GRANT v. HARRIS (2025)

ORDER DISMISSING THE COMPLAINT AND GRANTING LEAVE TO AMEND

The plaintiffs are individuals with substantial disabilities. They receive benefits through Florida's Long-Term Care Medicaid Waiver program (the “LTC program”). The program provides services to enrollees that allow them to live in the community as opposed to a nursing home facility. The defendant is the Secretary of the Florida Agency for Health Care Administration. AHCA oversees the LTC program and contracts with managed care plans that actually provide the services. In this lawsuit, the plaintiffs allege AHCA has failed to adequately oversee the managed care plans. They cite a variety of problems primarily focusing on the notice-and-hearing procedures managed care plans follow when reducing or denying benefits. The plaintiffs also assert the assessment tools that are required by Florida rule to determine what services should be provided are sometimes incorrect or inaccurate.

But no plaintiff has alleged there are any services the plaintiff needs but does not currently receive, and no plaintiff is currently facing a reduction or denial of services. The Secretary has moved to dismiss on numerous grounds and alternatively for a more definite statement. This order grants the motion to dismiss because the plaintiffs lack standing or otherwise fail to state a claim on which relief can be granted. The order gives the plaintiffs an opportunity to amend the complaint.

I

The Medicaid program is a cooperative federal-state program created to provide medical assistance to individuals of limited economic means. See 42 U.S.C. § 1396-1; see also Harris v. James, 127 F.3d 993, 996 (11th Cir. 1997) (quoting Silver v. Baggiano, 804 F.2d 1211, 1215 (11th Cir. 1986)). State participation in Medicaid is optional, but once a state chooses to participate, it must comply with the applicable statutes and rules. See Alexander v. Choate, 469 U.S. 287, 289 n.1, 105 S.Ct. 712, 83 L.Ed.2d 661 (1985). To participate in the Medicaid program, a state must submit a comprehensive “state plan” of services to be approved by the federal Centers for Medicare and Medicaid Services. See 42 U.S.C. § 1396a(b); 42 C.F.R. §§ 430.10–25.

Each state plan must include certain mandatory services, including nursing-facility services. See 42 U.S.C. § 1396a(a)(10) & 1396d(a)(4); see also Fla. Stat. § 409.905 (setting out the mandatory Medicaid services). In addition to the mandatory state plan, a state may also apply to provide additional services through “waiver programs.” See Omnibus Reconciliation Act of 1981, Pub. L. No. 97-35 § 2176, 95 Stat. 357 (codified as amended at 42 U.S.C. § 1396n(c)). Waivers permit states to offer home and community-based services to individuals to avoid institutionalization. See 42 U.S.C. § 1396n(c)(1); 42 C.F.R. § 441.300. Florida's LTC program is such a program. It provides home and community-based services for adults with disabilities and elderly individuals who require a nursing-home-facility level of care. See Fla. Stat. § 409.979.

Under federal law, each state must designate an agency responsible for administering and supervising Medicaid programs. See 42 U.S.C. § 1396a(a)(5). In Florida, AHCA is responsible for Medicaid programs. Fla. Stat. § 20.42(3). Federal rules permit the delegation of eligibility determinations and provision of Medicaid services. See 42 C.F.R. § 431.10(c). Thus, a state can contract with organizations to provide the care and services offered under the state plan. See 42 U.S.C. § 1396u-2. However, the state agency must ensure that any organization complies with federal law. 42 C.F.R. § 431.10(c)(3). Further, if a state contracts with private entities for the provision of services, the state must develop and implement quality assessment strategies. 42 U.S.C. § 1396u-2(c).

II

To administer the LTC program, AHCA has entered into contracts with seven private managed care plans. Under the contracts, the plans are required to provide the plaintiffs with case management services, assessment of care needs, and an adequate provider network. AHCA also has adopted a rule that applies to the managed care plans. See Fla. Admin. Code r. 59G-4.192. The rule refers to AHCA's website, which publishes a guide found at (the “Florida Policy”).

Under the rule and the Florida Policy, a managed care plan must develop a written “person-centered service plan (also called a plan of care).” 42 C.F.R. § 441.301(b); see Florida Policy § 6.2. To create a plan of care, the Florida Policy requires the use of a 701B Comprehensive Assessment and the LTC Supplemental Assessment. Florida Policy § 6.2; see also Compl., ECF No. 1 at 12 ¶ 38. The 701B Comprehensive Assessment is an individualized, complete assessment of an individual's medical, developmental, behavioral, social, financial, and environmental status. The LTC Supplemental Assessment evaluates the level of natural supports that are available to the enrollee. Natural supports are unpaid, voluntary assistance that an individual may receive.

Potential benefits under the LTC program include adult companion services, adult daycare, homemaker services (that is, help with meals and household care), skilled-nursing services, and respite care. Any benefit included in an individual's care plan must be medically necessary. This means it must be nursing-facility services or supportive services that are consistent with the individual's diagnosis and not in excess of the patient's need. See Florida Policy § 4.1.

Under federal law, a Medicaid enrollee must be given the opportunity for a hearing on a denial of a claim. This is sometimes called a “fair hearing.” 42 U.S.C. § 1396a(a)(3); see also 42 C.F.R. § 431.220(a)(1). The process begins with an internal grievance procedure with the private plan. See 42 C.F.R. § 438.402. There are rules that address the grievance procedures. For example, a notice of an adverse benefit determination—reduction, suspension, or termination of a benefit—must be provided in writing to the Medicaid enrollee at least 10 days before the proposed action takes effect. Id. § 438.404. AHCA has approved a template notice for use by the plans.

In addition, AHCA's contracts with the plans set out and require the plans to comply with the federal rules governing grievances. Part of the contracts is cited in the complaint. Compl., ECF No. 1 at 18 n.3. The complaint cites Attachment II, Ex. II-B, which has terms specific to the LTC Program. Attachment II, Core Contract Provisions, is also applicable. The contracts are available at . Under section VII.E. of the Core Contract Provisions, plans must provide notices of adverse decisions 10 days before the proposed action takes effect. If the enrollee requests, services must be continued during the appeal. Under section VII of the LTC Program Contract provisions, managed care plans must submit monthly reports to AHCA of all enrollees whose LTC services were denied, reduced, or terminated.

AHCA conducts fair hearings on benefit denials or reductions after the plan-level grievance is lost. AHCA has an Office of Fair Hearings. See Fla. Stat. § 409.285(2); see also Fla. Admin. Code R. 59G-1.100. AHCA's final order can be appealed to a district court of appeal. This is not obvious from the statute, but Florida secondary sources and courts have suggested this is the proper way to seek judicial review. See 17 Gregory Michael Dell et al., Florida Practice § 13:9 (Nov. 2024); Fla. Agency for Health Care Admin., Medicaid Fair Hearings, (agency materials stating an appeal of a final order goes through the district court of appeal); D.R. v. United Healthcare of Fla., Inc., 300 So. 3d 1227 (Fla. 3d DCA 2020) (reviewing on the merits a decision on Medicaid benefits from AHCA as a final agency order).

III

There are four plaintiffs in this case. They are Marc Grant, CJT, Daniel Gray, and Branden Petro. There was originally a fifth plaintiff, but she has voluntarily dismissed her claims. See ECF Nos. 27 & 29.

Mr. Grant has been enrolled in the LTC program since 2019. He has substantial developmental and physical disabilities. He lives with his family. Mr. Grant's managed care plan is Sunshine Health. In January 2024, Sunshine issued a notice stating Mr. Grant's services would be reduced based on the availability of family care. The notice cited but did not attach a policy. The notice was dated January 23, 2024, but was not received until February 3, 2024. Mr. Grant challenged the reduction with Sunshine. Sunshine upheld its decision. Mr. Grant sought review of Sunshine's decision before AHCA. Sunshine continued Mr. Grant's benefits during the review period. AHCA reversed Sunshine's decision, and Mr. Grant's services were not reduced. Mr. Grant says there are inaccuracies in his assessments. Specifically, he objects to the use of reasonable time for activities of daily living and asserts actual time should be used. Additionally, he says his assessment overstates the amount of family support available to him.

CJT has been enrolled in the LTC program since 2016. His managed care plan is Sunshine Health. CJT has substantial mental disabilities. He lives with his sister. In December 2023, Sunshine reduced CJT's companion care services, noting that his primary caregiver provided socialization. The notice cited but did not attach a policy. He challenged the decision. While his challenge was ongoing, his services were terminated. Sunshine upheld its reduction decision. CJT sought a hearing before AHCA. But Sunshine ultimately reversed its decision, and CJT's services were not reduced. CJT says his assessment should not cite his sister—who lives with him—as social support. He also says during the review process he was not given notices quickly despite requesting them by email.

Mr. Gray has been enrolled in the LTC program since 2017. His managed care plan is Humana. Mr. Gray is quadriplegic and lives with his 73- and 85-year-old parents. In April 2024, Mr. Gray's father's health declined, and Mr. Gray requested additional services due to a loss of assistance from his father. Humana denied the request. Mr. Gray internally appealed the decision, and Humana upheld the denial. But later, Humana agreed to provide the additional services. Mr. Gray says during the review process it was difficult to obtain his case file.

Mr. Petro has been enrolled in the LTC program since 2023. His managed care plan is Simply Health. Mr. Petro has substantial mental and physical disabilities. He lives with his family. Mr. Petro requires skilled nursing services. In December 2023, Simply said it was going to terminate Mr. Petro's nursing care. But after an internal challenge, Simply reversed its own decision. In June 2024, Simply said it was going to terminate Mr. Petro's nursing care and instead provide unskilled personal care services in the same amount of hours. Mr. Petro's doctor disagreed with the decision. Simply upheld its decision. AHCA dismissed Mr. Petro's appeal for failure to submit the appeal request to the correct email address. But Simply ultimately overturned its own decision, and Mr. Petro continues to receive nursing care.

IV

The complaint spans 79 pages and includes 314 paragraphs. While at times hard to follow, the alleged problems can be fairly grouped as inadequate notices, ending benefits during the appeal process, inadequate hearings, and inaccurate information in assessments.

Related to the inadequate notices, the plaintiffs say the notices do not include enough information, refer to but do not include policies, provide poor reasons for reductions, arrive late, do not include a plaintiff's full case file, and are not sent by email. Next, in a couple of instances, when managed care plans reduced benefits, the reduction was implemented while the review process was ongoing. Regarding the hearings, the plaintiffs say the hearings were inadequate because in one instance the AHCA hearing officer had a limited view of his jurisdiction. Finally, some of the plaintiffs challenge their care-plan assessments. They say the assessments contain inaccuracies about the time needed for certain tasks—activities of daily living and natural, unpaid supports.

These issues are primarily at the plan level. But the plaintiffs say AHCA is responsible because AHCA has not adequately overseen the plans. Based on these issues, the plaintiffs assert four claims.

Count one is a constitutional procedural due process claim. To prevail on this claim, the plaintiffs must show a deprivation of a constitutionally protected liberty or property interest, state action, and constitutionally inadequate process. Grayden v. Rhodes, 345 F.3d 1225, 1232 (11th Cir. 2003). Due process is a flexible concept that varies with the circumstances of each case. Id. To determine the requirements of due process in a particular situation, the court applies the balancing test articulated in Mathews v. Eldridge, 424 U.S. 319, 96 S.Ct. 893, 47 L.Ed.2d 18 (1976). But at a minimum, due process requires notice and an opportunity to be heard incident to the deprivation of life, liberty, or property at the hands of the government. Grayden, 345 F.3d at 1232.

Count two is under the Medicaid Act. The Medicaid Act provides that a state Medicaid plan must “provide for granting an opportunity for a fair hearing before the State agency to any individual whose claim for medical assistance under this plan is denied or is not acted upon with reasonable promptness.” 42 U.S.C. § 1396a(a)(3). An implementing rule requires the agency to inform the applicant of the right to a hearing, how to obtain a hearing, that the applicant can proceed alone or use an advocate, and the timeframe. 42 C.F.R. § 431.206.

Counts three and four assert claims under the Americans with Disabilities Act and the Rehabilitation Act. The governing standards under the ADA and RA are substantively the same in relevant respects. See Silberman v. Miami Dade Transit, 927 F.3d 1123, 1133 (11th Cir. 2019).

Title II of the ADA provides that “no qualified individual with a disability shall, by reason of such disability, be excluded from participation in or be denied the benefits of the services, programs, or activities of a public entity, or be subjected to discrimination by any such entity.” 42 U.S.C. § 12132. A rule implementing Title II provides that “[a] public entity shall administer services, programs, and activities in the most integrated setting appropriate to the needs of qualified individuals with disabilities.” 28 C.F.R. § 35.130(d). Further, “[a] public entity, in providing any aid, benefit or service, may not, directly or through contractual licensing, or other arrangements, on the basis of a disability deny a qualified individual with a disability the opportunity to participate in or benefit from the aid, benefit or service.” 28 C.F.R. § 35.130(b)(1). The rule also provides:

A public entity may not, directly or through contractual or other arrangements, utilize criteria or methods of administration (i) that have the effect of subjecting qualified individuals with disabilities to discrimination on the basis of disability; [or] (ii) that have the purpose or effect of defeating or substantially impairing accomplishment of the objectives of the public entity's program with respect to individuals with disabilities.

28 C.F.R. § 35.130(b)(3).

Also, “[a] public entity shall make reasonable modifications in policies, practices, or procedures when the modifications are necessary to avoid discrimination on the basis of disability, unless the public entity can demonstrate that making the modifications would fundamentally alter the nature of the service, program, or activity.” 28 C.F.R. § 35.130(b)(7).

Under Olmstead v. L.C. ex rel. Zimring, 527 U.S. 581, 119 S.Ct. 2176, 144 L.Ed.2d 540 (1999), a state violates the ADA if it unnecessarily isolates disabled individuals in institutions. See also Radaszewski ex rel. Radaszewski v. Maram, 383 F.3d 599 (7th Cir. 2004); Fisher v. Okla. Health Care Auth., 335 F.3d 1175 (10th Cir. 2003). But Olmstead does not impose on states a “standard of care for whatever medical services they render,” nor does it “require[ ] States to provide a certain level of benefits to individuals with disabilities.” Olmstead, 527 U.S. at 603 n.14, 119 S.Ct. 2176. Instead, Olmstead requires states to adhere to the ADA's nondiscrimination requirement “with regard to the services they do in fact provide.” Id.

V

This order dismisses the complaint primarily for lack of standing and partially for failure to state a claim on which relief can be granted.

In Lujan v. Defenders of Wildlife, 504 U.S. 555, 560, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992), the Supreme Court said the “irreducible constitutional minimum of standing contains three elements.” First, the plaintiff “must have suffered an injury in fact—an invasion of a legally protected interest which is (a) concrete and particularized, and (b) actual or imminent, not conjectural or hypothetical.” Id. (internal quotation marks and citations omitted). Second, “there must be a causal connection between the injury and the conduct complained of—the injury has to be fairly traceable to the challenged action of the defendant, and not the result of the independent action of some third party not before the court.” Id. (internal quotation marks, ellipses, and brackets omitted). Third, “it must be likely, as opposed to merely speculative, that the injury will be redressed by a favorable decision.” Id. (internal quotation marks omitted).

“In order to satisfy the ‘injury in fact’ requirement of standing, a plaintiff need not wait for an injury to occur. An allegation of future injury satisfies this prong of standing so long as the alleged injury is ‘imminent’ or ‘real and immediate’ and not merely ‘conjectural’ or ‘hypothetical.’ ” 31 Foster Children v. Bush, 329 F.3d 1255, 1265 (11th Cir. 2003) (quoting Lujan, 504 U.S. at 560, 112 S.Ct. 2130). A speculative risk that at some future point some individual might be impacted is not a basis for recovery and indeed does not even provide standing. See, e.g., City of Los Angeles v. Lyons, 461 U.S. 95, 102, 111, 103 S.Ct. 1660, 75 L.Ed.2d 675 (1983) (holding that a person who had been subjected to a chokehold in the past had no standing to seek injunctive relief against the city's practice of using chokeholds because there was not a “sufficient likelihood that he will again be wronged in a similar way”); Malowney v. Fed. Collection Deposit Grp., 193 F.3d 1342, 1346 (11th Cir. 1999).

To establish standing when a “plaintiff's injury arises from the government's allegedly unlawful regulation of a third party, ‘much more is needed.’ ” Black Warrior Riverkeeper, Inc. v. U.S. Army Corps of Eng'rs, 781 F.3d 1271, 1279 (11th Cir. 2015). In this situation, the “plaintiff must show that choices will be made by both the regulator and the regulated party in such manner to produce causation and permit redressability of the injury.” Id.

The plaintiffs have not adequately alleged standing.

For the claims based on the notices, the plaintiffs have failed to allege an injury that is traceable to or redressable by AHCA. The plaintiffs allege in a handful of instances, notices did not include enough information, were missing referenced policies, or were received late. But none of the plaintiffs are currently facing a reduction in benefits. It is speculative that any plaintiff will face a reduction or denial of benefits in the future. It is even more speculative that the various issues they experienced in the past related to the notices will recur. See Lyons, 461 U.S. at 102, 103 S.Ct. 1660; see also Disability Rights Fla., Inc. v. Palmer, No. 4:18-cv-342, 2019 WL 11253085, at *4–5 (N.D. Fla. Aug. 29, 2019). Moreover, even in the past instances where the notices were allegedly insufficient, the plaintiffs for the most part ultimately succeeded in challenging the reduction or denial either before the plan or before AHCA.

Further, the issues with the notices are not traceable to AHCA. AHCA publishes a form for a reduction in benefits that the plaintiffs apparently take no issue with. AHCA's contracts with the private plans require the plans comply with federal law. If the private plans—or four of the seven plans—in some instances filled out the form inadequately, it is not clear an injunction against AHCA would cure the problem.

Next is the claim that benefits were reduced while the review process was ongoing. This is not supposed to happen, as the Secretary acknowledges. Indeed, AHCA's contracts with the plans require compliance with federal law, which in turn requires benefits to continue upon request of the enrollee during the appeal process. See 42 C.F.R. § 438.420(b). The plaintiffs do not allege AHCA or even a contracted plan has a policy to end benefits while review is pending. There apparently is no nonspeculative basis to believe it will happen again. There is also no reason to believe this is traceable to AHCA. See 31 Foster Children v. Bush, 329 F.3d 1255, 1266 (11th Cir. 2003) (“As Lyons illustrates, future injury that depends on either the random or unauthorized acts of a third party is too speculative to satisfy standing requirements.”).

The plaintiffs disagree with at least one AHCA hearing officer's view on jurisdiction—the view that only the reduced service, not all the enrollee's other services, could be reviewed. Whether jurisdictional or not, this is at least a colorable view. And in any event, judicial review of allegedly erroneous decisions of AHCA hearing officers is available in Florida courts. See D.R. v. United Healthcare of Fla., Inc., 300 So. 3d 1227 (Fla. 3d DCA 2020) (reversing an AHCA final order based on a finding that the AHCA hearing officer improperly shifted the burden to the plaintiff).

Finally, some plaintiffs challenge information in their assessments. At times, the plaintiffs seem to challenge the assessment methodology altogether. At other times, they seem to challenge only their own assessments. Two issues for which this is true are whether natural supports are properly included and whether activities of daily living should be based on a reasonable amount of time or actual time. The plaintiffs challenge the inclusion of specific natural supports—unpaid, voluntary assistance, such as from family. And the plaintiffs assert assessments should be based on actual time, not asserted reasonable time for activities of daily living.

The assessments currently apply to the plaintiffs. If the assessments were constitutionally or statutorily defective, it could be redressed. See Brandy C. v. Palmer, No. 4:17-cv-226, 2018 WL 4689464, at *2 (N.D. Fla. Sept. 29, 2018). But none of the plaintiffs challenge the services they currently receive. None of the plaintiffs assert a need for a service not currently being provided. And none of the plaintiffs are facing a reduction in services. The alleged injury is the speculative risk that at some point in the future, something in the assessment could cause a reduction in benefits that would not be corrected through the appeal process. This sort of speculative risk is insufficient to state a claim. See Brandy C., 2018 WL 4689464, at *2; see also Disability Rights Fla., 2019 WL 11253085 at *4–5. In addition, for at least one plaintiff, the cited inaccuracy was based on a recent development—the declining health of a caregiver. Once this information was updated, services were adjusted.

As a basis for their claims, the plaintiffs rely heavily on Parrales v. Dudek, No. 4:15-cv-424, 2015 WL 13373978 (N.D. Fla. Dec. 24, 2015). But that case was different. At that time, there was no adopted Florida rule on managed care plans and assessments. AHCA did not provide meaningful guidance on how authorization decisions were made or how services could be accessed. There is now an adopted rule, the Florida Policy. And in this case, many of the plaintiffs’ complaints are that in discrete, seemingly isolated incidents, the contracted managed care plans did not follow the rules. This case is more like Brandy C. than Parrales.

The plaintiffs face enormous hardships. But the current complaint does not allege facts inconsistent with the view that AHCA's process and oversight role have generally been effective in ensuring needed services are provided. The process is not perfect; there are sometimes mistakes. But the plaintiffs have failed to allege any actionable injury or basis for recovery.

VI

For most of the claims, the plaintiffs lack standing. For the claims based on the assessments, the plaintiffs have failed to state a claim on which relief can be granted. This order grants the plaintiffs leave to amend. Any amendment should address head-on the lack of a concrete, imminent injury to the plaintiffs themselves that is traceable to AHCA.

IT IS ORDERED:

The motion to dismiss or for a more definite statement, ECF No. 20, is granted. The complaint is dismissed. The plaintiffs may file an amended complaint by April 24, 2025.

SO ORDERED on April 2, 2025.

Robert L. Hinkle, United States District Judge