It's hard to tell for certain from the photos, but a common culprit for sudden plant collapse in summer is Southern Blight. The fungus prospers in warm weather and conditions where air circulation around the crown of a plant (the main growth points, where stems emerge from the soil) is limited due to factors like dense growth and mulch crowding or covering the crown. Other types of crown rot pathogens act similarly. Fungus gnats are not likely, especially in outdoor environments where they have predators and competing organisms to deal with.

Once collapsed, a plant will not recover and should be removed so it doesn't continue to harbor any pathogens that may spread further. Do not compost the debris. Replanting in that area should be fine (the pathogens are ubiquitous so there is no way to keep them from coming back if conditions are ideal for them) as long as the plants are spaced sufficiently and not heavily mulched up to the crown so they continue to get good air circulation. No fungicide will provide any benefit.

While dense groundcover plantings have several benefits, like helping to out-compete weeds, reduce the need for mulch, and can be aesthetically appealing, unfortunately Southern Blight and similar diseases are a risk that increases in those conditions. The plants in your photo are not overly dense right now, but we mention this as something to keep in mind for when they eventually fill in and more completely carpet that area. If outbreaks of blight continue to afflict replacement plants in that part of the garden, consider mixing-in other groundcover species that might have less vulnerability to those kinds of pathogens.

To further reduce the risk of these types of blights, make sure that plants are only watered when they need it, which is when the soil around four to six inches deep (four may suffice for shallower-rooted groundcovers like this) has become somewhat dry to the touch at that depth.

Miri

If a fungus is the cause, would spraying an anti fungal like Captan be beneficial to stop the spread?

A few fungicide products might be labeled for use in suppressing Southern Blight infection, but none can cure any existing outbreak or reverse plant damage. Be aware that environmental conditions outside of our control play a large role in plant disease severity and spread, potentially rendering fungicides ineffective, and this fungus is naturally-occurring in the environment and may return at any point in the future. As noted in the page linked above, effectiveness of treatment may vary, and could promote the development of resistant strains of the fungus if they are over-used.

Since fungicides can potentially harm pollinators or other organisms, this concern plus the risk of poor efficacy and the accumulated costs of reapplication to maintain protection are the main reasons we discourage their use. The cost of multiple fungicide treatments (as one alone will not be sufficient) could easily outweigh the cost of plant replacement if certain individual plants succumb. Plus, we can't confirm that Southern Blight is the fungus responsible; if a root or crown rot is present instead, no fungicide will provide any benefits, though a root rot or crown rot tend to occur in conditions of poor drainage or over-watering.

If you replant, you could look for plugs, which are younger than most nursery-sized plants but which still establish fairly quickly after planting. Native plant plugs are increasing in popularity for their ease of planting and reduced cost, so are becoming more widely available (at least at nurseries stocking native plants). Costs can vary with nursery and plant species, but as a ballpark, many plugs seem to run in the $3-5 range apiece.

Miri

If you have one or more plants that is dying but not dead yet, you might be able to submit samples to a plant diagnostic lab for testing. Normally such testing is not inexpensive and submissions are made through commercial entities (landscapers, nurseries, arborists, lawn companies, etc.), but with the temporary closure of UMD's lab until the retired lab director can be replaced, nearby Extension services might be testing for free or reduced cost (refer to the linked page). You would need to inquire with the lab chosen to find out what their policy is for Maryland residents, plus determine how to collect and mail in samples if they are accepting submissions from residents directly.

Miri

We don't think it arrived in a mulch pile, as the fungus needs more herbaceous plant matter to subsist on. The majority of fungi associated with mulch are those that break the wood down into nutrients plants can use, and are beneficial in nature. (They also don't tend to infect live plants because they are not pathogens.) You can try solarization to sterilize the surface soil layers, though the heat from that technique doesn't permeate very far down into the soil. Burying spores can be more effective, though might not be practical too close to live established plants so their roots are not damaged. Plus, soil disturbance on a hillside may result in erosion and bring weed seeds to the surface where they can germinate, especially if mulch is temporarily removed. Pulling aside mulch a bit to improve air circulation around plant crowns, but this fungus thrives in heat and humidity, so we don't think it will be sufficient by itself to discourage infections.

Miri