Medicaid’s Refusal to Provide 24/7 Care in the Community Might be Discrimination

In Harrison v. Young (5th Cir. June 6, 2024), the Fifth Circuit considered Ms. Barbara Harrison’s claim challenging Medicaid’s denial of funding for medical services that she claimed are necessary for her survival. Harrison has severe physical and intellectual disabilities. She cannot walk or talk, and she is fed through a tube in her stomach. In April 2018, Harrison’s treating physician determined that her condition had deteriorated to the point where she required 24/7 one-on-one nursing care.

The State of Texas initially denied Harrison’s claim that she needed additional care. Harrison filed suit, arguing the Medicaid (1) discriminated against Harrison because of her disability, in violation of the Americans with Disabilities Act (“ADA”) and the Rehabilitation Act, by denying her Program-funded nursing services, and (2) violated her due process rights by denying her request for general revenue funds without a hearing. The due process argument was given short shrift because the additional funds Harrison sought would come from the State’s general revenues rather than its Medicaid program; that meant she had no right to a Medicaid fair hearing on that issue. However, the discrimination issue received more attention.

Initially, the Fifth Circuit noted that  Olmstead v. L.C. ex rel. Zimring, 527 U.S. 581, 599-600 (1999) found that “unjustified institutional isolation of persons with disabilities is a form of discrimination” prohibited by the American’s with Disabilities Act and the Rehabilitation Act. Harrison claimed she faced imminent unjustified institutionalization and is therefore being unlawfully discriminated against under Olmstead. The district court rejected her argument. When Harrison appealed, Medicaid argued the Fifth Circuit should dismiss her appeal on three alternative bases: (1) Harrison was not “qualified” for the Program; (2) Harrison was not discriminated against based on her disability; and (3) Harrison’s request cannot be reasonably accommodated. The Fifth Circuit addressed each before reversing and remanding the case for further proceedings.

Regarding whether Harrison is a qualified individual, the Court noted Texas relied solely on whether the cost of her care exceeded the program cost cap. The court rejected Medicaid’s argument on this point because it would render the ADA’s “reasonable modification” requirement meaningless. See Steimel v. Wernert, 823 F.3d 902, 916 (7th Cir. 2016).

Medicaid’s second argument challenged the continuing validity of Olmstead. “Specifically, HHSC says that the Olmstead opinion “borrowed [the] definition [of discrimination] from Title I” of the ADA because Title II did not specifically define the term. See Olmstead, 527 U.S. at 622 (Thomas, J., dissenting). And because the ADA Amendment Act of 2008 changed the definition of “discrimination” in Title I to “track the language of the ban on discrimination in Title VII of the Civil Rights Act,” HHSC reasons that Olmstead‘s definition of discrimination is no longer good law. Instead, HHSC urges that we use the “ordinary” or “traditional” meaning of discrimination, which “requires only `evenhanded treatment in relation to non-handicapped individuals.'” See Traynor v. Turnage, 485 U.S. 535, 548 (1988).”

The Fifth Circuit cited five reasons why Medicaid missed the mark with its interpretation of Olmstead. First Olmstead did not rely on the ADA’s definition of discrimination; it applied the entire statute and identified segregation of disabled individuals as a form of discrimination. Second, 2008 amendments to the ADA do not require a traditional meaning for the word “discrimination.” Thus, even assuming that Olmstead used the definition of discrimination in Title I, the 2008 amendments would not require a different understanding of discrimination under Title II. Third, the 2008 amendments to the ADA did not overturn Olmstead; the Court found it “would be counterintuitive for Congress to have broadened the interpretation of the term “disability” and expanded ADA coverage while simultaneously limiting the scope of the “discrimination” prohibited by Title II.” Fourth, the 2008 amendments did not alter the analysis to mirror the Civil Rights Act; it ensures that the emphasis in questions of disability discrimination is properly on the critical inquiry of whether a qualified person has been discriminated against on the basis of disability, and not unduly focused on the preliminary question of whether a particular person is a `person with a disability. Finally, “HHSC has cited no case, from any circuit, adopting its proposed interpretation. Olmstead therefore remains good law and we must abide by it.”

The Court next focused on which treatment professional’s opinion was determinative when deciding the amount of care needed. Harrison argued her doctor’s opinion should carry more weight. Medicaid argued otherwise. The dispositive question, though, was whether the care she sought was medically necessary. Regardless of which doctor opinion is accepted by the court, the issue was whether an Olmstead accommodation is reasonable” is a fact-intensive inquiry requiring more than just a “marginal cost comparison” between community-based care and institutionalization. Regarding the weight given to physician opinions regarding medical necessity, compare with Moore v. Meadows, 674 F. Supp.2d 1366 (N.D. Ga. 2009) (EPSDT); and Moore v. Reese, 637 F.3d 1220 (11th Cir. 2011) (holding that the treating physician and the state both had roles to play in determining medical necessity, and the treating physician’s opinion was not dispositive).

The Court sent the case back to consider additional factor after finding “[t]he bottom line is that many important factual questions concerning Harrison’s appropriate level of medical care and whether such care can be reasonably accommodated by the Program remain unanswered.”