Newman v. Kelly

• Decision Date: 24 March 1994
• Docket Number: Civ. A. No. 93-0994 (CRR).
• Citation: 848 F. Supp. 228
• Parties: Russell NEWMAN, et al., Plaintiffs, v. Sharon Pratt KELLY, et al., Defendants.
• Court: U.S. District Court — District of Columbia

848 F. Supp. 228

Russell NEWMAN, et al., Plaintiffs, v. Sharon Pratt KELLY, et al., Defendants.

Civ. A. No. 93-0994 (CRR).

United States District Court, District of Columbia.

March 24, 1994.

Donovan Leisure, Rogovin, and Schiller, Steven K. Hoffman, William A. Issacson, Legal Counsel, for the Elderly, Michael Schuster, Bruce Vignery, and Patricia DeMichelle, for plaintiffs.

O. Gregory Lewis, Asst. Corp. Counsel, for the District of Columbia, for defendants.

MEMORANDUM OPINION

CHARLES R. RICHEY, District Judge.

I. INTRODUCTION

Before the Court are the parties' cross Motions for Summary Judgment in the above-captioned action. The Plaintiffs, four individuals affected by the District of Columbia's nursing home regulations, brought this class action under 42 U.S.C. §§ 1395i-3, 1396r (the Medicare and Medicaid statutes) on behalf of all similarly situated individuals, seeking injunctive and declaratory relief to bring the District's nursing home regulations into compliance with the federal Nursing Home Reform Law of 1987.¹ Because the Court concludes that federal law pre-empts local regulations of facilities eligible for Medicare and/or Medicaid benefits based on level of care distinctions, and that the District of Columbia's regulations in this field violate federal law, the Court shall grant the Plaintiff's motion for summary judgement. However, the Court will give the Defendants thirty (30) to bring its regulations into compliance with 42 U.S.C. §§ 1395i-3, 1396r, after which those regulations not in compliance shall be null and void.

The Plaintiffs contend that the District of Columbia ("District" or "D.C.") unlawfully maintains a two-tiered system for regulating nursing facilities which are eligible for reimbursement under Medicare and/or Medicaid. They argue that the District's system distinguishes between "intermediate" and "skilled" care in contravention of the Nursing Home Reform Law, which abolished that distinction. The Plaintiffs further argue that because of the District's two-tiered system they have been subjected to various injuries particularly related to the District's scheme, including damaging transfers between and discharges from different facilities; harmful separations from loved ones; and burdensome denials of the right to live where they choose.

The Defendants contend that the Court should defer to the reasonable exercise of administrative expertise by the D.C. agencies which regulate nursing homes eligible for Medicare and/or Medicaid benefits, because (1) these Defendants do not engage in activities that result in illegal involuntary transfers of residents between and discharges from nursing facilities, and (2) Congress did not intend to pre-empt state action in the field of nursing facility licensure and regulation by enacting amendments to 42 U.S.C. §§ 1395i-3, 1396r.

After giving careful consideration to the parties' pleadings, the applicable law, and the entire record herein, the Court concludes (1) that the District's system causes transfers and discharges of nursing home residents which violate federal law, and (2) that federal law pre-empts the District's regulatory scheme for nursing facilities eligible for reimbursement under Medicare and/or Medicaid to the extent that the scheme enforces level of care distinctions.

II. FACTS

The individual Plaintiffs in this case are nursing home residents in the District of Columbia who have been affected by specific application of the District's regulatory scheme for nursing facilities eligible for federal reimbursement under Medicare and/or Medicaid. The individual Plaintiffs represent a class of upwards of 3,000 residents in D.C. nursing homes and the unlimited number of future residents who are or will be governed by the Defendants' nursing home regulatory scheme. Briefly, the following are facts surrounding the application of the District's regulatory scheme to the individual Plaintiffs.

Plaintiff Russell Newman resided at Rock Creek Manor when medical problems caused him to be admitted to the Georgetown University Hospital. His medical difficulties required the insertion of a feeding tube. After his medical condition stabilized, he requested through a representative to return to Rock Creek Manor. However, because feeding tube maintenance qualified as a level of care under the D.C. scheme for which Rock Creek Manor was not licensed, that institution could not and would not readmit him.

Plaintiff Ailene Ewell was also a resident of Rock Creek Manor along with her husband of over 50 years, James Ewell. Like Plaintiff Newman, Ms. Ewell was transferred to Georgetown University Hospital where she too had a feeding tube inserted. After this procedure, she was reclassified as needing "skilled" rather than "intermediate" care, as the District's scheme defines those terms. Based on the new level of care she required, Rock Creek Manor attempted to discharge her. Upon petition from Ms. Ewell, a District of Columbia Administrative Law Judge held that, under federal law, Rock Creek Manor was obligated to readmit her.

In March, 1992, Ms. Ewell was again hospitalized for injuries she received at Rock Creek Manor. After her latest medical problems, Ms. Ewell did not want to return to Rock Creek Manor and sought to be admitted to a new facility. Because of the D.C. scheme, however, she was reclassified as requiring skilled care, while her husband remained classified as needing intermediate care. Because of the difference in the levels of care each spouse required, Ms. Ewell must find a facility that is licensed for both levels of care before she and her husband can move.

Plaintiff John Studevant and his wife resided at J.B. Johnson nursing facility. Because of medical problems, Mr. Studevant was transferred to a local hospital for treatment. When his medical situation stabilized, he was reclassified as needing skilled care. Because of the D.C. scheme, however, J.B. Johnson is licensed solely for intermediate care beds. As a result, Mr. Studevant has not been able to return to his previous home and continue living with his wife.

Plaintiff Mattie Brown was admitted to the Wisconsin Avenue Nursing Home as an intermediate care resident living on the fifth floor. Following an illness, Ms. Brown was reclassified as requiring skilled care and was transferred to a Medicare (skilled care) licensed floor. After a short time, Ms. Brown was reclassified as requiring intermediate care, and facility administrators wanted to return her to the fifth floor. Because she believed her health on the Medicare floor was flourishing, Ms. Brown did not want to return to the fifth floor and challenged the transfer. A District of Columbia Administrative Law Judge refused to authorize her transfer, citing the proposed transfer's noncompliance with federal law, but the administrative hearing in which this ruling was made has not been approved by the agency.

In an affidavit supporting the Plaintiffs' Motion, the D.C. Long Term Care Ombudsman,² M. Anne Hart, related that she had been told in 1991 by relevant District agencies that the District was in the process of changing its licensure regulations for nursing facilities to comply with federal law. Plaintiffs' Motion for Preliminary Injunction, Declaration of M. Anne Hart, ¶ 22. Ms. Hart also states that, when she had a conversation in 1992 with an official at a D.C. agency charged with regulating nursing facilities, she was told that the District had given low priority to changing its regulatory system. Id., at ¶ 25.

The Defendants are responsible for the licensing of nursing facilities within the District of Columbia. D.C.Code § 32-1401, et seq. Under the District's licensing scheme, each facility eligible for Medicare or Medicaid reimbursement is licensed accordingly. When the level of care required by a resident changes, the resident's nursing facility must transfer or discharge that resident if that facility is not licensed to provide the appropriate level of care.³ Under D.C. law, when a facility discharges or transfers a resident, the resident must receive notice of and be given an opportunity to challenge that decision. It is the view of the District agencies which license and regulate nursing facilities that transfers based upon distinctions between levels of care are permissible in light of federal policy.

On July 20, 1992, the Health Care Financing Administration (HCFA) issued an advisory letter to the Defendants on the subject of nursing facility transfer policy. The pertinent sections of the letter state:

42 CFR 483.12(a) defines the instances under which a resident of a nursing facility may be transferred. Specifically, the resident has the right to remain in the facility unless: (1) a transfer is necessary for his/her welfare and the facility cannot meet the resident's needs; (2) the resident's health has improved to the extent that he/she no longer needs the services provided by the facility ...

Patients may not be moved between distinct parts of a facility solely for the purpose of manipulating Medicaid or Medicare payment. Such moves are only appropriate if the resident requests to be moved. The resident has the right to refuse such moves and if a transfer is made against the resident's wishes, he/she may grieve the action ...

.... Where facilities are concerned about not being able to transfer residents out of Medicare-certified, distinct-part beds once they no longer require skilled care, we offer the following alternatives. First, the facility could certify the entire facility for Medicare and Medicaid participation. The requirements are essentially the same for both programs. Then, intrafacility of a resident may be accomplished as long as the resident and, if known, the resident's legal representative or interested family member is notified promptly about the change of room or roommate. Second, the facility could ... certify a Medicaid-only distinct part to provide health related care

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