BRUCE KELLEY, NANCY KELLEY, Plaintiffs-Appellees, v. RICHFORD HEALTH CENTER, INC. d/b/a NORTHERN TIER CENTER FOR HEALTH, Defendant-Appellant, TEIG MARCO, M.D., Defendant-Cross-Defendant-Appellant, FRANKLIN COUNTY REHABILITATION CENTER, FRANKLIN COUNTY REHABILITATION & ADULT CARE CENTER, KRISTY JANKOWSKI, R.N., MARION PERRY, R.N., KYLA APLEY, L.N.A., Defendants-Appellees, FRANKLIN COUNTY REHAB CENTER, LLC, Defendant-Cross-Claimant-Appellee, THE UNIVERSITY OF VERMONT MEDICAL CENTER, INC., STEPHEN RANNEY, M.D., ANDREW STANLEY, M.D., Defendants, UNITED STATES OF AMERICA, Appellee.
Docket No. 23-344-cv
United States Court of Appeals for the Second Circuit
August 20, 2024
August Term, 2023 (Argued: February 27, 2024)
Before:
CALABRESI, CABRANES, and LOHIER, Circuit Judges.
MATTHEW SIDNEY FREEDUS (Rosie Dawn Griffin, on the brief), Feldesman Tucker Leifer Fidell LLP, Washington, DC, for Appellants.
Vincent Illuzzi, Orleans, VT, for Plaintiffs-Appellees.
Kaveh Shahi, Cleary Shahi & Aicher, P.C., Rutland, VT, for Defendants-Appellees and Defendant-Cross-Claimant-Appellee.
DANA KAERSVANG, United States Department of Justice (Mark B. Stern, Brian M. Boynton, United States Department of Justice; Carla B. Freedman, United States Attorney for the Northern District of New York; Samuel R. Bagenstos, Michael I. Goulding, Meredith Torres, United States Department of Health and Human Services, on the brief), Washington, DC, for Appellee.*
Bruce Kelley (“Kelley”) and his spouse, Nancy Kelley, filed this medical malpractice suit in Vermont state court after Kelley was paralyzed from the waist down while residing in the Franklin County Rehabilitation Center (“FCRC” or the “Rehabilitation Center”), a skilled nursing facility. The Kelleys blame the injury on Dr. Teig Marco, who treated Kelley in the facility under a contract between FCRC and Dr. Marco’s employer, the Richford Health Center, Inc. (“RHC” or the “Health Center”).
As a federally funded community health center, RHC is “deemed” to be a member of the Public Health Service under the Federally Supported Health Centers Assistance Act (FSHCAA),
The FSHCAA makes the Federal Tort Claims Act (FTCA) “the exclusive remedy for specified actions against members of the Public Health Service” (including deemed health centers) and protects “employees of the Public Health Service from being subject to suit while performing medical and similar functions by requiring that such lawsuits be brought against the United States instead.” Cuoco v. Moritsugu, 222 F.3d 99, 107–08 (2d Cir. 2000). As relevant here, the statute’s protection covers malpractice claims that arise from a deemed health center’s provision of medical services to patients and, in limited circumstances, nonpatients too.
After the Kelleys filed their lawsuit against the Rehabilitation Center, the Health Center, and Dr. Marco, among others, the Government invoked the FSHCAA and the FTCA to intervene, remove the case to federal court, and substitute itself as the sole proper defendant. The Rehabilitation Center opposed and filed a motion to remand. Following an evidentiary hearing, the Government decided that the FSHCAA did not cover Dr. Marco’s treatment of Kelley after all, and urged that the matter be remanded to state court. The District Court (Crawford, C.J.) agreed and granted the motion to remand. We AFFIRM.
BACKGROUND
I. Statutory Framework
The FSHCAA authorizes the United States Department of Health and Human Services (“HHS”) to deem federally qualified health centers as Public Health Service members. The designation entitles the centers and their employees to FTCA coverage for certain medical malpractice suits.
HHS has carved out narrow exceptions to this requirement. If the employees of a deemed health center provide either “after-hours coverage” for a non-deemed community health center’s patients or emergency treatment to any nonpatient, those activities will be covered by HHS’s
II. Factual Background
RHC applied for federal funding (and the corresponding malpractice coverage) under the FSHCAA in January 2017. In its application, RHC proposed hiring a doctor to provide primary care services at skilled nursing and rehabilitation facilities “[i]n order to continue caring for our patients.” App’x 279 (emphasis added). RHC also described its bid to provide medical services at rehabilitation centers as ensuring that its employees could “deliver health care services to patients confined to rehabilitation centers.” App’x 392 (emphasis added). HHS approved the Health Center’s grant application and deemed it a Public Health Service employee on August 31, 2017.
On October 1, 2017, RHC hired Dr. Marco to provide medical services to patients at local skilled nursing and rehabilitation facilities. That same day, Dr. Marco entered into a contract with FCRC to provide medical director services “as a [Richford Health Center] employee.” App’x 228.
Dr. Marco admitted Kelley as a new patient to FCRC about six months later. Things quickly went awry. The Kelleys allege that two FCRC nurses injured Kelley’s back and that another nurse and Dr. Marco failed to properly treat the injury. As Kelley’s condition worsened, Dr. Marco prescribed pain medication in lieu of ordering or conducting a full neurological exam. Dr. Marco’s failure to provide the necessary neurological treatment, the Kelleys claim, resulted in a permanent spinal cord injury and paralysis from the waist down.
III. Procedural History
The Kelleys filed suit in Vermont state court in February 2021. In November 2021, the United States Attorney for the Northern District of New York1 removed the action to federal court based on both the FSHCAA and the federal officer removal statute,
The Government then changed its mind. Initially, the Government revised its stated justification for the claim that Kelley’s treatment by Dr. Marco was covered by the FTCA. Kelley, it acknowledged, was never in fact a Health Center patient. Even so, it explained, Kelley’s treatment was entitled to FTCA coverage without HHS’s particularized determination of coverage because it occurred pursuant to an after-hours coverage agreement or on an emergency basis.
A subsequent evidentiary hearing prompted the Government to retreat even further. On December 12, 2022, it retracted its earlier certification that Dr. Marco’s
DISCUSSION
I. Appellate Jurisdiction
Before proceeding to the merits, we must first determine whether we have jurisdiction to consider this appeal. The Kelleys and FCRC argue that we do not. “Since at least 1949, federal appellate courts have generally lacked the power to review a district court order remanding a case to state court. But like most rules, this one has accrued exceptions with time.” BP P.L.C. v. Mayor of Balt., 141 S. Ct. 1532, 1536 (2021) (citing Act of May 24, 1949, § 84, 63 Stat. 102).
“In 2011, Congress added a[n] . . . exception for suits against federal officers or agencies removed pursuant to
A “colorable claim for removal under § 1442” is all it takes to trigger our review of a remand order, even if we ultimately determine that removal was improper. Agyin, 986 F.3d at 174. To invoke
With that in mind, we conclude that the Government’s notice of removal “asserted a colorable claim for removal under § 1442” because it certified that RHC was a deemed entity and that Dr. Marco’s treatment of Kelley fell within the scope of his employment. See id. at 174–78, 181. First, RHC and Dr. Marco had colorable claims to immunity from suit under the FTCA, which provides a colorable federal defense. “A merely colorable defense is sufficient to assure the federal court that it has jurisdiction to adjudicate the case.” Cuomo v. Crane Co., 771 F.3d 113, 116 (2d Cir. 2014) (quotation marks omitted); see Agyin, 986 F.3d at 174 (noting that we
Under
receipt by or service on that defendant of the initial pleading or summons . . . to file the notice of removal.” FCRC and the Kelleys argue that, colorable defense or not, the Government’s notice of removal was procedurally defective because it was filed more than thirty days after the defendants’ receipt of the summons and complaint in this case. We have explained, though, that the “thirty-day time limitation is . . . not jurisdictional.” Agyin, 986 F.3d at 182 (quotation marks omitted). “Therefore, if an opposing party does not object to an untimely notice of removal by timely filing a motion to remand, the objection is waived.” Id. Here, “no party filed such a motion or otherwise objected to the timeliness” of the Government’s notice of removal. Id. at 183. So even if the Government’s “removal under
FCRC and the Kelleys also challenge our appellate jurisdiction because the District Court premised its remand order on the inapplicability of the FSHCAA,
Finally, the Kelleys contend that RHC and Dr. Marco lack standing to appeal the remand order because they were not the “party” that removed the case in the first instance. This argument is foreclosed by the plain text of
II. Merits of the Remand Order
We review the merits of the remand order without deferring to the District Court’s decision. See Agyin, 986 F.3d at 173–74.
As the District Court explained, “[t]he deeming decision is highly consequential for [a federally qualified health center] because it makes it unnecessary to purchase liability insurance for many types of claims. Instead, the United States becomes the insurer of the [federally qualified health center], providing a defense and indemnity within the procedures of the FTCA.” Kelley, 2023 WL 2529926, at *6.
The FSHCAA makes clear that the scope of HHS’s deeming decision
depends on the patient’s status. In general, the deeming decision — and the corresponding FTCA coverage for malpractice claims — is limited to medical treatment that a deemed entity (such as the Health Center) and its employees provide to its patients.
RHC and Dr. Marco dispute a reading of the FSHCAA that limits FTCA immunity to claims arising from medical services to patients of deemed entities. They insist that patient status is irrelevant to the scope of FTCA immunity. Immunity attaches here, they claim, as long as Dr. Marco treated Kelley within the scope of his employment with the Health Center and regardless of Kelley’s status as a nonpatient of the Health Center. But this interpretation ignores the text of the FSHCAA, which ties an entity’s deemed federal employment to the patient/nonpatient status of the individual receiving treatment.
The parties agree that Kelley was not a Health Center patient before Dr. Marco treated him. The Appellants contend, though, that Kelley became a Health Center patient because Dr. Marco’s treatment fell within the scope of his employment for RHC. This argument again runs headlong against the
FSHCAA’s plain text, which limits HHS’s deeming decision to “patients of the entity,” not patients of the entity’s employees. See
FTCA coverage thus applies to Dr. Marco’s treatment of Kelley only if the treatment satisfies one or more of the FSHCAA’s specified statutory criteria for services to nonpatients described in HHS’s regulations,
Finally, HHS regulations provide that a health center planning to offer services that do not fit neatly into any of the descriptions listed in
We therefore conclude that Dr. Marco’s treatment of Kelley is not covered by HHS’s deeming decision, and accordingly
CONCLUSION
We have considered the Appellants’ remaining arguments and conclude that they are without merit. For the foregoing reasons, the judgment of the District Court is AFFIRMED.