Sullivan v. Day

661 N.E.2d 848, 1996 Ind. App. LEXIS 146, 1996 WL 69647
CourtIndiana Court of Appeals
DecidedFebruary 20, 1996
Docket49A02-9505-CV-240
StatusPublished
Cited by20 cases

This text of 661 N.E.2d 848 (Sullivan v. Day) is published on Counsel Stack Legal Research, covering Indiana Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Sullivan v. Day, 661 N.E.2d 848, 1996 Ind. App. LEXIS 146, 1996 WL 69647 (Ind. Ct. App. 1996).

Opinion

OPINION

SULLIVAN, Judge.

The Indiana Family and Social Services Administration and its secretary, Cheryl Sullivan (collectively FSSA), appeal from the trial court’s amended order of summary judgment declaring invalid FSSA’s method of *850 determining Medicaid eligibility for disabled individuals and enjoining FSSA from following that policy.

The restated issues for our review are as follows:

(1) Did the trial court err in deciding that current state and federal law requires' FSSA to determine that an individual whose medical condition will improve with treatment, but who cannot afford to pay for treatment, is disabled for purposes of Medicaid eligibility?
(2) Is Indiana’s current definition of disability more restrictive than that in place on January 1, 1972, thus violating the federal Social Security Act?

We conclude that, under the current statutory and regulatory scheme, FSSA is not required to take into account an applicant’s inability to pay for treatment, and to thereby determine that the applicant is entitled to Medicaid benefits for an otherwise treatable condition. However, we also conclude that the current criteria are more restrictive than those in place on January 1, 1972, because the statutory eligibility scheme in 1972 clearly contemplated that applicants with treatable conditions could qualify for medical services. Thus, we remand to the trial court with instructions to order relief not inconsistent with this opinion.

The naméd plaintiff in this class action, Petrieia Day, is a 55-year-old woman suffering from a severe degenerative condition of her right knee which impairs her ability to walk and stand. Employed for 15 years as a nurse’s aide, Day began to experience great difficulty performing her job responsibilities and was terminated in January 1992. After seeking medical treatment, she was told by her orthopedic specialist that total knee replacement surgery was required to improve her condition. Day lacked health insurance, however, and was unable to afford the recommended treatment.

Day applied for assistance under the state’s Medicaid for the Disabled program. See I.C. 12-15-2-3 (Burns Code Ed.Repl. 1995). Although she met the financial eligibility threshold, her application was denied on the ground that she did not meet the program’s medical disability requirement. Under the statute in effect at the time of Day’s application, medical assistance would only be provided to those needy disabled persons who had insufficient income or other resources to provide a reasonable subsistence and had “a physical or mental impairment, disease, or loss that ... appears reasonably certain to continue throughout the lifetime of the individual without significant improvement-” I.C. 12-14-15-1(2) (Burns Code Ed.Repl.1995). 1 The administrative law judge who upheld the denial of Day’s application found that because Day’s condition was treatable by surgery, it was not reasonably certain that she would be substantially impaired for the remainder of her lifetime. He also noted that neither the statute nor the administrative rules allowed for consideration of Day’s inability to pay for the surgery needed to treat her condition. The ALJ’s decision was affirmed by FSSA.

Day filed her petition for judicial review on January 19, 1993, combined with a class action complaint for declaratory and injunctive relief for persons similarly situated. Day' asserted that FSSA’s refusal to consider an applicant’s inability to pay for necessary treatment in determining medical disability violated state and federal law. On December 20,1993, the parties agreed to certification of the following class of plaintiffs:

“All individuals in Indiana who have had or will have applications for benefits under Ind.Code § 12-14-15 denied ... based on the state agency’s determination that they are not disabled because their conditions are treatable and therefore ... not ‘reasonably certain to continue throughout the lifetime of the individual without significant improvement,’ although they are unable to afford the treatment that may lead to improvement of their conditions.” Record at 132.

On April 7, 1994, the plaintiffs moved for summary judgment. On May 5, 1994, FSSA *851 moved for summary judgment and filed affidavits in support of its motion. Both parties agreed there were no genuine issues of material fact, and filed briefs.

On December 29, 1994, the trial court entered findings of fact, conclusions of law, and judgment in favor of the plaintiffs. 2 The court declared that the agency’s policy of determining Medicaid disability without taking into account the applicant’s ability to pay for restorative treatment was contrary not only to the definition of disability contained in I.C. 12-14-15-1(2), but also to the purpose of the Medicaid program set forth in 42 U.S.C.A. § 1396 (West 1992), and the state Medicaid rules promulgated under 405 Ind.Admin.Code (IAC) 2-2-3(a)(l). The order enjoined FSSA from enforcing the policy.

On January 26, 1995, FSSA filed a motion to correct errors. A modified order was issued February 21, 1995 which retained the declaratory and injunctive relief contained in the initial judgment but reduced the scope of FSSA’s obligation to notify class members. FSSA filed a timely praecipe and sought a stay pending appeal, which was granted on April 24, 1995. The plaintiffs asked this court to review the stay. We denied the plaintiffs’ motion on June 7,1995.

In the meantime, following the adverse ruling against FSSA in the lower court, the Indiana legislature amended the definition of disability contained in I.C. 12-14-15-1(2) to expressly preclude consideration of an applicant’s ability to pay for treatment in determining medical disability. 1995 Ind. Acts 152. The amended definition went into effect on May 10,1995. A non-code section 3 also adopted by the legislature provided that the amendment was “intended to be a clarification of the law and not a substantive change....” Id.

On May 16, 1995, FSSA filed a motion to vacate judgment, claiming that the new legislation eliminated the entire basis for the trial court’s order. The trial court set an August 14 hearing on the motion; however, in conjunction with our order denying review of the stay, this court ordered FSSA to file the record of proceedings by June 20, 1995 and proceed with the appeal, thus divesting the trial court of jurisdiction over the motion to vacate. See Ind. Appellate Rule 3(A).

I. Background on Medicaid Program

Medicaid is a joint federal-state program aimed at providing health care to certain low income individuals who would not otherwise be able to afford medical treatment. 42 U.S.C.A. § 1396 (West 1992). The program operates through a combined scheme of federal and state statutory and regulatory authority. See 42 U.S.C.A. § 1396a (West Supp.1995); I.C.. 12-15-1-1 (Burns Code Ed. Repl.1995).

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Bluebook (online)
661 N.E.2d 848, 1996 Ind. App. LEXIS 146, 1996 WL 69647, Counsel Stack Legal Research, https://law.counselstack.com/opinion/sullivan-v-day-indctapp-1996.