Massachusetts Ass'n of Older Americans v. Sharp, No. 82-1592
| Court | United States Courts of Appeals. United States Court of Appeals (1st Circuit) |
| Writing for the Court | Before COFFIN, Chief Judge, BOWNES and BREYER; BOWNES |
| Citation | 700 F.2d 749 |
| Parties | MASSACHUSETTS ASSOCIATION OF OLDER AMERICANS, et al., Plaintiffs, Appellants, v. Alexander SHARP, II, etc., Defendant, Appellee. |
| Docket Number | No. 82-1592 |
| Decision Date | 15 February 1983 |
Page 749
Plaintiffs, Appellants,
v.
Alexander SHARP, II, etc., Defendant, Appellee.
First Circuit.
Decided Feb. 15, 1983.
Page 750
Suzanne Harris, Cambridge, Mass., with whom Steven A. Hitov, New Rochelle, N.Y., was on brief, for plaintiffs, appellants.
Thomas Noonan, Deputy Gen. Counsel, Hyde Park, Mass., Dept. of Public Welfare, with whom Francis X. Bellotti, Atty. Gen., and E. Michael Sloman, Asst. Atty. Gen., Boston, Mass., Government Bureau, were on brief, for defendant, appellee.
Before COFFIN, Chief Judge, BOWNES and BREYER, Circuit Judges.
BOWNES, Circuit Judge.
Plaintiffs-appellants are a subclass consisting of approximately 4,400 families with stepchildren whose Medicaid and Aid to Families with Dependent Children (AFDC) has been terminated as a result of the stepparent liability provision recently added to the AFDC program. 42 U.S.C. Sec. 602(a)(31) (as amended). Defendant-appellee is the Commissioner of the Department of Public Welfare of the Commonwealth of Massachusetts. Plaintiffs appeal from the district court's denial of their motion for a preliminary injunction to prevent the termination of Medicaid. See 28 U.S.C. Sec. 1292. We reverse.
The Medicaid program was established in 1965 as Title XIX of the Social Security Act to provide federal financial assistance to states choosing to reimburse needy persons for certain medical treatment costs. Act of July 30, 1965, Pub.L. No. 89-97, tit. I, Sec. 121(a), 79 Stat. 343; see Schweiker v. Hogan, --- U.S. ----, ----, 102 S.Ct. 2597, 2600, 73 L.Ed.2d 227 (1982). States are not required to participate in the program, but if they do, they must comply with all requirements imposed both by the Act itself and by regulations promulgated by the Secretary of the Department of Health and Human Services. See 42 U.S.C. Sec. 1396; Schweiker v. Gray Panthers, 453 U.S. 34, 37, 101 S.Ct. 2633, 2636, 69 L.Ed.2d 460 (1981). A participating state must submit a plan for medical assistance that conforms to the requirements of 42 U.S.C. Sec. 1396a. Massachusetts has chosen to participate in the Medicaid program. See Mass.Gen.Laws Ann. ch. 118E (West Supp.1982).
A participating state is required to provide assistance to the "categorically needy" and may provide assistance to the "medically needy." 42 U.S.C. Sec. 1396a(a)(10); 42 C.F.R. Secs. 435.100-.340 (1981). The categorically needy are those persons receiving federal aid through other federal cash assistance programs such as AFDC and Supplemental Security Income (SSI). 42 U.S.C. Sec. 1396a(a)(10)(A). Also included in the categorically needy are those individuals who are excluded from AFDC because of an eligibility requirement that does not apply to the Medicaid program. The medically needy are persons who are unable to pay for medical expenses, but whose income is too large to qualify for aid under other federal financial assistance programs. See Schweiker v. Gray Panthers, 453 U.S. at 37, 101 S.Ct. at 2636.
The Act mandates that assistance provided to the categorically needy "shall not be less in amount, duration, or scope than the medical assistance made available to [the medically needy] ...." 42 U.S.C. Sec. 1396a(a)(10)(B)(ii). Congress imposed this preference for the categorically needy to ensure that those most in need of assistance would receive it first and in amounts not less than that received by other individuals. Schweiker v. Hogan, --- U.S. at ---- & n. 6, 102 S.Ct. at 2601 & n. 6.
Plaintiffs, as recipients of AFDC, were all eligible for and received Medicaid pursuant
Page 751
to the mandatory coverage of the categorically needy. The federal regulations governing Medicaid guarantee automatic enrollment in Medicaid upon qualification for AFDC and prohibit a state from requiring an additional Medicaid application from an individual receiving AFDC. 42 C.F.R. Sec. 435.909(a) (1981). Plaintiffs, thus, have never filed a separate application for Medicaid.In 1981 Congress, as part of the Omnibus Budget Reconciliation Act, P.L. No. 97-35, 95 Stat. 843, amended the AFDC Act to require that states include income of stepparents in determining a stepchild's eligibility for AFDC. See 42 U.S.C. Sec. 602(a)(31) (as amended). Prior to this amendment a stepparent's income was not considered in the AFDC eligibility determination. The Medicaid Act specifically excludes stepparent's income from eligibility determinations. 42 U.S.C. Sec. 1396a(a)(17)(D).
Acting pursuant to this new AFDC provision, defendant in March 1982 began notifying plaintiffs, AFDC families containing stepchildren, that their AFDC benefits were being terminated. These notices also advised the families that their Medicaid benefits were ending. After many families were terminated, plaintiffs brought this action seeking to have their Medicaid benefits restored and to prevent further terminations.
Plaintiffs claim that the terminations were illegal because defendant failed to comply with federal regulations requiring the state welfare agency to redetermine eligibility on other grounds before termination. See 42 C.F.R. Sec. 435.916(c) (1981). They admit that they are no longer automatically eligible for Medicaid as AFDC recipients. Nonetheless, they claim that most of them are still covered as categorically needy because stepparent income is an AFDC eligibility requirement specifically excluded from consideration in Medicaid eligibility.
Defendant responds that the regulations requiring a redetermination prior to termination do not apply to plaintiffs because they never independently qualified for Medicaid. Rather, defendant contends, the redetermination provisions cover only Medicaid recipients who applied for Medicaid directly and are not receiving it as a function of their eligibility for some other federal assistance program. Defendant argues that the proper course for plaintiffs is to make a new application for Medicaid.
The district court denied plaintiffs' motion for a preliminary injunction. The court's denial was based on its belief that any harm suffered by the plaintiffs could be avoided in the main by application for Medicaid benefits. The court conditioned its denial on defendant's sending notices to all plaintiffs informing them of the reasons for their termination from AFDC and Medicaid and advising them that they could still apply for Medicaid benefits.
In determining whether to grant a preliminary injunction the court must...
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