Planned Parenthood of Kan. v. Andersen
This text of 882 F.3d 1205 (Planned Parenthood of Kan. v. Andersen) is published on Counsel Stack Legal Research, covering Court of Appeals for the Tenth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.
Opinions
PHILLIPS, Circuit Judge.
Medicaid's free-choice-of-provider provision grants Medicaid patients the right to choose for their medical care any qualified and willing provider. 42 U.S.C. § 1396a(a)(23). On May 3, 2016, Kansas sent notices of decisions to terminate (effective May 10) its Medicaid contracts with two Planned Parenthood affiliates, Planned Parenthood of Kansas and Mid-Missouri ("PPGP"), and Planned Parenthood of the St. Louis Region ("PPSLR").1 The notices cited concerns about the level of PPGP's cooperation in solid-waste inspections, both Providers' billing practices, and an anti-abortion group's allegations that Planned Parenthood of America ("PPFA") executives had been video-recorded negotiating the sale of fetal tissue and body parts. Together, the Providers and three individual Jane Does ("the Patients") immediately sued Susan Mosier, Secretary of the Kansas Department of Health and Environment ("KDHE"), under
States have broad authority to ensure that Medicaid healthcare providers are qualified to provide medical services-meaning that they are competent to provide medical services and do so ethically. But this power has limits. States may not terminate providers from their Medicaid program for any reason they see fit, especially when that reason is unrelated to the provider's competence and the quality of the healthcare it provides. We join four of five of our sister circuits that have addressed this same provision and affirm the district court's injunction prohibiting Kansas from terminating its Medicaid contract with PPGP. But we vacate the district court's injunction as it pertains to PPSLR
*1211and remand for further proceedings on that issue. Though the Plaintiffs have provided affidavits from three Jane Does concerning their past and expected medical care from PPGP, the Plaintiffs have not provided affidavits from any persons receiving or expecting to receive medical care at PPSLR. Hence the Plaintiffs have failed to establish any injury they will suffer from the termination of PPSLR, meaning they have failed to establish standing to challenge that termination. But on this record, we cannot determine whether PPSLR itself can establish standing, an issue the district court declined to decide but now must decide on remand.2 Though Kansas has not raised this standing issue, we have an independent duty to assure ourselves of the district court's subject-matter jurisdiction. See City of Colo. Springs v. Climax Molybdenum Co. ,
BACKGROUND
I. The Medicaid Act and Kansas Regulations
The Medicaid Act's free-choice-of-provider provision states that "any individual eligible for medical assistance ... may obtain such assistance from any institution, agency, community pharmacy, or person, qualified to perform the service or services required ... who undertakes to provide him such services." 42 U.S.C. § 1396a(a)(23). This provision "guarantees that Medicaid beneficiaries will be able to obtain medical care from the qualified and willing medical provider of their choice." Planned Parenthood of Gulf Coast, Inc. v. Gee ,
Kansas, like all states, issues regulations to administer its Medicaid program. These regulations govern when, why, and how Kansas may terminate contracts between its Medicaid program and healthcare providers.
If the state decides to terminate the provider, the provider may request a hearing from Kansas's Office of Administrative Hearings ("OAH") within thirty-three days after receiving notice of termination.
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PHILLIPS, Circuit Judge.
Medicaid's free-choice-of-provider provision grants Medicaid patients the right to choose for their medical care any qualified and willing provider. 42 U.S.C. § 1396a(a)(23). On May 3, 2016, Kansas sent notices of decisions to terminate (effective May 10) its Medicaid contracts with two Planned Parenthood affiliates, Planned Parenthood of Kansas and Mid-Missouri ("PPGP"), and Planned Parenthood of the St. Louis Region ("PPSLR").1 The notices cited concerns about the level of PPGP's cooperation in solid-waste inspections, both Providers' billing practices, and an anti-abortion group's allegations that Planned Parenthood of America ("PPFA") executives had been video-recorded negotiating the sale of fetal tissue and body parts. Together, the Providers and three individual Jane Does ("the Patients") immediately sued Susan Mosier, Secretary of the Kansas Department of Health and Environment ("KDHE"), under
States have broad authority to ensure that Medicaid healthcare providers are qualified to provide medical services-meaning that they are competent to provide medical services and do so ethically. But this power has limits. States may not terminate providers from their Medicaid program for any reason they see fit, especially when that reason is unrelated to the provider's competence and the quality of the healthcare it provides. We join four of five of our sister circuits that have addressed this same provision and affirm the district court's injunction prohibiting Kansas from terminating its Medicaid contract with PPGP. But we vacate the district court's injunction as it pertains to PPSLR
*1211and remand for further proceedings on that issue. Though the Plaintiffs have provided affidavits from three Jane Does concerning their past and expected medical care from PPGP, the Plaintiffs have not provided affidavits from any persons receiving or expecting to receive medical care at PPSLR. Hence the Plaintiffs have failed to establish any injury they will suffer from the termination of PPSLR, meaning they have failed to establish standing to challenge that termination. But on this record, we cannot determine whether PPSLR itself can establish standing, an issue the district court declined to decide but now must decide on remand.2 Though Kansas has not raised this standing issue, we have an independent duty to assure ourselves of the district court's subject-matter jurisdiction. See City of Colo. Springs v. Climax Molybdenum Co. ,
BACKGROUND
I. The Medicaid Act and Kansas Regulations
The Medicaid Act's free-choice-of-provider provision states that "any individual eligible for medical assistance ... may obtain such assistance from any institution, agency, community pharmacy, or person, qualified to perform the service or services required ... who undertakes to provide him such services." 42 U.S.C. § 1396a(a)(23). This provision "guarantees that Medicaid beneficiaries will be able to obtain medical care from the qualified and willing medical provider of their choice." Planned Parenthood of Gulf Coast, Inc. v. Gee ,
Kansas, like all states, issues regulations to administer its Medicaid program. These regulations govern when, why, and how Kansas may terminate contracts between its Medicaid program and healthcare providers.
If the state decides to terminate the provider, the provider may request a hearing from Kansas's Office of Administrative Hearings ("OAH") within thirty-three days after receiving notice of termination.
II. Planned Parenthood's Alleged Wrongdoing
Planned Parenthood affiliates, many of which are located in areas with shortages of primary-care providers, deliver essential services to Medicaid recipients. PPGP has two health centers in Kansas and three in Missouri, and PPSLR has one health center in Missouri that also serves Kansas Medicaid patients. The Providers' services include annual health exams; different types of contraception along with contraceptive counseling; breast- and cervical-cancer screening ; cervical-cancer treatment; screening and treatment for sexually transmitted infections; human papillomavirus vaccinations ; pregnancy testing and counseling; and other health services.3 Though some Planned Parenthood clinics also perform abortions, Medicaid seldom pays for abortions. See, e.g. , Harris v. McRae ,
In July 2015, the anti-abortion group Center for Medical Progress ("CMP") released on YouTube a series of edited videos purportedly depicting PPFA executives negotiating with undercover journalists for the sale of fetal tissue and body parts. Kansas alleges that the videos demonstrate that "Planned Parenthood manipulates abortions to harvest organs with the highest market demand" and that PPFA executives are willing to negotiate fetal-tissue prices to obtain profits. Appellant's Opening Br. at 7. According to Kansas, this evidence matters because "PPFA controls its 'affiliate' organizations, including [PPGP] and PPSLR."
To prove PPFA's control over and affiliation with the Providers, Kansas claims that (1) "PPFA and its affiliates make no apparent effort to keep their finances separate"; (2) PPFA compiles a yearly " 'combined balance sheet,' " which "aggregate[s] 'revenue and expenses' " for the entire Planned Parenthood organization; (3) according to its 2014 tax return, PPFA transferred over $50 million to its affiliates; (4) PPFA drafts rules of procedure and operation for its affiliates and trains its affiliates' officers and employees in "management and medical practices"; and (5) PPFA's legal counsel represented PPGP and PPSLR in their meeting with the KDHE. Id. at 7-8 (quoting Appellant's App. at 479-82).
Based on CMP's videos of the PPFA executives, Kansas began investigating the Providers. In August 2015, Kansas's Board of Healing Arts ("BOHA"), the agency primarily responsible for medical licensure and regulation, requested from PPGP copies of "treatment records related to abortion procedures or stillbirths ... in which *1213fetal organs or tissues were transferred for any purpose other than those" permitted by law. Appellant's App. at 208-11. On January 7, 2016, the BOHA determined that, "[a]fter careful review of the investigative materials, ... no further action will be taken at this time." Id. at 215.
On December 16, 2015, Kansas's Bureau of Waste Management ("BWM") also initiated a solid-waste investigation under
On January 5, 2016, after counsel for BWM guaranteed the privacy of PPGP's patients, PPGP permitted the inspectors to take photographs on their return visit. The BWM inspectors left a report with PPGP's clinic employees, stating that BWM had found no violations. Later, on January 15, 2016, after PPGP had taken the necessary steps to make its vendor information confidential, PPGP provided BWM the requested waste-vendor information as well. Though Kansas points out that this was "an entire month after the first inspection," id. at 11, in reality, BWM had granted PPGP extra time so that PPGP could document its request to keep the information confidential.
Though Kansas never investigated PPSLR, the Missouri Attorney General did. In September 2015, after looking into PPSLR's fetal-tissue practices, the Missouri Attorney General's office announced that it had found no evidence of wrongdoing.
Relevant to this appeal, Kansas also notes that "[a]llegations ... emerged that Planned Parenthood offices around the country have engaged in questionable billing practices, including in the nearby states of Oklahoma and Texas." Id. at 8-9. And it claims that "Planned Parenthood's practices have prompted numerous lawsuits under the False Claims Act ('FCA')." Id. at 9.
III. Termination Proceedings & District Court Case
On March 10, 2016, about two months after Kansas's inspection of one of PPGP's clinics and two months after Kansas Governor Sam Brownback announced that he had "signed legislation stopping most taxpayer funding from going to Planned Parenthood," and that "[t]he time had[d] come to finish the job," Kansas issued notices of intent to terminate PPGP and PPSLR as state Medicaid providers.4 Governor Sam Brownback, 2016 State of the State (Jan. 12, 2016) (transcript available at https://governor.kansas.gov/2016-state-of-the-state-january-12-2016/). Those notices informed the Providers that, under
The notices also informed the Providers that they could each challenge their proposed terminations in administrative reviews, where they would "have the opportunity to present any relevant evidence" regarding their terminations.
Together, the Providers participated in an administrative review on April 29, 2016. At this review, the Providers' counsel presented evidence and argued against termination. But on May 3, 2016, Kansas sent each Provider a "Notice of Decision to Terminate," which provided that "[a]fter thorough review of all information presented, ... your participation in [Kansas's state Medicaid program] will be terminated effective May 10, 2016. "
Instead of requesting a hearing to review the terminations, the Providers, the Patients, and eleven individual PPGP and PPSLR employees (whose charges were later dropped after Kansas reconsidered and reversed its decision to terminate them from its state Medicaid program) sued Kansas under
The day after filing their lawsuit, the Plaintiffs filed a Motion for Temporary Restraining Order and Preliminary Injunction. On June 7, 2016, after Kansas twice continued the hearing date and agreed to extend the effective termination date to July 7, the parties argued the case before the district court. Kansas now argues that extending the termination date from May 10 to July 7 meant that the Providers had until August 10 to seek a hearing before the OAH. Kansas also notes that PPGP's Medicaid contract with the state dictated that the contract would terminate thirty days after "notification from the State that the provider's state fair hearing rights have expired or the state fair hearing has been completed related to the Medicaid termination."
*1215In granting the Plaintiffs' request for relief, the district court held that the case was ripe, that the Plaintiffs5 had standing, and that abstention wasn't necessary under Younger v. Harris ,
ANALYSIS
First, we address Kansas's arguments regarding standing, ripeness, and Younger abstention. Then, we move on to address the claim's merits. Specifically, we decide whether the Patients have a private right of action under the Medicaid Act, and whether they have met the requirements necessary to show that they are entitled to injunctive relief.
I. Justiciability
The United States Constitution empowers federal courts to address "Cases" and "Controversies." U.S. Const. art. III § 2, cl. 1. The cases-and-controversies requirement manifests in the dual justiciability doctrines of standing and ripeness. Kansas maintains that the district court erred in concluding that the Plaintiffs had standing and that the case was ripe.
A. Standing
We review de novo a district court's finding of standing. New Mexico v. Dep't of Interior ,
1. Injury in Fact
For standing, a plaintiff's injury must be "actual or imminent, not conjectural or hypothetical." Lujan v. Defs. of Wildlife ,
First, Kansas claims that only after the Plaintiffs had an administrative hearing *1216(which took place on April 29), "may [it] then issue a written preliminary decision, setting forth the effective date of the termination and the basic underlying facts supporting the order." Appellant's Opening Br. at 6. And Kansas goes on to argue that the "preliminary decision ... becomes final only after the time for a formal administrative hearing has passed."Id. (citing
Second, Kansas claims that the Plaintiffs' injuries are speculative because the Providers "refused to complete the administrative process," so no one can say whether they would have been terminated at all. Appellant's Opening Br. at 20. This argument hinges on Kansas's characterization of the termination letters and their effect. According to Kansas, the notices it sent to the Providers were "far from ... final termination[s]," but rather were "effectively ... complaint[s] that the Providers could formally contest ... or admit."
This argument fails. As did the district court, we read the notices of termination literally. See Mosier ,
In fact, as the district court noted, Kansas's "position on the effective date of termination *1217has been a moving target." Mosier ,
In light of such conduct, Kansas's claim that it wouldn't cut off funding to the Providers until September 10 is unpersuasive. We agree with the district court that Kansas cannot "have its cake and eat it too" by insisting that the terminations wouldn't be effective until September, yet refusing to agree to delay enforcement by guaranteeing that September effective date. Id. at *9. We also agree with the district court's position that "[t]he fact that [Kansas] is unwilling to put its counsel's representations into a stipulated order that would apply to both providers is entirely inconsistent with its position that this dispute is premature." Id.
In any case, we conclude that the Plaintiffs faced a substantial risk of injury from the moment Kansas sent its final notices of termination. Although the termination decisions would not have gone into effect until July 7, 2016 (accounting for Kansas's litigation-related extensions), the state "ha[d] already acted to terminate [the Providers'] Medicaid provider agreements; only the effect of [those] termination[s] ha[d] yet to be implemented." Gee ,
2. Causal Connection
Kansas alternatively argues that the Plaintiffs lack standing because their injuries *1218resulted from their own failure to "use available procedures to remedy an alleged injury," rather than Kansas's actions, and thus are not traceable to Kansas. Appellant's Opening Br. at 23.
Kansas correctly states that a plaintiff cannot show that a defendant caused its injuries if the plaintiff's injuries resulted from its own acts or failures to act. See Clapper ,
But the Plaintiffs' dilemma is dissimilar from that in Gonzales . In Gonzales , HHS could have prevented the plaintiff-association from suffering any injury by explaining how it would implement the new law harmoniously with the existing regulations.
We agree with the district court's decision not to "impose an indirect exhaustion requirement by finding that Plaintiffs caused their own injury by failing to pursue administrative remedies." Mosier ,
*1219B. Ripeness
Kansas next argues that this case is not ripe for adjudication because the Plaintiffs didn't complete the administrative-appeal process. Ripeness is a prerequisite to justiciability with both constitutional and jurisdictional components. See United States v. Bennett ,
1. Fitness for Judicial Resolution
"[T]o determine the fitness of issues for review, we may consider 'whether judicial intervention would inappropriately interfere with further administrative action' and 'whether the courts would benefit from further factual development of the issues presented.' "
Kansas's arguments on this point are related to its arguments on standing. The state claims that the administrative actions it took in this case were not final. Rather, it argues, the Plaintiffs could have requested a formal hearing and then a rehearing before the OAH. See
The district court disagreed, concluding that the "termination notices represent concrete actions by the KDHE that threatened to harm Plaintiffs by excluding [PPGP] and PPSLR as Medicaid providers, notwithstanding the option of an administrative appeal." Mosier ,
*1220Again, we agree with the district court's thoughtful analysis, this time on this case's fitness for judicial resolution. "[B]oth parties have submitted evidence on these issues, and ... neither party requested an evidentiary hearing on the motion for preliminary injunction." Id. at 10. This implies that no substantial factual disputes remained, and that the questions we must now answer are primarily legal questions. Kansas has presented its grounds for terminating the Providers, and it agrees that the propriety of the preliminary injunction rests on "whether the Providers' conduct and corporate affiliations justify the decision to terminate." Appellant's Opening Br. at 29. Though Kansas characterizes these issues9 as factual rather than legal, the district court found it telling that after the parties had one evidentiary hearing, even if it was informal, neither party later requested an evidentiary hearing on the motion for preliminary injunction. Mosier ,
And, because the Providers had clearly stated that they did "not intend to pursue" further administrative appeal, Appellee's Response Br. at 58, the Patients' injuries are "sufficiently likely to happen to justify judicial intervention," Gee ,
2. Hardship
Kansas also contends that the Plaintiffs failed to show that they would face hardship absent an injunction because possible future injury does not amount to hardship and the Providers' terminations were not final. We reject this argument for the same reason already given. Because the Providers chose not to appeal their terminations, the terminations were final and would have become effective no later than September 10. If this had happened, the Patients would have likely "suffer[ed] hardship by being denied access to the provider of their choice under 42 U.S.C. § 1396a(a)(23) and to medical services at [the Providers'] facilities." Gee ,
*1221II. Younger Abstention
Kansas next claims that the district court erred by declining to abstain under Younger . We review de novo the district court's decision on whether to abstain under Younger . Amanatullah v. Colo. Bd. of Med. Exam'rs ,
Younger abstention stems from the federal government's deference to and respect for the state government and its function. Younger ,
Here, the issue is whether the Providers' right to appeal after their April 29 evidentiary hearing and after the resulting termination decisions would amount to an administrative proceeding entitled to Younger abstention. To decide this question, we ask "whether there is an ongoing proceeding," and then we "decide whether that proceeding is the type of state proceeding that is due the deference accorded by Younger abstention." Brown ,
A. Administrative Proceeding Not Ongoing
Kansas argues that state administrative proceedings were "well underway" and remained ongoing because the Providers still had the right to seek a formal hearing until August 10. Appellant's Opening Br. at 31-32. The district court disagreed, concluding that state administrative proceedings had not yet begun.10 Mosier,
Before the Plaintiffs filed their § 1983 lawsuit and motion for preliminary injunction, the following events had taken place: (1) two different Kansas agencies had investigated the Providers to determine whether they had improperly sold or disposed of fetal tissue, and both agencies cleared the Providers of wrongdoing; (2) Kansas had sent the Providers notices of intent to terminate; (3) Kansas and the Providers had participated in one evidentiary hearing; and (4) Kansas had sent the Providers notices of decision to terminate with a termination date of May 10. Kansas argues that these decisions weren't final. But again, had the Providers taken no further action-and nothing required the Providers to take further action-those terminations would have become effective. In other words, neither party would have had anything left to do to execute the *1222terminations; the clock was running on certain termination.
After the Providers received Kansas's notices of termination, they had an optional right to challenge these decisions at an administrative hearing. But "no administrative proceeding commences until or unless [the Providers] appeal[ ], ... and [the Providers] ha[ve] foresworn that option." Planned Parenthood Gulf Coast, Inc. v. Kliebert ,
B. Not the Type of Proceeding Entitled to Younger Abstention
For similar reasons, even if proceedings were ongoing, they aren't the type requiring Younger abstention. Relevant to this appeal, civil enforcement proceedings merit abstention under Younger . Sprint Commc'ns, Inc. v. Jacobs ,
Under this framework, plaintiffs suing under § 1983 must "exhaust[ ] state administrative remedies only where the state administrative proceedings are coercive." Brown ,
We agree with the district court that the administrative proceedings in this case were not civil enforcement actions subject to Younger abstention. Mosier ,
Finally, but importantly, we also note that though the Providers had the right of appeal, the Patients did not. See Mosier,
III. Preliminary Injunction
We review a district court's preliminary injunction for abuse of discretion. N.M. Dep't of Game & Fish v. U.S. Dep't of Interior ,
Preliminary injunctions are extraordinary remedies requiring that the movant's right to relief be clear and unequivocal. Wilderness Workshop v. U.S. Bureau of Land Mgmt. ,
Before we address the Patients' likelihood of success on the merits, we first decide the threshold issue of whether the Medicaid Act's free-choice-of-provider provision, § 1396a(a)(23), creates a private right of action for the Patients.12 We then *1224determine whether the Patients are likely to succeed on the merits of their claim.
A. Private Right of Action Under § 1396a(a)(23)
We are comfortable joining four out of the five circuits that have addressed this issue, and we too hold "that § 1396a(a)(23) affords the [Patients] a private right of action under § 1983." Gee ,
As discussed, the statute at issue in this case is the Medicaid Act's free-choice-of-provider provision, 42 U.S.C. § 1396a(a)(23). That provision states:
A state plan for medical assistance must ... provide that (A) any individual eligible for medical assistance ... may obtain *1225such assistance from any institution, agency, community pharmacy, or person, qualified to perform the service or services required ... who undertakes to provide him such services....
42 U.S.C. § 1396a(a)(23)(A). This section goes on to state that "an enrollment of an individual eligible for medical assistance in a primary care case-management system ..., a medicaid managed care organization, or a similar entity shall not restrict the choice of the qualified person from whom the individual may receive services under section 1396d(a)(4)(C) of this title."14
1. Blessing /Gonzaga Requirements
The question here is whether the free-choice-of-provider agreement creates a private right enforceable under
a. Congress Intended to Benefit Medicaid Patients
As have the Fifth, Sixth, Seventh, and Ninth Circuits, we conclude that the free-choice-of-provider provision confers on Medicaid patients a private right of action. See Gee ,
Kansas also claims that Armstrong supports its claim that the free-choice-of-provider provision does not confer on the Patients an enforceable right because in it, Justice Scalia opined that Spending Clause legislation does not provide a private right of action. 135 S.Ct. at 1387. But in Armstrong , the Supreme Court analyzed an entirely different section of the Medicaid Act, 42 U.S.C. § 1396a(a)(30)(A), concluding that this specific section did not create a private right of action. Id. Section 1396a(a)(30)(A) provides that "[a] State plan for medical assistance must ... provide such methods and procedures relating to the utilization of, and the payment for" Medicaid services to ensure that Medicaid pays for only necessary, efficient, economic, and high-quality care while still setting reimbursement rates high enough to encourage providers to continue serving Medicaid patients. In his opinion, the last portion of which Justice Breyer declined to join, thus making that portion a plurality, Justice Scalia stated that "Section 30(A) lacks the sort of rights-creating language needed to imply a private right of action." Id. But the plaintiffs there did not sue under § 1983 to enforce a right established by the Medicaid Act. Id. ("The last possible source of a cause of action for respondents is the Medicaid Act itself. They do not claim that, and rightly so.").
Unlike § 1396a(a)(23), which provides that "any individual eligible for medical assistance ... may obtain such assistance from any [provider] ... qualified to perform the service or services required," the Medicaid Act section at issue in Armstrong directed states to adopt rate-setting plans in accordance with certain general standards. The free-choice-of-provider provision, "[i]n contrast [to Armstrong 's Medicaid Act section,] § 1396a(a)(23)... is phrased in individual terms that are specific and judicially administrable, as recognized by the Sixth, Seventh, and Ninth Circuits." Gee ,
b. Right Not Vague or Amorphous
Second, the free-choice-of-provider agreement is not so " 'vague and amorphous' that its enforcement would strain judicial competence." Blessing ,
Under the Medicaid Act, plaintiffs need show only that their provider of choice was (1) qualified to perform the medical services, and (2) undertaking to do so. See 42 U.S.C. § 1396a(a)(23). These requirements are " 'concrete and objective standards for enforcement,' which are 'well within judicial competence to apply.' " Gee ,
"[W]hile there may be legitimate debates about the medical care covered by or exempted from the [free-choice-of-provider] provision," the definition of the word "qualified" cannot be legitimately debated. Olszewski ,
Kansas again relies heavily on Armstrong to support its claim that § 1396a(a)(23) is judicially unadministrable. It claims that "determining whether a provider is 'qualified' is a [sic] dependent upon judgment, industry experience, and technical expertise," and that such a determination implicates "expert judgments and questions of state law." Appellant's Opening Br. at 41. But in making this claim, Kansas compares the free-choice-of-provider provision's willing-and-qualified requirements to the requirements contained in § 1396a(a)(30)(A) of the Medicaid Act, which was at issue in Armstrong . That section requires state plans to "provide for payments that are 'consistent with efficiency, economy, and quality of care,' all the while 'safeguard[ing] against unnecessary utilization of ... care and services.' " Armstrong ,
Compared to that "judgment-laden standard,"
c. Right Stated in Mandatory Terms
On the third element, we conclude that the statute is "couched in mandatory, rather *1228than precatory, terms." Blessing ,
2. Congressional Intent to Foreclose Private Enforcement
Still, even if a plaintiff meets these three threshold requirements, the plaintiff has established "only a rebuttable presumption that the right is enforceable under § 1983." City of Rancho Palos Verdes v. Abrams ,
Here, again, Kansas relies on Armstrong to support its claim. There, the providers sued Idaho, claiming that it had violated § 1396a(a)(30)(A) by reimbursing them at rates lower than the Medicaid Act permitted. Armstrong , 135 S.Ct. at 1382. The providers asserted "an implied right of action under the Supremacy Clause to seek injunctive relief against the enforcement or implementation of state legislation." Id. at 1383 (quoting Exceptional Child Ctr., Inc. v. Armstrong ,
*1229But Armstrong isn't a § 1983 case. Plus, an earlier Supreme Court case, Wilder v. Virginia Hospital Ass'n ,
Even if § 1396a(a)(30)(A) could fairly be read to display congressional intent to foreclose the availability of equitable relief, id. at 1386, § 1396a(a)(23) -the free-choice-of-provider provision-can't be read that way.
B. Preliminary Injunction Factors
1. Likelihood of Success on the Merits
Having concluded that the free-choice-of-provider provision confers on the Patients a private right of action, we now turn to the first and most important preliminary-injunction factor: whether the Patients are likely to succeed on the merits.
Again, § 1396(a)(23) requires a state plan to provide that "any individual eligible *1230for medical assistance (including drugs) may obtain such assistance from any institution, agency, community pharmacy, or person, qualified to perform the service or services required ... who undertakes to provide him such services[.]" In evaluating what it means for a provider to be "qualified to provide services," we agree with the district court and "the Seventh and Ninth Circuits, [that] '[t]o be 'qualified' in the relevant sense is to be capable of performing the needed medical services in a professionally competent, safe, legal, and ethical manner." Gee ,
All agree that states have considerable discretion in establishing provider qualifications. See
The Plaintiffs must be allowed to challenge PPGP's termination. After all, if a state wrongly terminates a provider-whether on grounds raised by Kansas under § 1320a-f(b)(5)(B) or f(b)(12)(B) or otherwise-it will have wrongly removed a qualified provider from the available pool. If a state could terminate providers without any challenge by affected patients, the patients' § 1396a(a)(23) right would lose force and be easily eviscerated. We agree with the district court that when Kansas shrinks the pool of qualified providers by terminating them under § 1396a(p)(1), patients must have a § 1396a(a)(23) right to challenge the state's termination decision as improper or wrongful. Mosier ,
Kansas takes a different view. It argues that termination decisions under § 1396a(p)(1) (which references § 1320a-7(b) ) are separate from the right of patients to any qualified and willing provider under § 1396a(a)(23). In effect, Kansas argues that patients have no right to services from qualified providers whom it has terminated.
We agree that states have broad powers to terminate Medicaid providers. After all, § 1396a(p)(1)"empowers states to exclude individual providers on such grounds directly, without waiting for the [federal] Secretary to act, while also reaffirming state authority to exclude individual providers pursuant to analogous state law provisions relating to fraud or misconduct." Betlach ,
In support of its view that termination decisions under § 1396a(p)(1) are final and beyond patients' ability to challenge under § 1396a(a)(23), Kansas relies in part on O'Bannon v. Town Court Nursing Center ,
In addition, we note that the nursing home residents in O'Bannon asserted procedural due-process rights, not substantive rights, as the patients do here. See Gee ,
a. Waste Inspections
The state first claims that PPGP's Overland Park clinic violated Kansas law by hindering the state's investigation of its waste-disposal practices. See
Specifically, Kansas argues that the clinic violated the Medicaid Act by failing "to grant immediate access" to the Kansas BWM employees who investigated the clinic's waste-disposal practices. 42 U.S.C. § 1320a-7(b)(12)(B). "Failure to grant immediate access means the failure to grant access at the time of a reasonable request or to provide a compelling reason why access may not be granted."
We agree with the district court that the Plaintiffs are likely to succeed in proving "that they did grant immediate access to the inspectors," as well as "that the solid waste inspection here d[id] not constitute a review bearing on" the quality of care the Providers furnished to Medicaid recipients. Mosier ,
Even if this conduct could be labeled a "[f]ailure to grant immediate access" to Kansas officials, which is doubtful, clinic employees "provide[d] a compelling reason" for their refusal to allow photographs or to turn over its vendor list: they were concerned for patient safety and privacy.
As its second basis for termination, Kansas relies on § 1320a-7(b)(5)(B). That provision allows the Secretary to terminate any individual or entity "for reasons bearing on the individual's or entity's professional competence, professional performance, or financial integrity." We agree with the district court "that PPKM's [now PPGP's] purported failure to cooperate with the BWM's solid waste inspection in December 2015 does not bear on PPKM's [PPGP's] 'professional competence, professional performance, or financial integrity.' " Mosier ,
The Dissent
The dissent does not contend that Kansas is entitled to prevail on § 1320a-7(b)(12)(B) or (b)(5)(B). As grounds authorizing termination, the dissent instead relies on a neighboring section unmentioned by Kansas in its brief- 42 U.S.C. § 1320a-7(b)(12)(C). Dissent at 1245. In fashioning a new argument, the dissent steps beyond our usual practice. See Modoc Lassen Indian Hous. Auth. v. UnitedStates Dep't of Hous. & Urban Dev , No. 14-1313,
That said, in responding to the dissent's argument, we turn to § 1320a-7(b)(12)(C) which reads as follows:
(12) Failure to grant immediate access. Any individual or entity that fails to grant immediate access, upon reasonable request (as defined by the [HHS] Secretary in regulations) to any of the following:
* * *
(C) To the Inspector General of the Department of Health and Human Services, for the purpose of reviewing records, documents, and other data necessary to the performance of the statutory functions of the Inspector General.
The dissent argues that Kan. Reg. § 28-29-16(a)(1) is analogous to this federal statute subsection, authorizing Kansas to terminate the Providers' contracts based on its regulation. The dissent relies on this portion of the state regulation:
The [Kansas Secretary of Health and Environment] or any duly authorized representative of the secretary, at any reasonable hour of the day, having identified themselves and giving notice of their purpose, may ... [e]nter ... any environment where solid wastes are generated, stored, handled, processed, or disposed, and inspect the premises and gather information of existing conditions and procedures....
Dissent at 1245-46.
The dissent ignores an applicable federal regulation bearing on inspections, which allows OIG immediate access on reasonable *1234request to review "records, documents and other materials or data ... necessary to the [performance of the Inspector General's] statutory functions[.]"
So we reject the view that Kansas was entitled to terminate PPGP on the dissent's independently raised ground. In doing so, we also rely on the district court's reasoning when it rejected Kansas's reliance on § 1320a-7(b)(12)(B) -namely, that PPGP was willing to let the inspection continue absent photographs (having confidentiality concerns), that the Kansas regulation did not provide for photography, and that PPGP willingly released the vendor lists after negotiating a confidentiality agreement with the inspecting agency. See Mosier ,
b. CMP Videos of Fetal Tissue Negotiation
Kansas next argues that it was entitled to terminate PPGP's and PPSLR's provider agreements because "PPFA's affiliates" violated federal and state law prohibiting the for-profit sale of human body parts and fetal tissue.
But, first, all of the termination provisions Kansas relies on require a criminal conviction or related sanction; and no PPFA affiliate, including PPGP and PPSLR, has been convicted or sanctioned for any wrongdoing. And the district court rightly explained that even if PPFA had negotiated the illegal sale of fetal body parts (and this allegation has never been proved), "under [ § 1396a(p)(1) ], the 'entity' that a 'State may exclude' must be the same entity that committed the infraction defined in § 1320a-7(b)." Mosier ,
Kansas never addresses the district court's conclusion, instead arguing that PPGP and PPSLR never established that they were separate and independent from PPFA. We agree with the district court that the Providers are not sufficiently affiliated with PPFA so that Kansas can attribute this alleged conduct to them under the law. See Mosier ,
But these factors do nothing to show that PPFA exercises control over its affiliates' daily operations. In fact, because many PPFA affiliates don't offer abortions-and Kansas provides nothing to show that PPFA could or would require them to do so-we cannot attribute PPFA's alleged abortion-related conduct to PPFA affiliates absent evidence that specifically implicates the affiliates.19 See Gee ,
In sum, the Plaintiffs are likely to succeed in proving that Kansas cannot terminate PPGP from the state's Medicaid program for PPFA's alleged unlawful conduct.
c. Medicaid Fraud by PPFA Affiliates
Last, Kansas claims it was justified in terminating PPGP and PPSLR in light of allegations that other PPFA affiliates had committed Medicaid fraud. Kansas claims that the numerous allegations of Medicaid fraud by Planned Parenthood affiliates around the country provide relevant evidence of PPGP's and PPSLR's "questionable billing practices." Appellant's Opening Br. at 8-9. This argument fails for the same reason the previous argument fails. Kansas never alleged that PPGP or PPSLR engaged in fraud, but it claims that because PPGP merged with Planned Parenthood of Central Oklahoma ("PPCO"), "the new combined entity has necessarily inherited PPCO's record of fraud." Id. at 54. But this "merger" doesn't have the effect that Kansas desires it to.
First, the only thing this "merger" changed was PPGP's name: the former PPKM now operates under the name "Planned Parenthood Great Plains." Appellant's App. at 828. The merger resulted in "no change of ownership or management structure" for PPGP. Id. Second, though Oklahoma Governor Mary Fallin cited two "integrity reviews" finding error rates in billing of 20.3% and 14.1% in calling for PPCO's termination from Oklahoma's Medicaid plan, id. at 417-19, Kansas presented no evidence that Oklahoma had sanctioned or terminated PPCO, and *1236PPCO is still an Oklahoma Medicaid provider. Third, Kansas cites nothing to support its claim that one corporate entity can inherit another's "record of fraud," even when the two entities merge into a single entity (which does not appear to have happened here).
After considering all of Kansas's bases for terminating PPGP from its state Medicaid plan as unqualified, we conclude that, as in Gee , Commissioner of Indiana , and Betlach , Kansas "is seeking to do exactly what [other circuits] warned against: 'simply labeling any exclusionary rule as a "qualification" ' to evade the mandate of the free-choice-of-provider requirement." Gee ,
2. Irreparable Harm
We next consider whether the Patients have shown that they would suffer irreparable harm absent injunctive relief.20 Irreparable harm is "certain, great, actual 'and not theoretical.' " Heideman v. S. Salt Lake City ,
Kansas argues that the Patients' injuries are speculative for the same reason it contested the Plaintiffs' standing and the case's ripeness: that the administrative appeal is still pending, meaning the state can't terminate the providers until that process is complete or the time period for appeal has expired.21 See GreaterYellowstone Coal. v. Flowers ,
We reject that argument here for the same reason we did above. Only the Providers have a right-not an obligation-to appeal Kansas's decision; the Patients do not. And the Providers have declared that they will not pursue administrative appeal. Mosier ,
Last, Kansas argues that the Patients would not be injured because the Providers "were conspicuously non-committal about whether termination would even force them to stop seeing the [Patients]," and that the Patients "alleged only that they will not have access to their preferred provider and (at worst) are unsure where else they might receive care." Appellant's Opening Br. at 58-59 & n.13. First, because the Patients all qualify for Medicaid, we cannot disagree with the district court, which "easily [found] that these patients will be unable to afford to pay out of pocket to see the health care provider of their choice without Medicaid assistance." Mosier ,
The district court did not abuse its discretion in concluding that the Patients would suffer irreparable harm absent entry of a preliminary injunction enjoining Kansas from terminating PPGP as a provider.
3. Balance of Harms & Public Interest
We address the last two preliminary-injunction factors together. The final steps in assessing a preliminary injunction's propriety require us to ask whether the balance of equities tips in the Plaintiffs' favor, and whether an injunction is in the public interest. Winter ,
On appeal, neither Kansas nor the Plaintiffs addressed this step in the analysis. Either way, we agree with the district court's thorough, reasoned analysis concerning PPGP. The court did not err in concluding that the Plaintiffs have met their burden on this point as well.
Thus, the district court did not abuse its discretion in finding that Plaintiffs have satisfied all of the elements required for entry of a preliminary injunction on the Patients' free-choice-of-provider claim concerning PPGP.
*1238CONCLUSION
For the reasons stated above, as relates to PPGP, we AFFIRM the district court's order granting the Plaintiffs' Motion for Temporary Restraining Order and Preliminary Injunction, thus restraining Kansas from terminating PPGP's Medicaid-provider agreement. And as relates to PPSLR, we VACATE the district court's order, because we conclude that the Patients have not met standing requirements-they have not alleged that they receive medical care at PPSLR. We remand for the district court to determine whether PPSLR itself has sufficiently alleged standing to proceed and whether it is entitled to a preliminary injunction.
Related
Cite This Page — Counsel Stack
882 F.3d 1205, Counsel Stack Legal Research, https://law.counselstack.com/opinion/planned-parenthood-of-kan-v-andersen-ca10-2018.