Supreme Court rules Medicaid enrollees can sue states

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Medicaid beneficiaries have the right to sue state agencies they allege break federal law, the Supreme Court ruled Thursday.

The 7-2 decision reaffirms previous precedent that U.S. District Court for the Northern District of Indiana challenged in 2020 when it dismissed a case against a county-owned nursing home accused of violating federal patient protection laws. The high court decision upholds a 2021 ruling by the U.S. Court of Appeals for the 7th Circuit. The case now returns to the district court.

The plaintiffs are the family of Gorgi Talevski, a now-deceased former resident of a nursing home operated by the Health and Hospital Corp. of Marion County, an Indianapolis-based, state-owned entity that includes the county public health department, skilled nursing facilities and a health system.

According to the family, the nursing home where Talevski lived violated the Nursing Home Reform Act of 1987 by inappropriately medicating then discharging him. The plaintiffs initiated a lawsuit against the Health and Hospital Corp. in 2019 by invoking section 1983 of a civil rights law enacted in 1871, which granted individuals to right to sue states over questions involving federal statutes.

“We hold that the two [Nursing Home Reform Act] provisions at issue here do unambiguously create section 1983-enforceable rights. And we discern no incompatibility between private enforcement under section 1983 and the statutory scheme that Congress has devised for the protection of those rights,” Justice Kentaji Brown Jackson wrote in the majority opinion.

The district court ruling upended that precedent and threatened to make it significantly more difficult for people to seek redress against states they allege are not following federal laws. A Supreme Court ruling for Marion County would have harmed people enrolled in Medicaid and other federal benefit programs, said Jane Perkins, litigation director at the National Health Law Program. It would have been a pervasive, really existential decision,” she said.

The Health and Hospital Corp. asked the Supreme Court to narrow the scope of section 1983 to apply only to civil rights or equal protection laws. The court declined.

“We have no doubt that [the Health and Hospital Corp.] wishes section 1983 said something else. But that is an appeal better directed to Congress,” Jackson wrote.

Chief Justice John Roberts and Justices Sonia Sotomayer, Elena Kagan, Neil Gorsuch, Brett Kavanaugh, Amy Coney Barrett and Jackson made up the majority. Justices Clarence Thomas and Samuel Alito dissented.

“HHC brought this case because it has a fiduciary duty to focus its scarce public resources on the healthcare needs of historically underserved populations. HHC’s goal was to understand from the Supreme Court the status of the governing law on the availability of federal claims regarding its nursing home operations,” the Health and Hospital Corp. of Marion County said in a statement.

“With the court’s definitive answer today that Medicaid-supported nursing home residents have both administrative and federal court remedies for alleged violations, HHC will continue to work to manage those operations safely and effectively and analyze the impact of the decision on those public resources,” Health and Hospital Corp. said.

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