Papers Considered:1. Notice of Petition, dated November 16, 2017; Article 78 Verified Petition and Complaint, dated November 9, 2017, with attached exhibits A-L; Affirmation of F. Paul Greene, Esq., dated January 5, 2018, with attached exhibits A-D; Memorandum of Law in Support of Article 78 Verified Petition and Complaint, dated January 5, 2018;2. Notice of Motion, dated February 9, 2018; Affirmation of Maria Lisi-Murray, Esq., dated February 9, 2018, with attached exhibit A; Affidavit of Ann Foster, sworn to February 8, 2018, with attached exhibit A; Memorandum of Law in Support of Motion to Dismiss Pursuant to CPLR 3211 (a) (1), (2), and (5), dated February 9, 2018;3. Memorandum of Law in Opposition to Motion to Dismiss, dated February 22, 2018; and4. Reply Memorandum of Law in Further Support of Motion to Dismiss Pursuant to CPLR 3211, dated March 7, 2018. Plaintiff-petitioner Bainbridge Nursing Home (“Bainbridge”) brings this combined CPLR article 78 proceeding/action for declaratory and injunctive relief, challenging the refusal of the State of New York (“State”) to process Medicaid rate appeals associated with its Adult Day Health Care (“ADHC”) program. Defendants-respondents Howard Zucker, M.D., the Commissioner of Health of the State of New York, and Robert Mujica, the Director of the Budget, move, pre-answer, to dismiss the verified petition/complaint (“Petition”) pursuant to CPLR 3211 (a) (1), (2) and (5), arguing principally that Bainbridge’s claims are barred by the terms of a universal settlement agreement to which Bainbridge assented.BACKGROUNDBainbridge operates a residential health care facility in the Bronx (see Public Health Law ["PHL"] §2801 [3]; Petition,3). It also operates ADHC programs at several locations, including an off-site program in Brooklyn (see Petition,3). According to the Petition, the vast majority of Bainbridge’s residents and clients are Medicaid recipients (see id.,11).1. Legal FrameworkFederal law requires the New York State Department of Health (“DOH”), as the State agency charged with setting Medicaid rates (see PHL §2808 [3]), to “provide an appeals or exception procedure that allows individual providers an opportunity to submit additional evidence and receive prompt administrative review…of payment rates” (42 CFR 447.253 [e]).DOH has established a rate appeal procedure to comply with this federal mandate (see 10 NYCRR 86-2.13, 86-2.14). Pursuant to agency regulations, Medicaid rate appeals are to be resolved within one year of filing or the 120th day after receipt of the initial rate sheet for any given rate year, whichever is later (see 10 NYCRR 86-2.14 [b]; see also PHL §2808 [17] [a] [requiring DOH to "consider…rate appeals within a reasonable period"]).In 2010, the State Legislature enacted PHL §2808 (17) (b), which established a cap on the total annual value of rate appeals that may be paid in State fiscal year (“SFY”) 2010-2011 and authorized a moratorium on the processing of rate appeals falling outside the cap (see L 2010, ch 109, §1, part B, §30; Matter of Woodside Manor Nursing Home v. Shah, 113 AD3d 1142, 1143-1144 [4th Dept 2014] ["Woodside"]).The Legislature amended PHL §2808 (17) (b) in 2011 “to expand the time period of the rate appeal moratorium through March 31, 2015 and to reduce the rate appeal cap to $50 million for [SFY 2011-2012]” (Woodside, 113 AD3d at 1144; see L 2011, ch 59, §1, part H, §98). At the same time, the Legislature amended PHL §2808 (17) to add a new paragraph (c) that required DOH to promulgate regulations establishing priorities and time frames for the processing of rate appeals in accordance with the moratorium and cap established in paragraph (b) of the subdivision (see L 2011, ch 59, §1, part H, §98; PHL §2808 [17] [c]; Woodside, 113 AD3d at 1144).In 2015, the Legislature extended the moratorium and cap through March 31, 2019 (see L 2015, ch 47, part D, §21). Thus, in its current form, PHL §2808 (17) (b) reads, in pertinent part:Notwithstanding any inconsistent provision of law or regulation to the contrary, for the state fiscal years beginning April first, two thousand ten and ending March thirty-first, two thousand nineteen, [DOH] shall not be required to revise certified rates of payment established pursuant to this article for rate periods prior to April first, two thousand nineteen, based on consideration of rate appeals filed by residential health care facilities or based upon adjustments to capital cost reimbursement as a result of approval by [DOH] of an application for construction under section twenty-eight hundred two of this article, in excess of an aggregate annual amount of eighty million dollars for each such state fiscal year…. In revising such rates within such fiscal limit, [DOH] shall, in prioritizing such rate appeals, include consideration of which facilities [DOH] determines are facing significant financial hardship as well as such other considerations as [DOH] deems appropriate…(id.).The delays in processing Medicaid rate appeals have engendered significant litigation throughout the State. Of particular note is Woodside, in which the Fourth Department held that the cap and moratorium established in PHL §2808 (17) (b) are entitled to retroactive application (see 113 AD3d at 1145-1146).The Court of Appeals granted leave to appeal in Woodside (see 22 NY3d 866 [2014]), which is said to have been the catalyst for negotiations between DOH and representatives of the residential home care industry to reach a comprehensive resolution of the legal, fiscal and policy issues raised by the backlog of unprocessed rate appeals. After protracted negotiations, DOH and representatives of over 600 residential home care operators in the State reached a Universal Settlement Agreement on March 9, 2016 (see Foster Aff., Ex. A),1 the particulars of which are discussed below.2. Bainbridge’s Rate AppealsBainbridge’s unprocessed rate appeals concern lease payments for its offsite ADHC program in Brooklyn (see 10 NYCRR 86-2.9, 86-2.21 [c] [3]) and the return of/on equity associated with such program (see id., 86-2.21 [e] [4]; Petition,
