D.D.C.: No standing to challenge lack of Medicaid notice

In a lawsuit challenging the lack of notice and an opportunity for a hearing when Medicaid prescription drugs are denied, a district court dismissed the case, finding that the plaintiffs had not met the requirements for standing.  NB v. District of Columbia, Civ. No. 10-1511 (RJL), 2011 WL 3440088 (D.D.C. July 29, 2011). Judge Leon was nominated by George W. Bush.

The Plaintiffs consist of five Medicaid beneficiaries who suffer from various medical conditions, including diabetes, asthma, high blood pressure, and anxiety and behavioral disorders. On numerous occasions, their drug coverage was denied, terminated, reduced or delayed without written notice of the change or an opportunity for a fair hearing to contest the change. The Plaintiffs brought a suit for declaratory and injunctive relief against the District of Columbia, its mayor, and the director of the Department of Health Care Finance (collectively “Defendants”).  The suit alleges that the lack of notice violated the Due Process Clause of the Fifth Amendment, the Medicaid statute and regulations, 42 U.S.C. § 1396a(a)(3); 42 C.F.R. 435.919, and District of Columbia law, § 4-201.01, et seq.

The court concluded that the Plaintiffs were not able to satisfy any of the elements of standing. First, the court held that the Plaintiffs did not suffer a cognizable injury because they were “ultimately” able to obtain their Medicaid prescriptions free of cost. The court stated: “Unfortunately, the inconveniences experienced by plaintiffs and their families, attributable to either the delay in receiving prescriptions or their inability to obtain their prescriptions at particular pharmacies, do not rise to the level necessary to constitute injury in fact.”  The court dismissed the alleged harm from fear or anxiety, stating that plaintiffs failed to allege facts that their fears were “real or immediate.”

The court next held that the alleged injuries were not traceable to the Defendants.  The court indicated that where delays or denials were due to the actions of a pharmacy or the failure of a doctor to meet the prior authorization requirements, the acts were not traceable to the agency.  The court stated: “in many of the instances alleged by plaintiffs, the ‘denial’ of coverage was actually a mistake by the pharmacy or the electronic claims management system—not a decision by the District that failed to meet Medicaid’s notice requirements.”  Thus, the court held that the mistakes of the electronic system established by the Defendants were not traceable to the actions of the Defendants.

While the court acknowledged that plaintiffs had incurred out-of-pocket expenses, the court found that these alleged injuries would not be redressable in a suit for declaratory and injunctive relief.

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