The Kansas court denied a motion to dismiss a Medicaid case challenging the denial of eligibility for a nursing home resident due to her husband’s annuity being counted as a resource, instead of income. The court held that two of the three relevant Medicaid provisions could be enforced under 42 U.S.C. § 1983.
The court concluded that sovereign immunity barred a declaration that the past denial of Medicaid was in error but did not bar injunctive relief against state officials, including injunctive relief requiring payment of past benefits. The court postponed a decision on the preemption claim, stating that there was inadequate briefing. Bernard v. Kansas Health Policy Authority, 2011 WL 786145 (D. Kan. Feb. 28, 2011). The judge was appointed by President Clinton.
Tanis Bernard resides in a nursing home. Her husband, Otis, purchased an annuity with over $600,000, and sought Medicaid eligibility for Tanis. The agency denied eligibility, treating the annuity as an available resource.
The court dismissed the claims against the state agency as barred by the Eleventh Amendment. But the court noted that under Ex parte Young, prospective claims against state officials were not barred by sovereign immunity. The court then examined whether the relief sought was prospective or retrospective. The court concluded that plaintiff’s claim for declaratory relief was barred, because it sought a judgment declaring that state officials violated federal law in the past. However, injunctive relief was not barred, because it would require that state officials conform their actions to federal law in the future.
The plaintiff also sought benefits tied to the date of her application, not only for the future. The court held that such benefits were not barred by sovereign immunity. The court characterized such benefits as “an incident of complying with the court’s prospective order” and “not a damages award for past liability.”
The court then evaluated whether the three statutory provisions upon which the plaintiff relied could be enforced under § 1983. First, the court looked at 42 U.S.C. § 1396p(c)(1)(A), which is phrased in terms of requirements for a state plan. Citing Suter v. Artist M., 503 U.S. 347 (1992), the court held that the provision had an aggregate focus and did not meet the standards for a § 1983 claim under Gonzaga v. Doe, 536 U.S. 273 (2002). The court did not cite the Suter fix statute, 42 U.S.C. §§ 1320a-2, 1320a-10, and perhaps was unaware of it.
Nevertheless, the court held that a claim under § 1983 was permissible for the other two statutory provisions upon which plaintiff relied, 42 U.S.C. § 1396p(c)(2)(B)(i) and 42 U.S.C. § 1396p(d)(2)(B). Neither of those provisions referenced the state plan, and the court concluded that the text made it “clear that Congress intended to confer individual rights on certain individuals.” The court further held that the administrative hearing provided by the Medicaid statute did not constitute a preclusive comprehensive remedial scheme.
The defendants challenged the preemption claim on the grounds that the complaint failed to specify the conflicting state and federal law. The court held that this did not warrant dismissal of the claim at the motion to dismiss stage, stating that “due to the brevity of the parties’ briefing on this issue, the court will revisit this issue at a later date.”