Oakland by HC120704133223

VIEWS: 23 PAGES: 19

									     MICHAEL STORTZ (No. 153378)
     PROTECTION AND ADVOCACY, INC.
     449 15th St., Suite 401
 1   Oakland, CA 94612
     (510) 839-0811
 2
     MARILYN HOLLE (No. 61530)
 3   SANDRA PETTIT (No. 54317)
     PROTECTION AND ADVOCACY, INC.
 4   3580 Wilshire Blvd., Suite 902
     Los Angeles, CA 90010-2512
 5   (213) 427-8747
 6   Attorneys for Petitioners
 7
 8
                                 CALIFORNIA SUPERIOR COURT
 9
                           IN AND FOR THE COUNTY OF SAN FRANCISCO
10
11
     ERIC HANSEN, MELISSA SILVA,           )   Case No. 984402
12   DEBORAH LEE, JOSEPH FRIEDMAN          )
                                           )   PETITIONERS' SUPPLEMENTAL
13          Petitioners,                   )   MEMORANDUM OF POINTS AND
                                           )   AUTHORITIES IN SUPPORT OF EX
14   v.                                    )   PARTE APPLICATION FOR TRO/STAY
                                           )
15   KIMBERLY BELSHÉ, as Director of       )   Ex Parte Hearing:
     Department of Health Services, and    )    Friday, February 7, 1997
16   CALIFORNIA DEPARTMENT OF              )    2 p.m. in Department 8
     HEALTH SERVICES,                      )
17                                         )
           Respondents.                    )
18   ___________________________________   )
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                                                         TABLE OF CONTENTS

 1   INTRODUCTION ........................................................................................................................... 1
 2
     ARGUMENT ................................................................................................................................... 2
 3       1.  Individual Petitioners and Others Who were Receiving
             Mental Health Case Management Services through the
 4           Short-Doyle Medi-Cal Provider Fred Finch Youth Center
             Continue to Qualify for the Services under All Applicable
 5           Criteria and Are at Significant Risk of Decompensation
             from the Interruption in Their Services ..................................................................... 2
 6
                          a.         Criteria for receiving case management
 7                                   services .......................................................................................................... 2
 8                        b.         Harm to Petitioners through Interruption
                                     in case management services ......................................................................... 6
 9
               2.         If the services at issue are Medi-Cal funded, then
10                        respondents are required to comply with federal Medicaid
                          regulations about notice and predeprivation hearing ................................................. 7
11
                          a.         The full panoply of Medi-Cal due process
12                                   rights attach to recipients receiving mental
                                     health services through Short-Doyle Medi-Cal
13                                   programs just as they do to recipients receiving
                                     drug and alcohol services through Short-Doyle
14                                   Medi-Cal programs or through managed care programs ............................... 8
15                        b.         Petitioners do not have fewer rights because
                                     respondents contend the services are not
16                                   medically necessary ....................................................................................... 9
17                        c.         Absent a federal Medicaid waiver, there can be
                                     no "pilot" services; the services petitioners
18                                   received were within the regular scope of
                                     Short-Doyle Medi-Cal Mental Health services ........................................... 10
19
20             3.         The Due process clauses of the United States and California
                          Constitutions required notice and an opportunity to be heard
21                        prior to termination of case management services .................................................. 11
22                        a.         Private interest that will be affected by
                                     the official action ......................................................................................... 13
23
                          b.         Erroneous deprivation factor ....................................................................... 13
24
                          c.         Dignity interest of petitioners ...................................................................... 14
25
                          d.         Cost of additional procedures ...................................................................... 14
26
     CONCLUSION .............................................................................................................................. 15
27                                          TABLE OF AUTHORITIES
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                                                                             ii
     CASES

     Cooper v. Kizer (1991)
 1   230 Cal.App.3d 1291, 282 Cal.Rptr. 492 ........................................................................................ 13
 2   Daniels v. Wadley (M.D. Tenn. 1996)
     926 F.Supp. 1305, 1311-1312 ......................................................................................................... 12
 3
     Easley v. Arkansas Dept. of Human Services
 4   (E.D. Ark. 1986) .............................................................................................................................. 12
 5   Frank v. Kizer (1989)
     213 Cal.App.3d 919 ....................................................................................................................... 1, 8
 6
     Goldberg v. Kelly
 7   (1970) 397 U.S. 254, 90 S.Ct. 1011 ........................................................................................ 1, 2, 11
 8   Griffeth v. Detrich (9th Cir. 1979)
     603 F.2d 118 .................................................................................................................................... 12
 9
     Haygood v. Younger (9th Cir. 1985)
10   769 F.2d 1350, 1355-1356............................................................................................................... 13
11   In re Jackson (1987)
     43 Cal.3d 501, 510-511, 233 Cal.Rptr. 911..................................................................................... 13
12
     In re Malinda S. (1990)
13   51 Cal.3d 358, 383, 272 Cal.Rptr. 787 ............................................................................................ 13
14   Jackson v. Rank
     E.D. Cal. (June 9, 1986) CCH Medi-Cal Guide ¶ 7199,
15   Case No. Civ. S-83-1451-LKK ......................................................................................................... 1
16   Jeneski v. Myers (1984)
     163 Cal.App.3d 13, 24, 209 Cal.Rptr. 178, 182 .......................................................................... 8, 13
17
     LeBaron v. U.S. (20th Cir. 1993)
18   989 F.2d 425 .............................................................................................................................. 12, 14
19   Mathews v. Eldridge (1976)
     424 U.S. 319, 96 S.Ct. 893 .................................................................................................... 2, 12, 14
20
     Memorial Hospital v. Maricopa County (1974)
21   415 U.S. 250, 259-260, 94 S.Ct. 1076 ............................................................................................. 13
22   Moffitt v. Austin (W.D. Ky. 1984)
     600 F.Supp. 295, 297 ....................................................................................................................... 12
23
     Mohilef v. Janovici (1996)
24   Cal.App.4th, 58 Cal.Rptr.2d 721 ..................................................................................................... 12
25   Morrissey v. Brewer
     408 U.S. 471, 481, 92 S.Ct. 2593 (1972) ........................................................................................ 13
26   People v. Ramirez (1979)
     25 Cal.3d 260, 158 Cal.Rptr. 316 .......................................................................................... 2, 12, 14
27
     Ressler v. Pierce (9th Cir. 1982)
28
                                                                             3
     692 F.2d 1212, 1217 ........................................................................................................................ 14

     Ruth v. Kizer (1992)
 1   8 Cal.App.4th 380, 385, 10 Cal.Rptr. 274, 277 ............................................................................... 13
 2   Sobky v. Smoley
     E.D. Cal. (1994) 855 F.Supp. 1123 ........................................................................................ 8 10, 11
 3
 4   CODES, STATUES AND REGULATIONS
 5   California Code of Regulations
            9 CCR §§ 1792, 1794, 1976, 1797 ...................................................................................... 10
 6          22 CCR § 51341 .................................................................................................................. 10
            22 CCR § 51341(b)(3) ......................................................................................................... 11
 7          22 CCR § 51341(b)(12) ....................................................................................................... 10
 8   Code of Civil Procedure
           § 1094.5 ............................................................................................................................... 15
 9
     United States Code
10          42 U.S.C. §§ 12131-12134 .................................................................................................. 14
            42 U.S.C. § 1396d(r)(5) ......................................................................................................... 4
11          42 U.S.C. § 1396d(a)(4) ........................................................................................................ 4
            42 U.S.C. § 1396d(a)(4)(B) ................................................................................................... 4
12          42 U.S.C. § 139n(g) ............................................................................................................. 11
            42 U.S.C. §§ 139n(c)(d)(e) .................................................................................................. 11
13          42 U.S.C. § 139n(b) ............................................................................................................. 11
            42 U.S.C. § 1315 ................................................................................................................. 11
14
     Welfare & Institutions Code
15          § 5600, et seq. ........................................................................................................................ 4
            § 5600.3(a)-(d) ....................................................................................................................... 4
16          § 5600.3(b)(2) ........................................................................................................................ 5
            § 5600.3(b)(3) ........................................................................................................................ 5
17
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                                                                            4
                                            INTRODUCTION
 1          Petitioners' supplemental brief responds to the arguments presented by counsel for

 2   respondents at the ex parte conference on Monday. In addition to asserting petitioners were not

 3   harmed by the termination of case management services, respondents argued as follows:

 4          (1)     The case management services received by petitioners and others similarly situated

 5   were gratuitous (though covered by Medi-Cal) and pursuant to a pilot project. They were

 6   gratuitous in that they were not medically necessary when received. There is a more stringent

 7   medical necessity standard applied to adults than to children under the age of 18. The petitioners

 8   and others receiving case management services through Fred Finch Youth Center did not meet the

 9   criteria for receiving case management services.

10          (2)     Short-Doyle Medi-Cal Mental Health Services provided through community

11   mental health systems such as Alameda County's Behavioral Health Services are not subject to the

12   notice and aid paid pending requirements applicable to fee-for-service Medi-Cal and are not

13   controlled by the settlement in Jackson v. Rank (E.D. Cal. June 9, 1986) CCH Medi-Cal Guide

14   ¶ 7199, Case No. Civ. S-83-1451-LKK, nor by the holding in Frank v. Kizer (1989) 213

15   Cal.App.3d 919, 261 Cal.Rptr. 882.

16          (3)     Because the case management services were provided by a pilot project and

17   because the services when provided were not medically necessary, there was no entitlement to the

18   services when they were received and therefore
19          (a)     the notice and due process rights under the regulations implementing the federal

20   Medicaid Act do not apply, and

21          (b)     petitioners have no interest triggering due process rights under Goldberg v. Kelly

22   (1970) 397 U.S. 254, 90 S.Ct. 1011, such as notice and an opportunity for a predeprivation

23   hearing.

24          The discussion below starts with the harm flowing from the termination of case

25   management services -- and why under the range of medical necessity definitions respondents may

26   be applying to petitioners, they nonetheless continue to qualify for Medi-Cal case management
27   services. The discussion goes on to explain why state and federal law compels compliance with

28
       PETITIONERS' SUPPLEMENTAL P&A'S RE TRO/STAY                                          Page 1
     the federal Medicaid notice and hearing regulations if the service at issue is Medi-Cal. If the

 1   service is funded by Medi-Cal, then all the federal notice and predeprivation hearing rights attach,

 2   period. How the Medi-Cal service is delivered -- fee-for-service, managed care, or Short-Doyle

 3   Medi-Cal -- has no impact on the State's obligation to comply with mandatory federal notice and

 4   hearing requirements.

 5          The discussion then shows that the services petitioners and others were receiving were are

 6   within the regular scope of Short-Doyle Mental Health Medi-Cal services. The discussion

 7   explains why, absent a federal waiver of statewideness and comparability requirements, there is no

 8   such thing as a "pilot" Medi-Cal service, though there may be pilot delivery systems.

 9          Finally, the discussion then addresses respondents' contention that Goldberg v. Kelly rights

10   do not apply by first showing that there is a protected property interest implicating due process

11   and then looking at petitioners' claims in light of the three factors in Mathews v. Eldridge (1976)

12   424 U.S. 319, 96 S.Ct. 893, plus the additional factor identified in People v. Ramirez (1979) 25

13   Cal.3d 260, 158 Cal.Rptr. 316.

14                                             ARGUMENT
15     1.   Individual petitioners and others who were receiving mental health case management

16          services through the Short-Doyle Medi-Cal provider Fred Finch Youth Center

17          continue to qualify for the services under all applicable criteria and are at significant

18          risk of decompensation from the interruption in their services.
19          a.      Criteria for Receiving case management services

20          Alameda County Behavioral Health Services, an entity to which respondents have

21   delegated some of their responsibility, authorized the provision of Medi-Cal covered mental health

22   case management and other rehabilitation services to Petitioners and others similarly situated in

23   accord with the medical necessity criteria contained in the Short-Doyle Medi-Cal Manual.

24   Excerpts of the manual were attached as Exhibt L to the Ex Parte Application, Exhibit L.1

25
            1
               Petitioners and others similarly situated have psychiatric conditions. Decl. of Eric
26   Hansen, ¶ 3; Decl. of Melissa Silva, ¶ 3; Decl. of Deborah Lee, ¶ 3; Decl. of Joseph Friedman,
     ¶3.
27
            Due to their psychiatric conditions, Petitioners and others similarly situated have
28   substantial impairments in community functioning, such as finding and maintaining a place to

       PETITIONERS' SUPPLEMENTAL P&A'S RE TRO/STAY                                           Page 2
     Alameda County pursued the Medi-Cal claiming procedures outlined in the interagency agreement

 1   attached to the petitioner's initial brief at exhibit M.

 2           According to Jeffrey Y. Sellwood, Associate Director of Fred Finch Youth Center, the

 3   "aftercare" component of California House provided "Medi-Cal eligible rehab option case

 4   management and mental health services to 12 ex-California House residents." Letter from Jeffrey

 5   Y. Sellwood to Alameda County Behavioral Health Services, Exhibit "N". Covered services

 6   included "one to one contact addressing mental health issues, linkage and collateral contact with

 7   community treatment resources, development of independent living skills, prevention of isolative

 8   behavior, development and implementation of county approved treatment plans, and, ultimately,

 9   prevention of hospital recidivism." Letter from Jeffrey Y. Sellwood, Exhibit "N".

10           Respondents confuse the issues by asserting petitioners and others similarly situated do not

11   meet eligibility criteria for mental health services provided to adults through Alameda County

12   Behavioral Health Services.2 Respondents refer to some unknown medical necessity criteria

13
     live. Decl. of Ronald and Linda Hansen, ¶¶ 6 & 20; Decl. of Melissa Silva, ¶ 5; Decl. of Deborah
14
     Lee, ¶ 3; Decl. of Esther Lee, ¶ 4; Decl. of Paula Friedman, ¶ 2.
15           Petitioners have difficulty with daily living activities, such as money management (Decl.
     of Eric Hansen, ¶ 5), day to day problems or stressors(Decl. of Melissa Silva, ¶ 7; Decl. of
16   Ronald and Linda Hansen, ¶ 11); attending classes at college (Dec. of Deborah Lee, ¶ 4; Dec. of
     Joseph Friedman, ¶ 4). Petitioner Lee has a difficult time developing a support system. (Decl.
17   of Esther Lee, ¶ 5). Petitioner Hansen has a difficult time maintaining his sobriety. (Decl. of
     Eric Hansen, ¶ 7).
18
             Petitioners and others similarly situated Medi-Cal recipients also meet the service
19   necessity criteria for the provision of Case Management/Brokerage Services through the
     SD/MC, as outlined in the SD/MC Manual. Exhibit L, 3-4, 3-5. Petitioner Hansen was
20   hospitalized for psychiatric care and treatment in a local inpatient mental health facility as
     recently as January 31. Decl. of Ronald and Linda Hansen, ¶ 10. Petitioners have a psychiatric
21   history of recurring substantial impairments or symptoms requiring placement in out-of-home
     residential treatment programs. Decl. of Ronald and Linda Hansen, ¶pp 3 and 4; Decl. of Melissa
22
     Silva, ¶ 3; Decl. of Deoborah Lee, ¶ 3; Decl. of Joseph Friedman, ¶ 3. Petitioner Friedman now
23   has no permanent living arrangement. Supplemental Decl. of Joseph Friedman, ¶ 2. Petitioners
     have an identified need for supportive services to maintain their current level of functioning in
24   the community. Decl. of Ronald and Linda Hansen, ¶¶ 8 and 11; Decl. of Melissa Silva, ¶ 9;
     Decl. of Ester Lee, ¶ 6; Decl. of Paula Friedman, ¶ 4.
25
26           2
                In our initial brief we referenced the EPSDT Medicaid requirement at 42 U.S.C.
     § 1396d(r)(5) and the fact that section provides a more liberal definition of medical necessity --
27
     correct or ameliorate defects and mental and physical conditions -- and a broader scope of
28   benefits to children and young adults under age 21. The age cutoff is required by 42 U.S.C.

       PETITIONERS' SUPPLEMENTAL P&A'S RE TRO/STAY                                           Page 3
     regarding adults who are "chronically, persistently, and seriously mentally ill." Presumably

 1   Respondents are referring to language in the so-called "Realignment" legislation which governs

 2   the provision of community mental health services to all state residents including those served

 3   pursuant to counties' indigent care responsibilities, regardless of their Medi-Cal eligibility. Welf.

 4   & Inst. Code Sections 5600, et seq. Under the Realignment legislation, the "capped" state funds

 5   available for mental health services are directed toward "target populations" and are prioritized

 6   therein as follows: (a) seriously emotionally disturbed children or adolescents; (b) adults and

 7   older adults who have a serious mental disorder; (c) adults or older adults who require or at risk of

 8   requiring acute psychiatric inpatient care, residential treatment, or outpatient crisis intervention

 9   because of a mental disorder with symptoms of psychosis, suicidality, or violence; and (d) persons

10   who need brief treatment as a result of a natural disaster or local emergency. Welf. & Inst. Code

11   Section 5600.3(a)-(d).

12          Even if the Realignment target population criteria could be construed as medical necessity

13   or utilization review criteria for the provision of Short-Doyle Medi-Cal mental health services,

14   Petitioners and others similarly situated meet the criteria. For adults, a "serious mental disorder"

15   is defined as follows:
             a mental disorder which is severe in degree and persistent duration3, which may
16           cause behavioral functioning which interferes substantially with the primary
             activities of daily living, and which may result in an inability to maintain stable
17           adjustment and independent functioning without treatment, support, and
             rehabilitation for a long or indefinite period of time.
18
19   Welf. & Inst. Code Section 5600.3(b)(2). Members of this target population must meet all of the

20   following criteria:
            (A)     The person has a mental disorder as identified in the most recent edition of the
21
     § 1396d(a)(4)(B): "early and periodic screening, diagnostic, and treatment services (as defined in
22
     subsection (r)) for individuals who are eligible under the plan and are under the age of 21."
23   Section 1396d(a)(4) is among the mandatory services required to be provided by participating
     states.
24
             3
                For years Petitioners and others similarly situated have received case management and
25   other mental health services, including out-of-home residential care, and their psychiatric
     conditions continue to exist. Declarations of Petitioners. But perhaps Respondents believe that
26   Petitioners and others similarly situated do not meet the "persistent duration" criteria because
27   they are not old enough. Maybe Respondents would have Petitioners and others similarly
     situated wait until they are 30 years old to be identified with a "persistent" disability.
28
       PETITIONERS' SUPPLEMENTAL P&A'S RE TRO/STAY                                             Page 4
                    Diagnostic and Statistical Manual of Mental Disorders...;
            (B)     (i) As a result of the mental disorder the person has substantial functional
                    impairments or symptoms, or a psychiatric history demonstrating that without
 1                  treatment there is an imminent risk of decompensation to having substantial
                    impairments or symptoms;
 2                  (ii) ..."functional impairment" means being substantially impaired...in independent
                    living, social relationships, vocational skills, or physical condition4;
 3          (C)     As a result of a mental functional impairment and circumstances the person is
                    likely to become so disabled as to require public assistance, services or
 4                  entitlements.5
 5   Welf. & Inst. Code Section 5600.3(b)(3).
 6
            Perhaps Respondents based their termination of case management services for Petitioners
 7
     and others similarly situated on the Realignment criteria or some "irrational and crazy"
 8
     interpretation of that or other criteria. Declaration of Michael Stortz in Support of Ex Parte
 9
     Application. Petitioners do not know because Respondents failed to provide them and others
10
     similarly situated a written notice explaining the basis for the termination.
11
            The following is clear. Petitioners qualify for Supplemental Security Income (SSI)
12
     benefits due to their psychiatric impairment. Petitioners are Medi-Cal beneficiaries. Until
13
     January 31, Petitioners and others similarly situated received Medi-Cal covered case management
14
     and rehabilitative mental health services. Fred Finch Youth Center and Alameda County
15
     Behavioral Health Services determined the medical necessity for and authorized these services.
16
     Fred Finch Youth Center, the Short-Doyle Medi-Cal provider which served Petitioners and others
17
     similarly situated, determined that Petitioners and others similarly situated continued to need and
18
     sought authorization for Short-Doyle Medi-Cal case management and rehabilitative mental health
19
     services after the expiration of its contract. Letter of Jeffrey Y. Sellwood, Exhibit "N".
20
     Respondents denied the treatment authorization request of the treating certified Medi-Cal
21
     providers for Petitioners and other similarly situated Medi-Cal beneficiaries and failed to provide
22
23          4
               This language is similar to the medical necessity definition in the Short-Doyle
24   Medi-Cal Manual. As discussed above, Petitioners and others similarly situated have
     substantial functional impairments. Petitioners are at risk of decompensation without case
25   management services. Decl. of Ronald and Linda Hansen, ¶ 13; Decl. of Melissa Silva, ¶ 12;
     Decl. of Esther Lee, ¶ 6; Decl. of Paula Friedman, ¶ 2.
26
            5
27              Due to their psychiatric conditions and circumstances, petitioners and others similarly
     situated receive entitlements, namely, SSI and Medi-Cal.
28
       PETITIONERS' SUPPLEMENTAL P&A'S RE TRO/STAY                                           Page 5
     Petitioners with a written notice and an opportunity file a fair hearing and receive aid pending a

 1   fair hearing decision. Respondents cannot now claim that Petitioners have no entitlement, and

 2   thus no due process rights, to the Medi-Cal services which they were receiving and being

 3   recommended.
            b. Harm to Petitioners through Interruption in case management services
 4
 5          Petitioners and others similarly situated face imminent harm. Petitioner Hansen was

 6   hospitalized for psychiatric care and treatment on January 31. Declaration of Mr. and Mrs.

 7   Hansen. Respondents may argue that there is no correlation between the termination of

 8   Petitioner's case management services and his inpatient psychiatric hospitalization. But one of

 9   the functions of case management is the "prevention of hospital recidivism" and, according to Fred

10   Finch Youth Center, Petitioners and others similarly situated "are not sufficiently resilient to

11   withstand extended transitions." Letter of Jeffrey Y. Sellwood, Exhibit "N". Petitioner Lee

12   needs a case manager so that things do not fall apart and she keeps out of trouble and danger.

13   Declaration of Esther K. Lee. Petitioner Friedman can regress severely and quickly. Declaration

14   of Paula Friedman.

15          Petitioners and others similarly situated face lost potential. Petitioner Silva's case

16   management services enable her to live in the community work toward a more independent future.

17    Declaration of Melissa Silva. Petitioner Hansen's case management services help with money

18   management, maintaining sobriety, and crisis intervention. Declaration of Eric Hansen. Petitioner
19   Lee's case management services assist in going to college and finding a stable living arrangement.

20   Declaration of Deborah Lee. Petitioner Friedman's case management services help in finding

21   employment and going to college. Declaration of Joseph Friedman.

22          Respondents are not likely to be significantly harmed by issuance of a temporary

23   restraining order requiring them to continue providing case management services to Petitioner

24   Friedman pending a decision on his administrative fair hearing request and to Petitioners Hansen,

25   Silva, Lee and others similarly situated pending a written notice and opportunity to file fair

26   hearing requests, and pending a decision on their administrative fair hearing requests if filed. The
27   provision of continued case management services to these 12-15 Medi-Cal eligible individuals

28
       PETITIONERS' SUPPLEMENTAL P&A'S RE TRO/STAY                                            Page 6
     during this process would not significantly financially burden Respondents. Furthermore, Fred

 1   Finch Youth Center is likely willing and able to provide such services during the pendency of the

 2   fair hearing processes. Letter of Jeffrey Y. Sellwood, Exhibit "N", and Letter of John Steinfirst to

 3   Alameda County Behavioral Services, Exhibit "O".

 4     2.   If the services at issue are Medi-Cal funded, then respondents are required to comply

 5          with federal Medicaid regulations about notice and predeprivation hearing.

 6          Respondents have not disputed that the services at issue are Medi-Cal funded. Further,

 7   correspondence from Fred Finch Youth Center (attached as Exhibits "N" and "O") corroborate that

 8   both the case management provided to residents (petitioner Friedman) and those served in the

 9   aftercare program (petitioners Hansen, Silva, Lee) were funded as targeted case management

10   services and as rehab option services. See Exhibit L, page 2-42. Being Medi-Cal or not

11   Medi-Cal is like being pregnant or not pregnant. The services either were or were not funded by

12   Medi-Cal. And just as you are pregnant whether or not you intended to be, the Medi-Cal funded

13   services come with all the procedural bells and whistles required under the federal Medicaid

14   regulations whether or not respondents believed the services to be medically necessary when

15   provided. All the federal notice and predeprivation hearing rights attach to each and every

16   Medi-Cal service despite respondents' contentions that the services were "gratuitous" because they

17   never were medically necessary.6      Frank v. Kizer (1989) 213 Cal.App.3d 919, 923, 261

18   Cal.Rptr. 882; Jeneski v. Myers (1984) 173 Cal.App.3d 18, 209 Cal.Rptr. 178.
            a.      The full panoply of Medi-Cal due process rights attach to recipients receiving
19                  mental health services through Short-Doyle Medi-Cal programs just as they
                    do to recipients receiving drug and alcohol services through Short-Doyle
20                  Medi-Cal programs or through managed care programs.
21
22          One of the questions addressed by the court in Sobky v. Smoley (E.D. Cal. 1994) 855

23   F.Supp. 1123 was the notice rights of Medi-Cal beneficiaries receiving drug and alcohol treatment

24   services through a Short-Doyle program and specifically whether the State was required to issue

25
            6
                As discussed above, the argument that the services provided were not medically
26   necessary are fallacious because the services addressed functional impairments interfering with
27   their ability to function in the domains outlined at page 3-2 of Exhibit L to Petitioners' initial
     points and authorities.
28
       PETITIONERS' SUPPLEMENTAL P&A'S RE TRO/STAY                                           Page 7
     any required notices or whether that responsibility could be delegated. The defendants in Sobky

 1   which included the respondents in this case did "not dispute that plaintiffs have a legitimate claim

 2   of entitlement to the continued receipt of Medicaid services and that due process must be

 3   provided." Id. at 1149. The court reviewed the state mandated procedural protections afforded

 4   Medi-Cal recipients receiving Short-Doyle drug and alcohol treatment services including (a) the

 5   right to a fair hearing related to denial, termination or reduction of services, (B) the right to a fair

 6   hearing under the procedures governing all other Medi-Cal fair hearings, and (c) the right to be

 7   informed in writing ten days before any termination or reduction of their benefits including about

 8   their right to request a fair hearing. Id. at 1149-1150. The court found the notice procedures

 9   facially constitutionally adequate noting that "[w]hat is important under the Constitution is that

10   notice be given, not who generates or delivers the notice." Id. at 1150. The court ruled for

11   defendants on this question in the absence of evidence that the procedures were not being

12   followed. Ibid.

13           It is difficult to understand how the respondents can argue that neither notice rights nor the

14   opportunity for a predeprivation hearing apply to Medi-Cal recipients receiving mental health

15   services through a Short-Doyle Medi-Cal program when respondents have already conceded that

16   at least notice rights attach to Medi-Cal recipients receiving drug or alcohol treatment services

17   through a Short-Doyle Medi-Cal program. Respondents are estopped from arguing that Medi-Cal

18   recipients receiving mental health services have no due process rights or fewer due process rights
19   than Medi-Cal recipients receiving drug/alcohol treatment services.

20           It is also difficult to understand how Medi-Cal recipients receiving outpatient Short-Doyle

21   Medi-Cal services have no or fewer due process rights than do Med-Cal recipients receiving

22   inpatient Short-Doyle Medi-Cal services. Attached as Exhibit "P" is an excerpt from regulations

23   in Title 9 of the California Code of Regulations governing in-patient Short-Doyle Medi-Cal

24   services. Those services state unequivocally that the full panoply of due process rights available

25   to Medi-Cal recipients generally are also available to Medi-Cal recipients receiving Short-Doyle

26   in-patient mental health services. 9 CCR §§ 1792, 1794, 1796, 1797. Further, respondents will
27   not dispute that Medi-Cal recipients receiving Medi-Cal services through other managed care

28
       PETITIONERS' SUPPLEMENTAL P&A'S RE TRO/STAY                                               Page 8
     systems -- whether mandatorily under the so-called "two-plan model," County Operated Health

 1   System (COHS), Geographic Managed Care (GMC) as in Sacramento, or optionally through

 2   electing to receive services through a managed care plan -- are entitled to notice and

 3   predeprivation hearings to the same extent as persons receiving Medi-Cal services through the

 4   fee-for-service system. Respondents are estopped from asserting that Medi-Cal recipients

 5   receiving outpatient mental health services through a Short-Doyle Medi-Cal program have no due

 6   process rights or fewer rights than do Medi-Cal recipients receiving inpatient mental health

 7   services through a Short-Doyle program or receiving services through other mandatory or optional

 8   managed care systems.

 9          b.      Petitioners do not have fewer rights because respondents contend the services

10                  are not medically necessary.

11          One of respondents' arguments is that the usual Medi-Cal notice and other due process

12   rights do not attach because respondents contend the services were never medically necessary. If

13   that were the case, then respondents could defeat the notice and due process rights of any case

14   where benefits were terminated simply by asserting they never were medically necessary. But, to

15   the extent these services have been authorized and federal financial participation sought,

16   respondents are estopped from making this argument, estopped from asserting they committed

17   fraud. Respondents cannot take the sweet fruit of federal financial assistance for half the cost of

18   Medi-Cal services without also taking the brambles of complying with the mandatory federal
19   Medicaid notice and fair hearing regulations.
             c.    Absent a federal Medicaid waiver, there can be no "pilot" services; the
20                 services petitioners received were within the regular scope of Short-Doyle
                   Medi-Cal Mental Health services.
21
22
            The case management services received by petitioners were within regular scope of
23
     Medi-Cal services available as medically necessary to all persons eligible to receive mental health
24
     services through a Short-Doyle Medi-Cal program. The services received are covered under the
25
     Medicaid service category of rehab option services as mental health services and under the
26
     Medicaid service category targeted case management. Exhibit L to petitioners' initial brief at
27
     page 2-11 under "E", 2-42, 3-1 through 3-5. See, also the Medi-Cal regulation at § 51341 of Title
28
       PETITIONERS' SUPPLEMENTAL P&A'S RE TRO/STAY                                            Page 9
     22 of the California Code of Regulations (CCR) listing and defining the Short-Doyle Mental

 1   Health Medi-Cal Program Services.7

 2          The court in Sobky v. Smoley (E.D. Cal. 1994) 855 F.Supp. 1123 examined the delivery of

 3   methadone treatment to Medi-Cal recipients under California's Short-Doyle Drug Medi-Cal

 4   program in light of several Medicaid conditions of participation.    Plaintiffs challenged the

 5   system whereby counties could elect to include or not include methadone treatment in its range of

 6   services and counties could limit the number of treatment slots available to its county residents.

 7   The court concluded that the system violated the federal Medicaid requirements of statewideness

 8   (Id. at 1133-1137), comparability (Id. at 1139-1142), and reasonable promptness (Id. at

 9   1146-1149) to the extent services available in one locality were not available to Medi-Cal

10   beneficiaries living in other localities or rationed access by limiting service slots. Thus once a

11   service is made available, it has to be available generally.8 Therefore Alameda County

12   Behavioral Health Services could not offer or authorize services on a "pilot" basis that were not

13   generally available. It could only do so via one of the federal waivers.9 Respondents have not

14   and cannot claim cover of a waiver for "pilot" services not generally available.

15
            7
16             Community mental health services include those designed to provide the maximum
     reduction of mental disability and restoration or maintenance of functioning consistent with the
17   requirements for learning, development, independent living and enhanced self-sufficiency.
18   Services shall be directed toward achieving the individual's goals/desired results/personal
     milestones. 22 CCR § 51341(b)(3). Case management brokerage means activities provided by
19   program staff to access medical, educational, social, prevocational, vocational, rehabilitative, or
     other needed community services for eligible individuals.
20   22 CCR § 51341(b)(12).
21          8
                Targeted case management allows the state to request the service for particular groups
     -- i.e., persons with psychiatric or developmental disabilities, etc. 42 U.S.C. 1396n(g)
22
     However, the comparability, statewideness and reasonable access requirements apply to persons
23   within the target group.
            9
24             Those waivers target limited numbers of people who meet the requirements of nursing
     facility or hospital placement and receive instead services to enable them to live outside an
25   institution: home and community based waivers for disabled, seniors, children infected with
     aids at birth or born drug dependent. 42 U.S.C. §§ 1396n(c), (d), (e). In addition there are
26   waivers to promote cost effectiveness and efficiency pursuant to 42 U.S.C. § 1396n(b) which is
27   primarily used for mandatory managed care but also authorize waiver of comparability and
     statewideness. Finally there are demonstration waivers under 42 U.S.C. § 1315.
28
       PETITIONERS' SUPPLEMENTAL P&A'S RE TRO/STAY                                           Page 10
       3.    The Due process clauses of the United States and California Constitutions require

 1           notice and an opportunity to be heard prior to termination of case management

 2           services.

 3           The threshold question is whether the due process clause applies at all -- i.e., whether there

 4   was any constitutionally protected property interest. In Goldberg v. Kelly (1970) 397 U.S. 254,

 5   90 S.Ct. 1011, the government did not dispute that due process rights were implicated in the

 6   termination of public assistance; the dispute instead was about just what process was due.

 7   Goldberg at 261-262, 90 S.Ct. at 1017-1018.      Here, however, respondents contend due process is

 8   not implicated at all -- not even a written notice -- because the Medi-Cal services terminated were

 9   not medically necessary when received. However, and paraphrasing Goldberg v. Kelly at 262,

10   Medi-Cal benefits are a matter of statutory entitlement for persons qualified to receive them.

11   Termination of Medi-Cal services involves state action that adjudicates important rights.     If the

12   question of whether or not one can keep any ostriches and emus on a seven acre ranch triggers due

13   process protections -- Mohilef v. Janovici (1996) ______ Cal.App.4th ______, 58 Cal.Rptr.2d 721

14   -- then certainly so does termination of the case management services petitioners need to function

15   in their day-to-day life.

16           The inclusion of mental health rehabilitation option services plus targeted case

17   management services for persons with psychiatric disabilities within the scope of Short-Doyle

18   mental health Medi-Cal services creates a statutory entitlement as was found in Griffeth v. Detrich
19   (9th Cir. 1979) 603 F.2d 118 by the combination of state statute concerning county general relief

20   obligations together with San Diego County's general relief regulations. Further, Courts have

21   consistently held that Medicaid recipients have a protected property interest in the continued

22   receipt of Medicaid benefits.    Daniels v. Wadley (M.D. Tenn. 1996) 926 F.Supp. 1305,

23   1311-1312; Easley v. Arkansas Dept. of Human Services (E.D. Ark. 1986) 645 F.Supp. 1535,

24   1545; Moffitt v. Austin (W.D. Ky. 1984) 600 F.Supp. 295, 297. Finally, the 10th Circuit in

25   LeBaron v. U.S. (10th Cir. 1993) 989 F.2d 425, found a protected interest where patients were

26   terminated from an Indian Health Service Clinic without notice and hearing. The clinic argued
27   "no [property] interest in a continuation of these benefits arose because these benefits were

28
       PETITIONERS' SUPPLEMENTAL P&A'S RE TRO/STAY                                           Page 11
     mistakenly extended to Plaintiffs." Id. at 427. The court found an interest in uninterrupted

 1   medical assistance.10 Ibid.

 2          The next question is what process is due. California courts applying the due process

 3   clause in both the United States and U.S. Constitutions apply an amalgam of the three-prong

 4   balancing test in Mathews v. Eldridge (1976) 424 U.S. 319, 335, 96 S.Ct. 893, 903, plus the

 5   dignity interest factor recognized in People v. Ramirez (1979) 25 Cal.3d 260, 269, 50 Cal.Rptr.

 6   316. See In re Malinda S. (1990) 51 Cal.3d 358, 383, 272 Cal.Rptr. 787,11 and In re Jackson

 7   (1987) 43 Cal.3d 501, 510-511, 233 Cal.Rptr. 911.

 8          a.      Private interest that will be affected by the official action.

 9          Having established that there is enough interest to trigger due process rights, the inquiry

10   under this criterion is the weight of the private interest. Kessler v. Pierce (9th Cir. 1982) 692

11   F.2d 1212, 1217. The interest in continuing receipt of case management is significant given the

12   crucial role case management plays in keeping the lives of petitioners and others stabilized.

13   Memorial Hospital v. Maricopa County (1974) 415 U.S. 250, 259-260, 94 S.Ct. 1076 (medical

14   care is as much a basic necessity of life to an indigent as welfare assistance); Jeneski v. Myers

15   (1984) 163 Cal.App.3d 13, 24, 209 Cal.Rptr. 178, 182 (noting "[t]he significance of Medicaid, and

16   the individual and collective human suffering which it ameliorates, rehabilitates, and forestalls").

17          The weight of the private interest is also reflected in the fact that if petitioners were here on

18   a Code of Civil Procedure § 1094.5 administrative writ after losing a fair hearing, the standard of
19
            10
20               "There may be a protected interest in `those claims upon which people rely in their
     daily lives.'" LeBaron at 427, quoting Board of Regents v. Roth (1972) 408 U.S. 564, 577, 92
21   S.Ct. 2701, 2709. LeBaron goes on to say: "Plaintiffs claim that they have been receiving
     certain medical benefits and developed an expectation that such health care would continue to be
22
     available. Once assistance had been extended, a court considering the nature of the recipient's
23   rights may consider that individual's interest in `uninterrupted assistance.'" Ibid.
            11
24              In re Malinda S at 384: (1) the private interest that will be affected by the official
     action, (2) the risk of an erroneous deprivation of such interest through the procedures used, and
25   the probable value, if any, of additional or substitute procedural safeguards, (3) the dignity
     interest in informing individuals of the nature, grounds and consequences of the action and in
26   enabling them to present their side of the story before a responsible governmental official, and
27   (4) the governmental interest, including the function involved and the fiscal and administrative
     burdens that the additional or substitute procedural requirements would entail.
28
       PETITIONERS' SUPPLEMENTAL P&A'S RE TRO/STAY                                            Page 12
     review would be the independent judgment standard because of the character of the interest

 1   involved. Ruth v. Kizer (1992) 8 Cal.App.4th 380, 385, 10 Cal.Rptr. 274, 277 (oxygen); Cooper

 2   v. Kizer (1991) 230 Cal.App.3d 1291, 282 Cal.Rptr. 492 (eligibility).

 3          b.      Erroneous deprivation factor

 4          The nature of the right dictates what process is due. "The more important the interest and

 5   the greater the effect of the impairment, the greater the procedural safeguards the state must

 6   provide to satisfy due process." Haygood v. Younger (9th Cir. 1985) 769 F.2d 1350, 1355-1356,

 7   citing Morrissey v. Brewer, 408 U.S. 471, 481, 92 S.Ct. 2593 (1972). In LeBaron the court noted

 8   that "the nature of health care benefits, coupled with the fact that the Plaintiffs had already

 9   received such benefits, leads us to conclude that some pre-termination hearing was necessary. Id.

10   at 427-28. Further, the risk of erroneous deprivation is underscored by the various medical

11   necessity definitions that may apply. See discussion under Argument 1 above. Finally, because

12   capped funds are given to Short-Doyle Mental Health medical programs to address the needs of

13   Medi-Cal beneficiaries, indigents and children entitled to mental health services under special

14   education laws, there is a financial incentive to underserve that can affect the reliability of

15   decisions.

16          c.      Dignity interest of petitioners

17          Petitioners have at least the same rights as parole violators in People v. Ramirez -- the right

18   to notice and an opportunity to be heard. Respondents, however, contend that petitioners do not
19   even have the right to written notice.

20          d.      Cost of additional procedures.

21          This factor in the balancing looks to the administrative burden and other societal costs that

22   would be associated with providing notice and a pretermination hearing. Mathews v. Eldridge

23   424 U.S. at 347. Since providing notice and an opportunity for a pretermination hearing is a

24   feature of every other system for delivering Medi-Cal services, providing the same to persons with

25   psychiatric disabilities receiving services through Short-Doyle mental health Medi-Cal programs

26   could not impose any undue burden. Indeed to deny notice and an opportunity for a
27   predeprivation hearing to persons receiving outpatient services in the Short-Doyle mental health

28
       PETITIONERS' SUPPLEMENTAL P&A'S RE TRO/STAY                                             Page 13
     Medi-Cal program would constitute a violation of Title II-A of the Americans with Disabilities

 1   Act, 42 U.S.C. §§ 12131 through 12134.

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           PETITIONERS' SUPPLEMENTAL P&A'S RE TRO/STAY                                   Page 14
                                                CONCLUSION
 1            Petitioners respectfully renew their request for the continuation of case management

 2   services for Petitioners and the other 12 to 15 similarly situated persons as outlined in petitioners'

 3   proposed order.

 4
     DATED: February 5, 1997 Respectfully submitted,
 5
                                              PROTECTION & ADVOCACY, INC.
 6
 7                                      by:   ___________________________
                                              Michael Stortz
 8                                            Attorneys for Petitioners
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       PETITIONERS' SUPPLEMENTAL P&A'S RE TRO/STAY                                            Page 15

								
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