Preparing and Managing a Medicaid Case: An Introductory Guide

Executive Summary

This introductory step-by-step guide to Medicaid litigation describes issues related to client selection, forum, form of relief, and more.

Preparing and Managing a Medicaid Case
Abstract. This introductory guide discusses various aspects of preparing and managing a Medicaid case. Both individual and class action cases receive attention. After providing some background to Medicaid litigation, the following topics are covered: (1) verifying clients and claims; (2) coordinating counseling responsibilities; (3) negotiations; (4) choice of forum; (5) preparing complaints in manageable analytic bites; (6) individual v. class actions; (7) forms of relief; (8) managing discovery; (9) expert witnesses; (10) anticipating and addressing defenses; and (11) monitoring and enforcing orders and agreements.
This guide can only touch on the many complex issues involved in case preparation and management. For in-depth assistance with case development, please contact the National Health Law Program. If you are a legal aid advocate, you should also obtain a copy of the National Center on Poverty Law, Federal Practice Manual for Legal Aid Attorneys.
A. Background to Medicaid Litigation
Since Medicaid was enacted in 1965, there have been a number of court challenges seeking to enforce the program’s requirements. While these cases have often obtained the requested relief, advocates who have filed them will, with near uniformity, caution that these efforts are not easy. Moreover, changes in the composition of the judiciary are bringing added challenges.
A review of previous litigation shows the following:
  • There have been thousands of published court decisions. There are numerous unpublished decisions.
  • There has been litigation in almost every state.
  • Since the mid 1990s, cases have focused on eligibility and services, provider participation; access to behavioral and mental health services and providers, particularly in community-based settings; and denials of services by managed care organizations.
  • The majority of cases have been resolved through settlements and consent decrees.
  • Since the 1990s, cases are much more likely to be tested by motions to dismiss on jurisdictional/standing bases. These requests have been granted by some courts and, in all cases, have led to frustrating delays in obtaining relief from ongoing problems.
While some Medicaid disputes can be resolved fairly quickly, problems are often difficult to address. There are many reasons for this, including:
  • Beneficiaries come to the office and complain but are intimidated to go to court; they lack the resources to do so.
  • Beneficiaries move and lose contact with their advocates. Beneficiaries also may experience on-again-off-again eligibility as family income varies, and this also complicates litigation.
  • Beneficiaries’ problems can be mooted out once they are brought to the attention of the government agency or managed care company, so systemic problems may be hard to address.
  • Impact litigation is costly and time consuming in situations where, already, there is little money and time.
  • Beneficiaries’ access to legal representation is limited. Individuals are dependent on legal services, protection & advocacy offices, public interest law firms (which typically are small offices), and private law firms (which can devote only limited resources to pro bono efforts). Legal services corporation-funded organizations are barred by Congress from filing class action lawsuits. Private law firms may have conflicts of interest, particularly where health care providers and insurers are involved, and they may be concerned about the ability to obtain attorneys fees if the state changes its policies after the case is filed. See Buckhannon Board and Care Homes v. W. Va. Dept. of Health and Human Res., 121 S.Ct. 1835 (2001) (rejecting catalyst theory for attorneys’ fees); Green v. Mansour, 474 U.S. 64 (1985) (refusing injunction where state has voluntarily halted violation).
  • Motions to dismiss can add to the cost of the litigation and the delay in obtaining relief through the courts.
  • Often, following even successful litigation, implementation of relief can be slow. It can be difficult locating legal staff to monitor implementation.
In sum, each Medicaid case needs to be considered and planned carefully. The “strategy of the case” should be developed before the complaint is filed. What other forms of advocacy will be employed in support of the case or the issue  – e.g. education, legislation, media? Should the case be filed as an administrative complaint, in state court, in federal court? Is a preliminary injunction needed? Will the case require the use of experts? What are the requirements of the Federal Rules of Civil Procedure and you Local Rules?
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