Grimes v. Bimestefer

Court of Appeals for the Tenth Circuit·Decided July 27, 2022·No. 21-1194·Unpublished

Opinion

Appellate Case: 21-1194 Document: 010110716748 Date Filed: 07/27/2022 Page: 1 FILED

United States Court of Appeals UNITED STATES COURT OF APPEALS Tenth Circuit

FOR THE TENTH CIRCUIT July 27, 2022

Christopher M. Wolpert

Clerk of Court

J. G., a minor, through her father and Conservator, Mark Grimes,

Plaintiff - Appellant,

v. No. 21-1194 (D.C. No. 1:19-CV-02674-WJM-STV)

KIM BIMESTEFER, in her official (D. Colo.) capacity as Executive Director of the Colorado Department of Health Care Policy and Financing; CHRISTINE NIERENZ, in her official capacity as Administrative Law Judge II for the Colorado Office of Appeals of the Colorado Department of Health Care Policy and Financing,

Defendants - Appellees.

------------------------------

COLORADO CENTER ON LAW AND POVERTY, INC.; COLORADO LEGAL SERVICES; JUSTICE IN AGING; NATIONAL CENTER FOR LAW AND ECONOMIC JUSTICE; NATIONAL HEALTH LAW PROGRAM,

Amici Curiae.

ORDER AND JUDGMENT*

*

This order and judgment is not binding precedent, except under the doctrines of law of the case, res judicata, and collateral estoppel. It may be cited, however, for its persuasive value consistent with Fed. R. App. P. 32.1 and 10th Cir. R. 32.1.

Appellate Case: 21-1194 Document: 010110716748 Date Filed: 07/27/2022 Page: 2

Before PHILLIPS, MORITZ, and EID, Circuit Judges.

Appellant J.G., through her father and conservator, Mark Grimes, appeals the district court orders dismissing her claims, denying her motion for reconsideration, and denying her motion to amend her complaint. Exercising jurisdiction under 28 U.S.C. § 1291, we affirm.

BACKGROUND

I. Factual Background1 J.G. was born in December 2005. In January 2007, she suffered an adverse reaction to a measles-mumps-rubella-varicella vaccine. That unfortunately led to serious health consequences.

Through her mother and then-conservator, J.G. petitioned for compensation in the Court of Federal Claims under the National Childhood Vaccine Injury Act of 1986, 42 U.S.C. § 300aa-15 et seq.2 While her petition was pending, J.G. applied for and was

1 The contents of this section are taken from J.G.’s complaint. We disregard all legal conclusions and irrelevant allegations. Straub v. BNSF Ry. Co., 909 F.3d 1280, 1287 (10th Cir. 2018). But we accept as true all relevant, well-pleaded facts and view them in the light most favorable to the plaintiff. Id.

2 The Vaccine Act “establishes a no-fault compensation program” that compensates individuals who are injured by vaccines. Bruesewitz v. Wyeth LLC, 562 U.S. 223, 228 (2011). Under the program:

A person injured by a vaccine, or his legal guardian, may file a petition for compensation in the United States Court of Federal Claims, naming the Secretary of Health and Human Services as the respondent. A special master then makes an informal adjudication of the petition . . . . The Court of Federal Claims must review objections to the special master's decision and enter final judgment . . . . At that point, a claimant has two options:

Appellate Case: 21-1194 Document: 010110716748 Date Filed: 07/27/2022 Page: 3

approved to receive benefits under Colorado’s Medicaid program. That included Home and Community Based Children’s Extensive Support Waiver services, which are offered to children with developmental delays or disabilities. In Colorado, Medicaid is administered by the Colorado Department of Health Care Policy & Financing (“Department”).

In 2011, while J.G. was receiving Medicaid benefits, a special master in the Court of Federal Claims approved a settlement between J.G. and the Department of Health and Human Services (“DHHS”). The settlement included compensation for several categories of damages, including (1) a lump-sum payment into a reversionary trust that DHHS created, Regions Bank managed as trustee, and J.G. could access for only therapy expenses, and (2) a lump-sum payment to purchase an annuity, providing J.G. annual payments during her life. A Colorado state court also approved the settlement terms.

For roughly five years, the Department expressed no concerns with J.G.’s settlement. That changed in April 2016, when the Department began questioning the settlement’s terms. J.G.’s representatives tried addressing the Department’s concerns but to no avail. In 2017, J.G. was notified that her Medicaid benefits were being terminated. The notice stated that the reversionary trust was a countable resource that placed J.G.

to accept the court’s judgment and forgo a traditional tort suit for damages, or to reject the judgment and seek tort relief from the vaccine manufacturer.

Id.

Appellate Case: 21-1194 Document: 010110716748 Date Filed: 07/27/2022 Page: 4

above the allowable-resource limit to qualify for Medicaid assistance. It also said that money received under the annuity contract put J.G. over the allowable income limit.

J.G. appealed that decision to the Office for Administrative Courts. The appeal was assigned to Administrative Law Judge Tanya Light. During those proceedings, the parties agreed that the case could be decided on summary-judgment briefing, without a hearing. So they submitted their briefs and supporting exhibits, some of which were stipulated. After considering the arguments, ALJ Light issued an “Initial Decision” that reversed the Department’s ineligibility ruling, concluding that neither the reversionary trust nor the annuity were countable assets for determining J.G.’s Medicaid eligibility.

The Department objected to the Initial Decision, and J.G. filed a response to those objections. The matter was reviewed by Appellee Christine Nierenz, an ALJ in the Department’s Office of Appeals. In July 2019, she issued a Final Agency Decision (“Final Decision”) that reversed the Initial Decision. ALJ Nierenz concluded that the reversionary trust and the annuity were countable assets after all, making J.G. ineligible for Medicaid assistance. II. Procedural Background The Final Decision stated that J.G. could seek judicial review of the decision by suing in the appropriate state district court within 35 days. But J.G. didn’t pursue that option; she instead turned to federal court and filed a complaint in the District of

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Colorado. She asserted five claims under 42 U.S.C. § 1983 against ALJ Nierenz and Kim Bimestefer in their official capacities as members of the Office of Appeals.3 In Count I, J.G. alleges that ALJ Nierenz violated 42 U.S.C.

§ 1396a(a)(10)(A)(ii)(V)–(VI) by not evaluating her Medicaid eligibility “in accordance with the regulations and law as set forth in the [Supplemental Security Income] program.”4 R. Vol. 1 at 109. According to J.G., had ALJ Nierenz correctly relied on the Supplemental Security Income eligibility standards, she would have concluded that neither the reversionary trust nor the annuity was countable income to J.G.

In Count II, J.G. alleges that the reversionary trust isn’t a countable asset under 42 U.S.C. § 1396p(h)(1) or an available asset to her under 42 U.S.C. § 1396a(a)(17). She alleges that by interpreting the reversionary trust otherwise, the Department violated § 1396p(h)(1). She asks the district court to declare the trust a non-countable and unavailable asset to her, “as more fully set forth in the opinion of [] ALJ [Light] in the Initial Decision.” R. Vol. 1 at 118.

In Count III, J.G. alleges that the Department erred in concluding that the annuity was a countable resource under 42 U.S.C. § 1396p. She says that because her annuity is

3 Bimestefer is the Department’s Executive Director.

4 Supplemental Security Income is a federal program that is “designed to help aged, blind, and disabled people[] who have little or no income” by providing them money for basic needs. Supplemental Security Income Home Page — 2014 Edition, U.S. SOC. SECURITY ADMIN., http://www.ssa.gov/ssi/ (last visited Sept. 26, 2014).

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