off. of Tax & Revenue v. Shuman, 82 A.3d

58, 70 (D.C. 2013) (quoting Ramos v. District of Columbia Dep’t of Consumer &

Regul. Affs., 601 A.2d 1069, 1073 (D.C. 1992)).           In Shuman, an OAH ALJ

considered a “glitch” in a District computer system that caused a series of

erroneous tax bills and notices to be sent to a household. Id. at 61. The ALJ

prohibited the tax agency from sending further incorrect notices or bills to the

couple, imposed “conditional monthly fines potentially adding up to many tens of

thousands of dollars,” and ordered “the unconditional transfer of a large amount of

money from one District agency” to another. Id. at 61–62. This court reversed the

ALJ’s decision, finding that the “totally unprecedented” order by the ALJ was
                                           9

based on a subjective “sense of justice” rather than “the provisions of the statute in

question.” Id. at 69–70.

      But Shuman does not bar ALJs from imposing declaratory or injunctive

relief in all circumstances. It simply reinforces that ALJs must operate within the

bounds prescribed by statute. 5

      In Paschall, a petitioner was seeking readmission to a nursing facility under

D.C. Code § 44–1003.09(c), which provides that “[i]f as a result of a hearing held

under this section a resident is to be returned to a facility, the Mayor shall facilitate

that return . . . .” See 871 A.2d at 468. The ALJ determined that he could not

order the patient’s readmission to the facility before a hearing and that “such an

order could be issued only by a judge of the Superior Court upon request for

equitable relief made in that court.” Id. at 464. Although the court ultimately

      5
        To the extent DHS argues that only § 4-210.16(a), not § 4-210.16(b), could
authorize “broad” and “systemic” relief, that argument is without merit.
Subsection (a) allows multiple similarly situated individuals to seek resolution as a
class while subsection (b) instructs that misapplications of the law will be
corrected. There is no indication that a claimant must pursue class-action status
under subsection (a) in order to obtain relief under subsection (b), and “[e]ach
provision of the statute should be given effect, so as not to read any language out
of a statute ‘whenever a reasonable interpretation is available that can give
meaning to each word in the statute.’” Bd. of Dirs. of the Wash. City Orphan
Asylum v. Board. of Trs. of the Wash. City Orphan Asylum, 798 A.2d 1068, 1080
(D.C. 2002) (quoting Sch. St. Assocs. Ltd. P’ship v. District of Columbia, 764 A.2d
798, 807 (D.C. 2001) (en banc)).
                                        10

rested its decision on a federal regulation, see id. at 469 (citing 42 C.F.R.

§§ 431.205, -246), it also considered the proper interpretation of D.C. Code § 44–

1003.09(c). Ultimately concluding that § 44–1003.09(c) empowered “the ALJ [to]

order readmission after a hearing,” we also noted that the petitioner made “a strong

case” that § 44-1003.09(c) implicitly authorized the ALJ to order readmission even

before the hearing. Id.

      The language “the Mayor will” in D.C. Code § 4-210.16 authorizes an ALJ

to order the mayor to correct an unlawful policy. 6 See Paschall, 871 A.2d at 468–

69 (drawing a similar conclusion based on language in D.C. Code § 44–1003.09(c)

that “the Mayor shall facilitate” the return of a successful hearing applicant). The

government argues, and Ms. Coe agrees, that the ALJ does not have authority to

enforce an order for equitable relief. That does not, however, prevent the ALJ

from issuing an order that may then be enforced by the Superior Court. See D.C.

Code §§ 2-1831.01(12), 2-502(11), 2-1821.09(e).

      We need not decide whether such an order would be appropriate in this case.

“To hold, as we do, that the ALJ possesses such authority is not to say that he must

      6
        DHS contends that the language “the Mayor will correct that challenged
policy” leaves no room for an injunction and it must be the Mayor herself who
takes action. We are not persuaded by this reading, which presumably would
prevent a Superior Court judge, and not just an OAH ALJ, from issuing an
injunction.
                                        11

exercise it or that to do so will be appropriate in all cases, including this one.”

Paschall, 871 A.2d at 469. DHS contends in its brief that “after identifying the

issue that caused the premature proposed termination of Ms. Coe’s benefits, the

Mayor put a process in place to correct the mistake.”          DHS made similar

representations to the ALJ but, as DHS acknowledges, the ALJ did not address

them. Ms. Coe, for her part, provided evidence that other people had experienced

unlawful termination of benefits, suggesting that her termination was the result of

“standard practice,” rather than “isolated employee error.” Ms. Coe made similar

representations to this court, which DHS contested. On remand, the ALJ should

consider whether DHS’s unlawful policy still exists and whether an order directing

the mayor to correct the policy is warranted in this case. See id. (remanding for

factfinding by ALJ and determination whether requested order was still necessary);

Badawi v. Hawk One Sec., Inc., 21 A.3d 607, 614 (D.C. 2011) (“Normally, when

an agency fails to make a finding on a materially contested issue of fact, we do not

‘fill the gap by making [our] own determination from the record, but must remand

the case for findings on that issue.’” (alteration in original) (quoting Morris v.

EPA, 975 A.2d 176, 181 (D.C. 2009))).
                                           12

                                          III.

      For the foregoing reasons, we reverse the ALJ’s ruling that he lacked the

authority to order the mayor to correct the unlawful policy and remand for further

proceedings not inconsistent with this opinion.

                                                      So ordered.

      FISHER, Senior Judge, dissenting: The ALJ granted Ebony Coe all the relief

she needed and all that she was entitled to receive. Nevertheless, petitioner’s

lawyers are determined to use this case as a vehicle to obtain a ruling that may

benefit other clients in future cases. I believe that we should “confine ourselves to

a resolution of the only question fairly presented to us by this appeal . . . .” District

of Columbia v. Wical Ltd. P’ship, 630 A.2d 174, 182 (D.C. 1993).

      Petitioner sought reversal of the agency’s decision to terminate her benefits,

arguing that DHS had failed to screen her for MAGI eligibility, as the law

required. DHS responded that it indeed should have considered whether Coe was
                                         13

eligible for Medicaid coverage on alternative bases. The agency attributed the

error to a faulty process; its computer system had “a built-in failsafe to prevent

fraud and duplicate case creation” which blocked active Medicaid enrollees from

receiving an eligibility determination. DHS did not have “a policy, construction,

or interpretation containing a misapplication of th[e] law.” DHS assured the ALJ

that it was “actively working” to change the certification process and, in the

meantime, averred that it would address cases “on an ad-hoc basis as they are

brought to the Agency’s attention.” As for Coe, DHS stated that it would “assist

her in obtaining” a determination of her income-based eligibility and “ensur[e] that

she does not experience a break in coverage” if she still qualified for Medicaid.

      Because the notice of termination was “based on a misapplication of law,”

the ALJ reversed the agency’s decision.          He concluded: “By noticing the

termination of Petitioner’s Medicaid benefits without having considered whether

she was eligible for benefits based on her MAGI, DHS violated Petitioner’s right,

under federal law, to continue receiving Medicaid benefits until ‘found to be

ineligible,’” citing 42 C.F.R. § 435.930(b). However, the ALJ declined to issue

“the broad remedial order [Coe] seeks,” adding that the reversal of the termination

notice “provides Petitioner with adequate relief in this case.” He also decided not

to grant “declaratory relief beyond that which explains [the] order of reversal.”
                                          14

      Here, the parties primarily dispute whether the ALJ had the power to order

the mayor to comply with the law through an injunction and, if so, whether he was

obliged to issue such an order here. Those are not easy questions. The statute

clearly indicates that the mayor “will” correct a challenged policy if a claimant is

granted relief because of a misapplication of law — but the text is silent as to

whether an ALJ is empowered to order the mayor to do so.

      In this case it is unnecessary to decide whether an ALJ has the authority to

issue an injunction, either stemming from the specific language of § 4-210.16(b) or

based on other statutory or implied authority. “An injunction is a drastic and

extraordinary remedy, which should not be granted as a matter of course.”

Monsanto Co. v. Geertson Seed Farms, 561 U.S. 139, 165 (2010). No need for an

injunction exists if a “less drastic remedy” is “sufficient to redress” the injury. Id.

at 165–66. The language of § 4-210.16(b) already instructs the Mayor to “correct

the challenged policy, construction or interpretation,” and petitioner has not shown

why that legislative directive is inadequate or ineffective.

      Here, moreover, petitioner already received the relief that she needed:

a comprehensive review of her eligibility for Medicaid. The ALJ’s order, which
                                          15

reversed the notice of termination, effectively kept petitioner in her previous

enrollment status; petitioner’s reply brief confirms that the District has complied

with the ALJ’s order. Additionally, DHS declared that it would review Coe’s

eligibility for MAGI-based Medicaid and that Coe would not face a gap in her

coverage if she qualifies. Regarding individuals who are similarly situated to Coe,

the District represents that it has developed a practice to manually process such

applications. As the District’s brief promises: “Under the current ABD renewal

process, if the beneficiary is no longer eligible under their current category, the

agency will evaluate the beneficiary for another Medicaid eligibility category prior

to terminating Medicaid coverage.”

      This makeshift process no doubt is cumbersome and inefficient. Should the

District again fail to meet the requirements of the Medicaid program, one potential

avenue for seeking broader relief is a consolidated administrative hearing based on

the provision that allows “a class action on behalf of . . . others similarly situated,”

D.C. Code § 4-210.16(a), (a procedure which petitioner did not invoke here. We

also note that the Superior Court “can assuredly issue equitable relief in an

appropriate case.” D.C. Office of Tax and Revenue v. Shuman, 82 A.3d 58, 74

(D.C. 2013).
                                         16

      The ALJ properly concluded that DHS had misapplied the law, he reversed

the notice of termination that the agency had sent to petitioner prematurely, and the

District has devised an interim solution. Because petitioner’s injury has been

redressed, there is no need in this case to determine whether a more “drastic and

extraordinary remedy,” such as an injunction, would be available in other

circumstances.