Rosebud Sioux Tribe v. United States, 3:16-CV-03038-RAL

ROSEBUD SIOUX TRIBE, a federallyrecognized Indian tribe, and its individual members, Plaintiff, v. UNITED STATES OF AMERICA;DEPARTMENT OF HEALTH AND HUMAN SERVICES,an executive department of the United States; THOMAS E. PRICE,Secretary of Health and Human Services; INDIAN HEALTH SERVICE,an executive agency of the United States; CHRIS BUCHANAN, Acting Director ofIndian Health Service; FRANCIS FRAZIER,Acting Director of the Great Plains Area Indian Health Service,¹ Defendants.

3:16-CV-03038-RAL

UNITED STATES DISTRICT COURT DISTRICT OF SOUTH DAKOTA CENTRAL DIVISION

March 31, 2017

OPINION AND ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS' MOTION TO DISMISS

The Rosebud Sioux Tribe (the Tribe) filed a Complaint against the United States of America, the Department of Health and Human Services (HHS) and its Secretary, the Indian Health Service (IHS) and its Acting Director, and the Acting Director of the Great Plains Area of IHS (collectively the Government), seeking declaratory and injunctive relief due to the allegedly inadequate health care provided by IHS to tribal members. Doc. 1. The Government filed amotion to dismiss the complaint for lack of subject matter jurisdiction and for failure to state a claim upon which relief can be granted. Doc. 17. The Tribe opposed the motion to dismiss. Doc. 24. The case thereafter was transferred to the undersigned judge. Doc. 33. For the reasons stated below, the Government's motion to dismiss is granted as to Counts I, II, and IV, and denied as to Count III of the Complaint.

I. Background

The Government seeks to provide, administer, and oversee health services to members of federally recognized tribes through IHS, which is an agency within HHS. Doc. 1 at ¶ 6. The Rosebud Sioux Tribe is a federally recognized tribe whose members are eligible to receive health care from federally funded IHS facilities. Doc. 1 at ¶¶ 2, 6, 31. The Rosebud IHS Hospital² is located in Rosebud, South Dakota, and serves as the primary source of health care for the Tribe's members. Doc. 1 at ¶ 31. Congress makes annual appropriations for all IHS programs, which HHS then distributes among 170 service units, within 12 regional IHS areas. Doc. 18 at 2-3; IHS 2016 Profile, U.S. Dep't of Health and Human Servs. (Sept. 2016), https://www.ihs.gov/newsroom/factsheets/ihsprofile/. Expenses for the treatment of tribal members are reimbursed by Medicare and Medicaid, so long as IHS hospitals comply with the conditions of participation at 42 U.S.C. §§ 1395qq, 1396j.

After federal surveyors inspected and reviewed the Rosebud IHS Hospital in mid-November of 2015, the Centers for Medicare and Medicaid Services (CMS) sent the Rosebud IHS Hospital a "Notice of Intent to Terminate Medicare Provider Agreement" concerning its emergency department. Doc. 1 at ¶¶ 35-36. The CMS stated that the deficiencies discovered during the review process were an "immediate and serious threat to the health and safety [of] anyindividual who comes to [the Rosebud IHS Hospital] to receive emergency services." Doc. 1 at ¶ 36. To avoid closure of the emergency department, the Rosebud IHS Hospital needed to correct its violations of the Medicare Conditions of Participation for Hospitals by December 12, 2015. Doc. 1 at ¶ 36. On December 5, 2015, IHS announced that the Rosebud IHS Hospital was on "divert status," due to staffing and resource issues, and that individuals seeking emergency services at the Rosebud IHS Hospital would be directed to the emergency rooms in Winner, South Dakota, or Valentine, Nebraska, which are approximately 55 and 44 miles away, respectively. See Doc. 1 at ¶ 37. On January 5, 2016, the Rosebud IHS Hospital was again sent a "Notice of Intent to Terminate Medicare Participation" because of failure to comply with federal requirements. Doc. 1 at ¶ 39. Federal surveyors visited the Rosebud IHS Hospital again in February 2016, and found ongoing noncompliance with Medicare Conditions of Participation. Doc. 1 at ¶ 42. On March 1, 2016, CMS again sent Rosebud IHS Hospital a termination notice, stating that its Medicare Provider Agreement would be terminated March 16, 2016. Doc. 1 at ¶¶ 42-43.

On April 28, 2016, the Tribe filed this suit, an action for declaratory and injunctive relief, with four counts. Doc. 1. Counts I and II of the Tribe's Complaint are based on a provision of the Indian Health Care Improvement Act (IHCIA), 25 U.S.C. § 1631(b)(1), which requires a one-year notice to Congress before any IHS hospital, facility, or portion of such can be closed, in order to evaluate the impact of the closure. Count I alleges a violation of the IHCIA directly, while Count II seeks judicial relief under the Administrative Procedures Act, 5 U.S.C. § 702 (APA), for the alleged violation of the IHCIA. Doc. 1 at ¶¶ 45-59. Count III alleges violation of treaty rights, other statutory obligations, and the trust responsibility obliging the Government to provide health care services to the Tribe's members. Doc. 1 at ¶¶ 60-66. Count IV allegesviolations of equal protection and due process under the Fifth Amendment of the United States Constitution stemming from the Rosebud IHS Hospital's emergency department closure. Doc. 1 at ¶¶ 67-77. The Complaint seeks various declaratory and injunctive relief, as well as costs, fees, and other relief deemed proper. Doc. 1 at 21-23.

With its motion to dismiss, the Government filed a Declaration of the Acting Chief Executive Officer at the Rosebud IHS Hospital, and attached various documents to provide information about events that have occurred at the Rosebud IHS Hospital after the suit was filed. Doc. 19. On April 30, 2016, the CMS and IHS entered into a Systems Improvement Agreement to promote future compliance with the Medicare conditions of participation. Doc. 19 at ¶ 13. IHS awarded a contract to AB Staffing Solutions, LLC (ABSS) on May 17, 2016, to provide staffing and management services to the Rosebud IHS Hospital emergency department. Doe. 19 at ¶ 14. The emergency department at the Rosebud IHS Hospital reopened and resumed providing 24-hour emergency care on July 15, 2016. Doc. 19 at ¶ 16. The Government filed its motion to dismiss following these developments. Doc. 17.

The Tribe's response to the motion to dismiss recognizes that the Rosebud IHS Hospital emergency department reopened under ABSS management on July 15, 2016, but raises concerns about ABSS and about ongoing staffing and care issues, submits information about five deaths and delivery of two babies that occurred during transport to off-reservation emergency departments, focuses on its non-IHCIA claims in Counts III and IV, and requests an opportunity for discovery on its IHCIA claims in Counts I and II. Docs. 24, 25, 26, 27, 28. The Tribe likewise filed declarations and additional documents. Docs. 25, 26, 27, 28. The Tribe argues that discovery is required to evaluate the standard of care provided by ABSS, to determine whether the Great Plains Area IHS had discretion with its spending appropriations to specifichospitals, and to test whether the Rosebud IHS Hospital emergency department's divert status truly was temporary. Doc. 24 at 14-16. The Tribe also argues that if this Court relies upon materials outside the pleadings in ruling upon the Government's motion, it must convert this into a motion for summary judgment, upon which "[a]ll parties must be given a reasonable opportunity to present all the material that is pertinent to the motion." Doc. 24 at 14 (alteration in original) (quoting Fed. R. Civ. P. 12(d)).

II. Legal Standards

A. Rule 12(b)(1) and Rule 12(b)(6)

The Government has filed its motion to dismiss under both Federal Rule of Civil Procedure 12(b)(1) for lack of subject matter jurisdiction, and Rule 12(b)(6) for failure to state a claim upon which relief can be granted. Doc. 17. To challenge subject matter jurisdiction under Rule 12(b)(1), the Government must either attack the facial or factual basis for jurisdiction. Osborn v. United States, 918 F.2d 724, 729 n.6 (8th Cir. 1990). Regardless of whether the jurisdictional attack is facial or factual, the plaintiff has the burden of proving subject matter jurisdiction. V S Ltd. P'ship v. Dep't of Hous. & Urban Dev., 235 F.3d 1109, 1112 (8th Cir. 2000). Under a facial attack, the "court restricts itself to the face of the pleadings, and the non-moving party receives the same protections as it would defending against a motion brought under Rule 12(b)(6)." Jones v. United States, 727 F.3d 844, 846 (8th Cir. 2013) (quoting Osborn, 918 F.2d at 729 n.6). However, under a factual attack of the court's jurisdiction, no presumptive truthfulness attaches to the plaintiff's pleadings as under Rule 12(b)(6), because at issue is the court's very power to hear the case. See Osborn, 918 F.2d at 729-30. Under a factual attack to its jurisdiction, the court is free to consider matters outside the pleadings, without invoking Rule 56 and converting the motion to dismiss into a motion for summary judgment, because"[j]urisdictional issues, whether they involve questions of law or of fact, are for the court to decide." Id. at 729 (citing Williamson v. Tucker, 645 F.2d 404, 413 (5th Cir. 1981)). The Government raises a factual attack to this court's jurisdiction, and this Court can thus consider matters outside the pleadings without converting this motion into one for summary judgment when ruling under Rule 12(b)(1). Doc. 18 at 6 (citing Titus v. Sullivan, 4 F.3d 590, 593 (8th Cir. 1993)); Doc. 35 at 2.

The Government also invoked Rule 12(b)(6) in its motion to dismiss. When considering a motion to dismiss under Rule 12(b)(6), a court must draw all reasonable factual inferences in favor of the non-moving party, but need not accept the nonmoving party's legal conclusions. Freitas v. Wells Fargo Home Mortg., Inc., 703 F.3d 436, 438 (8th Cir. 2013); Retro Television Network, Inc. v. Luken Commc'ns, LLC, 696 F.3d 766, 768-69 (8th Cir. 2012). The court "generally must ignore...