Turner v. Md. Dept. of Health , 245 Md. App. 248 ( 2020 )

Linda Turner v. Maryland Department of Health
No. 2304, Sept. Term, 2018
Opinion by Leahy, J.
Administrative Law > Standing > Judicial Review
A proper party in an administrative action may not have standing to file a petition for
judicial review in the circuit court. See Sugarloaf Citizens’ Ass’n v. Dep’t of Env’t, 344
Md. 271, 285-86 (1996) (“[A] person may properly be a party at an agency hearing under
Maryland’s ‘relatively lenient standards’ for administrative standing but may not have
standing in court to challenge an adverse agency decision.”). And certainly, a person or
entity deemed not a proper party in an administrative action does not have standing to file
a petition for judicial review. See Montgomery Cty. v. One Park N. Assocs., 275 Md. 193,
201-02 (1975) (explaining that Montgomery County was not entitled to judicial review of
an agency’s decision because, although it may have been “aggrieved” by the agency’s
order, it was not a party to the administrative proceedings and, therefore, was not a “party
aggrieved” under the APA).
Administrative Law > Standing > Judicial Review
Nursing Home Facility’s “Medicaid Authorized Representative” Order was not valid to
confer standing to petition for judicial review from the agency’s denial of deceased
patient’s application for long-term care Medical Assistance (“Medicaid benefits”) where
Nursing Home was never appointed, or applied to be appointed, the personal representative
of the deceased’s estate.
Health—General > Medical Assistance Program > Authorized Representative
42 C.F.R. § 435.923 allows an applicant to personally designate an authorized
representative. 42 C.F.R. § 435.923(a)(1); COMAR 10.01.04.12 B(2)(a). The applicant
must express her authorization by transmitting her signature through one of the manners
specified in paragraph (f) of 42 C.F.R. § 435.923. Any valid designation of an authorized
representative that does not require the signature of the applicant must be accorded under
state law pursuant to C.F.R. § 435.923(a)(2).
Health—General > Medical Assistance Program > Authorized Representative
As expressly provided in COMAR 10.01.04.12B(3)(d), only a “personal representative of
the applicant or recipient’s estate . . . or a person who has in good faith filed an application
to be appointed the personal representative” may have the requisite “proof of legal
authority,” 10.01.04.12B(2)(b) to serve as the authorized representative of the decedent in
this case.
Circuit Court for Howard County
Case No. 13-C-18-114673
REPORTED
IN THE COURT OF SPECIAL APPEALS
OF MARYLAND
No. 2304
September Term, 2018
______________________________________
LINDA TURNER
v.
MARYLAND DEPARTMENT OF HEALTH
______________________________________
Graeff,
Leahy,
Shaw Geter,
JJ.
______________________________________
Opinion by Leahy, J.
______________________________________
Filed: April 2, 2020
Pursuant to Maryland Uniform Electronic Legal
Materials Act
(§§ 10-1601 et seq. of the State Government Article) this document is authentic.
2020-09-09 11:06-04:00
Suzanne C. Johnson, Clerk
This appeal involves a nursing facility’s effort to receive payment from the
Maryland Medical Assistance Program, commonly referred to as the Medicaid program,1
for services the facility rendered to its deceased patient. We are asked to consider whether
the nursing facility had standing, as the deceased’s purported “Medicaid Authorized
Representative,” to pursue an administrative appeal and subsequent petition for judicial
review from the denial of long-term care Medical Assistance (“Medicaid benefits”).
Linda Turner was a resident at Ridge Leasing, LLC (the “Facility”),2 a long-term
care nursing facility, until her death. She required twenty-four-hour care due to various
ailments and had limited assets to pay for her care. Consequently, Ms. Turner submitted
an application for Medicaid benefits to the Howard County Department of Social Services
(the “Local Department”) to pay for her care at the Facility. After the first application was
denied, she submitted another. Just before the second application was denied, she passed
away. The Facility petitioned the Circuit Court for Howard County for appointment as the
“Medicaid Authorized Representative” on behalf of the deceased Ms. Turner. The court
granted the Facility’s motion and issued an “Order Appointing Authorized Medicaid
Representative” (“MAR Order”).
1
The Maryland Department of Health administers the Medical Assistance Program
and, pursuant to Maryland Code (1993, 2019 Repl. Vol.), Health—General Article (“HG”),
§ 15-103, “has a statutory responsibility to adopt rules and regulations for the
reimbursement of providers under the Program.” Dep’t of Health & Mental Hygiene v.
Riverview Nursing Ctr., Inc., 104 Md. App. 593, 598 (1995).
2
The Facility defines the appellant in this case as “Linda Turner; by Authorized
Representative Ridge Leasing, LLC.” Because we hold that the Facility did not have
standing to represent Ms. Turner’s estate in the underlying proceedings, we will refer to
Ms. Turner and the Facility separately.
Forearmed with the MAR Order, the Facility appealed the denial of Medicaid
benefits before the Office of Administrative Hearings (“OAH”). The OAH denied the
Medicaid benefits, and the Facility filed a petition for judicial review in the circuit court.
The Maryland Department of Health (“MDH”), appellee, intervened and moved to dismiss
the Facility’s petition because the Facility had not filed to become the personal
representative of Ms. Turner’s estate and, correspondingly, lacked standing. The circuit
court agreed with MDH and dismissed the Facility’s petition. The Facility filed a timely
appeal and presents one question for our review, which we have slightly rephrased: Did
the circuit court err in finding that the Facility lacked standing to pursue an administrative
appeal from the denial of Ms. Turner’s Medicaid benefits?
After resolving that the issue of standing was not waived by failing to raise it before
the OAH, we conclude that the Facility did not have authority under Maryland law to act
on Ms. Turner’s behalf after her death without first filing to become the personal
representative of her estate. Accordingly, we affirm the circuit court’s decision to dismiss
the case because the Facility lacked standing to petition for judicial review of the
administrative decision denying Medicaid benefits.
BACKGROUND
Sadly, Ms. Turner was admitted to the Facility on January 13, 2016 and remained
there until she died 21 months later. She required twenty-four-hour care because she was
suffering from a variety of mental and physical ailments, including breast cancer, memory
loss, obesity, schizophrenia, and anxiety disorder. Initially, due to her memory loss, Ms.
2
Turner was unable to access any of her assets or offer any information regarding their
value. She sought assistance through the Medicaid program.
Medical Assistance Applications
Ms. Turner, with the Facility’s assistance, submitted two applications for Medicaid
benefits to the Local Department.3 Ms. Turner’s first application was denied because she
did not submit documents requested by the Local Department to verify her eligibility for
Medicaid benefits.
On March 8, 2016, the Facility petitioned the Circuit Court for Howard County to
appoint guardians of Ms. Turner’s person and property to manage Ms. Turner’s affairs and
to assist her in obtaining documentation necessary to support her application for Medicaid
benefits. The guardianship petition represented that Ms. Turner was widowed with one
adult daughter but did not provide Ms. Turner’s preadmission address or the name or
contact information for her daughter. The petition further averred that, because Ms. Turner
suffered from schizophrenia and cognitive impairment, she required assistance to research,
secure, and manage her assets and income. The circuit court granted the petition and
appointed guardians for Ms. Turner’s person and property on July 7, 2016.
Ms. Turner filed a second application for Medicaid benefits on August 19, 2016 and
submitted documentation reporting total assets of $5,147.00. The Local Department
3
Ms. Turner applied for long-term care coverage under the Maryland Medical
Assistance Program, administered by the State to provide “comprehensive medical and
other health related care for eligible categorically and medically needy persons.” Code of
Maryland Regulations (“COMAR”) 10.09.24.02.
3
denied the second application on October 28, 2016 because Ms. Turner’s assets exceeded
the resource limit of $2,500.00 for benefit eligibility.4
Ms. Turner died on October 18, 2016. The circuit court entered an order terminating
the guardianship of Ms. Turner’s person on December 5, 2016, and another order
terminating the guardianship of property on June 28, 2017.
Petition for Appointment of Medicaid Authorized Representative
Approximately ten months following Ms. Turner’s death, on August 23, 2017, the
Facility filed a “Petition for Appointment of Authorized Medicaid Representative” (“MAR
Petition”) in the Circuit Court for Howard County. The petition stated that “there are no
persons acting on behalf of Ms. Turner to pursue appeal” of the “erroneous determination”
by the Local Department denying Medicaid benefits, and that the Facility would be “unable
to pursue an appeal for Ms. Turner unless it is appointed as the Medicaid Authorized
Representative for Ms. Turner.” With the exception of an “adult daughter whose identity
and whereabouts remain[ed] unknown,” the Facility was “unaware of any other relatives
of Ms. Turner who [were] willing to provide assistance with regard[] to her application for
Medicaid benefits.”
4
According to COMAR 10.09.24.08M, the “Medically Needy Resource Standard”
for one individual is $2,500.00. An applicant is “ineligible for any month in which
countable resources exceed the applicable standard[.]” COMAR 10.09.24.08L. Because
Ms. Turner maintained cash assets in excess of $2,500.00 throughout the time-period at
issue, she was ineligible for Medicaid assistance. To be considered eligible for Medicaid
assistance, it is not relevant whether the applicant has more debts than resources. Ms.
Turner had outstanding debts, including over $65,000.00 that she owed the Facility at the
time of her death. Payments could have been, but were not, made to the Facility and other
debtors during the months at issue so that Ms. Turner could qualify for Medicaid assistance.
4
The petition further averred that Maryland law, specifically Code of Maryland
Regulations (“COMAR”) 10.01.04.12, “permits an individual or organization with a direct
financial interest to act in good faith as a designated Medicaid representative for
incapacitated individuals if no other individual or organization is willing and able to act on
the applicant or recipient’s behalf.” The Facility represented that it did “not anticipate any
objections to the relief requested” and that there are “no known interested parties on which
to serve notice.” MDH was not served a copy of the MAR Petition.
The circuit court granted the MAR Petition and issued the Facility’s proposed MAR
Order on September 1, 2017. Notwithstanding that Ms. Turner had already passed away,
the MAR Order authorized the Facility to “take such actions as are necessary to qualify
[Ms. Turner] for Medicaid benefits available to her including:”
a. taking such actions as are necessary to pursue eligibility of Medicaid
benefits for her through administrative or legal causes of action;
b. spending down of assets payable to [the Facility] as are necessary to
qualify Linda Turner for Medicaid, and [sic]
c. obtaining financial records including, but not limited to, bank statements
and records regarding any and all accounts associated with Ms. Turner or
held in her name, life insurance documentation, documentation pertaining
to any and all assets, income and/or resources held by Ms. Turner or for
Ms. Turner’s benefit as required by the Maryland Medical Assistance
Program in order to process Ms. Turner’s application. [sic]
d. pursue any rights on behalf of Ms. Turner that are afforded by law or
statute or regulation to an individual seeking Medicaid benefits to appeal
a denial(s), past or future, of Medicaid benefits, past or future, previously
issued or issued in the future, or inaction by any State agency with respect
to the application for Medicaid benefits on behalf of Linda Turner; and
e. retain counsel to assist in obtaining Medicaid benefits[.]
5
Appeal to OAH
The Facility appealed the denial of Medicaid benefits before the OAH in a letter
dated October 2, 2017.5 A hearing was held before an administrative law judge (“ALJ”)
on January 9, 2018. In a written decision, dated February 23, 2018, the ALJ affirmed the
decision of the Local Department and concluded “as a matter of law that the Local
Department properly determined that [Ms. Turner] was ineligible for [Medicaid] benefits
for the months of February 2016 through July 2016 due to being over the resource limit for
benefits eligibility.”
Petition for Judicial Review of Administrative Decision
Within 30 days of the ALJ’s decision, the Facility, as Ms. Turner’s “authorized
representative” under the MAR Order, filed a petition for judicial review in the Circuit
Court for Howard County on March 26, 2018.6 The Facility claimed the “Department of
5
The letter noted an appeal and request for fair hearing to contest the Local
Department’s October 28, 2016 denial of the August 19, 2016 application. An applicant
who has been denied eligibility for benefits is entitled to a fair hearing before an ALJ under
COMAR 10.01.04.02. The ALJ did not address whether the fair hearing appeal was filed
timely, nor shall we.
6
The final decision of the OAH in this case constitutes a final decision by MDH.
See COMAR 10.09.24.02 and 13. Title 7, Chapter 200 of the Maryland Rules “govern[s]
actions for judicial review of (1) an order or action of an administrative agency, where
judicial review is authorized by statute[.]” Maryland Rule 7-201(a). Pursuant to Maryland
Rule 7-203(a),
a petition for judicial review [of an agency decision] shall be filed within 30
days after the latest of: (1) the date of the order or action of which review is
sought; (2) the date the administrative agency sent notice of the order or
action to the petitioner, if notice was required by law to be sent to the
petitioner; or (3) the date the petitioner received notice of the agency’s order
or action, if notice was required by law to be received by the petitioner.
6
Health’s decision via the [OAH]” denying Ms. Turner Medicaid benefits was “erroneous
as a matter of law,” because “Ms. Turner had no access to her resources due to the
undisputed facts that the resources were unknown and Ms. Turner was incompetent. As
such, the resources cannot be considered countable.” This time, the Facility served a copy
of its petition on MDH. MDH responded on April 27th by filing its intention to participate
in the action. See Maryland Rule 7-204.
The Facility filed its Maryland Rule 7-207 memorandum on June 11th. The Facility
challenged the ALJ’s determination, upholding the Local Department’s finding, that “funds
in Ms. Turner’s checking account were countable and available resources.” The Facility
noted that the ALJ erred by ruling on months that were specified in the first application,
even though the appeal related to the second application. The Facility added a new
argument: that the denial of benefits violated the federal Americans with Disabilities Act
because Ms. Turner’s disability rendered her unable to participate in the application
process, and the Local Department penalized her “by denying Medicaid benefits for having
assets which were unknown to her[.]”
A month later, MDH moved to dismiss the petition on the ground that the MAR
Order did not grant standing to the Facility to petition for judicial review on Ms. Turner’s
behalf.7 Specifically, MDH argued that the Facility was not an aggrieved party as required
7
On the same day, MDH also filed its response to the Facility’s Rule 7-207
memorandum in which it argued, among other things, that the Facility’s suggestion that
“Ms. Turner’s resources could not be considered available to her until they were
‘discovered’ by her guardian is not supported by applicable law.” Additionally, MDH
pointed out that even if the ALJ had considered the wrong application (which it did not
concede), any failure to make a separate finding was of “no consequence” because “there
7
under the Maryland Administrative Procedure Act (“Maryland APA”), Maryland Code
(1984, 2014 Repl. Vol., 2019 Supp.), State Government Article (“SG”), §§ 10-101 et seq.
MDH further explained that according to COMAR 10.01.04.12B(3), “[f]ollowing the death
of a Medicaid applicant or recipient, the applicant or recipient’s appeal of a denial of
benefits can only be pursued by a personal representative of an estate.”
In its opposition to the motion to dismiss, the Facility assailed MDH’s claim that
only a personal representative of an applicant’s estate may pursue an appeal of Medicaid
benefits. Relying on 42 C.F.R. §§ 400.203 and 435.923, the Facility asserted that “[f]ederal
regulation grants broad authority to authorized representatives, which survives death.”
Because the Facility was designated as an “authorized representative,” the Facility argued
that it should be “abundantly clear from the regulations” that the Facility’s authority: “a)
survives death, b) is only limited by the Medicaid applicant or beneficiary, and c) cannot
be limited by or have special requirements added to it by the State.” The Facility averred
that to require it to file all necessary documents to open a creditor’s estate to pursue
Medicaid benefits would be unduly burdensome and was not required under federal
regulations.
MDH countered that “federal law, []both expressly and implicitly recognizes that
authorized representative status itself depends on state law.” According to MDH, the
is no evidence that Ms. Turner disposed of assets” which would result in her meeting the
financial eligibility threshold. Finally, in response to the alleged ADA violation, MDH
averred that the Facility made “no attempt whatsoever to show how acts or omissions by
the [L]ocal [D]epartment amount to exclusion from participation in or denial of benefits or
discrimination on the basis of disability in accordance with the elements of an ADA
claim[.]”
8
federal regulation that controls this matter—42 C.F.R. § 435.923(a)(2)—expressly
incorporates a representative’s authority “accorded under state law.”
At the hearing on the motion before the circuit court, counsel for MDH highlighted
four main points in support of the motion to dismiss. First, that “COMAR 10.01.04.12 and
specifically [subsection] B(3) identifies the individuals who have legal authority to appeal
an eligibility determination,” and “the only entity that is able to appeal an eligibility
determination for a deceased person is the personal representative of the estate.” Second,
both a guardianship and a power of attorney terminate on the death of an individual. Third,
§ 7-401 of the Estates and Trusts Article allocates the ability to prosecute and defend
litigation specifically to the personal representative of the estate. While “[n]othing would
have prevented the [F]acility from becoming the personal representative,” there was “no
personal representative identified in this case.” Fourth, SG § 10-222 provides that only an
aggrieved party can pursue a petition for judicial review, and without the status as a
personal representative, the Facility did not have standing because it was not an aggrieved
party. MDH concluded by expressing the State’s “strong interest in ensuring that these
regulations are complied with and that there are protections built into the Estates and Trusts
Article.” Counsel noted that “the [F]acility claims those procedures are burdensome. . . .
But those burdens are intended to protect the estate. And this is – this appeal is an effort
to bypass those protections.”
Counsel for the Facility pressed that because “Medicaid is a state implemented
federal program,” Maryland is violating the federal regulation by being “more restrictive
9
than the federal regulation,” which only requires “a representative or person acting
responsibly for the individual.”
Ruling from the bench, the circuit court dismissed the Facility’s petition for judicial
review because the Facility was not an aggrieved party. The judge observed that
“Maryland has created through COMAR 10.01.04.12 certain requirements on who can be
an authorized Medicaid representative,” and concluded that, in the case of a deceased
individual, “Maryland requires there’s only one way to do it and that’s for the personal
representative of the recipient’s estate to make that application.” The judge noted that the
MAR Order was issued without MDH being served and having the opportunity to present
its arguments on the law to the court.
The circuit court memorialized its ruling in a written order entered on August 27,
2018. Specifically, the order directed that “the petition for judicial review is DISMISSED
because [the Facility] is not an aggrieved party,” and directed the clerk to close the case.
The Facility’s timely appeal followed.
DISCUSSION
I.
Standard of Review
Whether the circuit court erred when it granted MDH’s motion to dismiss is a
question of law, which we review de novo. Greater Towson Council of Cmty. Ass’ns v.
DMS Dev., LLC, 234 Md. App. 388, 408 (2017).
In this case, the circuit court considered, among other things, the MAR Petition, the
MAR Order, and the official public comments to 42 C.F.R. § 435.923. “When the circuit
10
court considers matters outside the pleadings, the court treats the matter as a motion for
summary judgment[.]” Comm. for Responsible Dev. on 25th St. v. Mayor & City Council
of Baltimore, 137 Md. App. 60, 73 (2001) (quoting Boyd v. Hickman, 114 Md. App. 108,
117-18 (1997), cert. denied, 346 Md. 26 (1997)). We review whether the court’s decision
was correct as a matter of law regardless of whether the court’s order operated as a grant
of a motion to dismiss or for summary judgment. Greater Towson Council, 234 Md. App.
at 408.
II.
Motion to Dismiss Petition for Judicial Review
A. Parties’ Contentions
Before this Court, the Facility argues that the circuit court erred in dismissing the
petition for judicial review on three grounds. First, the Facility contends that federal law
allows for an authorized representative “to pursue an applicant’s Medicaid rights once an
applicant is deceased” under 42 C.F.R. §§ 400.203 and 435.923 without first becoming, or
filing to become, the personal representative of the estate. Because the Facility obtained
authorization from the circuit court to serve as Ms. Turner’s authorized representative
under the MAR Order, the Facility was able to pursue Ms. Turner’s Medicaid benefits,
even after she passed away. The “scope of authorization given to the Authorized
Representative[] a) survives death, b) is only limited by the Medicaid applicant or
beneficiary, and c) cannot be limited by or have special requirements added to it by the
State.”
11
Second, the Facility claims that Maryland law permits individuals other than
personal representatives to pursue Medicaid benefits on behalf of deceased individuals.
Specifically, the Facility states that (a) Maryland recognizes the appointment of a special
administrator when necessary to protect property prior to the appointment and qualification
of a personal representative, and (b) a circuit court has “full equity powers and jurisdiction”
to “ensure that there is the ability to correct and supplement the law as needed.”
During oral argument, the Facility clarified that it is not challenging the Maryland
regulations for the designation of authorized representatives as conflicting with federal law,
nor is it advancing any other preemption theory. Rather, the Facility contends that the
circuit court erred in its interpretation of the applicable Maryland and federal laws.
Third, the Facility adds that the procedure by which the Facility obtained the MAR
Order was “nearly identical to that of a special administrator and within the equity powers
of the court.”
MDH responds that Maryland law governing who is authorized to appeal the denial
of a deceased person’s Medicaid application is consistent with federal law. The applicable
Maryland regulation, COMAR 10.01.04.12, complies with federal law because it permits
an applicant to designate the personal representative as an authorized representative “at the
time of application and at other times. And where such authority is ‘accorded under state
law,’ such as in the appointment of a personal representative of an estate, [MDH] treats the
state-law designation as a ‘written designation’ of authorized representative[.]” MDH
insists that, under Maryland law, only the personal representative of an estate has standing
to pursue judicial review of a deceased individual’s denial of Medicaid benefits.
12
Accordingly, MDH avers that the “MAR Order is ultra vires and cannot provide a legal
basis under which the nursing facility could have pursued the petition for judicial review
in circuit court.”
B. Standing Requirements under the APA
MDH administrative hearings are governed by the provisions of the Maryland APA,
which provides for the right to petition for review from a final administrative decision in
the circuit court, and from there, the right to appeal to this Court.8 See SG §§ 10-222 and
10-202, 203 (defining agencies subject to the Maryland APA and providing a list of
agencies that are generally excluded from its provisions); COMAR 10.01.04.08C.(1). See
also Dep’t of Health & Mental Hygiene v. Campbell, 364 Md. 108, 117 (2001) (noting that
review of final decisions by the Department of Health and Mental Hygiene [the former
name of MDH], is subject to review under the APA). In order to petition for judicial review
of an administrative decision under SG § 10-222, the “person or entity must both be a party
8
We recently reinforced that this Court has no authority to exercise further review
of an administrative agency’s decision beyond the circuit court unless a statute expressly
grants us that authority. See Gray v. Fenton, 245 Md. App. 207, 211-212, No. 3478, Sept.
Term, 2018, slip op. at 4 (filed April 1, 2020) (citations omitted) (dismissing the
appellant’s appeal because the municipal code governing her administrative action did not
provide for the right of review in this Court). We note, as we did in Gray, id. at 4, n. 2, that
Maryland Code, Courts and Judicial Proceedings Article, § 12-302(a) (providing that right
to appeal must be expressly provided by law) refers to “an appeal from a final judgment of
a court entered or made in the exercise of appellate jurisdiction” (emphasis added). The
Court of Appeals has explained, however, that this language refers to “an original circuit
court action, authorized by statute, judicially reviewing an adjudicatory decision of an
administrative agency or an adjudicatory decision of a local legislative body when it acts
in a quasi-judicial capacity.” Prince George’s Cty. v. Beretta U.S.A. Corp. 358 Md. 166,
175 (2000) (citing Gisriel v. Ocean City Bd. of Sup’rs of Elections, 345 Md. 477, 486-96
(1997).
13
to the administrative proceedings and be aggrieved by the final decision of the agency.”
Sugarloaf Citizens’ Ass’n v. Dep’t of Env’t, 344 Md. 271, 287 (1996) (emphasis added);
SG § 10-222(a)(1) (“[A] party who is aggrieved by the final decision in a contested case
is entitled to judicial review of the decision as provided in this section.”) (emphasis added).
Before a case reaches the circuit court, the threshold to establish party status before
an administrative agency is generally low. The Court of Appeals explained the rationale
of administrative standing in Sugarloaf Citizens’ Association v. Department of
Environment:
Absent a statute or a reasonable regulation specifying criteria for
administrative standing, one may become a party to an administrative
proceeding rather easily. In holding that a particular individual was properly
a party at an administrative hearing, Judge J. Dudley Digges for the Court
in Morris v. Howard Res. & Dev. Corp., 278 Md. 417, 423 (1976), explained
as follows:
He was present at the hearing before the Board, testified as a
witness and made statements or arguments as to why the
amendments to the zoning regulations should not be approved.
This is far greater participation than that previously determined
sufficient to establish one as a party before an administrative
agency. . . . Bearing in mind that the format for proceedings
before administrative agencies is intentionally designed to be
informal so as to encourage citizen participation, we think that
absent a reasonable agency or other regulation providing for
a more formal method of becoming a party, anyone clearly
identifying himself to the agency for the record as having an
interest in the outcome of the matter being considered by that
agency, thereby becomes a party to the proceedings.
344 Md. 271, 286-87 (1996) (emphasis added), superseded by statute, 2009 Md. Laws Ch.
651 (H.B. 1569), on other grounds, as recognized in Patuxent Riverkeeper v. Maryland
Dep’t of Env’t, 422 Md. 294 (2011). While the requirements for administrative standing
14
are generally more lenient than the requirements for judicial standing, “this leniency only
exists ‘[a]bsent a statute or a reasonable regulation specifying criteria for administrative
standing[.]” Chesapeake Bay Found., Inc. v. DCW Dutchship Island, LLC, 439 Md. 588,
599 (2014) (citing Sugarloaf, 344 Md. at 286). Our decisional law teaches that a proper
party in an administrative action may not have standing to file a petition for judicial review
in the circuit court.9 And, a fortiori, a person or entity deemed not a proper party in an
administrative action does not have standing to file a petition for judicial review.10
9
The Court of Appeals explained in Sugarloaf:
The cases in this Court, and the language of the Administrative Procedure
Act itself, § 10–222(a)(1) of the State Government Article, recognize a
distinction between standing to be a party to an administrative proceeding
and standing to bring an action in court for judicial review of an
administrative decision. Thus, a person may properly be a party at an agency
hearing under Maryland’s “relatively lenient standards” for administrative
standing but may not have standing in court to challenge an adverse agency
decision.
344 Md. at 285-86 (citation omitted); see also Med. Waste Assocs., Inc. v. Maryland Waste
Coal., Inc., 327 Md. 596, 611-14 (1992) (noting organization was a party at administrative
proceeding but “did not have standing to remain a party in the judicial review actions”),
superseded by statute, 2009 Md. Laws Ch. 651 (H.B. 1569), on other grounds, as
recognized in Patuxent Riverkeeper v. Maryland Dept. of Env’t, 422 Md. 294 (2011).
10
To have standing to petition for judicial review, a person or entity must satisfy
two conditions: (1) the person or entity must have been a party to the administrative
proceedings; and (2) the party must be “aggrieved” by the decision of the agency. Greater
Towson Council, 234 Md. App. at 409. An entity or person who was not a party to the
proceedings before the administrative agency cannot be a “party aggrieved” by the
agency’s decision and, therefore, will not have standing to petition for judicial review. See
Montgomery Cty. v. One Park N. Assocs., 275 Md. 193, 201-02 (1975) (explaining that
Montgomery County was not entitled to judicial review of an agency’s decision because,
although it may have been “aggrieved” by the agency’s order, it was not a party to the
administrative proceedings and, therefore, was not a “party aggrieved” under the APA).
15
C. Waiver
At oral argument, in response to a question from this Court, counsel for the Facility
argued, for the first time, that the Department had waived its standing argument by not
raising it before the OAH. We conclude that, under prevailing law, the question of standing
for judicial review cannot be waived by a failure to raise the issue before an administrative
agency.
Standing to maintain judicial review of an administrative decision is a “matter to
be resolved exclusively by the courts.” Sugarloaf, 344 Md. at 291-92. In Sugarloaf, an
ALJ appeared to render findings and conclusions on a party’s entitlement to maintain
judicial review of an administrative action, “holding that the plaintiffs would not be
‘aggrieved’ by the issuance of the permits and that, therefore, they did not ‘have standing
to challenge the administrative decisions.’” Id. at 289. The Court of Appeals explained
that if the ALJ had, in fact, determined a party’s entitlement to judicial review of the agency
action, the ALJ exceeded her proper role:
Under basic principles of administrative law, as well as the separation
of powers requirement set forth in Article 8 of the Maryland Declaration of
Rights, [] it is not the proper function of an administrative official or agency
See also Clipper Windpower, Inc. v. Sprenger, 399 Md. 539, 560-62 (2007) (determining
that an entity that failed to satisfy the “statutorily provided criteria” for becoming a party
to an administrative action before the Public Service Commission was not a party to the
Commission’s decision, and thus was not a “party in interest” entitled to apply for
rehearing).
We should clarify here that a person or entity—even without standing to file a
petition for review—may, depending on the circumstances, intervene as a party, as the
MDH did in this case, or be brought into the case as a party. See SG § 10-222(d)(1) (“The
court may permit any other interested person to intervene in a proceeding under this
section.”).
16
in the executive branch of government to decide whether a plaintiff or
potential plaintiff has standing to maintain an action in court.
* * *
. . . . [W]ith respect to the allocation of functions between
administrative agencies and the judiciary, the determination of whether a
person has standing to maintain an action in court is exclusively a judicial
function.
Id. at 290 (internal footnote omitted). Standing for purposes of judicial review is properly
determined by the circuit court, “through a motion or other pleading filed by [the appellee]
to dismiss [the appellant] as a party, [the appellant’s] answer thereto, and testimony if need
be on the point.” Morris v. Howard Research & Dev. Corp., 278 Md. 417, 424-25 (1976).
Moreover, the issue of standing is one of a “narrow category of issues” that courts of appeal
will “sua sponte address” even if not raised by an appellant. Joseph H. Munson Co., Inc.
v. Sec’y of State, 294 Md. 160, 168-69 (1982) (collecting cases), aff’d sub nom. Sec’y of
State of Md. v. Joseph H. Munson Co., Inc., 467 U.S. 947 (1984).11
As the background chronology makes plain, MDH raised the issue of standing in
the circuit court and—in addition to receiving a ruling dismissing the Facility’s petition—
preserved the issue of standing for our review. Having determined that the issue of standing
is properly before us, we consider whether the Facility has met the conditions required to
11
In his treatise on administrative law, Professor Arnold Rochvarg observes that
“[S]tanding is an issue that an appellate court can address on its own motion, and can be
raised even if not presented below. This is true because if the petitioner lacks standing,
there may be no interested parties asserting adverse claims, and thus no justiciable
controversy.” Arnold Rochvarg, Principles and Practice of Maryland Administrative Law
§ 14.6 at 189-90 (2011). In Sipes v. Board of Municipal and Zoning Appeals, we explained
that “[a]lthough the issue of standing may not be jurisdictional in nature, it does go to the
very heart of whether the controversy before the court is justiciable. If the controversy is
nonjusticiable, it should not be before the court, and therefore must be dismissed.” 99 Md.
App. 78, 87-88 (1994) (internal citations omitted).
17
maintain judicial review, which in this case, entails analyzing the requirements for the
designation of authorized representatives under the Medicaid program.
D. Requirements for the Designation of Authorized Representatives
The Medicaid program is a voluntary, cooperative federal-state program, which
generally provides “funding to States that reimburse needy persons for the cost of medical
care.” Wisconsin Dep’t of Health & Family Servs. v. Blumer, 534 U.S. 473, 479 (2002);
see Maryland Code, Health—General Article (“HG”), § 15-103 (designating MDH to
adopt rules and regulations under the program). When a state elects to participate in
Medicaid, the state must develop and submit for federal approval a State Medicaid Plan
that complies with the Medicaid Act and regulations promulgated by the Secretary of the
United States Department of Health and Human Services. See Dep’t of Health & Mental
Hygiene v. Campbell, 364 Md. 108, 112 (2001) (citing 42 U.S.C. § 1396).
Federal law establishes minimum requirements under 42 C.F.R. § 435.923 for the
designation of an authorized representative, generally defined as an individual or entity
designated to act on behalf of an applicant or beneficiary of Medicaid benefits.12 The
federal regulation requires state agencies, such as MDH, to recognize Medicaid authorized
representatives that meet the requirements of the federal regulation, but also permits states
to establish their own requirements under state law:
12
The MDH regulation, tracking 42 C.F.R. § 435.923, defines an “authorized
representative” as “an individual or organization acting responsibly on behalf of the
applicant or recipient in accordance with §§ B, C, D, and E of this regulation, in assisting
with an applicant or recipient’s application, renewal of eligibility, appeals, and other
ongoing communications with the agency.” COMAR 10.01.04.12A(1).
18
Authority for an individual to act on behalf of an applicant or beneficiary
accorded under state law, including but not limited to, a court order
establishing legal guardianship or a power of attorney, must be treated as a
written designation by the application or beneficiary of authorized
representation.
42 C.F.R. § 435.923(a)(2) (emphasis added).
Under the federal regulation, state agencies must allow an applicant13 or
beneficiary14 to designate an individual or organization to act on his or her behalf. 42
C.F.R. § 435.923(a)(1). Medicaid programs are required to “permit applicants and
beneficiaries to designate an individual or organization to act responsibly on their behalf”
in assisting with applications and communicating with state programs regarding eligibility,
services, and appeals from denials of eligibility or service. Id. “Such a designation . . .
must be permitted at the time of application and at other times.” Id. In addition, the
designation must include the applicant’s signature. Id.As permitted under 42 C.F.R. § 435.923, MDH promulgated COMAR 10.01.04.12
to address the designation of authorized representatives in Maryland. The regulation
provides, in pertinent part:
(1) An applicant or recipient may designate any individual or organization to
serve as an authorized representative.
(2) An authorized representative may be designated either:
(a) In writing, including the applicant or recipient’s signature; or
13
An “applicant” is defined as “an individual whose written application for
Medicaid has been submitted to the agency determining Medicaid eligibility, but has not
received final action. This includes an individual (who need not be alive at the time of
application) whose application is submitted through a representative or a person acting
responsibly for the individual.” 42 C.F.R. § 400.203.
“Beneficiary means a person who is entitled to Medicare benefits and/or has been
14
determined to be eligible for Medicaid.” 42 C.F.R. § 400.200.
19
(b) By providing proof of legal authority to act on behalf of an applicant
or recipient.
(3) Legal authority includes, but is not limited to those who are the:
(a) Applicant or, if applicant or recipient is a minor, recipient’s parent;
(b) Applicant or recipient’s legal guardian, if one has been appointed, or
a person who has in good faith filed an application to be appointed the
applicant or recipient’s legal guardian but who has not yet been
appointed the applicant or recipient’s legal guardian;
(c) Applicant or recipient’s healthcare surrogate as defined in Health
General Article, § 5-605, Annotated Code of Maryland;
(d) Personal representative of the applicant or recipient’s estate, or a
person who has in good faith filed an application to be appointed
the personal representative of the applicant or recipient’s estate but
who has not yet been appointed the personal representative of the
applicant or recipient’s estate;
(e) Individual appointed to make legal or medical decisions on behalf of
the applicant or recipient pursuant to a validly executed power of
attorney; or
(f) Attorney or paralegal retained by the individual.
* * *
(5) For individuals who lack the capacity to designate an authorized
representative, for whom no other individual or organization has the legal
authority to act under §B(2) of this regulation, . . . an authorized
representative can be any individual or organization with a direct
financial interest in the outcome of the hearing or whose employer has a
direct financial interest in the outcome of the hearing who:
(a) In good faith is acting in the best interest of the applicant or
recipient;
(b) Declares that the applicant or recipient lacks legal capacity; and
(c) Declares that to the best of his or her belief, no other individual or
organization is willing and able to act on the applicant or recipient’s
behalf.
COMAR 10.01.04.12B (emphasis added). The regulation further permits the designation
of an authorized representative under 10.01.04.12B(5) to “take place at any time, including,
but not limited to, the time of application, upon redetermination, upon filing an appeal, and
at the appeal hearing.” COMAR 10.01.04.12C.
20
Our examination of COMAR 10.01.04.12 confirms that it meets the minimum
requirements provided in 42 C.F.R. § 435.923.15 First, as 42 C.F.R. § 435-923(a) requires,
15
We set it out the pertinent provisions of 42 C.F.R. § 435.923 below for easy
comparison with the State regulation:
(a)(1) The agency must permit applicants and beneficiaries to designate an
individual or organization to act responsibly on their behalf in assisting with
the individual’s application and renewal of eligibility and other ongoing
communications with the agency. Such a designation must be in accordance
with paragraph (f) of this section, including the applicant’s signature, and
must be permitted at the time of application and at other times.
(2) Authority for an individual or entity to act on behalf of an applicant
or beneficiary accorded under state law, including but not limited to,
a court order establishing legal guardianship or a power of attorney,
must be treated as a written designation by the applicant or beneficiary
of authorized representation.
(b) Applicants and beneficiaries may authorize their representatives to—
(1) Sign an application on the applicant’s behalf;
(2) Complete and submit a renewal form;
(3) Receive copies of the applicant or beneficiary’s notices and other
communications from the agency;
(4) Act on behalf of the applicant or beneficiary in all other matters
with the agency.
(c) The power to act as an authorized representative is valid until the
applicant or beneficiary modifies the authorization or notifies the agency that
the representative is no longer authorized to act on his or her behalf, or the
authorized representative informs the agency that he or she no longer is
acting in such capacity, or there is a change in the legal authority upon which
the individual or organization's authority was based. Such notice must be in
accordance with paragraph (f) of this section and should include the applicant
or authorized representative’s signature as appropriate.
(d) The authorized representative—
(1) Is responsible for fulfilling all responsibilities encompassed within
the scope of the authorized representation, as described in paragraph
(b)(2) of this section, to the same extent as the individual he or she
represents;
(2) Must agree to maintain, or be legally bound to maintain, the
confidentiality of any information regarding the applicant or
beneficiary provided by the agency.
* * *
21
the MDH regulation plainly allows the applicant or beneficiary to designate an individual
or organization to act responsibly on his or her behalf “through the applicant or recipient’s
signature.” Compare 42 C.F.R. § 435.923(a)(1), with COMAR 10.01.04.12B(2)(a).
Second, MDH allows for designation of an authorized representative under state law to be
treated as a written designation “[b]y providing proof of legal authority to act on behalf of
an applicant[.]” Compare 42 C.F.R. § 435.923(a)(2), with COMAR 10.01.04.12B(2)(b),
(3). Finally, in conformance with 42 C.F.R. § 400.203, the MDH regulation does not
require that an applicant be alive when an application is filed but, as discussed in greater
detail below, the application for a deceased applicant must be filed through the personal
representative of the estate. Compare 42 C.F.R. § 400.203 (definition of applicant), with
COMAR 10.01.04.12B(3)(d), C.
The Facility’s contention that MDH has limited the “scope of authorization” or
added special requirements in violation of federal law is incorrect. As addressed above, 42
C.F.R. § 435.923 allows an applicant—Ms. Turner in this case—to personally designate
an authorized representative. 42 C.F.R. § 435.923(a)(1); COMAR 10.01.04.12 B(2)(a).
The applicant must express her authorization by transmitting her signature through one of
the manners specified in paragraph (f) of 42 C.F.R. § 435.923. Given that Ms. Turner was
(f) For purposes of this section, the agency must accept electronic, including
telephonically recorded, signatures and handwritten signatures transmitted
by facsimile or other electronic transmission. Designations of authorized
representatives must be accepted through all of the modalities described in §
435.907(a).
42 C.F.R. § 435.923(a)-(d), (f).
22
deceased when the Facility purported to receive authority to act as Ms. Turner’s authorized
agent, she could not “sign” her authorization.16
Any valid designation of an authorized representative that does not require the
signature of the applicant must, then, be accorded under state law pursuant to 42 C.F.R. §
435.923(a)(2). The MDH regulation defines various circumstances under which a person
or entity can offer such “proof of legal authority to act on behalf of [the] applicant[.]”
COMAR 10.01.04.12B(2)(b). Consequently, rather than limit the scope of authorization
that is permitted under federal law, as the Facility argues, the MDH regulation expands the
means of qualifying as an authorized representative, as permitted under 42 C.F.R. §
435.923(a)(2).
E. The Facility Did Not Have Standing
The Facility contends that it had standing to file the petition for judicial review in
the underlying case because it obtained authorization from the circuit court to serve as the
Medicaid authorized representative through the MAR Order. We turn to COMAR
16
The Facility’s contention that its scope of authorization “survives death” under
the federal and state regulations is not supported by law or fact in the case. First, as
established above, even though 42 C.F.R. § 400.203 states that an applicant includes an
“individual who need not be alive at the time of application,” 42 C.F.R § 435.923(a)(1)
provides that the initial designation of that representative must include the applicant’s
signature. The record does not include a designation of the Facility as Medicaid authorized
representative signed by Ms. Turner. Furthermore, 42 C.F.R. § 435.923(c) expressly
provides that a “change in the legal authority” may invalidate an authorized
representative’s power to act. Under “well-established principles of agency law, an agent’s
authority terminates upon the death of the principal.” Brantley v. Fallston Gen. Hosp.,
Inc., 333 Md. 507, 511 (1994).
23
10.01.04.12 and the Estates and Trusts Article to discern whether the Facility qualified as
Ms. Turner’s Medicaid authorized representative.
Although COMAR 10.01.04.12B offers several possibilities to serve as an
authorized representative—e.g., as an applicant’s legal guardian or an individual
authorized through a valid power of attorney—because Ms. Turner was deceased at the
time the MAR Order was issued, our focus is limited to how authority can be obtained to
act on behalf of a decedent. After considering every provision in COMAR 10.01.04.12
under which the Facility could possibly serve as the Medicaid authorized representative for
Ms. Turner after she passed away, we conclude that the only option was to become the
personal representative of Mr. Turner’s estate, or “a person who has in good faith filed an
application to be appointed the personal representative of [Ms. Turner’s] estate[.]”
COMAR 10.01.04.12B(3)(d).17
The Maryland Code (1974, 2017 Repl. Vol.), Estates and Trusts Article (“ET”), § 1-
301 directs that: “[a]ll property of a decedent shall be subject to the estates of decedents
law, and upon the person’s death shall pass directly to the personal representative[.]” ET
§ 1-301(a). In turn, the control of the estate of the decedent is turned over to the personal
representative:
A personal representative has a right to and shall take possession or control
of the estate of the decedent, except that property in the possession of the
person presumptively entitled to it as heir or legatee shall be possessed by
17
The Facility does not argue that it would qualify as a Medicaid authorized
representative under COMAR 10.01.04.12B(5). We think this is prudent because the
language of B(5), requiring that the representative “[i]n good faith is acting in the best
interest of the applicant or recipient,” is clearly intended to apply while the applicant is
living.
24
the personal representative only when reasonably necessary for purposes of
administration.
ET § 7-102. Among other enumerated powers, a personal representative “may prosecute,
defend, or submit to arbitration actions, claims, or proceedings in any appropriate
jurisdiction for the protection or benefit of the estate[.]” ET § 7-401(y)(1). See also
Rosebrock v. E. Shore Emergency Physicians, LLC, 221 Md. App. 1, 12 (2015) (“Upon the
death of the ward (now decedent), the only person who may prosecute an action on the
decedent’s behalf is the personal representative.” (emphasis added)).
The Facility contends that MDH “wrongly asserted below that only personal
representatives can pursue Medicaid appeals on behalf of a deceased individual” because
Maryland law allows a special administrator to pursue such claims. The Facility quotes a
segment from ET § 6-401 stating: “a special administrator may be appointed by the court
whenever it is necessary to protect property prior to the appointment and qualification of a
personal representative.”18 The initial problem with this argument is that the Facility
ignores the provision in the statute that only “[u]pon the filing of a petition . . . a special
18
Throughout this opinion, we refer to the version of the Estates and Trusts Article
in effect at the time of the underlying hearing in the circuit court. Since then, ET § 6-
401(a) was amended to provide as follows:
(a) On the filing of a petition by an interested party, a creditor, or the register,
or on the motion of the court, a special administrator may be appointed by
the court:
(1) If it is necessary to protect property before the appointment and
qualification of a personal representative; or
(2) On the termination of appointment of a personal representative and
before the appointment of a successor personal representative.
2019 Md. Laws, ch. 197 (S.B. 398).
25
administrator may be appointed.” ET § 6-401(a) (emphasis added). The Facility has not
been appointed, nor petitioned to be appointed, as special administrator of Ms. Turner’s
estate. Moreover, COMAR 10.01.04.12 does not specify that a special administrator can
serve as an authorized representative. Again, COMAR 10.01.04.12B(3)(d) expressly
provides that only a “personal representative of the applicant or recipient’s estate . . . or a
person who has in good faith filed an application to be appointed the personal
representative” may have the requisite “proof of legal authority,” 10.01.04.12B(2)(b) to
serve as the authorized representative of the decedent in this case.
Finally, we reject the Facility’s hollow contention that the circuit court did not
require express authority to grant the MAR Petition but could rely on its equitable and
general jurisdiction. Under Maryland law, “[p]rimarily, [] the administration of a
decedent’s estate is committed to the Orphans’ Court.” Tribull v. Tribull, 208 Md. 490,
499 (1956); see also Knox v. Stamper, 186 Md. 238, 245 (1946) (“The general rule is that
the personal estates of deceased persons should ordinarily be administered and finally
distributed in the [o]rphans’ courts.”). Courts of equity intervene only to “remedy some
evil or establish some right which [orphans’ courts] are powerless to grant or establish.”
Gaver v. Gaver, 176 Md. 171, 189-90 (1939). While it is well-established that the orphans’
court is “a court of special limited jurisdiction, [and] must be confined to the express letter
of its authority,” DeFelice v. Riggs Nat’l Bank of Wash., 55 Md. App. 476, 478 (1983)
(citation omitted), the orphans’ court has “broad authority within the area of its express
jurisdiction.” Kaouris v. Kaouris, 324 Md. 687, 694 (1991). “Implicit in this grant of
jurisdiction to orphans’ courts is a restriction on the jurisdiction of state equity courts from
26
interfering with the administration of a decedent’s estate.” Ibru v. Ibru, 239 Md. App. 17,
34 (2018) (citing Gaver, 176 Md. at 189-90). Accordingly, the General Assembly has
granted our orphans’ courts authority over a decedent’s estate and, correspondingly,
conferred the personal representative with authority to act on behalf of the estate. The
Court of Appeals’ delineation of the scope of a court’s equitable powers applies with
noteworthy force here:
Equity, like the common law, is not a ‘brooding omnipresence in the sky.’[19]
Equitable principles are applicable to limited subjects in limited
circumstances[.]
Cent. Sav. Bank of Balt. v. Post, 192 Md. 371, 381 (1949). The General Assembly has
established a comprehensive framework for the appointment of personal representatives
and their respective obligations and authority. We will not eschew the General Assembly’s
clear direction by favoring “equitable relief” that is unmoored to a statute or the common
law.
Conclusion
We hold that the MAR Order was not validly obtained because the Facility was not
the personal representative of Ms. Turner’s estate at the time the order was issued.
COMAR 10.01.04.12B(3)(d) (authorizing the personal representative of an applicant’s
estate, or a person who has in good faith filed an application to be appointed the personal
representative, to apply for designation as authorized representative). Only a personal
19
Justice Holmes expressed that “[t]he common law is not a brooding omnipresence
in the sky, but the articulate voice of some sovereign or quasi sovereign that can be
identified[.]” S. Pac. Co. v. Jensen, 244 U.S. 205, 222 (1917) (Holmes, J., dissenting).
27
representative may be designated as the authorized representative to prosecute an appeal
from the denial of Medicaid benefits on behalf of a deceased individual. COMAR
10.01.04.12; ET § 7-401(y)(1). Consequently, because the Facility was not the personal
representative of Mrs. Turner’s estate, the Facility lacked standing to petition for judicial
review from the agency’s denial of Ms. Turner’s application for Medicaid benefits.
We affirm the judgment of the circuit court.
JUDGMENT OF THE CIRCUIT COURT
FOR HOWARD COUNTY AFFIRMED;
COSTS TO BE PAID BY APPELLANT.
28
The correction notice(s) for this opinion(s) can be found here:
https://mdcourts.gov/sites/default/files/import/appellate/correctionnotices/cosa/2304s18cn.pdf