Turner v. Heckler

783 F.2d 657, 1986 U.S. App. LEXIS 22312
Court of Appeals for the Sixth Circuit·Decided February 14, 1986·No. No. 84-3108·Published·Cited by 3 cases

Opinion

BAILEY BROWN, Senior Circuit Judge.

The Defendant Secretary of Health and Human Services (Secretary) appeals from a judgment of the district court granting Plaintiffs’ request for a preliminary injunction and ordering the Secretary to financially participate in all medicaid benefit payments made to eligible nursing home residents by the Defendant Ohio Department of Public Welfare (ODPW) under an interim settlement agreement executed by the Plaintiffs and the ODPW and adopted as an order of the district court, 573 F.Supp. 867. The only basis for the issuance of injunctive relief against the Secretary was the district court’s finding that the Secretary, in violation of 42 U.S.C. § 1316(a)(1), failed to compare the provisions of the state medicaid plan which were in effect on January 1, 1972 (1972 Medicaid Plan) with the amendments to the Plan enacted in Ohio Admin.Code § 5101:1-39-22. Because we find that the district court failed to consider an offer of proof made by the Secretary prior to the issuance of the injunctive order demonstrating that a comparison of the 1972 Medicaid Plan with such amendments to the Plan had been [658] conducted by the Secretary in accordance with the district court’s interpretation of the requirements of § 1316(a)(1), we conclude that the district court abused its discretion in issuing the preliminary injunction.

I.

Introduction

The federal medicaid program, Title XIX of the Social Security Act, 42 U.S.C. § 1396 et seq., was enacted in 1965 to extend financial assistance to states that chose to subsidize certain costs of medical treatment for particular groups of low-income individuals. Harris v. McRae, 448 U.S. 297, 301, 100 S.Ct. 2671, 2680, 65 L.Ed.2d 784 (1980). States that participated in the federal program were required to extend coverage to persons described as the “categorically needy,” i.e., those who received financial assistance under any one of the four federal programs established in the Social Security Act.1 Schweiker v. Hogan, 457 U.S. 569, 572, 102 S.Ct. 2597, 2600, 73 L.Ed.2d 227 (1982). In addition, states that chose to offer assistance to the “medically needy — persons lacking the ability to pay for medical treatment, but with incomes too high to qualify for categorical assistance” — received partial federal reimbursement. Schweiker v. Gray Panthers, 453 U.S. 34, 37, 101 S.Ct. 2633, 2636, 69 L.Ed.2d 460 (1981).

In 1972, Congress consolidated three of the four categorical assistance programs2 into one assistance program, the Supplemental Security Income for the Aged, Blind and Disabled (SSI), 42 U.S.C. § 1381 et seq., and assumed sole responsibility for the program funding and eligibility. Id. at 38, 101 S.Ct. at 2637. Under SSI, the number of persons eligible for financial assistance represented, in some cases, an increase in those numbers previously eligible under the categorical assistance programs. Id. This prompted a concern in Congress. As recounted by the Supreme Court in Gray Panthers:

Congress feared that [the participating] States would withdraw from the cooperative Medicaid program rather than expand their Medicaid coverage in a manner commensurate with the expansion of categorical assistance. ‘[I]n order not to impose a substantial fiscal burden on these States’ or to discourage them from participating ... Congress offered what has become known as the § 209(b) option. Under it, States could elect to provide Medicaid assistance only to those individuals who would have been eligible under the state Medicaid plan in effect on January 1, 1972. States thus became either ‘SSI States’ or ‘209(b) States’ depending on the coverage that they offered.

Gray Panthers, 453 U.S. at 38-39, 101 S.Ct. at 2637-2638 (footnote omitted).

Ohio chose the “§ 209(b)” option. Ohio Rev.Code Ann. § 5111.02. In May of 1982, Ohio promulgated Ohio Admin.Code § 5101:1-39-22 (Plan Amendments), amending its existing medicaid plan, and filed for approval with the United States Department of Health and Human Services (Department) pursuant to 42 U.S.C. § 1316(a)(1). The Plan Amendments were approved by the Secretary without the benefit of a copy of the 1972 Medicaid Plan for comparison.3 Ohio began implementing its amended medicaid plan sometime in early 1983.

Under the pertinent terms of Ohio’s medicaid plan as amended by § 5101:1-39-22, [659] the nursing home applicant’s eligibility for financial assistance was determined by comparing the applicant’s net income4 with the cost of care in the nursing institution. Recognizing that in many instances the income of the applicant was used to support a non-institutionalized spouse, often referred to as a “community spouse,” the amended plan permitted a maintenance needs allowance (MNA) for that spouse in the amount of $222 a month. This permitted the applicant to set aside up to $222 of his income per month and not have that amount counted by the state as income for purposes of calculating eligibility.5 The applicant’s contribution for'nursing care was calculated by reducing dollar for dollar the amount of the MNA authorized for support of the community spouse by the net income of the community spouse received from outside sources and then deducting the resulting figure from the net income of the medicaid applicant.

II.

Facts

A class action suit was filed in United States District Court for the Southern District of Ohio on March 4, 1983, against the Secretary and the Department as well as against various state and local welfare agencies in Ohio.6 The Plaintiffs were four married couples, each couple consisting of a spouse receiving nursing care financial assistance under the amended Ohio medicaid plan and a non-institutionalized spouse who was dependent upon the income of the institutionalized spouse for support and maintenance.

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Turner v. Heckler, 783 F.2d 657, 1986 U.S. App. LEXIS 22312 (6th Cir. 1986).

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