Judge: Mary H. Strobel, Case: 22STCP00750, Date: 2023-01-31 Tentative Ruling

Case Number: 22STCP00750    Hearing Date: January 31, 2023    Dept: 82

             Respondents California Department of Health Care Services (“DHCS” or “Department”) and Michelle Baass, Director of the State Department of Health Care Services (“Director”) (collectively “Respondents”) generally demur to the first, second, third, and fourth causes of action in the first amended petition for writ of mandate (“FAP”) filed by Petitioner K. Andrew Johnson, M.D. (“Petitioner”).

Judicial Notice

Respondents’ Request for Judicial Notice (“RJN”) Exhibits 1-4 – Granted. 

Petitioner’s RJN Exhibit 1 – Granted. 

Petitioner’s RJN Exhibit 2 – Denied.  The USC-Brookings article is not an official act of the legislative and executive departments of this state.  (Evid. Code § 452(c).)  Petitioner does not furnish the court with sufficient information to find that the article states facts that are common knowledge or not reasonably subject to dispute.  (Evid. Code § 452(g), (h) and § 453.)  Petitioner’s citation to a description of the Schaeffer Center’s mission and his contention that the source of the study is “respected” do not satisfy that standard.   Respondents’ objection is sustained.  However, the court will deem as true any allegations about this study in the FAP.  (See FAP ¶ 44.)

Background

Brief Summary of Petition

            Petitioner “is board certified by the American Board of Anesthesiology and duly licensed as a medical doctor by the State of California. He has provided, and continues to provide, anesthesia services at various locations in southern California.”  (FAP ¶ 2.)

            In this writ action, Petitioner seeks to enforce Welfare and Institutions Code section 14079 on behalf of himself and “other physician anesthesiologists in the State of California.”  (Id. ¶¶ 2-10.)  Petitioner contends that Department failed to comply with section 14079 when setting Medi-Cal rates for physician anesthesiologists.  (Id. ¶¶ 1-2.)  The requirements of section 14079 are discussed in the Analysis section below.  Petitioner prays for the following:

·         “[a] writ of mandate compelling the Respondents to take into account in their next access report, and all future access reports, the statutory factors set forth in California Welfare & Institutions Code section 14079, subd. (b)(1) - (b)(3) (i.e., CPI, Medicare rates, and physician charges)”;

·         “a writ of mandate compelling the Respondents to update and timely implement ‘[a]nnual cost increases for physicians as reflected by the Consumer Price Index’”;

·         “An Order requiring the Respondents to pay retroactive reimbursement to physician anesthesiologists from 2001 to the present….”; and

·         “An Order requiring Respondents to pay all retroactive reimbursement into a common fund with 25 percent of this common fund being set aside for attorneys’ fees.”

(FAP Prayer ¶¶ 1-4.)

Statutory Background – Medicaid Act and Medi-Cal

“Medicaid is a cooperative federal-state program through which the federal government reimburses states for certain medical expenses incurred on behalf of needy persons.’”  (Keffeler v. Partnership Healthplan of California (2014) 224 Cal.App.4th 322, 326-27; see 42 U.S.C. § 1396 et seq.)   "States do not have to participate in Medicaid, but those that choose to do so must comply both with statutory requirements imposed by the Medicaid Act and with regulations promulgated by the Secretary of the U.S. Department of Health and Human Services." (Keffeler, supra at 326-27.)  States administer the program and "determine eligibility, the types of services covered, payment levels for services, and other aspects of administration, within the confines of federal law." (Id. at 327.)

To qualify for federal funds, a state must submit its Medicaid plan and any amendments to the federal agency that administers the program, the Centers for Medicare & Medicaid Services (CMS). (Douglas v. Independent Living Center ofSo. Calif., Inc. (2012) 565 U.S. 606, 610.) “Participating states are required to include in their plans reimbursement methods and standards for the medical services provided.”  (California Hosp. Ass’n v. Maxwell-Jolly (2010) 188 Cal.App.4th 559, 565.) 

State plans and amendments must " provide such methods and procedures relating to the utilization of, and the payment for, care and services available under the plan (including but not limited to utilization review plans as provided for in section 1396b(i)(4) of this title) as may be necessary to safeguard against unnecessary utilization of such care and services and to assure that payments are consistent with efficiency, economy, and quality of care and are sufficient to enlist enough providers so that care and services are available under the plan at least to the extent that such care and services are available to the general population in the geographic area.”  (42 U.S.C. § 1396a(a)(30)(A) [hereafter section 30(A)].) 

“Section 30(A) is commonly understood to set two standards for Medicaid provider rates: ‘efficiency, economy and quality of care’ (EEQ) and equal access to care.”  (Santa Rosa Memorial Hospital, Inc. v. Kent (2018) 25 Cal.App.5th 811, 820.)

Medi-Cal is California's state Medicaid program. (See e.g. Welf. & Inst. Code §§ 14132.)  Department administers the Medi-Cal program.  (22 C.C.R. § 50004(a).) 

“Medicaid providers and recipients may challenge CMS approval of a state plan under the Administrative Procedure Act (APA).”  (Santa Rosa, supra, 25 Cal.App.5th at  815.)  “[T]hey may obtain judicial review should the agency uphold the rates” after that administrative process.  (Id. at 818.)

Procedural History

            On March 3, 2022, Petitioner filed a verified petition for writ of ordinary mandate and complaint for declaratory relief against Respondents. 

            On June 29, 2022, Respondents filed a demurrer and a meet and confer declaration.  The court received Petitioner’s opposition and Respondents’ reply. 

            On September 8, 2022, after a hearing, the court sustained Respondents’ demurrer to the petition with leave to amend.  The court’s September 8, 2022, ruling is not repeated here but is incorporated by reference.  

            On September 27, 2022, Petitioner filed his FAP.

            On October 31, 2022, Respondents filed their demurrer to the FAP and meet and confer declaration.  The court has received Petitioner’s opposition and Respondents’ reply. 

Legal Standard – Demurrer

A demurrer tests the sufficiency of a pleading, and the grounds for demurrer must appear on the face of the pleading or from judicially noticeable matters.  (Blank v. Kirwan (1985) 39 Cal.3d 311, 318; Saltarelli & Steponovich v. Douglas (1995) 40 Cal.App.4^th 1, 5.)  “A demurrer tests the pleadings alone and not the evidence or other extrinsic matters.”  (Hahn v. Mirda (2007) 147 Cal.App.4th 740, 747.) 

The allegations in the petition must be liberally construed in favor of Petitioner on demurrer.  (Mobil Oil Corp. v Exxon Corp. (1986) 177 Cal.App.3d 942, 947.)  A demurrer accepts as true “all material facts properly pleaded and matters subject to judicial notice, but not deductions, contentions, or conclusions of law or fact.” (Stonehouse Homes LLC v. City of Sierra Madre (2008) 167 Cal. App. 4th 531, 538.)  “A demurrer must dispose of an entire cause of action to be sustained.”  (Poizner v. Fremont General Corp. (2007) 148 Cal.App.4th 97, 119.)

Analysis

The first, second, and third causes of action are for writ of ordinary mandate.  Respondents demur to these causes of action on the grounds that “(1) petitioner does not have an enforceable ‘beneficial right’ to the annual revision of any particular Medi-Cal reimbursement rate; (2) the Department has broad discretion in periodically reviewing and revising reimbursement rates and there is no ministerial duty to revise rates using the factors listed in Section 14079, subdivision (b); [and] (3) the Department has complied with state and federal law at all times.”  (Dem. 11.)

There are two essential requirements to the issuance of an ordinary writ of mandate under Code of Civil Procedure section 1085: (1) a clear, present, and ministerial duty on the part of the respondent, and (2) a clear, present, and beneficial right on the part of the petitioner to the performance of that duty. (California Ass’n for Health Services at Home v. Department of Health Services (2007) 148 Cal.App.4th 696, 704.) “An action in ordinary mandamus is proper where … the claim is that an agency has failed to act as required by law.” (Id. at 705.)

“Generally, mandamus is available to compel a public agency's performance or to correct an agency's abuse of discretion when the action being compelled or corrected is ministerial.”  (AIDS Healthcare Foundation v. Los Angeles County Dept. of Public Health (2011) 197 Cal.App.4th 693, 700.)  “A ministerial act is an act that a public officer is required to perform in a prescribed manner in obedience to the mandate of legal authority and without regard to his own judgment or opinion concerning such act's propriety or impropriety, when a given state of facts exists.”  (Kavanaugh v. West Sonoma County Union High School Dist. (2003) 29 Cal.4th 911, 916.)   

“However, [mandamus] will lie to correct abuses of discretion. In determining whether a public agency has abused its discretion, the court may not substitute its judgment for that of the agency, and if reasonable minds may disagree as to the wisdom of the agency's action, its determination must be upheld. A court must ask whether the public agency's action was arbitrary, capricious, or entirely lacking in evidentiary support, or whether the agency failed to follow the procedure and give the notices the law requires.”  (County of Los Angeles v. City of Los Angeles (2013) 214 Cal.App.4th 643, 654.) 

Section 14079

            Welfare and Institutions Code, which is central to the writ petition, provides as follows:

(a)  The director shall periodically review the reimbursement levels for physician and dental services in the Medi-Cal fee-for-service delivery system, and shall periodically revise the rates of reimbursement to physicians and dentists to the extent the director deems necessary to comply with applicable federal Medicaid program requirements, including provisions on reasonable access to physician and dental services for Medi-Cal beneficiaries.

(b)  To the extent consistent with the department's federally approved access monitoring plan, or any successor methodology for monitoring reasonable access to Medi-Cal covered services, as described in Section 1396a(a)(30)(A) of Title 42 of the United States Code, this periodic review, as it relates to rates for physician services, shall take into account at least the following factors:

(1) Annual cost increases for physicians as reflected by the Consumer Price Index.

(2) Physician reimbursement levels under the Medicare Program.

(3) Prevailing customary physician charges within the state and in various geographical areas.

(4) Characteristics of the current population of Medi-Cal beneficiaries and the medical services needed.

Section 14079 was originally enacted in 1976.  It was amended in 1992 and then also again in 2020. The 1992 version stated that “the director annually shall review the reimbursement levels for physician and dental services under Medi-Cal, and shall revise periodically the rates of reimbursement to physicians and dentists to ensure the reasonable access of Medi-Cal beneficiaries to physician and dental services.”  (See 1992 Cal. Legis. Serv. Ch. 713 (A.B. 3564) (WEST).)   The 1992 amendment required the director to consider the four factors specified in section (b)(1)-(4) of the current statute. 

On June 29, 2020, the Legislature enacted Assembly Bill 80 (Cal. Stats 2020 Ch. 12) (AB 80), which amended Section 14079 to require only periodic reviews of reimbursement levels and to adjust “rate reviews for physician and dental reimbursable services to more closely align with federal access-to-care requirements.” (Resp. RJN, Exh. 1, [Sen. Com. On Budget and Fiscal Review, Analysis of Assem. Bill No. 80 (2019-2020 Reg. Sess.)], at p. 1.)

Standing

To have standing to seek a writ of mandate, a party must be “beneficially interested.”  (CCP § 1086.) “A petitioner is beneficially interested if he or she has some special interest to be served or some particular right to be preserved or protected over and above the interest held in common with the public at large.”  (Rialto Citizens for Responsible Growth v. City of Rialto (2012) 208 Cal. App. 4th 899, 913; accord Carsten v. Psychology Examining Com. (1980) 27 Cal.3d 793, 796-97.) “This standard … is equivalent to the federal ‘injury in fact’ test, which requires a party to prove by a preponderance of the evidence that it has suffered ‘an invasion of a legally protected interest that is '(a) concrete and particularized, and (b) actual or imminent, not conjectural or hypothetical.'’”  (Associated Builders and Contractors, Inc. v. San Francisco (1999) 21 Cal.4th 352, 361-362.)  “One who is in fact adversely affected by governmental action should have standing to challenge that action if it is judicially reviewable.”  (Save the Plastic Bag Coalition v. City of Manhattan Beach (2011) 52 Cal.4th 155, 165.) 

Respondents contend that Petitioner has no private right of action because section 14079 incorporates section 30(A); the U.S. Supreme Court held that there is no private right of action under 30(A); and “petitioner cannot prevail on his three mandamus claims seeking to compel the Department to revise rates without first establishing the Department’s noncompliance with Section 30(A).” (Dem. 17-20.)

In Armstrong v. Exceptional Child Center, Inc. (2015) 575 U.S. 320, medical providers claimed an Idaho state agency set reimbursement rates lower than section 30(A) permitted and sued in federal court to order the agency to increase the rates.  The U.S. Supreme Court held that “[t]he sheer complexity associated with enforcing § 30(A), coupled with the express provision of an administrative remedy, § 1396c, shows that the Medicaid Act precludes private enforcement of § 30(A) in the courts.”  (Id. at 329.)  The Court noted that “[i]t is difficult to imagine a requirement broader and less specific than § 30(A)'s mandate that state plans provide for payments that are ‘consistent with efficiency, economy, and quality of care,’ all the while ‘safeguard[ing] against unnecessary utilization of ... care and services.’”  (Id. at 328.) 

In Santa Rosa Memorial Hospital, Inc. v. Kent (2018) 25 Cal.App.5th 811, the California Court of Appeal applied Armstrong to a writ petition seeking to enforce section 30(A) in state court and held the petitioner lacked standing.  In Santa Rosa, the California legislature reduced Medicaid hospital payments 10 percent between 2008 and 2011 and CMS, the federal agency that administers the Medicaid program, approved the rate reductions.  A group of hospitals sued California’s Department of Health Care Services (i.e., the Respondent here) in state court and alleged that the rate reductions violated section 30(A).  The hospitals sought a writ of mandate to declare the rates void and “and to obtain an award of almost $100 million in recalculated rates.”  (Id. at 814.)     

The Santa Rosa Court held that the hospitals could not seek a writ of mandate against DHCS to contest Medicaid reimbursement rates under section 30(A).  The Court stated as follows:

Plaintiff hospitals seek a writ of mandate declaring void these reduced rates of payment they received for inpatient services provided to Medicaid recipients and ordering a recalculation of those rates. Medicaid providers may challenge the sufficiency of payment rates by petitioning the federal agency that approved the rates to set aside the disputed rates and they may obtain judicial review should the agency uphold the rates. [Citations.] The department correctly contends that an administrative rate challenge followed by judicial review of the agency determination under the Administrative Procedure Act, 5 United States Code section 701 et seq., is the exclusive remedial path to correct rates that do not comply with section 30(A) standards.

The trial court rejected this contention but went on to deny plaintiffs' petitions on the merits, finding the rates compliant with the Medicaid Act. We need not consider the many issues bearing on the merits of plaintiffs' claims because we conclude that under no circumstances is writ relief against the state agency available to challenge on substantive grounds rates that have been approved by CMS.

(Santa Rosa, supra, at 819-820 [bold italics added].) 

Respondents contend that to prevail on its writ claims, Petitioner must necessarily prove that the Department failed to comply with section 30(A).  (Dem. 17-20.)  Respondents contend that Petitioner “plainly challenges the sufficiency of Medi-Cal reimbursement rates” and “there is no private right of action for such relief by writ.”  (Id. at 17.)  Respondents’ arguments are persuasive. 

“To qualify for federal funds [under Medicaid], participating states submit a ‘state plan’ to the federal government…. State plans and amendments are submitted for review and necessary approval to the federal agency that administers the program, the Centers for Medicare & Medicaid Services, a division of the Department of Health and Human Services (CMS).”  (Santa Rosa, supra, 25 Cal.App.5that 815.)  As a participant in the federal Medicaid program, “the State of California has agreed to abide by certain requirements imposed by federal law in return for federal financial assistance in furnishing medical care to the needy.”  (Olszewski v. Scripps Health (2003) 30 Cal.4th 798, 804.) Among other federal requirements, California must ensure access to covered Medi-Cal benefits by providing for reimbursement to providers consistent with the statutory factors of efficiency, economy, and quality of care, and comparable geographic access set forth in section 30(A).

In this context, the FAP clearly challenges on substantive grounds the sufficiency of federally approved Medi-Cal reimbursement rates.  Petitioner does not allege in the FAP that CMS has not approved California’s current Medi-Cal reimbursement rates or found them inconsistent with section 30(A).  Nonetheless, in his first, second, and third causes of action, Petitioner contends that California’s Medi-Cal reimbursement rates are inadequate because they fail to account for: (1) the annual cost increases for physicians as reflected by the Consumer Price Index; (2) physician reimbursement levels under the Medicare program; and (3) prevailing customary physician charges within the state and in various geographical areas. (FAP ¶¶ 32, 38, 45.)  In his Prayer for Relief, Petitioner seeks orders directing Respondents to “update” the rates and “to pay retroactive reimbursement to physician anesthesiologists from 2001 to the present.”  (Prayer ¶¶ 2-3.)  Thus, like the hospitals in Santa Rosa, Petitioner “challenge[s] on substantive grounds rates that have been approved by CMS.”  The Court held that writ relief is not available for that purpose. 

Section 14079 is not a rate-setting statute and does not, in itself, govern the setting of Medi-Cal rates.  Rather, the statute requires a periodic review of the Medi-Cal reimbursement levels “to the extent the director deems necessary to comply with applicable federal Medicaid program requirements” and “[t]o the extent consistent with the department's federally approved access monitoring plan.”  Section 14079 expressly incorporates the federal standards described in section 30(A).  Thus, this court cannot issue a writ directing Department to “update” its rates and pay retroactive reimbursement, as Petitioner requests, without determining that the rates do not comply with section 30(A).  Stated another way, if the Medi-Cal reimbursement levels have been approved by CMS as in compliance with “federal Medicaid program requirements” and section 30(A), the director of Department could not abuse her discretion in finding that periodic review and revision of such rates is not “necessary to comply with applicable federal Medicaid program requirements.”  An allegation of non-compliance with section 30(A) is, therefore, necessary to Petitioner’s claim that Respondents failed to comply with section 14079. 

The court recognizes neither Armstrong nor Santa Rosa decided whether there is a private right of action under section 14079.  Nonetheless, both cases are binding on this court, and both provide guidance directly relevant to the court’s determination of whether Petitioner has standing to seek the writ relief prayed for in the FAP.  Petitioner cites no other published appellate decision that would support his claim of standing.  Because Petitioner’s writ claims inherently require a determination of non-compliance with section 30(A), the court finds Armstrong and Santa Rosa to be compelling authority in support of Respondents’ contention that Petitioner lacks standing to the extent he seeks writs compelling Department to modify its Medi-Cal reimbursement rates or pay retroactive reimbursement. 

As the court stated in the September 8, 2022, ruling, it may be theoretically possible that a petitioner could allege a scenario in which the Department violated section 14079 in a manner that would not require the court to consider Department’s compliance with section 30(A).  While Petitioner seeks a writ compelling Respondents to “take into account in their next access report, and all future access reports, the statutory factors set forth in California Welfare & Institutions Code section 14079” (Prayer ¶ 1), Petitioner also seeks a writ compelling rates to be reset and moneys to be reimbursed based on the allegedly improper rates.  Petitioner lacks standing to seek such writ relief in court, as analyzed above. 

Petitioner contends that he is challenging Department’s application of section 14079, not section 30(A), and he “does not have an administrative remedy against CMS for a violation of this state law.”  (Oppo. 7.)  But, as discussed, Petitioner’s writ claims necessarily depend on a determination of non-compliance with section 30(A).  Relatedly, Petitioner argues that “[a]nother independent reason why this court cannot condition the application of section 14079 upon the state’s compliance with Section 30(A) is because this statute is unenforceable in courts” pursuant to Armstrong. (Oppo. 14.)  While true, the point undermines Petitioner’s claim of standing.  As stated in Armstrong, the relief Petitioner seeks “must be sought initially through the Secretary rather than through the courts.” (Armstrong, supra, 575 U.S. at 331.) 

Petitioner argues that “CMS does not formally approve or disapprove the access reviews mandated by 42 C.F.R. sections 447.203 and 447.204.”  (Oppo. 7.)  Petitioner then argues that “14079(b) refer[s] to the new procedural requirements in 42 C.F.R. sections 447.203 and 447.204, and not to Section 30(A).”  (Oppo. 10.)  Petitioner argues that these federal regulations require California to “submit an access report based on a review and revision of physician rates at least every three years.”  (Oppo. 9.) 

An argument that 14079 applies to 42 C.F.R. sections 447.203 and 447.204 but not Section 30(a) is unpersuasive.  The Legislature expressly incorporated section 30(A) in section 14079(b).  Thus, Petitioner is incorrect to the extent he contends that section 14079(b) refers only to procedural requirements in the federal regulations.  Moreover, sections 447.203 and 447.204 were specifically promulgated to implement the statutory commands provided under Section 30(A). (42 C.F.R. § 447.200; 80 Fed. Reg. 67576-01 (2015).)  Those regulations are part and parcel of section 30(A). 

Based on the foregoing, Petitioner has not alleged standing for his writ claims alleging, substantively, that California’s Medi-Cal reimbursement rates are inadequate.  (FAP ¶¶ 32, 38, 45.)  Petitioner also has not alleged standing for his prayers that seek orders directing Respondents to “update” the rates and “to pay retroactive reimbursement to physician anesthesiologists from 2001 to the present.”  (Prayer ¶¶ 2-3.)  

For purposes of this demurrer, the court will assume, without deciding, that Petitioner could have standing for his prayer for relief that seeks to compel Respondents “to take into account in their next access report, and all future access reports, the statutory factors set forth in California Welfare & Institutions Code section 14079, subd. (b)(1) - (b)(3).”  The court considers that argument next.

Has Petitioner Alleged a Clear, Present, and Ministerial Duty or an Abuse of Discretion? 

            Petitioner contends that the Department violated Section 14079 by allegedly failing to account for: (1) the annual cost increases for physicians as reflected by the Consumer Price Index; (2) physician reimbursement levels under the Medicare program; and (3) prevailing customary physician charges within the state and in various geographical areas. (FAP ¶¶ 32, 38, 45.) 

However, the factors set forth in section 14079(b) cannot be read in isolation and must be harmonized with the entire statute.  When interpreting a statute, the court must construe the statute, if possible to achieve harmony among its parts.  (People v. Hull (1991) 1 Cal. 4th 266, 272.)   “When interpreting statutory language, we may neither insert language which has been omitted nor ignore language which has been inserted.”  (See People v. National Auto. and Cas. Ins. Co. (2002) 98 Cal.App.4th 277, 282.)  “[I]nterpretations which render any part of a statute superfluous are to be avoided.”  (Young v. McCoy (2007) 147 Cal.App.4th 1078, 1083.) 

Section 14079(a) states that “[t]he director shall periodically review the reimbursement levels for physician … services in the Medi-Cal fee-for-service delivery system, and shall periodically revise the rates of reimbursement to physicians … to the extent the director deems necessary to comply with applicable federal Medicaid program requirements, including provisions on reasonable access to physician and dental services for Medi-Cal beneficiaries.”  (bold italics added.)  Section 14079(b) also states that “[t]o the extent consistent with the department's federally approved access monitoring plan, or any successor methodology for monitoring reasonable access to Medi-Cal covered services, as described in Section 1396a(a)(30)(A) of Title 42 of the United States Code, this periodic review, as it relates to rates for physician services, shall take into account at least the following factors: ….” (bold italics added.)

Thus, section 14079 directly ties the Director’s “periodic” revision of rates to a determination by the Director that the changes are “necessary to comply with applicable federal Medicaid program requirements.”  Furthermore, the four factors specified in section 14079(b) only need to be considered “to the extent consistent” with Department’s federally approved plans under section 30(A).  Any cause of action for mandate must be made within this statutory framework. 

Whether Respondents had any legal duty to give further consideration to annual cost increases for physicians as reflected in the CPI; physician reimbursement levels under Medicare; or prevailing customary physician charges within the state and various geographical areas depends on whether that consideration would be consistent with Department’s federally approved plans under section 30(A).  (§ 14079(b).)  Furthermore, the Director would only be required to make rate revisions if she determines the changes are “necessary to comply with applicable federal Medicaid program requirements.”  (§ 14079(a).) 

Section 14079 requires the Director to take certain factors into account “to the extent consistent with the department’s federally approved access monitoring plan, or any success methodology for monitoring reasonable access… as described in Section [30(a)].”  Petitioner alleges that CMS does not approve the access monitoring plan.  Respondent appears to disagree.  At the hearing, the parties should address whether that is a true factual dispute.  The parties should also address the effect on any obligation under Section 14079 if in fact there is no federally approved access monitoring plan.

Assuming there is an approved access monitoring plan, Petitioner argues the Department’s most recent Access Monitoring Review Plan from 2019 does not mention or consider the factors set forth in section 14079(b). (FAP ¶¶ 23-24, 32-33, 38, 45-46.)  Petitioner appears to argue that consideration of the 14079(b) factors would nonetheless be consistent with the approved access monitoring plan.  Petitioner should highlight where in its Petition it makes this allegation. 

Petitioner does not allege that Director has failed to conduct the “periodic” review required by section 14079(a) or sections 447.203 and 447.204.  As Petitioner acknowledges, “due to Covid CMS has extended the deadline for updated AMRPs from October 1, 2022, to October 1, 2024.”  (Oppo. 9, fn. 1 and Resp. RJN Exh. 4.)  This timing raises an issue of ripeness with respect to Petitioner’s prayer that Respondent be required to take into account the 14079(b) factors in its next review.  Petitioner has provided no information regarding the status of that review or whether Respondent will or will not take those factors into account. 

Petitioner must allege a clear and present ministerial duty.  Because the 2019 AMRP is several years old, it necessarily does not prove any current abuse of discretion (in 2022-2023) in failing to consider factors set forth in section 14079.  Petitioner concedes this point in the FAP, stating that the 2019 AMRP “cannot satisfy this requirement [of section 14079(b)(1)] because it is based on a comparison of Medi-Cal data between SFYs (‘State Fiscal Years’) 2015-16 and 2016-17.”  (FAP ¶ 33.)  To the extent Petitioner relies on the 2016 AMRP to allege an abuse of discretion (Oppo. 17), this argument is unpersuasive for the same reason.  The parties should address this further at the hearing.

To the extent the Petitioner seeks a writ compelling the Respondents to update and timely implement annual cost increases for physicians as reflected by the CPI or  an order requiring the Respondents to pay retroactive reimbursement to physician anesthesiologists from 2001 to the present, the Petitioner lacks standing and the demurrer is sustained without leave to amend. 

The parties should address further at the hearing whether the demurrer should be overruled with respect to Petitioner’s request for a writ compelling Respondents to take into account in their next access report, and all further access reports, the factors set forth in 14079(b).   

Fourth Cause of Action – Declaratory Relief

Pursuant to the local rules which designate that Department 82 is a specialized Writs and Receivers department and not a general civil department, only those special proceedings stated in the rule (including for writ of mandate) are properly assigned to this department.  (LASC Local Rules 2.8(d) and 2.9.)  Local Rules 2.8(d) and 2.9 do not include a claim for declaratory relief as special proceedings assigned to the writs departments.  To the extent the fourth cause of action seeks declaratory relief under CCP section 1060 on the question of whether fees may be awarded “from a common fund” created for the benefit of a class of beneficiaries, the court stayed the cause of action on September 8, 2022, pending resolution of the writ causes of action. 

The fourth cause of action also appears to seek attorney’s fees pursuant to CCP section 1021.5.  Should Petitioner seek attorney fees or other relief incidental to the writ causes of action, Department 82 may rule on such matters by noticed motion should Petitioner prevail on his writ causes of action.  Respondents could raise all available defenses to a motion for fees at that time. 

Leave to Amend

            This is the court’s second ruling on demurrer.  Petitioner has been given an opportunity to amend the defects in his pleading in response to the court’s September 8, 2022, ruling, which was issued after written briefing and oral argument.  As to the claims requiring update and implementation of annual cost increases based on CPI and an order requiring retroactive reimbursement, the pleading remains defective for the reasons discussed above and in the court’s prior ruling.  In his opposition brief, Petitioner has neither requested leave to amend nor made an offer of proof of how he could allege additional facts to address the defects discussed above.  In these circumstances, leave to amend is denied.