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Tuesday, May 10, 2016

Ind. Decisions - 7th Circuit decides one Indiana case today, re Medicaid waivers for persons with disabilities

In Karla Steimel v. John J. Wernert and Michael Beckem v. Indiana Family and Social Services (SD Ind., Magnus-Stinson), a 27-page opinion, Chief Judge Wood writes:

No one would accuse the Medicaid program of simplicity. Our task in this appeal is to consider whether Indiana has chosen an acceptable way to deliver certain home‐ and community‐based services. It does so through so‐called waiver programs that are operated by state Medicaid agencies. The word “waiver” is used because the default assumption under Medicaid is that these kinds of services will be delivered in institutions. Congress has recognized, however, that many people are better served by and prefer community‐ based care. For these people, it uses waiver programs under which the state (and the federal government) will pick up the tab.

The Indiana Family and Social Services Administration (the Agency) runs three waiver programs relevant to this case: the Aged and Disabled Medicaid Waiver Program (A&D waiver), the Community Integration and Habilitation Medicaid Waiver Program (CIH waiver), and the Family Supports Medicaid Waiver Program (FS waiver). Importantly for our case, the programs vary in how much money each client can receive, what must be demonstrated to qualify for aid, and who is entitled to assistance. Because Indiana has closed most of its institutional facilities, these waiver programs serve the vast majority of people with disabilities in Indiana. The state’s total institutional capacity can accommodate only one quarter of the number of people on the CIH waiver alone. Until 2011, the Agency placed many people with developmental disabilities on the A&D waiver, which has no cap on services. That changed when the Agency decided that it had not been adhering to certain A&D rules. In order to fix its mistakes, it enacted a policy change that rendered many developmentally disabled persons, including the plaintiffs, ineligible for care under the A&D waiver. These people were moved to the FS waiver, under which they may receive services worth no more than $16,545 annually. Developmentally disabled people who were switched from the A&D waiver to the FS waiver may apply for the CIH waiver, which is uncapped. But not everyone qualifies for the CIH waiver, and so this possibility is an empty one for many.

The plaintiffs in the two cases we have consolidated for disposition are developmentally disabled persons who were moved from the A&D waiver to the FS waiver. They argue that their new assignment violates the integration mandate of the Americans with Disabilities Act (ADA), 42 U.S.C. §§ 12101 et seq., because it deprives them of community interaction and puts them at risk of institutionalization. They also seek class certification.

The district court granted summary judgment to the defendants on the integration‐mandate claims and denied class certification. We conclude that there is a genuine dispute of material fact with respect to the individual claims based on the integration mandate, and so judgment for the defendants to that extent was premature. The district court did not abuse its discretion, however, in declining to certify the class, because the proposed class is too vague. * * *

Our decision today does not require the state of Indiana to adopt any particular solution to make its waiver program compliant with the integration mandate. If plaintiffs prevail on the merits, the district court, in conjunction with the parties, may exercise its equitable powers to craft an appropriate injunction. But the state cannot avoid the integration mandate by painting itself into a corner and then lamenting the view. The state designs, applies for, develops policies regarding, and executes its waiver programs. If those programs in practice allow persons with disabilities to leave their homes only 12 hours each week, cooping them up the rest of the time, or render them at serious risk of institutionalization, then those programs violate the integration mandate unless the state can show that changing them would require a fundamental alteration of its programs for the disabled.

Because the plaintiffs’ claims both fit within and, if caused by the state’s policy, represent violations of the integration mandate, we REVERSE the judgment of the district court and REMAND for further proceedings consistent with this opinion. We AFFIRM the district court’s decision not to certify the proposed class. Costs will be taxed against the state.

Posted by Marcia Oddi on May 10, 2016 06:06 PM
Posted to Ind. (7th Cir.) Decisions