Romano v. Greenstein

• Decision Date: 28 June 2013
• Docket Number: No. 12–30565.,12–30565.
• Parties: Tiffany L. ROMANO, Plaintiff–Appellee v. Bruce D. GREENSTEIN, in his official capacity as Secretary of the Louisiana Department of Health and Hospitals, Defendant–Appellant.
• Court: U.S. Court of Appeals — Fifth Circuit

721 F.3d 373

Tiffany L. ROMANO, Plaintiff–Appellee

v.Bruce D. GREENSTEIN, in his official capacity as Secretary of the Louisiana Department of Health and Hospitals, Defendant–Appellant.

No. 12–30565.

United States Court of Appeals,Fifth Circuit.

June 28, 2013.

David Holman Williams (argued), Esq., Southeast Louisiana Legal Services, New Orleans, LA, for Plaintiff–Appellee.

Neal Risley Elliott, Jr. (argued), Esq., Department of Health & Hospitals for the State of Louisiana, Baton Rouge, LA, for Defendant–Appellant.

Appeal from the United States District Court for the Eastern District of Louisiana.

Before KING, HIGGINBOTHAM, and CLEMENT, Circuit Judges.

PATRICK E. HIGGINBOTHAM, Circuit Judge:

This appeal turns on whether 42 U.S.C. § 1396a(a)(8)—a provision of the Medicaid Act—creates a right that is enforceable under 42 U.S.C. § 1983, and, if so, whether a Medicaid claimant must exhaust Louisiana's procedure for judicial review before filing suit in federal court. We conclude that § 1396a(a)(8) creates a right enforceable under § 1983, and that exhaustion of Louisiana's procedure for judicial review is not required before a Medicaid claimant files suit in federal court.

I.

“Medicaid is a cooperative federal-state program through which the federal government provides financial assistance to states so that they may furnish medical care to needy individuals.” ¹ A state's participation in the Medicaid program is voluntary, but “participating states must complywith certain requirements imposed by the Medicaid Act and regulations promulgated by the Secretary of Health and Human Services.” ²

Plaintiff Tiffany Romano received Medicaid benefits in Louisiana. In August 2011, the Louisiana Department of Health and Hospitals (“DHH”) decided that Romano was no longer eligible for Medicaid benefits. Romano appealed to a state administrative law judge (“ALJ”), who reversed DHH's termination of her Medicaid benefits. In November 2011, DHH again proposed termination of Romano's Medicaid benefits. Romano again appealed to an ALJ, who affirmed DHH's termination of her Medicaid benefits. Romano then sued the Secretary of DHH in federal court under 42 U.S.C. § 1983, the federal Medicaid Act, and the U.S. Constitution, alleging that DHH's decisions, policies, and procedures resulted in an illegal termination of her Medicaid benefits. DHH moved to dismiss Romano's suit, arguing that the availability of a state judicial review process divested the district court of subject matter jurisdiction and that Romano did not have a private cause of action under § 1983. Alternatively, DHH requested that the district court exercise Burford abstention. Romano moved for summary judgment, contending that Louisiana violated federal standards in discontinuing her Medicaid benefits. The district court denied DHH's motion to dismiss and granted summary judgment in favor of Romano. DHH timely appealed.

II.

On appeal, DHH does not challenge the merits of the district court's decision to grant summary judgment in favor of Romano. Instead, it challenges only the district court's denial of its motion to dismiss. Specifically, DHH argues that (1) the district court lacked subject matter jurisdiction over Romano's claims; (2) Romano did not have a private cause of action under § 1983; and (3) the district court should have exercised Burford abstention.

A.

We turn first to DHH's argument that the district court lacked subject matter jurisdiction over Romano's claims. We review de novo a district court's decision to deny a motion to dismiss for lack of subject matter jurisdiction. ³ Each of DHH's arguments turns on the procedures for administrative and judicial review that Louisiana makes available to Medicaid claimants. Under the Medicaid Act, “[t]o qualify for federal assistance, a state must submit to the Secretary and have approved a ‘plan for medical assistance.’ ” ⁴ The state plan must “provide for granting an opportunity for a fair hearing before the State agency to any individual whose claim for medical assistance under the plan is denied or is not acted upon with reasonable promptness.” ⁵ Louisiana complies with that requirement by granting Medicaid claimants a fair hearing before a state ALJ. Under Louisiana's Administrative Procedure Act, claimants may also appeal an ALJ's adverse decision regarding their Medicaid benefits in a state district court.⁶

DHH first contends that the district court lacked subject matter jurisdiction because Romano failed to exhaust Louisiana's procedure for judicial review.⁷ To be clear, Louisiana provides Medicaid claimants with both an opportunity for administrative review (a fair hearing before an ALJ) and an opportunity for judicial review (an appeal in state district court from an ALJ's adverse decision). This case does not require us to determine whether Romano was required to exhaust her administrative remedy, because she appealed to an ALJ and received an adverse decision before filing suit in federal court.⁸ This case only presents the question of whether Romano was required to exhaust her state judicial remedy before filing suit in federal court. We conclude that she was not required to do so.⁹ There is no general requirement that a plaintiff exhaust state administrative or judicial remedies before she can pursue a claim under § 1983,¹⁰ nor does the Medicaid Act or Louisiana law create an exhaustion requirement for Medicaid claimants.¹¹ Louisiana's own statute providing for judicial review in state court makes clear that it is not “limiting ... utilization of or the scope of judicial review available under other means of review, redress, relief, or trial de novo provided by law.” ¹²

DHH also argues that the district court cannot review a state-level administrative adjudication. Citing to Elgin v. Department of the Treasury,¹³ DHH asserts that Romano is trying to present claims that “must be resolved through the statutorily required administrative process.” Here, unlike in Elgin, the statute in question is not a federal statute that explicitly lays out the exclusive parameters for judicial review. Instead, the Medicaid statute delegates the administrative review process to the states. Louisiana provides for review by an ALJ, and then for judicial review in state district courts. Despite the availability of state court review, the statute providing for that review explicitly states that it does not limit “utilization of or the scope of judicial review available under other means of review, redress, relief, or trial de novo provided by law.” ¹⁴ Moreover, neither Congress nor Louisiana has specified any exclusive forum for judicial review of Medicaid claims. We therefore conclude that the mere availability of judicial review in state court does not preclude Romano from pursuing her claim in federal court, nor does it divest the federal district court of its jurisdiction to consider the matter.

B.

We now turn to DHH's argument that the district court erred in denying its motion to dismiss because Romano did not have a private right of action that is enforceable under § 1983. We review de novo a district court's decision to deny a motion to dismiss for failure to state a claim.¹⁵

“Section 1983 imposes liability on anyone who, under color of state law, deprives a person ‘of any rights, privileges, or immunities secured by the Constitution and laws.’ ” ¹⁶Section 1983 provides a cause of action for violations of federal statutes as long as the statute (1) creates an enforceable right and (2) does not foreclose enforcement under § 1983. ¹⁷ Romano argues that 42 U.S.C. § 1396a(a)(8) creates a right enforceable under § 1983.¹⁸Section 1396a(a)(8) requires that a state plan for Medicaid assistance must “provide that all individuals wishing to make application for medical assistance under the plan shall have an opportunity to do so, and that such assistance shall be furnished with reasonable promptness to all eligible individuals.” ¹⁹ DHH has not even attempted to meet its burden of showing that “Congress specifically foreclosed a remedy under § 1983.” ²⁰ We therefore confine our analysis to the issue of whether § 1396a(a)(8) creates a right enforceable under § 1983.²¹ We join the First, Third, and Eleventh Circuits and conclude that it does.²²

In Blessing v. Freestone, the Supreme Court articulated a three-part test for determining whether a federal statute creates a right enforceable under § 1983:

First, Congress must have intended that the provision in question benefit the plaintiff. Second, the plaintiff must demonstrate that the right assertedly protected by the statute is not so “vague and amorphous” that its enforcement would strain judicial competence. Third, the statute must unambiguously impose a binding obligation on the States. In other words, the provision giving rise to the asserted right must be couched in mandatory, rather than precatory, terms.²³

Five years later, in Gonzaga University v. Doe, the Supreme Court elaborated on the appropriate analysis for determining whether a statutory provision gives rise to a federal right.²⁴ It made clear that nothing “short of an unambiguously conferred right” can support a cause of action under § 1983.²⁵ Relying in large part on Blessing, the Gonzaga Court provided several guidelines for determining when a statutory provision “unambiguously” creates a federal right. The statute must be phrased in “explicit rights-creating terms”—“in terms of the persons benefitted.” ²⁶ It must clearly confer an “individual entitlement” and have “an unmistakable focus on the benefitted class.” ²⁷ A provision does not confer an individual right when it “speak[s] only in terms of institutional policy and practice,” or when it has an “aggregate focus” and is “not concerned with whether the needs of any particular person have been satisfied.” ²⁸

Section 1396a(a)(8), which requires that a state plan for medical assistance must “provide that all individuals wishing to make...