“Poor, disabled, and otherwise disadvantaged Tennesseans should not require luck, perseverance, or zealous lawyering to receive healthcare benefits they are entitled to under the law.”
How’s that for an opening sentence to a judicial opinion? That’s how an August 26, 2024, decision in a class action case called A.M.C. v. Stephen Smith started – and it only got better from there.
In the case, a Federal District Court judge in Tennessee ruled in favor of individuals terminated from Medicaid who had sued the state for numerous failures in the state’s eligibility processes. The case, originally filed in 2020, represents a win for thousands of individuals in Tennessee and may serve as a wake up call for other states with similarly inadequate eligibility systems (I’m lookin’ at you Florida!).
The Tennessee lawsuit alleged four major types of failures by the state. First, the state was committing errors in its eligibility review—perhaps most notably, when terminating people from a category of Medicaid, the state was not always reviewing them for eligibility for other categories of Medicaid, as required by Medicaid law and the Constitution (namely, the Due Process requirements of the Fourteenth Amendment). Second, the state was not always providing individuals with proper notice about their eligibility results, which is also required by law and the Constitution. Sometimes, in fact, the state was providing people with misleading notices. Third, the state was not always allowing people to contest their eligibility terminations through Fair Hearings, which is (you guessed it) required by law and the Constitution. And fourth, the state’s various problematic policies resulted in discrimination on the basis of disability, contrary the Americans with Disabilities Act (ADA).
The judge decided in favor of the plaintiffs, finding violations by the state in all of these areas. The opinion is carefully written and does issue-by-issue analysis of fifteen different issues raised by the plaintiffs (and finds the plaintiffs are right on most issues). It’s hard to argue against the findings of serious violations by the state or the legal conclusions in the opinion when it’s all laid out with such precision.
So what comes next? Although the judge has ruled in favor of the plaintiffs, the ultimate remedy in the case has not been decided yet. The judge has ordered that the plaintiffs and state attempt mediation with a mutually agreed-upon mediator, prior to the judge addressing the plaintiffs’ claims for relief. The solution that seems most appropriate is that the plaintiffs’ Medicaid be reinstated, and specifically retroactively reinstated to cover the time they were without coverage due to the state’s failures, along with a commitment from the state to fix the underlying problems identified by the lawsuit. It remains to be seen what, if anything, will come out of mediation. But the judge’s opinion in the case should give the state a strong incentive to fully right their wrongs through mediation, because Lady Justice just called, and she’s on her way.
In addition to direct improvements in Tennessee, the case may also have ripple effects beyond Tennessee. It should prompt other states to take stock of their processes and improve them, lest they get dragged to court as well. It should also prompt CMS to evaluate how its oversight mechanisms did not in the first instance prevent these problems from happening, but more alarmingly, at least correct them during the past four years (remember, the case was filed in 2020), considering that the state has all along gotten federal Medicaid dollars to help fund their coverage and eligibility systems.
Note: The plaintiffs are well-represented by the National Health Law Program, the Tennessee Justice Center, the National Center for Law and Economic Justice, and the law firm Selendy Gay (pro bono), and many of the litigation documents are available here.
