Brown v. Tennessee Dept. of Finance and Admin.
| Decision Date | 24 July 2009 |
| Docket Number | No. 3:00-0665.,3:00-0665. |
| Citation | 649 F.Supp.2d 780 |
| Parties | Lakersko BROWN, et al., Plaintiffs, v. TENNESSEE DEPARTMENT OF FINANCE AND ADMINISTRATION and M.D. Goetz, Jr., Commissioner, Defendants. |
| Court | U.S. District Court — Middle District of Tennessee |
Kent Ellis Krause, Parks T. Chastain, Brewer, Krause & Brooks, Martha M. Lafferty, Sherry A. Wilds, Nashville, TN, for Plaintiffs.
Dianne Stamey Dycus, Tennessee Attorney General's Office, Nashville, TN, Brian Stuart Koukoutchos, Charles J. Cooper, Michael W. Kirk, Cooper & Kirk, Washington, DC, for Defendants.
In accordance with the Memorandum entered contemporaneously herewith, the Court rules as follows:
(1) Defendants' Motion To Vacate The Agreed Order Approving The Settlement Agreement And To Dismiss The Case (Docket Entry No. 155) is hereby GRANTED, but only to the extent that Defendants need no longer honor their commitment in the Settlement Agreement to develop "provider network capacity" or any commitment they arguably made to eliminate a waiting list for services by December 31, 2009, as determined by the Sixth Circuit in Brown v. Tennessee Dept. of Finance and Admin., 561 F.3d 542 (6th Cir.2009). The motion is hereby DENIED in all other respects.
(2) Defendants' Motion For Summary Judgment (Docket Entry No. 266) is hereby GRANTED. Within the limits or caps set for the federally approved Medicaid waivers, to the extent there exist available waiver slots and funding for those slots, Defendants shall be required to comply with the Settlement Agreement provisions to enroll eligible individuals on the waiting list into those slots with reasonable promptness before the Settlement Agreement expires on December 31, 2009.
(3) Plaintiffs' Motion For Summary Judgment (Docket Entry No. 269) is hereby DENIED.
It is so ORDERED.
Pending before the Court are Defendants' Motion For Summary Judgment (Docket Entry No. 266) and Plaintiffs' Motion For Summary Judgment (Docket Entry No. 269). The parties fully briefed these motions.
Also, on March 9, 2009, the Sixth Circuit reversed in part and remanded this Court's Memorandum and Order (Docket Entry Nos. 199 & 200; 2007 WL 2710704 (M.D.Tenn. Sept. 12, 2007)), denying Defendants' Motion to Vacate the Agreed Order Approving the Settlement Agreement and to Dismiss the Case (Docket Entry No. 155). Brown v. Tennessee Dept. of Finance and Admin., 561 F.3d 542 (6th Cir.2009). At the time the Motion to Vacate was originally filed on January 19, 2007, Plaintiffs filed a response (Docket Entry No. 175), and Defendants filed a reply (Docket Entry No. 179). These filings are once again before the Court. The Motion to Vacate must now be ruled upon in light of the Sixth Circuit's recent opinion and its instructions on remand.
On May 1, 2001, the Court certified a class comprised of mentally retarded Tennessee residents. Members of the certified class are eligible for Medicaid services through State and privately owned Intermediate Care Facility/Mental Retardation ("ICF/MR") facilities, pursuant to 42 U.S.C. § 1396a, or they are eligible for home-based services through a Home and Community-Based Services ("HCBS") waiver for the mentally retarded, pursuant to 42 U.S.C. § 1396n. The class members complain that they request services under these programs, but (1) they are denied the opportunity to apply for such services; (2) when they do apply for services under these programs, they are denied; or (3) they are placed on a long, slow-moving waiting list for services under these programs. Following denial of the parties' cross-motions for summary judgment and a fairness hearing, the Court entered an Agreed Order on June 17, 2004, approving a Settlement Agreement ("the Agreement") executed by the parties. (Docket Entry No. 116.)
In the years after the Agreed Order was entered, some of the parties' goals as expressed in the Agreement were satisfied, while others were not. The parties have engaged in ongoing litigation about whether the terms of the Agreement have been met or will be met before the Agreement expires on December 31, 2009, absent any written continuation of the Agreement that may be obtained as provided in Section XII.B. of the Agreement.
In September 2007, the Court denied Defendants' Motion to Vacate the Agreed Order Approving the Settlement Agreement and to Dismiss the Case (Docket Entry No. 155), as well as Plaintiffs' Motion For Modification of the Settlement Agreement (Docket Entry No. 166). Defendants appealed the Court's denial of the Motion to Vacate, and as previously mentioned, the Motion to Vacate is the subject of the Sixth Circuit's recent reversal and remand on March 9, 2009.
Previously, in July 2008, the Court denied Plaintiffs' Second Amended Motion For An Order For Specific Performance For Non-Compliance With Settlement Agreement (Docket Entry No. 218). That motion challenged Defendants' compliance with certain terms relating to years one and two of the Agreement. The Court held that Plaintiffs failed to show that the Defendants breached the terms of the Agreement that applied to years one and two, and thus, the Court denied the motion for specific performance. (Docket Entry Nos. 250 & 251, Memorandum and Order; 2008 WL 2704362 (M.D.Tenn. July 8, 2008).) Plaintiffs did not appeal.
Section VII of the Agreement, entitled "Long-Range Planning," required the parties to engage in negotiations to try to reach agreement about expansion of enrollment and provision of services in waiver programs for the third, fourth and fifth years of the Agreement. Although the parties engaged in negotiations, they were unable to reach accord, and the Magistrate Judge declared an impasse. As contemplated by Section VII of the Agreement, the Court then set a trial date to determine the extent of the Defendants' obligations in years three through five. In advance of the trial date, the parties filed cross-motions for summary judgment which are the motions presently pending before the Court. Thus, the summary judgment motions concern the number of individuals who must be enrolled in MR waiver programs and the obligations of the parties in years three through five of the Agreement.
The Sixth Circuit's recent decision was issued before the Court could rule on the summary judgment motions. In light of the appellate decision, the Court continued the trial date and allowed the parties an opportunity to supplement their summary judgment briefing with discussions about the impact of the Sixth Circuit decision on the case. The Court need not rule on the substance of the summary judgment motions if the Court determines that Defendants' Motion to Vacate should be granted in its entirety in light of the Sixth Circuit opinion. Therefore, the Court will begin with the Motion to Vacate.
Defendants moved to vacate the Agreement and dismiss the case in its entirety. The Defendants argued that, at the time the parties negotiated the Agreement, they mutually labored under a fundamental misunderstanding that the phrase "medical assistance" in the Medicaid statute meant that States must provide qualified individuals with medical services directly, not merely financial reimbursement for such services.
Defendants reasoned that Plaintiffs' First Amended Complaint alleged the existence of the DMRS1 waiting list violated 42 U.S.C. § 1396a(a)(8) & (10) in that the State failed to provide services with reasonable promptness and on equal footing with other Medicaid services. Section 1396a(a)(8) (emphasis added) requires that "[a] state plan for medical assistance must[] provide that all individuals wishing to make application for medical assistance under the plan shall have opportunity to do so, and that such assistance shall be furnished with reasonable promptness to all eligible individuals." Section 1396a(a)(10)(B) (emphasis added) requires that "[a] state plan for medical assistance must[] provide . . . that the medical assistance made available to any individual described in subparagraph (A)—(i) shall not be less in amount, duration, or scope than the medical assistance made available to any other such individual, and (ii) shall not be less in amount, duration, or scope than the medical assistance made available to individuals not described in subparagraph (A)."
According to Defendants, federal courts had widely assumed that the phrase "medical assistance" encompassed the direct provision of medical services by the State. See e.g. Bryson v. Shumway, 308 F.3d 79, 88 (1st Cir.2002); Doe v. Chiles, 136 F.3d 709, 716 n. 13 (11th Cir.1998); Sobky v. Smoley, 855 F.Supp. 1123, 1147 (E.D.Cal. 1994). Moreover, because courts had held that §§ 1396a(a)(8) and (10) applied to the administration of Medicaid waiver programs, the definition of "medical assistance" was also applied by courts to the provision of waiver services, at least up to the number of approved available slots within the waiver program. See e.g., Boulet v. Cellucci, 107 F.Supp.2d 61, 77-78 (D.Mass.2000); Lewis v. New Mexico Dept. of Health, 94 F.Supp.2d 1217, 1234 (D.N.M.2000). The only contrary view at the time appeared in dicta in Bruggeman v. Blagojevich, 324 F.3d 906, 910 (7th Cir. 2003), in which a Seventh Circuit panel observed:
Even if [plaintiffs] did require emergency treatment, their theory of violation would be a considerable stretch because the statutory reference to `assistance' appears to have reference to financial assistance rather than to actual medical services, though the distinction was missed in Bryson v. Shumway, 308 F.3d 79, 81, 88-89 (1st Cir.2002), and Doe v. Chiles, 136 F.3d 709, 714, 717 (11th Cir. 1998). Medicaid is a payment scheme, not a scheme for state-provided medical assistance, as through state-owned hospitals. The regulations that implement the provision indicate that what is required...
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