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Wednesday, June 01, 2011

Enforcing Medicaid's Equal Access Provision: The Obama Administration's Disappointing Amicus Brief in Independent Living Center

Over the weekend, the New York Times ran a thorough story summarizing an amicus brief the Obama Administration filed last week in Douglas v. Independent Living Center, the trio of monumental Medicaid cases that the Supreme Court is set to hear next Term.  As the article notes, the Administration's brief sides quite forcefully with the State of California (the Petitioner in Douglas), and against the Ninth Circuit, which had held that the Supremacy Clause itself provides a cause of action for an injunction to enforce one of the most important provisions of the Medicaid Act--the so-called "equal access" provision. That provision [42 U.S.C. 1396a(a)(30)(A)] requires states to set reimbursement rates that are "sufficient to enlist enough providers so that care and services are available under [Medicaid] at least to the extent that such care and services are available to the general population in the geographic area." Here, plaintiffs challenged a series of drastic across-the-board reductions in Medicaid reimbursement rates by California, allegedly in violation of the Medicaid Act's "equal access" mandate. 

In short, the government's brief argues that there is no express cause of action to enforce the "equal access" provision (true); that the Supreme Court has never squarely held that the Supremacy Clause provides a cause of action for injunctive relief to enforce a federal statute against an allegedly preempted state law (debatable at best); and that such a cause of action in this case would "not be compatible with the nature of the statutory scheme." 

Skipping over the second issue, it's the Obama Administration's position on the third issue that is what I find so disappointing both legally and politically.

The heart of the matter comes in the following passage on page 26 of the brief:

If private parties who lack a statutory cause of action could simply style their suit as a preemption action to enjoin state officials from enforcing a state law that was adopted to implement the State’s undertakings pursuant to the program, the result would be in considerable tension with Congress’s decision not to confer a private right of action to enforce state compliance.

Legally, I'm not sure this even follows. Congress's decision not to confer a private right of action (1) came in 1965, before the Court's contemporary jurisprudence disfavoring implied remedies; (2) could have reflected the understanding that the only defendants in suits to enforce the equal access provision would be state officers, who could be sued (as was then clear thanks to Monroe v. Pape) under Section 1983; and (3) could just as easily have reflected a wariness of damages remedies for violation of the equal access provision, without any intent to foreclose equitable relief.

And in any event, the government's brief conveniently neglects to note that, at least until the Supreme Court's decision in Gonzaga University v. Doe, every circuit to reach the issue had concluded that the equal access provision could be enforced through Section 1983--holdings that necessarily relied on the conclusion that Congress did mean for the equal access provision to be privately enforceable. To be sure, Gonzaga changes that calculus dramatically (as post-Gonzaga courts have recognized vis-a-vis the equal access provision, which is why Independent Living Center is a Supremacy Clause case), but if the question for Supremacy Clause purposes is simply whether there is tension with Congress's decision not to confer a private right of action, it seems to me that the pre-Gonzaga cases suggest quite forcefully that the answer is no. In point of fact, private enforcement of the equal access provision was the central means by which that provision was enforced for the first 37 years that it was on the books, an understanding that was both shared and repeatedly endorsed by the Department of Health and Human Services (and its predecessor, the Department of Health, Education, and Welfare), at least until Gonzaga.

Thus, the implicit argument that the Administration relies upon, but does not articulate, is that Gonzaga did not just change the standard for determining whether federal statutes are enforceabile via Section 1983; it also necessarily changed the standard for determining whether federal statutes can be enforced against state laws that they preempt via the Supremacy Clause. That would be an incredibly significant (and, in my view, disturbing) result, yet it comes through only between the lines.

Separate from the brief's rather conclusory legal analysis, it's the politics of the brief that I find completely baffling.  The same Administration, when asked for its views on whether certiorari should be granted, recommended a denial--because of both the unique facts of this case, and the absence of a circuit split on the central (cause of action) issue.[Curiously--or perhaps tellingly--that brief was joined by various attorneys from the Department of Health & Human Services, including the Acting General Counsel, whereas the merits brief was not... one can only speculate, but it seems entirely possible that the merits brief is the outcome of an internal battle that HHS lost, which would be particularly ironic as I note below].

To be sure, the CVSG brief avoided taking a firm position on the underlying enforceability question, but if the Administration was willing to leave the Ninth Circuit decision intact at that point, what makes it necessary to go after it at the merits stage, as opposed to sitting this one out? 

The implicit answer the brief gives is fairly typical for implied cause-of-action cases, i.e., that federal enforcement actions are theoretically available, and that private enforcement would produce potentially inconsistent judicial interpretations of the equal access provision that could interfere with the Secretary of Health and Human Services' authority to administer the Medicaid Act. [Here's the irony.] Of course, that position should have supported a grant, rather than a denial, in the invitation brief. Clearly, something changed behind the scenes, and the merits brief thereby represents a shift in policy that, if endorsed by the Supreme Court, would make it all-but-impossible to enforce the equal access mandate--one of the most important statutory requirements of the Medicaid program.

This may seem like a lot of huffing and puffing over a hypertechnical Federal Courts issue about an even more hypertechnical statute. But as Professor Abby Moncrieff has put it,

enforcing § 30(A)’s requirements is necessary to ensure that Medicaid programs abide by their legal commitment to provide healthcare to the poor. The states must have flexibility in their rate-setting methodologies, but they are statutorily required—and should be judicially required—to pay a reasonable price for the services they buy.

Why would this Administration all of a sudden decide that it disagrees? 

Update: A helpful reader pointed out that it's standard practice for the government to file on the merits in any case in which the Court seeks its views at the cert. stage. I thought that was only true when the government recommends a grant, but that at least explains why the Administration filed. It still does nothing to explain why this was the result...  

Posted by Steve Vladeck on June 1, 2011 at 04:08 PM in Current Affairs, Steve Vladeck | Permalink


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