D.Hi.: No dismissal but no PI for reduction of immigrants’ medical benefits

The District Court of Hawaii rejected both the defendants’ motion to dismiss and the plaintiffs’ motion for preliminary injunction in a challenge under Equal Protection Clause and the ADA to a Hawaii medical benefits program. The court found that the program discriminated based on alienage and was subject to strict scrutiny. It also found that the defendants had not adequately argued that the ADA claim should be dismissed. However, the court held that the plaintiffs did not meet their burden to merit a preliminary injunction. Korab v. McManaman, Slip Copy, 2011 WL 3240444 (D.Hi. July 28, 2011). Judge Michael Seabright, nominated by George W. Bush, wrote the opinion.

In 1996, Congress enacted the Personal Work Opportunities and Reconciliation Act. Among other changes to Medicaid, the new law prevented lawful immigrants who have been in the United States for less than five years from receiving Medicaid benefits. States are still permitted to create their own programs to provide medical care. Hawaii has created a variety of programs to provide medical services to immigrants to the United States who have been here for less than five years (“New Residents”) and citizens of countries with Compacts of Free Association with the United States (“COFA Residents”). In 2010, the state implemented a new program, Basic Health Hawaii, that provided more limited benefits and was capped at 7,000 participants, and it transferred many COFA residents to the new program.

Because of the changes to the Hawaii medical benefits programs, a number of New Residents and COFA Residents were denied medical services or faced higher costs. They brought a lawsuit claiming that the programs violated the Equal Protection Clause of the 14th Amendment by discriminating based on alienage, and that the state violated the Americans with Disabilities Act by requiring disabled plaintiffs to seek care in hospitals rather than in “the most integrated setting appropriate”.

The court first examined the defendants’ motion for summary judgment on the Equal Protection claim. The court dismissed the defendants’ argument that the state was only making distinctions based on Medicaid eligibility rather than alienage. These arguments, the court explained, were “based on semantics and not realities.” Given that participation in Medicaid is voluntary for states and that Medicaid allows states to decide what additional groups to cover, the court held that the state could not claim its distinctions were based on a factor other than alienage.

The court also rejected the defendants’ arguments that the court should follow Hong Pham v. Starkowski. 16 A.3d 635 (Conn. 2011). In that case, the Connecticut Supreme Court held that the Equal Protection clause was not violated when the state ended a benefits program for immigrants. Since the particular program had never provided benefits to non-immigrants, the state was not discriminating against immigrants simply by ending the program, even though eligible non-immigrants would continue to receive Medicaid benefits. The Hawaii District Court found Hong Pham to be “unpersuasive.” The court observed that “Hong Pham would allow a state to create separate programs that provide different benefits based on suspect classification […] Such an absurd (and insidious) result stands the Equal Protection Clause on its head.” Rejecting the arguments based on Hong Pham, the court concluded that strict scrutiny would apply to the state’s actions. Because the defendants had not argued that the claim should be dismissed if strict scrutiny applied, the court denied their motion to dismiss the equal protection claim.

The court quickly rejected the defendants’ arguments for dismissing the Americans with Disabilities Act claim. The court recited the requirements for an ADA claim, but decided that the defendants’ arguments were too limited and conclusory to decide whether they were entitled to summary judgment. It dismissed their motion but allowed the defendants to raise the issue again later.

After rejecting the defendants’ motion for summary judgment, the court turned to the plaintiffs’ request for preliminary injunctive relief. The court found the plaintiffs arguments to be insufficient, and denied their request.

The court identified the plaintiffs’ lack of a class certification as the first defect with the plaintiffs’ request for an injunction. Preliminary injunctions may be granted before class certification, but they are disfavored because without class certification it is more difficult to determine the precise impact of a preliminary injunction on the parties. Without class certification to clarify what a preliminary injunction would actually accomplish, the court decided to exercise its discretion not to grant the relief.

The court also found that the plaintiffs failed to satisfy the requirements for a preliminary injunction. First, while the plaintiffs must show the law clearly favors their position, the court reasoned that the plaintiffs could only show some likelihood of success on the merits. Second, although the named plaintiffs would suffer irreparable harm from continued denial of benefits, the plaintiffs failed to show such harms were common or typical to the class. Third, because the plaintiffs had not identified the size of the class and because the injunction would require mandatory action by the state, the plaintiffs had not established that the balance of equities favored granting an injunction. Finally, the court found that the public interest did not clearly favor either party. Weighing all the factors together, the court held that the plaintiffs had not met their burden. It denied their motion for a preliminary injunction.

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