On November 28, 2005, the Florida Pediatric Society, the Florida Chapter of the American Academy of Pediatrics, the Florida Academy of Pediatric Dentistry, Inc., and certain named individual children who were eligible to receive medical and dental care through Medicaid filed this class action lawsuit in the U.S. District Court for the Southern District of Florida. The plaintiffs, represented by attorneys from private practice and from the Public Interest Law Center of Philadelphia, brought this suit under 42 U.S.C. § 1983 against the Florida Agency for Health Care Administration ("AHCA"); the Florida Department of Children and Families ("DCF"); the Surgeon General; and the Florida Department of Health ("DOH"). The plaintiffs asked the court for declaratory and injunctive relief, claiming that the defendants systematically failed to administer the state's Medicaid program in compliance with federal law. Specifically, they alleged that the defendants violated Title XIX of the Social Security Act, 42 U.S.C. § 1396 et seq. (also known as the Medicaid Act), by failing to provide essential medical and dental services to eligible children in Florida. The plaintiffs sought to certify a class consisting of all children who now, or in the future will, reside in Florida and who are, or will be, eligible under Title XIX of the Act for Early and Periodic Screening, Diagnosis and Treatment Services.
The complaint included four counts. In Count I, the plaintiffs alleged that the defendants violated 42 U.S.C. §§ 1396a(a)(8) and (a)(10) by failing to provide "medical assistance . . . with reasonable promptness to all eligible individuals." Count II claimed that the defendants violated 42 U.S.C. § 1396a(a)(30)(A) by failing to afford equal access to medical care through a Medicaid program that ensured that reimbursement rates for providers were high enough to guarantee children access to care that equaled the access of their peers in other geographical areas. Count III charged that the defendants violated 42 U.S.C. §1396u-2(b)(5), which requires that states obtain assurances that the HMO contractors offer a suitable range of services and access to preventive and primary care services for the population expected to be enrolled and maintain a sufficient number, mix, and geographic distribution of providers. Finally, Count IV alleged that the defendants violated 42 U.S.C. § 1396a(a)(43) by failing to effectively inform the plaintiffs and their caretakers of the availability of child health care services.
On January 12, 2007, the District Court (Judge Adalberto Jordan) issued an order granting in part and denying in part the defendants' motion to dismiss. The Court refused to dismiss the case on the theory that the organizational plaintiffs lacked standing, holding that it did not need to answer this question given that the individual plaintiffs clearly had standing. The District Court proceeded to reject in large part the argument that the statutes under which the plaintiffs sued do not confer individually enforceable rights. Adopting the Supreme Court's test in Gonzaga University v. Doe, 536 U.S. 273 (2002), the District Court held that the statutes from Counts I, II, and IV evinced an "unmistakable focus on the benefitted class" and therefore created private rights of action. The statute in Count III, by contrast, was held not to create a privately enforceable right because it is "aggregate and systemwide in nature" rather than focused on the needs of a particular class of people. The defendants filed a motion asking the Court to reconsider this decision and certify certain issues as immediately appealable to the Eleventh Circuit, but the District Court (Judge Jordan) rejected that request on April 24, 2007.
The parties then engaged in extensive discovery. On March 20, 2009, the District Court (Judge Jordan) granted in part and denied in part two partial motions for summary judgment filed by DCF and the Surgeon General. For its part, DCF challenged the plaintiffs' standing, and the Court determined that at least one plaintiff had suffered an injury in fact because the child experienced an eighteen-month delay for an appointment in violation of Count I and because he failed to receive information about his rights to medical care in violation of Count IV. The Court further held that each of these violations could be traced to DCF. The plaintiffs did, however, fail to satisfy the causation element for Count II because DCF lacked authority to set or modify reimbursement rates, an authority that state law reposes in AHCA. Having concluded that at least one plaintiff had standing, the District Court turned to the merits of the summary judgment motion. It denied the motion with respect to the first prong of Count I (42 U.S.C. § 1396a(a)(8)) and Count IV, holding that issues of material fact existed about whether DCF unlawfully prevented children from obtaining health care services and whether the agency failed to inform the plaintiffs about their rights to medical care. But the Court did rule for the defendants and grant summary judgment on the second prong of Count I (§ 1396a(a)(8)). It held that the plaintiffs had failed to produce any evidence showing that DCF afforded them unequal treatment compared to other Medicaid recipients or people not on Medicaid. As a result, summary judgment was proper on this part of Count I.
The District Court then evaluated the Surgeon General's motion for summary judgment, which raised substantially the same issues as DCF's motion. The Court held that at least one plaintiff had standing on Counts I and II. Because this plaintiff's surgery was delayed by a year, he was denied medical care with reasonable promptness in violation of the first prong of Count I. The Surgeon General also violated prong two of Count I because the plaintiffs received deficient medical assistance compared to the assistance afforded other individuals. As for Count II, the District Court determined that medical care and services were not available to the plaintiffs to the same extent they were available to the rest of the population in the geographic area. The Court then held that the causation requirement was satisfied, explaining that DOH has at least some control over the Medicaid reimbursement rates paid to providers. On Count IV, however, the Court held that the plaintiffs lacked standing because they failed to allege facts showing that DOH was responsible for any lack of information concerning available medical services. The Court then denied the Surgeon General's summary judgment motion on Counts I and II because of the plaintiffs' factual showings on DOH's failure to provide medical services with reasonable promptness and to ensure that payments to providers were sufficiently high to guarantee quality care as compared with that received by other children.
The parties tried mediation for the next few months, but on June 9, 2009, they reached an impasse. On June 25, Magistrate Judge Chris McAliley issued a recommendation that the District Court grant the plaintiffs' motion for class certification. The District Court (Judge Jordan) then issued an order on September 30 adopting the magistrate's report and granting in part the motion for certification. After concluding that the plaintiffs had standing to pursue Counts I, II, and IV against AHCA, the Court certified a class consisting of all children under the age of 21 who now, or in the future will, reside in Florida and who are, or will be, eligible under Title XIX of the Social Security Act for Early Periodic Screening, Diagnosis and Treatment Services.
Also on September 30, 2009, the District Court (Judge Jordan) issued an order denying the defendants' motions for summary judgment. The Court again rejected the argument that the statutes at issue do not confer individually enforceable rights. It also rejected the defendants' contention that the term "medical assistance" in §§ 1396a(a)(8) and 1396a(a)(10) is narrowly defined and precludes relief for failure to provide medical services.
After more discovery, a bench trial began on December 9, 2009. The trial consisted of 94 sessions and ended in January 2012. On November 21, 2012, the District Court (Judge Jordan) issued an order requiring the parties to submit memoranda of law explaining whether the new Affordable Care Act provisions moot or otherwise affect the issues in this case. These provisions, which took effect on January 1, 2013, require Medicaid to match Medicare's rate of payment for primary care treatment for any services performed over the next two years.
On March 18, 2013, the District Court (Judge Jordan) denied the defendants' request to dismiss certain claims as moot because of Florida's state plan amendment, which gave to Medicaid providers Medicare's higher reimbursement rates. The Court explained that the Centers for Medicare & Medicaid Services had yet to approve the amendment, which means that medical providers in the state still have not been paid the higher rates that the plaintiffs demanded. As a result, the claims in the case remain viable. The District Court (Judge Jordan) again rejected the defendants' mootness arguments in an order issued on July 10, 2014. The Court held that a temporary two-year increase of Medicaid reimbursement rates to Medicare levels did not moot the case given the uncertainty about whether the state legislature would keep funding the rate increases past their expiration date on December 31, 2014. Moreover, Florida's decision to place 98 to 99 percent of children eligible for Medicaid in managed care similarly did not render the case moot because of the 1 to 2 percent of excluded children and because the managed care system would not be live until October 1, 2014.
On November 25, 2014, the District Court (Judge Jordan) denied the defendants' request to reopen the record for trial on liability and their suggestion of mootness. In declining to reopen the record, the Court explained that allowing more discovery and trial sessions would cause substantial prejudice and would improperly prolong the process of determining liability. The Court then rejected the defendants' mootness arguments. Even though DCF made significant changes in its system for determining Medicaid eligibility, including implementing a new computer system with new income eligibility standards and a new streamlined Medicaid application, the Court held that because these changes were relatively recent it remained unclear whether they would fully resolve all of the plaintiffs' complaints.
About a month later, on December 30, 2014, the District Court (Judge Jordan) issued its findings of fact and conclusions of law in an opinion that spanned more than 150 pages. The Court began by reaffirming its pretrial determination that the individual plaintiffs have standing to bring this case. (It declined to reach the organizational plaintiffs' standing but reserved the right to do so in a future revised order.) The Court also reaffirmed its pretrial class-certification ruling and its determination that the statutes underlying Counts I, II, and IV confer individually enforceable rights under which the plaintiffs can bring this action. After making extensive factual findings, the District Court held that Florida's Medicaid program violated federal law in several respects. The program has failed to compensate physicians and specialists at rates that are competitive with those of Medicare or private insurers. Specifically, the state's system for reimbursing physicians prioritizes budget neutrality and fails to consider statutory mandates like ensuring that reimbursement rates are sufficiently high to incentivize physicians to treat Medicaid patients. As a result, about one-third of Florida children on Medicaid do not receive the preventative care to which they are entitled, a violation of the Early Periodic Screening, Diagnosis and Treatment requirements for preventative medical care under §§ 1396a(a)(8) and (a)(10). The District Court held that the defendants violated these requirements for specialty care as well. On the issue of dental care, the Court reached similar conclusions, holding that children in Florida are not receiving such care with reasonable promptness and that dental reimbursement rates are too low. The Court then identified the defendants' additional violations of federal law, including those relating to outreach efforts.
On March 31, 2015, the District Court (Judge Jordan) issued amended findings of fact and conclusions of law in response to a motion filed by the defendants. The Court's changes related primarily to the expiration of a state statute that had delegated to DCF certain outreach responsibilities. Given the statute's expiration, the Court held that DCF could no longer be sued under Count IV for failing to perform these duties, although AHCA and DOH remained subject to liability. The Court's other changes involved the standing of some of the individual plaintiffs.
After a scheduling conference, the District Court informed the parties that the next phase of the case would focus on whether there remains an ongoing controversy to justify awarding any declaratory or injunctive relief. The Court directed the parties to file their respective offers of proof in preparation for a hearing to be held on April 24, 2015.Brian Tengel - 04/07/2015