Manuel Guaman v. Velez

• Decision Date: 12 July 2011
• Citation: 421 N.J.Super. 239,23 A.3d 451
• Parties: Manuel GUAMAN, Maria Guaman, Nadia Chery, Deyinira Valenzuela, Rosa Rodriguez and Keithon Blake, Plaintiffs–Appellants,v.Jennifer VELEZ, Commissioner of New Jersey Department of Human Services and John Guhl, Director, Division of Medical Assistance and Health Services, Defendants–Respondents.
• Court: New Jersey Superior Court

421 N.J.Super. 239

23 A.3d 451

Manuel GUAMAN, Maria Guaman, Nadia Chery, Deyinira Valenzuela, Rosa Rodriguez and Keithon Blake, Plaintiffs–Appellants,

v.Jennifer VELEZ, Commissioner of New Jersey Department of Human Services and John Guhl, Director, Division of Medical Assistance and Health Services, Defendants–Respondents.

Superior Court of New Jersey, Appellate Division.

Motion Argued April 5, 2011.Decided July 12, 2011.

Jennifer B. Condon argued the cause for appellants (Seton Hall University School of Law Center for Social Justice and Gibbons, P.C., attorneys; Ms. Condon, Baher Azmy, Newark, Rachel Lopez, and Lawrence S. Lustberg, Newark, on the brief).Dianna Rosenheim, Deputy Attorney General, argued the cause for respondent Department of Human Services, Division of Medical Assistance and Health Services (Paula T. Dow, Attorney General, attorney; Melissa H. Raksa, Assistant Attorney General, of counsel; Ms. Rosenheim, on the brief).Brett D. Kahn argued the cause for amicus curiae New Jersey Appleseed Public Interest Law Center; New Jersey Policy Perspective; New Jersey Citizen Action; State Parent Advocacy Network; Family Voices of New Jersey; Next Step; New Jersey Working Families Alliance; Blue Wave; South Jersey Chapter of the National Organization of Women; The Unitarian Universalist Legislative Ministry of New Jersey; The Lutheran Office of Governmental Ministry in New Jersey; Latino Action Network; and Democracia (McCarter & English, LLP, attorneys; John C. Kelly and Emily B. Goldberg, of counsel and on the brief; Mr. Kahn, Amy T. Klug, and Lauren S. Jones, Newark, on the brief).Before Judges CARCHMAN, GRAVES and MESSANO.

The opinion of the court was delivered by

MESSANO, J.A.D.

Plaintiffs are legal resident aliens who have resided in this country for less than five years. They seek emergent relief enjoining enforcement of Medicaid Communication 10–01 and N.J.A.C. 10:78–3.2, as amended and adopted on May 28, 2010, which authorized termination of their enrollment in the NJ FamilyCare Program (FamilyCare), a state-funded Medicaid program offering subsidized health insurance to qualifying low-income adults and children. Pursuant to the issuance of the communication by the Division of Medical Assistance and Health Services (the Division), and adoption of the regulation by the Department of Human Services (DHS, and collectively, defendants), several thousand legal resident aliens were terminated from FamilyCare, and several thousand more became ineligible to enroll, resulting in an estimated $29.8 million in savings for the State. See id. at 1405. Plaintiffs argue that the agency actions are ultra vires, violate the equal protection guarantees of the Federal and State Constitutions, and will cause them to suffer irreparable harm unless injunctive relief is ordered.

On January 11, 2011, we granted plaintiffs leave to file a motion for emergent relief on an expedited basis and ordered briefing of the issues presented. In the interim, plaintiffs moved: 1) to file a proposed class member's certification under seal because disclosure of his identity would pose a risk to his safety from terrorist groups in his native country; and 2) to permit thirteen organizations to appear as amici curiae.¹ We granted those motions and heard oral argument from the parties and amici on April 5, 2011.

“[A] party who seeks mandatory preliminary injunctive relief must satisfy a ‘particularly heavy’ burden.” Rinaldo v. RLR Inv., LLC, 387 N.J.Super. 387, 396, 904 A.2d 725 (App.Div.2006) (quoting Punnett v. Carter, 621 F.2d 578, 582 (3d Cir.1980)). A successful applicant must demonstrate by clear and convincing evidence, Am. Emp'rs' Ins. Co. v. Elf Atochem N. Am., 280 N.J.Super. 601, 610–611 n. 8 (App.Div.1995), that a stay is necessary to prevent irreparable harm, that the legal right underlying the claim is settled, that the material facts are substantially undisputed, that the applicant has a reasonable probability of success on the merits, and that a balancing of the equities and the hardships weighs in favor of granting relief. Crowe v. De Gioia, 90 N.J. 126, 132–34, 447 A.2d 173 (1982). Having considered the arguments raised in light of the record and these applicable legal standards, we deny plaintiffs' motion for a preliminary injunction staying enforcement of Medicaid Communication 10–01 and N.J.A.C. 10:78–3.2.

I.

We review the relevant statutory framework and provide some factual and procedural background that is undisputed.

While each State has significant discretion in designing its own Medicaid programs, A.K. v. Div. of Med. Assistance & Health Servs., 350 N.J.Super. 175, 178–79, 794 A.2d 835 (App.Div.2002), they are subject to the approval of the United States Secretary of Health and Human Services, and each state must comply with the minimum requirements imposed by the Federal Medicaid Act in order to receive federal matching funds. Atkins v. Rivera, 477 U.S. 154, 157, 106 S.Ct. 2456, 2458, 91 L.Ed.2d 131, 137 (1986); 42 U.S.C.A. § 1396a.

In 1968, New Jersey elected to participate in the Medicaid program by enacting the “ ‘New Jersey Medical Assistance and Health Services Act,’ ” N.J.S.A. 30:4D–1 to–19.5, administered by DHS through the Division. N.J.S.A. 30:4D–3(c) and 30:4D–4. The program enables the State:

[T]o provide medical assistance, insofar as practicable, on behalf of persons whose resources are determined to be inadequate to enable them to secure quality medical care at their own expense, and to enable the State, within the limits of funds available for any fiscal year for such purposes, to obtain all benefits for medical assistance provided by the Federal Social Security Act.

[ N.J.S.A. 30:4D–2 (emphasis added).]

As originally enacted, our statute conformed to the broad federal eligibility guidelines which then mandated coverage for non-citizen lawful permanent residents regardless of their date of entry or length of residency in the United States. L. 1968, c. 413. See Monmouth Med. Ctr. v. Hau Kwok, 183 N.J.Super. 494, 497, 444 A.2d 610 (App.Div.1982); 45 C.F.R. § 233.50 (1973); 42 C.F.R. § 435.402(b) (1990). A “ ‘[q]ualified applicant’ ” was initially defined as “a resident of this State ... determined to need medical care and services as provided under this act[.]” L. 1968, c. 413. See Monmouth Med. Ctr., supra, 183 N.J.Super. at 496, 444 A.2d 610 (quoting N.J.A.C. 10:94–3.2 (supp.12–8–76)(repealed 2010)). (an “ ‘applicant must be a resident of the United States who is either a citizen or an alien lawfully admitted for permanent residence or otherwise permanently residing in the United States under color of law’ ”).

In 1996, Congress enacted the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA), 8 U.S.C.A. §§ 1601 to 46, and significantly limited a non-citizen's access to federally-subsidized medical benefits. A.B. v. Div. of Med. Assistance & Health Servs., 407 N.J.Super. 330, 343, 971 A.2d 403 (App.Div.), certif. denied, 200 N.J. 210, 976 A.2d 386 (2009). PRWORA's self-declared purpose was “to remove the incentive for illegal immigration provided by the availability of public benefits.” 8 U.S.C.A. § 1601(6).

To that end, PRWORA divided aliens into two categories—qualified and unqualified—and limited Medicaid eligibility to “qualified aliens,” which it narrowly defined as lawful permanent residents, designated refugees, aliens granted asylum, and other specified categories of lawfully-present aliens. 8 U.S.C.A. §§ 1612(b), 1641(b). Only qualified aliens who entered the country prior to August 22, 1996, or otherwise lived in the country for five years from the date of lawful permanent resident designation (the five-year bar), however, were eligible for non-emergency federal Medicaid benefits. 8 U.S.C.A. §§ 1612(b)(2)(B), 1613(a). For all intents and purposes, federally-funded Medicaid is largely unavailable for people arriving in the United States after August 22, 1996 unless they have resided in this country for at least five years. 8 U.S.C.A. § 1613(a). Further, PRWORA provided:

With respect to the State authority to make determinations concerning the eligibility of qualified aliens for public benefits ..., a State that chooses to follow the Federal classification in determining the eligibility of such aliens for public assistance shall be considered to have chosen the least restrictive means available for achieving the compelling governmental interest of assuring that aliens be self-reliant in accordance with national immigration policy.

[8 U.S.C.A. § 1601(7) (emphasis added).]

Nonetheless, PRWORA permits States to provide State-funded benefits to aliens not otherwise eligible for federal Medicaid benefits. 8 U.S.C.A. §§ 1622(a), 1624(a). States may elect to offer state-funded coverage to all, some, or no qualified aliens residing in the United States for less than five years.

Our legislature thereafter amended the statutory definition of “ ‘[q]ualified applicant’ ” to mean “a person who is a resident of this State, and either a citizen of the United States or an eligible alien[.]” N.J.S.A. 30:4D–3(i). An “ ‘[e]ligible alien’ ” was defined, in part, as “a lawful permanent resident” who entered the United States prior to August 22, 1996, or if entry occurred after August 22, 1996, “who entered the United States at least five years ago.” N.J.S.A. 30:4D–3(q).

In 2005, the Legislature adopted The Family Health Care Coverage Act (FHCCA), N.J.S.A. 30:4J–8 to–19, which re-established, reformed, and expanded a prior program to provide subsidized health insurance coverage to qualifying children, pregnant women, and low-income parents, guardians, and individuals, “ within the limits of funds appropriated or otherwise made available for the program.” N.J.S.A. 30:4J–12(a) (emphasis added).² The new FamilyCare program was intended to address the “most serious health problem” facing state residents, namely, the “lack of access to affordable health care...