Kansas Hosp. Ass'n v. Whiteman
| Decision Date | 13 October 1994 |
| Docket Number | Civ. A. No. 93-4217-DES. |
| Citation | 865 F. Supp. 730 |
| Parties | KANSAS HOSPITAL ASSOCIATION: Bethany Medical Center: Asbury-Salina Regional Medical Center; and Stormont-Vail Regional Medical Center; and Inez Williams and Vanessa Brewer, Individually and on behalf of all similarly situated persons, Plaintiffs, v. Donna L. WHITEMAN in her official capacity as Secretary of the Kansas Department of Social and Rehabilitation Services, Defendant. |
| Court | U.S. District Court — District of Kansas |
Charles R. Hay, Wayne T. Stratton, Goodell, Stratton, Edmonds & Palmer, Topeka, KS for Kansas Hosp. Ass'n, Bethany Medical Center, Asbury-Salina Regional Medical Center Inc., Stormont Vail Regional Medical Center.
Carol L. Boorady, Legal Services of Wichita, Wichita, KS, Stephen M. Kirschbaum, Jane K. Swanson, Wyandotte-Leavenworth Legal, Kansas City, KS, for Inez Williams, Vanessa L. Brewer, Gary Byers.
Reid Stacey, Social & Rehabilitation Services, Topeka, KS, Vickie J. Larson, S. William Livingston, Jr., Covington & Burling, Washington, DC, Bruce A. Roby, Kansas Dept. of S.R.S. Topeka, KS, for Kansas Dept. of Social and Rehabilitation Services.
C. Geraldine Umphenour, Office of Gen. Counsel, Dept. of Health & Human Services, Kansas City, MO, Jackie A. Rapstine, Office of U.S. Atty., Topeka, KS, for Secretary of Health and Human Services of U.S., Dept. of Health and Human Services of the U.S. Adm'r of the U.S. Health Care Financing Admin.
This matter is before the court on plaintiffs Williams and Brewers' renewed motion for preliminary injunctive relief (Doc. 102) and plaintiffs Kansas Hospital Association; Bethany Medical Center; Asbury-Salina Regional Medical Center; and Stormont-Vail Regional Medical Center's motion for partial summary judgment (Doc. 110). Defendant Donna L. Whiteman, in her official capacity as Secretary of the Department of Social and Rehabilitative Services ("SRS") for the state of Kansas filed responses in opposition to both motions (Docs. 114, 117).
All plaintiffs contend that recent rulings by the Health Care Financing Administration ("HCFA"), have invalidated the Kansas Medicaid state plan amendment which raised the copayment for institutional services from $25 to $325.
On November 3, 1993, this court denied plaintiffs' motion for preliminary injunction to restrain defendant Whiteman from raising the Medicaid recipient copayment for institutional services from $25 to $325. Kansas Hosp. Ass'n v. Whiteman, 835 F.Supp. 1556 (D.Kan.1993). On September 16, 1994, the United States Court of Appeals for the Tenth Circuit affirmed that decision. Williams v. Whiteman, 36 F.3d 1106 (10th Cir.1994) ().
The state, on February 1, 1994, sought approval of the plan amendment. ("SPA 93-25")
On March 22, 1994, HCFA's Associate Regional Administrator for Medicaid wrote Whiteman expressing serious concerns about the proposed State Plan amendment, SPA 93-25, which raised the copayment from $25 to $325. HCFA was concerned enough about the potential negative impact on Medicaid recipients that Whiteman was asked to suspend the implementation of the policy. HCFA also asked for additional information from Whiteman seeking assurances that there would not be a chilling impact upon Kansas Medicaid beneficiaries' access to care.
In the response, the state argued that there was no indication that any Medicaid recipient had been negatively impacted, reiterated its belief that the copayment increase was valid and refused to suspend the implementation of the policy.
On July 28, 1994, Bruce C. Vladeck, HCFA Administrator, formally disapproved SPA 93-25. The Secretary is first consulted before the Administrator makes a determination of disapproval. 42 C.F.R. § 430.15(c)(2). In the letter of disapproval, the HCFA administrator concluded that "a copayment in the amount proposed by Kansas cannot be in the best interest of the Medicaid recipients." HCFA also outlined the process for seeking HCFA reconsideration.
The state presents the affidavit of Robert Epps, Commissioner of Income Support and Medical Services of SRS which states that Vince Cain, Chief, Medicaid Operations Branch, Region VII, HCFA Region VII office, said SRS could continue to use the $325 copayment while the agency is seeking reconsideration. On September 23, 1994, SRS submitted a request for reconsideration.
On October 7, 1994, this court held a hearing on plaintiffs' renewed motion for preliminary injunction and motion for partial summary judgment. At that hearing, plaintiffs introduced a letter dated October 6, 1994, from HCFA Regional Administrator, Joe L. Tilghman, to defendant Whiteman, informing her that SRS was being cited for being "out of compliance with sections 1902(a)(14) and 1902(a)(19) of the Social Security Act (the Act)." The letter further informed SRS would initiate compliance proceedings against Kansas pursuant to § 1904 of the Act and 42 C.F.R. § 430.35. Kansas was also put on notice that if the compliance proceedings were carried to conclusion, the state faces the risk of losing all or part of its federal financial participation in the state's Medicaid program. SRS was also advised to submit a written plan to insure the copayment policy is in compliance with federal regulations.
During the hearing conducted before this court on October 7, 1994, individual plaintiffs argued that the circumstances had changed because HCFA had disapproved SPA 93-25 and had, just the day before the hearing, ordered into motion the procedure by which a state agency may be held accountable to answer why that agency is not in compliance with federal law. Individual plaintiffs argued that the harm to individual Medicaid recipients who might be dissuaded from seeking institutional services because of the increase in copayment was now coupled with the harm to all Medicaid recipients if the state of Kansas loses federal funding because its state Plan is not in compliance.
Defendant Whiteman argued that nothing had changed since this court's order denying the original preliminary injunction. In essence the defendant's position is that the HCFA ruling is not a final order and will not be so until the agency reconsideration determination is made. Defen...
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