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That's probably easiest. Health Affairs where health policy advances.
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Chris Fleming
Welcome to another edition of Health Affairs This Week, the podcast where Health Affairs editors and guests talk about the health policy news of the week. I'm Chris Fleming. Today, we're focusing on a key Supreme Court case that came down last week. Health and Hospital Corporation, a Marion County v Talevski. The case focused on access to the courts for Medicaid enrollees who claim they were harmed by illegal state action.
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Chris Fleming
To discuss this case and other matters Medicaid, we're very pleased and very lucky to be joined by one of the nation's leading experts on Medicaid, Sara Rosenbaum. Sara is the Harold and Jane Hirsch, professor of law and health policy and the founding chair of the Department of Health Policy at the Milken Institute School of Public Health at George Washington University.
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Chris Fleming
And Sara has devoted her career to issues of health justice for medically underserved and marginalized populations. She's well known for her work on Medicaid, national health reform and other issues. She, Tim Jost and others wrote two Forefront articles on Talevski, one last year previewing the case and then one this past week analyzing the decision. We'll put links to those articles in the show notes, and I would encourage listeners to read them as they delve into the issues we'll discuss today and much more detail.
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Chris Fleming
Sara, welcome.
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Sara Rosebaum
Thank you. It's such so always so great to be with you. And I'm sure I speak for everybody when I say that Health Affairs is the indispensable journal in all of its manifestations.
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Chris Fleming
Well, thank you. Thank you very much for the kind words. So I mentioned the decision that came down last week and Talevski. This was a case, as you know, involving a lawsuit that was brought by the family of Gorgi Talevski against a nursing home that was owned by Marion County in Indiana. The family allege that the nursing home violated Mr. Talevski’s rights by chemically restraining him and repeatedly attempting to forcibly transfer him to other institutions.
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Chris Fleming
Can you expand on those sort of basic facts and give us a sense of what was at stake from a legal point of view in this case?
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Sara Rosebaum
So the case arose, as you pointed out, as the result of very serious nursing home abuse. That was what the allegations were and in the Medicaid statute. So as part of the federal statute itself is a special nursing home reform law that was added to Medicaid in the late 1980s. It's known as the Federal Nursing Home Reform Act, or FNHRA.
00;03;46;16 - 00;04;22;22
Sara Rosebaum
And FNHRA imposes a whole series of duties on states to ensure the quality and appropriateness of the treatment of nursing home residents, but also contains language that literally is called rights. And in that language, it states explicitly that residents have a right to be free from inappropriate restraints, and they have a right to be protected from inappropriate transfers that cannot be justified and or done arbitrarily.
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Sara Rosebaum
So what was involved here was not just sort of the state's not doing its job, but it rose to the level of, as the family claimed, a violation of his federal rights under FNHRA. The family sought relief from the state over and over again. They tried to get the county and the state to respond and all efforts failed.
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Sara Rosebaum
And so finally they did what has not happened very often. But it has happened before. They filed a lawsuit in federal court. They used a special law which has been sort of intertwined with Medicaid known as 1983. And 1983, it can be thought of as sort of the ticket that lets you in the doors of a courthouse.
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Sara Rosebaum
Just because you're unhappy doesn't necessarily mean you can go to court. But 1983 is the way that people who believe their federal rights have been violated under Medicaid can go to the federal courts and get the courts actually to intervene. And of course, the power of the courts is far, far greater than the power of agency. So that's how the case got into federal court.
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Sara Rosebaum
And they won. They lost in the trial court. But on appeal, the appeals court did exactly what other appeals courts have done. It looked at the statute and said, well, FNHRA is a series of rights. And 1983 is a special post-Civil War act that says that if your federal rights have been violated, you can sue state officials acting under color of law for violating those rights.
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Sara Rosebaum
And they said, you know, the case could go forward. That's fine. And there's no other remedy. The state is doing nothing. And the state doesn't even have the kind of powers that a court has. And you can sue and you can sue for damages, which is what they did. The county immediately appealed to the Supreme Court. County officials are considered state officials for purposes of 1983.
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Sara Rosebaum
On appeal, they made two allegations. One was, or two claims, one was that, in fact, the law in question, FNHRA created no rights and it was a special, even if the law did create some rights. In fact, there's a whole separate process built into FNHRA that precludes people from going to court. And then your only recourse is to state, is to the state to remedy the problem.
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Sara Rosebaum
But even more fundamentally, they claimed that, in fact, laws like Medicaid, so laws created for public welfare purposes that give grants to states to aid very vulnerable populations, even when those laws create rights, they are not the kind of rights that 1983 covers. So you may have rights in Medicaid, but they are not 1983 rights. They are simply what the state argued is third party beneficiary rights, meaning that the Medicaid beneficiaries have no direct rights to enforce.
00;07;54;04 - 00;08;22;18
Sara Rosebaum
Under 1983, the relationship, according to the state, was between the state and the federal government, and only the federal government could intervene. The beneficiaries essentially were off to the side, and the state claimed that that whole theory was part of what we call common law doctrine that was in place at the time that 1983 was written back in the 1870s.
00;08;22;21 - 00;08;46;17
Sara Rosebaum
It's sort of an unspoken gloss on top of 1983. It was amazing to many people, including myself, that the court took the case because it was so consistent with what other circuits had done and it was consistent with the court's own prior rulings. But this is not a claim that surprised anybody. This has been lurking out there for decades.
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Chris Fleming
Just to unpack a little bit, can you very briefly explain you mentioned that courts are more powerful in these instances than agencies. What's the you know, one of the arguments was, well, the feds can always come in and take oversight and enforcement actions against a state that's acting illegally. Why is that not sufficient in a case like this?
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Sara Rosebaum
First of all, a court can do two things that no agency and no and certainly HHS cannot do. Number one, the court can issue an injunction. An injunction is an unbelievably powerful tool. It basically tells the defendant either to stop doing something illegal that it's doing or to start making changes that it's legally bound to make. The other thing the court can do, of course, is award damages, which happens when somebody's rights have been violated and the person suffers injury because 1983 is analogous to what we know as the law of torts.
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Sara Rosebaum
And when you have a personal injury and the defendant is found liable, you can get damages for all kinds of torts. Now, HHS has important tools. HHS can tell a state to stop doing a bad thing. HHS can enter into a corrective action plan with the state. HHS, just by the virtue of its oversight, can put some pressure on the state to stop doing what it's doing.
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Sara Rosebaum
But in the end, HHS really cannot enjoin any action. And even if HHS decides that it's going to invoke the ultimate punishment, which is to withhold funding until the state changes its practices. States have very, very elaborate due process rights under the Social Security Act, and those rights play out before a withhold can be imposed or a clawback can be imposed.
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Sara Rosebaum
And so there's really no way for HHS, even if it had the personnel to do it, it just does not have the power of the courts. The courts are unique creatures in American law.
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Chris Fleming
So, Sara, you mentioned that people maybe were surprised that the court took this case because there were there wasn't really a conflict in the appellate courts. Many people maybe thought that the court might use this case to restrict the rights of Medicaid beneficiaries to sue using Section 1983. How did the court ultimately rule?
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Sara Rosebaum
The court stuck by its precedents. We have 50 plus years of precedent holding that 1983 is available to enforce Medicaid rights, just as it is for all rights is something that we detail in the blogs. Going back to 1968, they said, nope, these are rights, they are enforceable rights. And your notion that somehow beneficiaries are third party beneficiaries with no rights of their own is wrong.
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Sara Rosebaum
And furthermore, and this is where we were all, I think, collectively quite amazed. The Court went on to completely dismiss all their theories they had been using over decades now to sort of assemble this third party beneficiary contract theory. And the court said, we are perplexed by this because 1983 is a tort law and tort, the law of torts is very, very different from the law of contracts.
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Sara Rosebaum
And so you're in here with all these third party contract beneficiary theories that have no place in 1983. And so the Talevskis won. It's important to note, though, that this case is limited by its facts. In other words, Medicaid is a very, very huge, very complicated law. It's got general language that's instructions to states. It's got rights creating language and each right is separately analyzed by the court.
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Sara Rosebaum
So just because the Talevskis won here doesn't mean that every case that goes to the Supreme Court in the future is going to be a winner.
00;13;05;23 - 00;13;26;23
Chris Fleming
Thanks, Sara. We're getting close to the end of our time for today. And I do want to mention to readers that Sara also has a piece on the Medicaid managed care rule, the proposed rule that you can read on Forefront as well. Before we end, I really want to give you a chance, I mean, you're you talked about the history of that led up to this case.
00;13;26;26 - 00;13;43;00
Chris Fleming
You've been a huge part of that history. You know, you've been working in this field and on these issues for a long time and have been a seminal figure. Can you talk a little bit about sort of how your own career unfolded and sort of how you were intertwined with these issues we've been talking about today?
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Sara Rosebaum
It's a great question. And some day I promised myself that a few of us would get together to do the oral history. I would say that it is fair to say that I and a few other people, Tim Jost, Andy Schneider, Jane Perkins. There are a number of us who essentially grew up with Medicaid, where our careers coincided with the rise of Medicaid and the very, very first cases to test the relationship between Medicaid and 1983.
00;14;16;25 - 00;14;53;01
Sara Rosebaum
And so we lived through the early litigation. We lived through successive efforts by some members of Congress to try and separate Medicaid from 1983 efforts. Of course, as many listeners will be familiar with. To literally strip Medicaid of its enforceable rights, to kind of end the whole 1983 issue, and all through this, the other theme has been this repeated effort by challengers to come up with judicial ways of getting at the Medicaid-1983 relationship.
00;14;53;04 - 00;15;25;20
Sara Rosebaum
So when this case arose, there were a number of people who were ready for it. We know it. We know the issues. And, of course, Medicaid also has become such a powerhouse in you know, when I started, there were about 20 million people in Medicaid, if that. And today it's the biggest public insurer we've got. And so the interest in preserving Medicaid and the guarantee it contains are like nothing any of us could have imagined 50 years ago.
00;15;25;23 - 00;15;35;23
Chris Fleming
Well, Sara, thank you so much. We really appreciate your time today and all of the work you've put in on the issue of Medicaid and other issues.
00;15;35;26 - 00;15;38;13
Sara Rosebaum
Thank you so much for having me.
00;15;38;15 - 00;15;53;24
Chris Fleming
And with that, we'll have to call it a day. Maybe we'll get a chance to bring Sara back and talk about the great unwinding that Medicaid has been going through. But for today. As always, thank you to our listeners. Be sure to subscribe wherever you get your podcasts and we'll see you next week.