County of Santa Cruz v. Kathleen Sebelius , 584 F. App'x 425 ( 2014 )

FILED
NOT FOR PUBLICATION AUG 01 2014
MOLLY C. DWYER, CLERK
UNITED STATES COURT OF APPEALS U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
COUNTY OF SANTA CRUZ; COUNTY No. 13-16297
OF SONOMA; COUNTY OF SAN
DIEGO; COUNTY OF MARIN; D.C. No. 3:07-cv-02888-JSW
COUNTY OF SANTA BARBARA;
COUNTY OF SAN LUIS OBISPO;
COUNTY OF MONTEREY; MEMORANDUM*
THEODORE M. MAZER, M.D.;
WOLBERS AND POREE MEDICAL
CORPORATION,
Plaintiffs - Appellants,
v.
SYLVIA M. BURWELL,** Secretary,
Department of Health and Human
Services,
Defendant - Appellee.
Appeal from the United States District Court
for the Northern District of California
Jeffrey S. White, District Judge, Presiding
*
This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
**
Sylvia M. Burwell is substituted for her predecessor as Secretary of
the Department of Health and Human Services.
Argued and Submitted June 10, 2014
San Francisco, California
Before: O’SCANNLAIN, FERNANDEZ, and BEA, Circuit Judges.
The California counties of Santa Cruz, Sonoma, San Diego, Marin, Santa
Barbara, San Luis Obispo, and Monterey, as well as Theodore M. Mazer and
Wolbers & Poree Medical Corp., (collectively “Plaintiffs”), brought this action
against the Secretary of the Department of Health and Human Services (“the
Secretary”). Plaintiffs claim that the Secretary’s failure to revise the “fee schedule
areas,” which determine the fees paid to the Plaintiffs for providing Medicare
services, violated Plaintiffs’ equal protection rights, and that 42 U.S.C. § 1395w-
4(j)(2) (the “Fee Schedule” statute) and the regulation implementing this statute, 42
C.F.R. § 414.4, are unconstitutional as applied to Plaintiffs because the Fee
Schedule statute and the related regulation deprived Plaintiffs of equal protection.
The district court granted the Secretary’s motion to dismiss for failure to
state a claim for relief or, in the alternative, for summary judgment. We AFFIRM.
Under our “highly deferential” rational basis review of such government
classification under the equal protection component of the Due Process Clause,
Kahawaiolaa v. Norton, 386 F.3d 1271, 1279–80 (9th Cir. 2004), the Secretary’s
decision to maintain the status quo in the fee schedule areas structure can be
supported on the basis of minimizing administrative cost and burden. See Armour
v. City of Indianapolis, 132 S. Ct. 2073, 2083 (2012).
AFFIRMED.