MEMORANDUM IN OPPOSITION TO DEFENDANTS* MOTION TO DISMISS OR FOR SUMMARY JUDGMENT I. INTRODUCTION The State of Kentucky has attempted to respond to a "Perfect Storm" budget crisis, caused by "Too Many Patients, Too Little Money," Defendants* Memorandum, p. 2, by adopting an "emergency regulation" redefining eligibility for Medicaid long-term care so as to render ineligible, persons previously certified as eligible for nursing facility services, a mandatory form of service under the federal Medicaid statute.1 This draconian action has resulted in determinations that two groups of people, some residing in nursing homes and some receiving home and community based services ("HCBS"), but all of whom had already been acknowledged by the state to need nursing facility services, are no longer eligible for long-term care under Kentucky*s Medicaid program. Plaintiffs and the class they represent are being deprived of a mandatory service, nursing facility services, by implementation of the new regulations. Defendants have not attempted to assert that their administrative redefinition of the need for nursing facility services is based upon new medical knowledge providing a more enlightened understanding of who actually needs nursing facility services, or indeed upon any medical or health-related considerations at all. There is no suggestion in their motion or supporting memorandum or documents that the amendments are in the best interests of Kentucky Medicaid recipients. Indeed, Defendants never even say that the new regulations are consistent with the objectives of the Medicaid Act. or in accord with federal Medicaid law.2 There seems to be no serious disagreement as to the basic nature of the Medicaid Act or of the obligations of the state under the Act. Defendants acknowledge in their memorandum that the Medicaid Act "is a cooperative federal-state program to facilitate the availability of medical care for needy individuals," that, "[c]ertain Medicaid programs are mandatory," and that "if a state participates in Medicaid, it must provide a base level of services." Defendants* Memorandum at 6. Defendants also acknowledge that participating states are "required to provide financial assistance to qualified individuals for specified categories of medical services, and that one of those mandatory services is "skilled (sic) nursing facility services."3 Id. Defendants also do not dispute Plaintiffs* allegation that Defendants previously determined that all the Plaintiffs needed nursing facility services, "but have recently reversed those determinations solely on the basis of budgetary constraints and not on any improvement in the Plaintiffs* health or daily living skills necessary to live independently." Complaint, * 1. No non-budgetary reason is given for the state*s peremptory action in redefining eligibility for long term care to remove persons long certified as requiring nursing facility services. Defendants do not identify any provision of the Medicaid statute, the regulations thereunder, or any court decision which they say authorizes states, for budgetary reasons, to shrink the number of persons eligible for mandated services simply by redefining the need for such services to conform to their budgetary wishes. II. STATEMENT OF THE CASE A. The Medicaid Program The federal Medicaid program provides a federal subsidy to states that choose to pay for certain health care to be provided to low-income individuals. See 42 U.S.C. *1396 et seq. (Medicaid Act). Generally, low-income elderly and disabled individuals, low-income single parents, pregnant women, and children are the populations entitled to be served by the Medicaid program. 42 U.S.C. *1396a(a)(10). "Although participation in the [Medicaid] program is voluntary, participating states must comply with certain requirements imposed by the Act and regulations promulgated by the Secretary of Health and Human Services." Harris v. McRae, 448 U.S. 297, 301 (1980); Wilder v. Virginia Hospital Ass*n, 496 U.S. 498, 502 (1990). Kentucky has chosen to participate in the Medicaid program, and is therefore bound by federal Medicaid statutes and regulations in the operation of its program. 1. Nursing Facility Services Are A Mandatory Service Under Medicaid - There are services that a state, at its discretion, may or may not make available for coverage in that state*s Medicaid program. These optional services include routine prescription drugs, dental services, physical therapy, dentures, and others. 42 U.S.C. *1396d(a). By contrast, the nursing facility services under consideration in this case are mandatory services that any state which participates in the Medicaid program must provide. See Westside Mothers v. Haveman, 289 F.3d 852, 856 (6th Cir. 2002) ("The Medicaid Act and related regulations set out a detailed list of services every state program must provide."). Specifically, 42 U.S.C. *1396a(a)(10)(A) requires that for all individuals meeting the eligibility requirements, a state "must...provide...for..medical assistance...at least the care and services listed in paragraphs (1) through (5), (17) and (21) of section 1396d(a)." The services that *1396d(a) mandates all states to provide include: "(4)(A) nursing facility services.....for individuals 21 years of age or older." (emphasis provided). The "nursing facility services" identified as a mandatory service in *1396d(a)(4) are subsequently defined as "services which are or were required to be given an individual who needs or needed on a daily basis nursing care (provided directly or requiring the supervision of nursing personnel) or other rehabilitation services which as a practical matter can only be provided in a nursing facility on an inpatient basis." 42 U.S.C. *1396d(f). Thus, individuals within the categorical populations in 42 U.S.C. *1396a(a)(10), as are Plaintiffs, and who need on a daily basis, nursing care which as a practical matter, can be delivered only in a nursing facility on an inpatient basis, must be provided coverage for nursing facility services. 2. Home and Community Based Services Are Provided Only To Persons Who Have Been Found To Need Nursing Facility Services Or Institutionalized Care - The Medicaid statute contemplates that states may choose to offer services in a setting other than a nursing home to some people who are entitled to mandatory long-term care services. States may offer a specified package of HCBS to Medicaid beneficiaries who, "but for the provision of such services would require the level of care provided in a hospital, nursing facility or intermediate care facility for the mentally retarded the cost of which could be reimbursed under the State [Medicaid] program." 42 U.S.C. **1396a(a)(10) (A)(ii)(VI); see also 42 U.S.C. *1396n(c)(1). In order to include HCBS within Medicaid, a state must submit an application to the federal Centers for Medicare and Medicaid Services (CMS) for an HCBS waiver, and receive subsequent approval from CMS. The term, "waiver,"4 does not mean that a state may operate such a program any way it wants, without regard to federal law. In all nonwaived aspects, the state*s home and community based waiver program must comply with federal Medicaid law. See 42 U.S.C. *1396a(a)(10)(A). Individuals who receive home or community-based services in lieu of nursing facility services must still be provided the basic package of Medicaid services. Id; see Bryson v. Shumway , 308 F.3d 79, 89 (1st Cir. 2002) ("The strictures of the reasonable promptness requirement of federal Medicaid law should apply with no less force to opt-in plans such as the waiver program."); Ass*n of Residential Res. in Minn.(ARRM) v. Minn.Comm*r of Human Services, 2003 WL 22037719 *7-8 (D.Minn. Aug. 29, 2003) (Exhibit E) (state must abide by Medicaid "equal access provision" in its HCBS program, as rules of statutory construction dictate that provisions not specifically identified as ones that may be waived must be considered obligatory). Furthermore, a state must abide by the specific rules which relate to the waiver program itself. See Wood v. Tompkins, 33 F.3d 600, 608 (6th Cir. 1994) ("[certain provisions of the waiver statute] impose mandatory duties upon participating states."). Defendants opine that, "Should the Plaintiffs succeed" in this litigation, the state "may be forced to consider whether it should abandon altogether any effort to provide these optional [HCBS] services and remove them from their State Plan." Defendants* Memorandum at 5. That statement is misleading for it implies that the state somehow would save money by abolishing the HCBS program. As already explained, all individuals receiving services under Kentucky*s HCBS program are doing so because they meet the Medicaid program*s categorical requirements and have been found to need nursing facility services. In an HCBS waiver program, qualified individuals receive services either in the nursing facility or in their home and/or other community setting, generally depending on whether the state has a sufficient number of waiver "slots" to incorporate the individual into the waiver program. In absence of a slot, or waiver program, the state must provide coverage for nursing facility care. 42 U.S.C. **1396a(a)(10) and 1396d(a) Thus, if Kentucky were to abandon the HCBS program, the state would be obliged to provide nursing facility services for those beneficiaries in lieu of HCBS. No basis has been offered for thinking that nursing facility services would cost the state less than HCBS. Indeed, to obtain approval of an HCBS program, the state must certify that the program will not increase per capita expenditures. 42 U.S.C. *1396n(c)(2)(D). 3. The New Regulations - As of April 4, 2003, based on determinations that they were entitled to receive nursing facility services, all Plaintiffs were receiving services under the Kentucky Medicaid program. Some were residing in nursing homes. Others were part of the HCBS waiver program. On April 4, 2003, in response to budgetary constraints, Kentucky adopted "emergency regulations" which purported to alter eligibility for the mandatory federal Medicaid nursing facility services. 907 KAR 1:022E. Defendants projected that their alteration of the level-of-care criteria would save some $45 million. Comp. * 2. In fact, redeterminations under the new regulations have resulted in rulings that none of the Plaintiffs remained eligible for nursing facility services. This is so despite the fact that all of them had previously been recognized as needing nursing facility services. There is no finding or suggestion that the conditions of Plaintiffs have changed, or that they are somehow less in need of nursing facility services than they were before April 4, 2003.5 B. For Purposes Of This Motion, Defendants Admit Plaintiffs* Factual Allegations 1. Motion To Dismiss - Defendants have moved to dismiss Plaintiffs* complaint or, in the alternative, for summary judgment. Defendants correctly acknowledge their understanding that in addressing their motion to dismiss, made under Rule 12 (b)(1) and (6) of the Federal Rules of Civil Procedure, the court will accept as true all of the allegations set forth in the Complaint. Thus, for purposes of the motion to dismiss, Defendants accept as true that: * all Plaintiffs are physically and emotionally fragile low-income persons who, as of April 4, 2003, were receiving long-term care services through the Kentucky Medicaid program, pursuant to determinations by Defendants that all Plaintiffs needed that level of care. Comp. * 1; * some Plaintiffs were receiving long-term care in nursing homes and others were receiving care through Kentucky*s Home and Community Based Services Waiver program, but all were receiving such services by virtue of a determination that they need nursing facility services, a mandatory category of services under the federal Medicaid statute. Comp ** 1, 57- 103; * prior to April 4, 2003 Kentucky officials decided to respond to the state*s budgetary needs by eliminating $250 million worth of Medicaid services, Comp. * 2, and for that purpose alone, on April 4, 2003, issued "emergency regulations." Comp. ** 1 and 2; * the emergency regulations "substantially altered the level-of-care criteria used to determine eligibility for long-term care services," Comp. * 2, in a manner "projected to save $45 million annually." Id.; * by operation of the new regulations, between April and July 2003 1,209 people receiving HCBS and 198 people receiving nursing facility services were advised they no longer qualify for long-term care services because they do not meet the new criteria for nursing facility services. Comp * 2;6 * the rate of level of care denials increased by 480 percent from the first quarter of 2003, prior to the adoption of the regulations, to the next quarter of 2003, immediately after the effective date of the emergency regulations. Comp. * 2. * through such regulations, all Plaintiffs, without any improvement in their conditions, have been determined no longer to be eligible for long-term care. Comp. * 3, et passim;. * Defendants have compounded the problem by issuing notices of the kind attached to Plaintiffs* complaint, and by failing in some cases to ensure that benefits are continued when a timely appeal is filed. Comp. * 4; 2. Motion For Summary Judgment - Defendants have also moved, in the alternative, for summary judgment under Rule 56 of the Federal Rules of Civil Procedure. Summary judgment is appropriate only when the "pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to an material fact and the moving party is entitled to judgment as a matter of law." Atlas Concrete Pipe, Inc. V. Roger J. Au & Son, Inc. (In re Atlas Concrete Pipe, Inc.), 668 F.2d 905 (6th Cir. 1982). Such a motion normally would be accompanied by one or more affidavits setting out certain factual allegations. In this case, Defendants have filed only one affidavit, by Benjamin R. Sweger, Director of the Division of Long Term Care and Disability Services of the Kentucky Department for Medicaid Services. The affidavit, however, merely recites certain information concerning administration of the Kentucky Medicaid program. The affidavit is silent as to any healthcare, or nonbudgetary, purpose in adopting the emergency regulations and does not appear on its face to remove numerous material factual issues which preclude summary judgment for defendant. Most of the Sweger statements straddle the key April 4, 2003 date, when the emergency regulations went into effect, in a way that does not permit either the Court or Plaintiffs to ascertain the degree to which rates of denials changed after the emergency regulations went into effect. See ** 9-14, 16. These figures can not be seen as contradicting any of the information set out in Plaintiffs* Complaint. Significantly, the Sweger affidavit does not contradict Plaintiffs* allegation that after the effective date of the emergency regulations, level -of- care denials increased by 480 percent. Comp., * 2. Nor does Defendants* Memorandum shed any light on the purpose of the affidavit. That Memorandum does recite, at pages 16-17, some Sweger affidavit information, but does so without explanation. Defendants do not suggest or argue that the affidavit contradicts any of Plaintiffs* allegations. The Sweger affidavit does contain information consistent with, or which directly supports, some of Plaintiffs* contentions. For example, paragraph 15 acknowledges that during the period from April 4, through July 31, 2003, some 1201 persons who had been receiving HCBS were denied continuation of those services. This is substantially consistent with Plaintiffs* complaint, paragraph 2, alleging that 1209 persons were denied continuing HCBS during that time. Plaintiffs request the Court to take special note of paragraph 5 of the Sweger affidavit. There, Director Sweger acknowledges that all persons receiving nursing facilities services, whether in nursing homes or through the HCBS waiver program, became eligible for such services by meeting the same criteria, established for nursing facility services. He points to 907 KAR 1:022 (the regulations prior to April 4, 2003) and 907 KAR 1:022E, the "emergency regulations" adopted on April 4, 2003, as the source of such criteria. III. ARGUMENT A. Defendants Have No Health Related Reason For Adopting The New Regulations And Do Not Seriously Argue That Their Actions Comply With The Medicaid Act At the heart of this case is the fact that Defendants have determined that all Plaintiffs have met the standards for mandatory nursing facility services, but then without any change in the conditions of Plaintiffs, Defendants have, to alleviate strains on Kentucky*s overall budget, changed the regulations as a means of declaring that Plaintiffs no longer meet the standards. Defendants* primary contention is that Plaintiffs should not be permitted to come before this Court to assert their claims. They do not attempt to argue that there is any health related purpose for their actions. Nor do they carefully parse the words of the Medicaid Act or even assert that their actions are in compliance with the law. Defendants do not contest that Plaintiffs meet the categorical population requirements, nor do they appear to contest that Plaintiffs have a medical need for a mandatory service. What Defendants seem to believe, however, is that they need only provide such services to the degree they find "practicable," after Kentucky has fulfilled all its other budgetary needs and wishes. Defendants* Memorandum at 22. But Medicaid is intended to provide health care security for poor and vulnerable persons, and nursing facility services are a mandatory requirement, not an optional one. Defendants make a weak attempt to defend their actions by broadly invoking various authorities and implying that these authorities somehow give them unfettered discretion to administer the Medicaid program in such a way as to alleviate the "huge budget shortfalls" which have hit Kentucky*s "struggling economy," Defendants* Memorandum, page 2, without regard to objectives of the Medicaid program or the health care needs of Kentucky*s poorest and most vulnerable residents. However, no authority they cite furnishes any support for such a contention. The first case cited, Commonwealth v. Smith, 875 S.W. 2d 873 (Ky. 1994), involves a tax established under Kentucky state law and is inapposite. The second case, Pharmaceutical Research and Manufacturers of America v. Walsh, 123 S.Ct.1855, 155 L.Ed. 2d 889 (2003) (hereafter "Pharma") also does not support a claim that states have carte blanche discretion to adjust the Medicaid program in any way for any purpose whatever. In that case, Maine*s requirement of prior authorization for prescriptions of certain drugs was permissible, tentatively, because it was based on a health related purpose, protecting the health of Maine*s uninsured residents. Pharma also is inapplicable to this case because Congress had "effectively ratified" the practice of including prior authorization plans in state plans. 123 S. Ct. at 1861. Also, Maine*s programmatic changes involved an optional service, prescription drugs, not the mandatory services at issue here. Most in contrast with this case, the Supreme Court did not view the record as permitting a conclusion that "any patient*s medical needs would be adversely affected" by Maine*s programmatic changes, 123 S. Ct. at 1870. The Court noted the district court*s assumption that Maine*s program would "not deny a single Medicaid recipient access to the safest and most efficacious prescription drug therapy indicated for their individual medical circumstances." Id. at 1869. Even the quote from Pharma, reproduced at pages 3 and 4 of Defendants* Memorandum, far from suggesting carte blanche state discretion, bristles with requirements protecting Medicaid beneficiaries. In Alexander v. Choate, 469 U.S. 287 (1985), the Court noted that the Medicaid Act "gives the States substantial discretion to choose the proper mix of amount, scope, and duration limitation on coverage, as long as care and services are provided in *the best interest of the recipients.*" 469 U.S. at 303. Tennessee*s change in the number of annual days of inpatient hospital care for Medicaid beneficiaries from 20 to 14 was upheld because the new standard did not deny any beneficiary "meaningful access" to mandatory hospital services. In this case, defendants are not just limiting the number of hours or days of nursing care to be provided to eligible individuals, but denying nursing facility care altogether to those in medical need of these services. This is not permitted under the Medicaid Act. In Beal v. Doe, 432 U.S. 438 (1977), Pennsylvania*s decision to refuse to provide payment for nontherapeutic abortions was upheld because the state*s health-related purpose, encouraging normal childbirth, provided justification. Also, nontherapeutic abortions were an optional service, in contrast to the mandatory nursing facility services being denied Plaintiffs in this case. Neither those cases, nor any other authority of any kind, provide support for Kentucky*s attempt to shrink eligibility strictly for budgetary purposes, excluding large numbers of people from a mandatory Medicaid service which Kentucky has already recognized they need. B. Defendants Rely On Jurisdictional Obstacles to Bar Plaintiffs From Access To This Court 1. Plaintiffs Are Directly Affected By The State*s Actions And Have Standing To Bring This Action - Defendants devote several pages to argument that Plaintiffs do not have standing to bring this action. Defendants* Memorandum at 17-19. However, Plaintiffs plainly do have standing. Each plaintiff has a personal stake in the outcome of this controversy. Plaintiffs* interests sought to be protected fall within the *zone of interests* protected and regulated by the Medicaid Act, and the established legal standards for constitutional standing indisputably are met. Plaintiffs have properly alleged their concrete, particularized injury, loss of HCBS and nursing facility services; that Defendants caused their injury by adopting and implementing the regulations; and that the relief Plaintiffs seek, an injunction preventing implementation of the regulations, would redress or prevent their loss of mandated services under the Medicaid Act. Thus, Plaintiffs fully satisfy the tests of both constitutional and prudential standing. See generally, Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61 (1992); Whitmore v. Arkansas, 495 U.S. 149 (1990); Simon v. Eastern Ky.Welfare Rights Organization, 426 U.S. 26, 41-42 (1976); Allstate Ins.Co.v. Thrifty Rent-A-Car Systems, Inc., 249 F.3d 450, 456 (6th Cir.2001); and Coyne v. American Tobacco Co., 183 F.3d 488, 494 (6th Cir.1999). 2. This Court Has Jurisdiction Under Section 1983 To Hear Plaintiffs* Claims That Defendants* Actions Deprive Them Of Rights Under The Medicaid Act and the Fourteenth Amendment to the United States Constitution - 42 U.S.C. *1983 provides a cause of action to a person who has been deprived by a state official of "any rights, privileges, or immunities secured by the Constitution and laws" of the United States. Plaintiffs allege that Defendants, both of whom are Kentucky state officials, have denied them rights to which they are entitled under the Medicaid Act and the Fourteenth Amendment. Specifically, Plaintiffs allege that Defendants have denied them their rights under 42 U.S.C. *1396a(a)(10), 1396a(a)(17), 1396d(a)(4) and 1396a(a)(3), which, collectively, provide them the right to nursing facility services, reasonable eligibility standards and the right to due process when appealing decisions. In 1990, the Supreme Court found a provision of the federal Medicaid law enforceable under Section 1983. Wilder v. Virginia Hosp. Ass*n, 496 U.S. 498 (1990). The since-repealed Boren Amendment required that a state Medicaid program pay reasonable reimbursement rates. The Virginia Hospital Association filed suit under Section 1983, alleging that the rates paid by the Virginia Medicaid program were inadequate. The Supreme Court articulated what is now the traditional three-part test to determine whether an enforceable right exists: Such an inquiry turns on whether "the provision in question was intended to benefit the putative plaintiff." [Golden State Transit Corporation v. Los Angeles, 493 U.S.103, 106]. If so, the provision creates an enforceable right unless it reflects merely a "congressional preference" for a certain kind of conduct rather than a binding obligation on the governmental unit, Pennhurst State School and Hospital v. Halderman, 451 U.S. 1, 19....., or unless the interest the plaintiff asserts is "too vague and amorphous" such that it is "beyond the competence of the judiciary to enforce." 496 U.S. at 509 . Applying the test, the Court found that the Boren Amendment created a federal right and thus was enforceable under Section 1983. As Defendants* Memorandum acknowledges, the relevant issue is whether the statutory provisions "create enforceable rights, privileges, or immunities within the meaning of [Section] 1983." Wright v. Roanoke Redevelopment and Housing Authority, 479 U.S. 418, 423 (1987); see Defendants* Memorandum at 19. But Defendants somehow reach the conclusion that the entire Medicaid Act is unenforceable through Section 1983 because the Act, "creates no individual rights to specific services because it only speaks in terms of what a state must do to make itself eligible for funding." Id, at 23. In reaching this startling conclusion, Defendants practically ignore Wilder. They cite the case only once at the tail of a string of citations, Defendants* Memorandum at 21, and do not discuss it at all. Instead, the emphasis is on the Supreme Court*s decision in Gonzaga University v. Doe, 536 U.S. 273 (2002), to which Defendants refer repeatedly. The implication seems to be that Gonzaga and other recent Supreme Court cases have overruled Wilder. Defendants cite only one case in support of their theory, Sabree v. Houston, 245 F.Supp.2d 653 (E.D.Pa. 2003) (appeal pending). Defendants* Memorandum at 23. While some of the district court*s language in Sabree appears to say the Medicaid Act does not contain any rights that may be enforced under Section 1983, the case stands alone, and even that court recognizes that the Supreme Court found a provision of the Medicaid Act enforceable in Wilder. Id. at 657. Gonzaga cited Wilder with approval, 536 U.S. at 278, and other courts have recognized that Gonzaga did not undermine Wilder. In Ass*n of Residential Resources in Minnesota (ARRM) v. Minnesota Commissioner of Human Services, 2003 WL 22037719 (D.Minn. Aug. 23, 2003) (Exhibit D) (hereafter, "ARRM"), a provider association sued under Section 1983, relying on two separate provisions of the Medicaid Act. First , the provider claimed denial of rights in 42 U.S.C. *1396n(c)(2)(A), requiring state assurance that "necessary safeguards (including adequate standards for provider participation) have been taken to protect the health and welfare of individuals provided services under the [home and community based] waiver......"). The district court cited the Sixth Circuit*s opinion in Wood v. Tompkins, 33 F.3d 600 (6th Cir, 1994), in finding that the provision created an enforceable right for Medicaid recipients. "Defendants challenge the vitality of Woods given the Supreme Court*s decision in Gonzaga. Gonzaga, however, did not explicitly overrule Woods, and the Court finds Woods persuasive here." 2003 WL 22037719 at *6. However, the district court, citing Gonzaga, found that the provision only "unambiguously" intended to benefit Medicaid recipients, not providers. Therefore ARRM did not have an enforceable right in 42 U.S.C. *1396n(c)(2)(A) Id. at *6. The court reached a different conclusion on ARRM*s claim that it was denied rights under 42 U.S.C. *1396a(a)(30), the Medicaid Act*s "equal access provision,"requiring that provider payments be "consistent with efficiency, economy, and quality of care and are sufficient to enlist enough providers so that care and services are available." The district court cited the Eighth Circuit*s holding in Arkansas Medical Society v. Reynolds, 6 F.3d 519 (8th Cir. 1993), that the provision created an enforceable right for providers. The court continued, "Defendants question the continued vitality of Arkansas Medical Soc*y, and urge that the equal access provision does not create a private right of action for [p]laintiffs under the holding of Gonzaga University. Gonzaga, however, did not overrule Arkansas Medical Soc*y. Nor did it overrule the case on which Arkansas Medical relied*Wilder v. Virginia Hosp. Ass*n." 2003 WL 22037719 at *7. Similarly, the district court in Missouri Child Care Ass*n v. Martin, 241 F.Supp.2d 1032 (W.D.Mo.2003) refused to read Gonzaga as overruling any part of Wilder. The court in Missouri Child Care Ass*n found a provision of the federal Child Welfare Act, 42 U.S.C. **670, et seq, enforceable by child care providers under Section 1983 using the reasoning of Wilder. The court said: In Gonzaga, the U.S. Supreme Court did not overrule Wilder. Without criticism, it stated that in Wilder, it had found standing to sue under Section 1983 "to enforce a reimbursement provision of the Medicaid Act, on the ground that the provision....in Wilder explicitly conferred specific monetary entitlements upon plaintiffs." Gonzaga, 122 S.Ct. at 2774. The Supreme Court in Gonzaga then pointed out that in Suter and Blessing the Court had refused to infer enforceable rights under the spending clause, but may have put a misleading emphasis on benefits instead of focusing on Congress* intent to permit individual suits to enforce spending legislation. If the Supreme Court had intended to overrule Wilder, one would expect the criticisms or clarification to be directed at Wilder and not Blessing and Suter. Id., at 1040-41 (emphasis added). See also Bryson v. Shumway, 308 F.3d 79, 88 (1st Cir.2002). Defendants stress that the "Supreme Court has only twice found spending legislation to confer individual enforceable rights," Memorandum at 21 (emphasis in original). But they do not address the fact that one of those was Wilder, which upheld judicial enforcement of the Medicaid statute. In addition to Gonzaga, Defendants cite Suter v. Artist M., 503 U.S. 347 (1992), and Blessing v. Freestone. 520 U.S. 329 (1997), perhaps intending to suggest that those cases have somehow overruled Wilder. But those cases have not overruled or eroded Wilder. In Suter, the Court reaffirmed Wilder, but in a way that some construed to prevent Section 1983 actions, where the statute is based on a state plan, as is the Medicaid statute. Congress specifically overruled Suter in that respect, saying in a 1994 law which remains in effect today: In an action brought to enforce a provision of the Social Security Act, such provision is not to be deemed unenforceable because of its inclusion in a section of the Act requiring a State plan or specifying the required contents of a State plan. This section is not intended to limit or expand the grounds for determining the availability of private actions to enforce State plan requirements other than by overturning any such grounds applied in Suter v. Artist M., 112 S.Ct. 1360 (1992), but not applied in prior Supreme Court decisions respecting such enforceability.... 42 U.S.C. *1320a-2 (emphasis added). Blessing also reaffirmed Wilder and repeated the three part test. Indeed, more recent cases refer to this as the Blessing test. The Sixth Circuit Court of Appeals has concluded that neither Suter nor Blessing limited an individual*s right to enforce provisions of the Medicaid Act by virtue of its nature as a spending clause program. In Wood v. Tompkins, 33 F.3d 600 (6th Cir.1994), the court found the Medicaid home and community-based waiver program provisions enforceable under Section 1983 and said, "[T]he Suter majority expressly relied on parts of Wilder, carefully distinguished other parts, did not overrule the earlier case, and is entirely consistent with it....Defendant contends that Suter significantly changed the law.....[T]his contention is without merit." 33 F.2d at 606. See also Westside Mothers v. Haveman, 330 F.3d 758 (6th Cir.2002) (Medicaid early and periodic screening, diagnosis and treatment ("EPSDT") services enforceable under Section 1983); and Gean v. Hattaway, 330 F.3d 758 (6th Cir.2003) (Medicaid statutory fair hearing provision and implementing regulations enforceable under Section 1983).7 Therefore, in determining whether Plaintiffs have enforceable rights within 42 U.S.C. *1396a(a)(10), 1396a(a)(17),1396d(a)(4) and 1396a(a)(3), the question continues to turn on whether the provisions: 1) unambiguously confer rights intended to benefit the Plaintiffs; 2) create a binding obligation on the state rather than merely reflecting a congressional preference for a certain kind of conduct; and 3) are sufficiently clear and focused as to be within the competence of the judiciary to enforce. a. Plaintiffs* First Claim Is Based Upon Enforceable Rights Created By 42 U.S.C. **1396a(a)(10)(A)(i) and 1396d(a)(4) - Plaintiffs* first claim is that Defendants have denied them "nursing facility services" in violation of 42 U.S.C. **1396a(a)(10)(A)(i) and 1396d(a)(4). One meeting the age and financial requirements of 42 U.S.C. *1396a(a)(10)(A) must be provided the Medicaid services enumerated in *1396d(a)(1)-(5), (17) and (21), which includes nursing facility services (*1396d(a)(4)). Plaintiffs contend that these are rights enforceable under *1983, and that Kentucky*s actions in redefining eligibility for such mandatory services in a way designed to exclude, for budgetary reasons, persons whom Kentucky already has recognized need nursing facility services is a per se violation of Plaintiffs* rights under those provisions. Just one year ago, the Sixth Circuit found that Medicaid beneficiaries had rights enforceable under *1983 in virtually identical provisions of the Medi caid Act * 42 U.S.C. *1396a(a)(10) and 1396d(a)(4). Westside Mothers v. Haveman, 289 F.3d 852 (6th Cir. 2002). In Westside Mothers, plaintiffs were children claiming that Michigan was illegally denying them early and periodic, screening, diagnostic and testing (EPSDT) services. Plaintiffs claimed that individuals meeting the age and financial requirements of one of the categorical populations in 42 U.S.C. *1396a(a)(10) must be provided the mandatory services found in *1396d(a)(1)-(5), (17) and (21). Specifically, the plaintiffs claimed that they were being denied services found in *1396d(a)(4), which includes, "(A) nursing facility services.....for individuals 21 years or older; (B) early and periodic screening, diagnostic, and treatment services.....for individuals eligible under the plan and are under the age of 21; (C) family planning services and supplies furnished....to individuals of child-bearing age....who are eligible under the State plan and who desire such services and supplies." 289 F.3d at 856, 863. Under the above provisions, the Sixth Circuit found rights enforceable under *1983. "First, the provisions were clearly intended to benefit the putative plaintiffs, children who are eligible for the screening and treatment services." Id. at 863. The court focused on *1396a(a)(10)(A), which declares that each state "must....provide (A) for making medical assistance available, including at least the care and services listed in paragraphs (1) through (5), (17) and (21) of section 1396d(a) of this title, to * (i) all individuals [who meet the age and financial requirements of a categorical population]." Next, it found that the relevant provisions set a binding obligation on the state. "They are couched in mandatory rather than precatory language, stating that Medicaid services *shall be furnished* to eligible children." Id. at 863. The court referred to *1396a(a)(8) of the Medicaid statute, which declares that participating states "must....provide that all individuals wishing to make application for medical assistance under the plan shall have opportunity to do so, and that such assistance shall be furnished with reasonable promptness to all individuals." (emphasis provided). Lastly, the court found that the provisions were not too vague or amorphous to be enforced by a court. To reach this conclusion, the court pointed out that EPSDT services were specifically defined in *1396d(r). It also concluded that Congress did not foreclose enforcement in the language of the Medicaid statute, nor did it establish "any remedial scheme sufficiently comprehensive to supplant *1983." Id. The very same provisions that were at issue in Westside Mothers are at issue in the case at hand. Plaintiffs claim that they meet the age and financial requirements of one of the categorical populations in 42 U.S.C. *1396a(a)(10)(A), but are being denied Medicaid coverage for nursing facility services, a mandatory service contained in *1396d(a)(1)-(5), (17) and (21). In fact, the service Plaintiffs are being denied are contained in *1396d(a)(4), the same provision in *1396d that contains the EPSDT provision. There is nothing to distinguish the provisions at issue in Westside Mothers with the provisions the Plaintiffs are seeking in the case at hand. Clearly, plaintiffs are the intended beneficiaries of 42 U.S.C. *1396a(a)(10) * they have met the age and financial requirements of the section, and the state therefore "must provide (A) for making medical assistance available, including at least the care and services listed in paragraphs 1-5, 17 and 21 of section 1396d(a)" to them. And as directed by the Sixth Circuit in Westside Mothers, the determination of whether the statute creates a binding obligation for the state of Kentucky entails a simple reference to 42 U.S.C. *1396a(a)(8), which dir ects that eligible individuals "shall be furnished" medical assistance, which the statute defines as including, at a minimum, nursing facility services. Third, the provisions are not so vague and amorphous as to defeat judicial enforcement. Just as the EPSDT services were defined in *1396d (*1396d(r)), so too are nursing facility services (*1396d(f)). It also cannot be said that Congress prohibited enforcement within the statute, or that there is any "comprehensive enforcement mechanism" within the statute such that private enforcement is barred. Nothing in the Medicaid statute has changed since Westside Mothers. See also Wood v. Tompkins, 33 F.3d at 612 ("In Wilder, the Supreme Court held that the administrative remedies set forth in the Medicaid Act for violations under the Act *cannot be considered sufficiently comprehensive to demonstrate a congressional intent to withdraw a private remedy. 496 U.S. at 522, 110 S.Ct. At 2524. This holding is dispositive in the present case, for the remedies described in Wilder are the very same remedies set forth in the Medicaid Act for the alleged violations at issue in the present case. They are no more comprehensive now than they were in Wilder"). Furthermore, the provisions at issue here are easily distinguishable from the provisions reviewed by the Supreme Court in Gonzaga. In analyzing FERPA*s nondisclosure provision, the Court noted that the provision spoke only "in terms of institutional policy and practice, not individual instances of disclosure." Gonzaga, 536 U.S. at 288. "Therefore, as in Blessing, they have an *aggregate* focus, 520 U.S. at 343, 117 S.Ct. 1353, they are not concerned with *whether the needs of any particular person have been satisfied." Id. (emphasis provided). The Medicaid Act, however, in mandating that "medical assistance....shall be furnished....to eligible individuals," *1396a(a)(8), and that such medical assistance is specifically defined to include a select group of services, each of which is carefully defined (*1396d), cannot possibly be said to be unconcerned with "the needs of any particular person." Therefore, 42 U.S.C. **1396a(a)(10) and 1396d(a)(4) contain rights that Plaintiffs may enforce under *1983. b. Plaintiffs Second Claim Is Based On Enforceable Rights Established By 42 U.S.C. *1396a(a)(17) of The Medicaid Act - Plaintiffs* second claim is that Defendants are now enforcing unreasonable standards for determining eligibility for nursing facility services in violation of 42 U.S.C. *1396a(a)(17). This provision mandates that "a state plan for medical assistance must.....(17).....include reasonable standards (which shall be comparable for all groups.......) for determining eligibility for and the extent of medical assistance under the plan.....which are consistent with the objectives of [the Medicaid Act.]" This provision also provides a right that is enforceable under *1983. A federal district court in the Sixth Circuit found this statutory provision enforceable under *1983, and the Sixth Circuit Court of Appeals affirmed the district court*s decision. Markva v. Haveman, 168 F.Supp.2d 695 (E.D.Mich.2001), aff*d, 317 F.3d 547 (6th Cir.2002). In Markva, the plaintiffs were grandparent caretakers who challenged Michigan*s Medicaid eligibility evaluation policy of only allowing parents to deduct from their income certain expenses they incurred in caring for their children. Grandparents seeking Medicaid eligibility who were the caretakers of their grandchildren were prohibited from making the same deductions. The plaintiffs claimed, among other things, that the eligibility policy violated *1396a(a)(17). 168 F.Supp.2d at 699, 707. The state claimed that the plaintiffs had no enforceable right to prosecute *1396a(a)(17) under *1983. The district court disagreed. "[T]he statute by its terms is intended to provide standards upon which individual applicants can rely in the determination of their benefit eligibility by state officials. It is intended to benefit the plaintiffs, and it is a binding obligation on the state agency." Id., at 711. This provision too * *1396a(a)(17) * is easily distinguishable from the provision at issue in Gonzaga. This provision directs that a state "must" include reasonable standards which "shall" be comparable for all eligible individuals and which are "consistent with the objectives" of the Medicaid Act. Section 1396a(a)(17) clearly speaks in terms "of the benefitted class," Gonzaga, 536 U.S. at 287, citing Cannon v. University of Chicago, 441 U.S. 677, 690-93 (1979), as opposed to the nondisclosure provisions of FERPA, which "speak only to the Secretary of Education," and are "two steps removed from the interests of individual students." 536 U.S. at 287. Furthermore, the Court declared in Gonzaga that "[o]ur conclusion that FERPA*s nondisclosure provisions fail to confer enforceable rights is buttressed by the mechanism that Congress chose to provide for enforcing those provisions.....These administrative procedures squarely distinguish this case from Wright and Wilder, where an aggrieved individual lacked any federal review mechanism...." Id. at 289-90 (emphasis added). And as the Sixth Circuit said, "[T]he remedies described in Wilder are the very same remedies set forth in the Medicaid Act for the alleged violations at issue in the present case. They are no more comprehensive now than they were in Wilder." Wood v. Tompkins, 33 F.3d at 612. Therefore, applying the proper Section 1983 analysis to all three provisions cited by Plaintiffs reveals that all three contain enforceable rights, and the courts that have had the opportunity to review these provisions have concluded as much. All three are clearly intended to benefit the plaintiffs, speak in mandatory terms and are not vague or amorphous. Binding precedent establishes that the enforcement mechanism in the Medicaid Act is not so comprehensive as to foreclose private enforcement under Section 1983, and the provisions cannot be considered less than an unambiguously conferred right. Therefore, Plaintiffs must be allowed to proceed with their Medicaid claims. c. Plaintiffs* Fourth and Fifth Claims Are Based Upon Enforceable Rights Established by 42 U.S.C. *1396a(a)(3) and the Fourteenth Amendment - Plaintiffs allege that Defendants have denied them due process of law in violation of 42 U.S.C. *1396a(a)(3), its implementing regulations, 42 C.F.R. *431.200 et seq., and their constitutional due process rights under the Fourteenth Amendment to the United States Constitution8. Under the Medicaid Act, participating states must provide the opportunity for a fair hearing if Medicaid benefits are denied. 42 U.S.C. *1396a(a)(3). The regulations, 42 C.F.R. *431.205(d), explicitly require that the Medicaid state hearing system meet the constitutional due process standards set forth in Goldberg v. Kelly, 397 U.S. 254 (1970). Numerous cases have found that the fair hearing requirements under the Medicaid Act, as well as the procedural due process protections under the Fourteenth Amendment, provide rights that are enforceable under 42 U.S.C. *1983. See Moffitt v. Austin , 600 F.Supp. 295 (W.D. Ky. 1984) (Claim allowed under *1983 for violations of procedural due process under the Medicaid Act, its regulations and the Fourteenth Amendment.,9 where state failed to provide Medicaid recipients in intermediate care facilities with benefits pending terminations and with specific reasons for terminations); Daniels v. Wadley, 925 F.Supp. 1305 (M.D. Tenn. 1996), aff*d in part and modified in part, 1998 U.S. App. LEXIS 7973 (6th Circuit, April 22, 1998)10 (Plaintiffs permitted to proceed in *1983 action to contest provisions of a Medicaid managed care program that violated *1396a(a)(3) and the Fourteenth Amendment by failing to: a) maintain enrollee*s benefits pending resolution of a coverage dispute; b) resolve claim disputes within ninety days; and c) hold predeprivation hearing with an impartial hearing officer). Since the United States Supreme Court*s most recent rulings on the *1983 cause of action, Blessing v. Freestone, 520 U.S. 329 (1997) and Gonzaga University v. Doe, 536 U.S. 273 (2002), the Sixth Circuit has again found that a Medicaid beneficiary may bring a *1983 claim for alleged violations of due process under *1396a(a)(3) the Medicaid Act. Gean v. Hattaway, 2003 U.S. App. LEXIS 11291; 2003 Fed. App. 0183P (6th Cir. June 6, 2003). Section 1396a(a)(3) meets the Gonzaga test because that section is phrased in terms of fair hearing rights for the person(s) benefitted - Medicaid beneficiaries - demonstrating that Congress unambiguously intended to create a federal right for such individuals. Gonzaga, 536 U.S. at 283-84. Plaintiffs may pursue their due process claims under *1983 because *1396a(a)(3) of the Medicaid Act and the Fourteenth Amendment are intended to establish enforceable federal rights and have been held to do so. Both provisions are clearly intended to benefit Medicaid recipients, are phrased in mandatory terms and are not vague or amorphous. The above cases clearly demonstrate that Plaintiffs may bring a *1983 claim to assert violations, under color of state law, of their procedural due process rights under the Medicaid Act as well as under the Fourteenth Amendment. 3. The Court Has Jurisdiction Under 28 U.S.C. Section 1331 to Consider and Rule Upon Plaintiffs* Supremacy Clause Claim - Even if Defendants were correct in their mistaken contention that Plaintiffs have no rights under the Medicaid statute which may be asserted under 42 U.S.C. *1983, this would not alter the fact that the court has jurisdiction over Plaintiffs* Supremacy Clause claim under 28 U.S.C. *1331.11 Plaintiffs seek injunctive and declaratory relief from enforcement of the Kentucky emergency regulations on the grounds that the regulations are in conflict with, and therefore are preempted by the Federal Medicaid Act. Complaint, Third Claim, ** 112-114. This is sufficient to vest this court with jurisdiction over Plaintiffs* preemption claims without regard to whether the Medicaid statute directly vests Plaintiffs with a cause of action. In another case involving the Medicaid Act, the Second Circuit Court of Appeals said: We know of no governing authority to the effect that the federal statutory provision which allegedly preempts enforcement of local legislation by conflict must confer a right on the party that argues in favor of preemption. On the contrary, a state or territorial law can be unenforceable as preempted by federal law even when the federal law secures no individual substantive rights for the party arguing preemption. Id. Thus, regardless of whether the Medicaid statute's relevant provisions were designed to benefit PhRMA, PhRMA can invoke the statute's preemptive force. Pharmaceutical Research and Manufacturers of America v. Walsh, 249 F. 3d 66, 73 (1st Cir. 2001), rev*d on other grounds, __U.S__, 123 S. Ct. 1855, 155 L.Ed. 2d 889 (2003). Preemption derives from the Supremacy Clause of the United States Constitution, which provides that the laws of the United States Constitution "shall be the supreme Law of the Land...any Thing in the Constitution or Laws of any State to the Contrary notwithstanding." U.S. Const. art. VI, cl. 2. The Supreme Court has held that a claim that a state statute or regulation is preempted by federal law is a justiciable cause of action which gives this federal court both jurisdiction and the power to resolve preemption claims: It is beyond dispute that federal courts have jurisdiction over suits to enjoin state officials from interfering with federal rights. See Ex Parte Young, 209 U.S. 123, 160-62, 28 S. Ct. 441, 444-455, 52 L. Ed. 714 (1908). A plaintiff who seeks injunctive relief from state regulation, on the ground that such regulation is preempted by a federal statute which, by virtue of the Supremacy Clause of the Constitution, must prevail, thus presents a federal question which the federal courts have jurisdiction under 28 U.S.C. * 1331 to resolve. This Court, of course, frequently has resolved pre-emption disputes in a similar jurisdictional posture. Shaw v. Delta Airlines, 463 U.S. 85, 96 n.14 (1983)). In Verizon Md. Inc. v. Pub. Serv. Comm*n of Md., 535 U.S. 635 (2002), the Supreme Court last year affirmed this rule, holding that jurisdiction was supplied by 28 U.S.C. *1331 to review Verizon*s claim that a decision of a state utility commission was preempted by the Telecommunications Act. The Court said: We have no doubt that federal courts have jurisdiction under *1331 to entertain such a suit. Verizon seeks relief from the Commission*s order "on the ground that such regulation is pre-empted by a federal statute which, by virtue of the Supremacy Clause of the Constitution, must prevail," and its claim "thus presents a federal question which the federal courts have jurisdiction under 28 U.S.C. *1331 to resolve." Shaw v. Delta Air Lines, Inc. 463 U.S. 85, 96 N.14 (1983). 532 U.S. at 642. This jurisdiction is not affected by the absence of a private cause of action stated in the statute. In Verizon, the Supreme Court said: The Commission contends that since the Act does not create a private cause of action to challenge the Commission*s order, there is no jurisdiction to entertain such a suit. We need express no opinion on the premise of this argument. "It is firmly established in our cases that the absence of a valid (as opposed to arguable) cause of action does not implicate subject-matter jurisdiction, i.e., the court*s statutory or constitutional power to adjudicate the case." Steel Co. v. Citizens for Better Environment, 523 U.S. 83, 89 (1998)). As we have said, "the district court has jurisdiction if *the right of the petitioners to recover under their complaint will be sustained if the Constitution and laws of the United States are given one construction and will be defeated if they are given another,* unless the claim *clearly appears to be immaterial and made solely for the purpose of obtaining jurisdiction or where such a claim is wholly insubstantial and frivolous.* " Ibid. 535 U.S. at 642-43.(citations omitted). Thus, the Court upheld preemption jurisdiction without finding it necessary to determine whether Verizon had a private right of action under the Telecommunications Act providing for a cause of action . Id. In Lawrence County v. Lead-Deadwood Sch. Dist. No. 1, 469 U.S. 256, 259 n. 6 (1985), the Court stated: The county originally sought a declaratory judgment that the state statute conflicted with the federal Act and was therefore invalid under the Supremacy Clause. The Federal District Court entered a declaratory judgment in favor of the county. Lawrence County v. South Dakota, 513 F .Supp. 1040 (SD 1981). The Court of Appeals for the Eighth Circuit vacated that judgment, however, concluding that the county's invocation of the Supremacy Clause did not convert the action into one arising under federal law for purposes of federal jurisdiction under 28 U.S.C. * 1331. 668 F.2d 27 (1982). This ruling was erroneous. In Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 103 S.Ct. 2890, 77 L.Ed.2d 490 (1983), we granted declaratory relief to a party challenging a state statute on pre-emption grounds, reaffirming the general rule that "[a] plaintiff who seeks injunctive relief from state regulation, on the ground that such regulation is pre-empted by a federal statute which, by virtue of the Supremacy Clause of the Constitution, must prevail, thus presents a federal question which the federal courts have jurisdiction under 28 U.S.C. *1331 to resolve." Id., at 96, n. 14, 103 S.Ct., at 2899, n. 14. See also Dalton v. Little Rock Family Planning Services, 516 U.S. 474 (1996) (enjoining state statute conflicting with the Medicaid statute). The Sixth Circuit Court of Appeals also has recognized that federal courts have jurisdiction under 28 U.S.C. *1331 over suits to enjoin state officials from enforcing state laws which conflict with federal law. Bunning v. Kentucky, 42 F.3d 1008, 1011 n.3 (6th Cir. 1994); also see Mich.Bell Tel.Co. v. MFS Intelenet of Mich.Inc., 339 F.3d 428 (6th Cir. 2003); and GTE North, Inc. v. Strand, 209 F. 3d 909 (6th Cir. 2000). In Bunning, plaintiff sued to enjoin the operation of the Kentucky Public Financing Campaign Act on the ground that it was in conflict with the Federal Election Campaign Act and hence preempted by the Supremacy Clause. The District Court entered judgment enjoining the Kentucky statute and the Sixth Circuit affirmed. The court did not find a private right of action, but nonetheless said: The district court's subject matter jurisdiction to entertain Congressman Bunning's preemption challenge to the Registry's investigation is clear. Lawrence County v. Lead-Deadwood Sch. Dist. No. 1, 469 U.S. 256, 259 n. 6, 105 S.Ct. 695, 697 n. 6, 83 L.Ed.2d 635 (1985); Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 96 n. 14, 103 S.Ct. 2890, 2899 n. 14, 77 L.Ed.2d 490 (1983) [FN3]; Alltel Tennessee, Inc. v. Tennessee Pub. Serv. Comm'n, 913 F.2d 305 (6th Cir.1990). Other courts of appeals too have found that 28 U.S.C. *1331 provides jurisdiction for courts to adjudicate the merits of preemption claims without finding a private cause of action under the relevant federal statute. Shaw Self - Ins. Inst. of Am.v. Korioth, 993 F.2d 479, 483 (5th Cir. 1993) and Gillis v. Louisiana, 294 F.3d 755, 760 (5th Cir. 2002)). See Ill. Ass*n of Mortgage Brokers v. Office of Banks and Real Estate, 308 F.3d 762, 765 (7th Cir. 2002) ("It is not necessary for us to determine whether" the federal law at issue by "its own force create[s] rights enforceable under *1983" because "federal jurisdiction is supplied . . . when the plaintiff seeks declaratory relief against regulation by a state agency and contends that the agency has violated federal law by adopting particular regulations.") (citations omitted); St. Thomas - St. John Hotel & Tourism Ass*n v. Gov*t of the U.S. V.I., 218 F.3d 232, 241 (3d Cir. 2000) ("We know of no governing authority to the effect that the federal statutory provision which allegedly preempts enforcement of local legislation by conflict must confer a right on the party that argues in favor of preemption. On the contrary, a state or territorial law can be unenforceable as preempted by federal law even when the federal law secures no individual substantive rights for the party arguing preemption.") (citations omitted); Bud Antle, Inc. v. Barbosa, 45 F.3d 1261, 1269 (9th Cir. 1995) ("Even in the absence of an explicit statutory provision establishing a cause of action, a private party may ordinarily seek declaratory and injunctive relief against state action on the basis of federal preemption.") (citation omitted). The Second Circuit in Burgio and Campofelice, Inc. v. NYS Dep*t of Labor, 107 F.3d 1000 (2d Cir. 1997), held that "[a]lthough there is some confusion in the cases, we agree with those commentators who have concluded that *[t]he best explanation of Ex parte Young and its progeny is that the Supremacy Clause creates an implied right of action for injunctive relief against state officers who are threatening to violate the federal Constitution or laws.* " (citing 13B C. Wright, A. Miller & E. Cooper, Federal Practice & Procedure: Jurisdiction 2d * 3566, at 102 (1984); see also Guaranty Nat'l Ins. Co. v. Gates, 916 F.2d 508, 512 (9th Cir.1990) (quoting same). But see Legal Envtl. Assistance Found., Inc. v. Pegues, 904 F.2d 640, 643 (11th Cir.1990)). The decision in Planned Parenthood of Central Texas v. Sanchez, 280 F. Supp. 590 (W.D. Tex. Aug. 2003)(appeal pending) is directly in point. Although finding that providers, such as plaintiffs in that case, have no Section 1983 rights under the Medicaid Act sections sought to be enforced, the court nonetheless enjoined the state statute as conflicting with the Medicaid statute under the Supremacy Clause/preemption doctrine discussed above. This case falls squarely within the holding of Verizon and other cases cited here. Plaintiffs contend that Kentucky*s emergency regulations are contrary to the Medicaid statute and are therefore violative of the Supremacy Clause. There is no contention by Defendants, nor could there be, that Plaintiffs* claims are "immaterial" or "wholly insubstantial and frivolous." Accordingly, the claims asserted by Plaintiffs present federal questions which come within this Court*s jurisdiction under 28 U.S.C. *1331 to enforce claims of preemption under the Supremacy Clause. C. Defendant*s Motions to Dismiss or For Summary Judgment on Plaintiff*s Due Process Claims Must Also Be Denied The Complaint (Fourth and Fifth Claim) clearly sets forth violations of the procedural due process provisions of the federal Medicaid Act and regulations, as well as the Kentucky Medicaid regulations and the 14th Amendment to the United States Constitution. Complaint, ** 53-56, 59, 64, 68, 73, 78, 83, 88-89, 93-94, 99 and 102. These allegations are admitted for the purposes of the motion to dismiss. As to summary judgment, defendants have not submitted any affidavits or other evidence to demonstrate that there are no material facts at issue as required by Rule 56. By contrast, the Declarations that Plaintiffs have attached as Exhibits further outline these procedural violations. See Exhibit F - Declarations of Vada Jewell Kerr ** 21-26; Exhibit G - Gena Bell ** 11; Exhibit H - Thelma Garmon * 17; Exhibit I - Patricia Moore ** 14, 15; Exhibit J - Lydia Allgood ** 7, 8; Exhibit K - Janet Hannah ** 4, 5, 7; Exhibit N - Ovaleria Dubree ** 10; In fact, Defendants* own conduct concedes that the notices were inadequate. When faced with due process objections to the notices from other class members who were fortunate enough to obtain representation, defendants issued new notices,12 but only when ordered to do so by the state*s own administrative law judges. Complaint ** 59, 78; Exhibit G - Gena Bell * 11; Exhibit I - Patricia Moore *15. In addition, most of the named Plaintiffs who had not already had their defective notices vacated received revised notices after the complaint was filed. See Exhibit O - Amended Notice to Hazel Barnett; Exhibit P - Amended Notice to Tommy Hill; Exhibit J - Lydia Allgood * 8; Exhibit K - Janet Hannah * 7. These revised notices did nothing to help the thousands of Medicaid applicants and beneficiaries who received only the original notice and who may have surrendered their right to a hearing and continued benefits pending the hearing decision because of the confusing notices described below. Section 42 U.S.C..*1396a(a)(3) requires states to provide a fair hearing whenever a Medicaid service is denied. The implementing regulations, 42 C.F.R. *431.200 et seq., say: A notice required under *431.206(c)(2), (c)(3), or(c)(4) of this subpart must contain--(a) A statement of what action the State, skilled nursing facility, or nursing facility intends to take;(b) The reasons for the intended action;(c) The specific regulations that support, or the change in Federal or State law that requires, the action;(d) An explanation of* (1) The individual's right to request an evidentiary hearing if one is available, or a State agency hearing; or (2) In cases of an action based on a change in law, the circumstances under which a hearing will be granted; and(e) An explanation of the circumstances under which Medicaid is continued if a hearing is requested. 42 C.F.R. *431.210. See comparable Kentucky Medicaid regulations at 907 KAR 1:563. The notices sent to Plaintiffs and other class members, advising them that they were no longer eligible for nursing home or HCBS under the new level of care criteria were deficient in major respects. Such failures are all the more critical when the class of recipients is by definition elderly and disabled. See Vargas v. Trainor, 508 F.2d 485, 489-90 (7th Cir. 1974). 1. Inadequate Statement of Reasons - All of the Plaintiffs originally received adverse notices stating: Healthcare Review Corporation, having reviewed your medical case with your physician or having made an effort to contact your physician, has determined that the case as presented, does not meet payor criteria for: continued stay in a facility. See Exhibits A through J to the Complaint13. The notices to five Plaintiffs added, "*documentation was insufficient to support level of care for continued stay in a nursing facility." See Exhibits A through E to the Complaint. The notices sent to five other Plaintiffs added: "*documentation does not support medical necessity/appropriateness for continued stay in a nursing facility level of care as outlined in 907 KAR 1:022." See Exhibits F through J to the Complaint. These notices fail to give the Plaintiffs any idea of the specific reason why they do not meet the level of care criteria, as required by 42 C.F.R. *431.210(b) and 907 KAR 1:563 Sec. 2(3)(b). This information is essential to allow Plaintiffs to prepare for a hearing to contest the denial of long-term care benefits under Medicaid. Moffitt v. Austin, 600 F. Supp. 295, 297-98 (W.D. Ky. 1984) is directly in point. It held that notices that state "further stay at the intermediate care facility not necessary" and "after due consideration of the medical data, ... the adverse decision should be upheld" are too generic and the boiler-plate reasons are inadequate to allow the individuals to prepare a defense and hence violate the due process regulations. None of the notices sent to named plaintiffs or class members gave a reason that identified which of the many pages of criteria had not been met. The notice do es not enable a Medicaid beneficiary to understand what information would have to be produced at an administrative hearing. 2. No Citation or Erroneous Citation to Authority Supporting or Requiring the Action - Defendants* notices were required to contain "the specific regulations supporting the action". 42 C.F.R. * 431.210(c); 907 KAR 1:563 Sec. 2(3)(c). This requirement, along with the other regulatory notice requirements, "is necessary to protect claimants against proposed agency action *resting on . . . misapplication of rules [or] policies [to] the facts of particular cases.*" Ortiz v. Eichler, 794 F.2d 889, 893 (3rd Cir.1986), quoting Goldberg v. Kelly, 397 U.S. at 268. See also Rodriguez v. Chen, 985 F. Supp. 1189, 1195 (D.Az.1996) (citation to the law relied on must be accurate and tailored to the individual case). None of the original adverse level of care notices sent to Plaintiffs cited to an accurate, specific regulation that supported the decisions. The notices to five Plaintiffs failed to cite any regulation. Complaint, Exhibits A through E. Notice to another Plaintiff incorrectly cited to 907 KAR 1:022, which had been replaced by 907 KAR 1:022E. Complaint, Exhibit G. Sections 907 KAR 1:022 and 1:022E are both very long, complicated regulation s . None of the notices even made an attempt to identify what section or subsection of the regulation was at issue. The emergency regulation, 1.022E, for example, is at least twelve pages long. It is unreasonable to expect beneficiaries receiving this notice to locate the regulations, navigate through dense text, and conclude which section is the applicable provision. 3. Failure to Explain When Benefits Will Be Continued Pending Appeal - Adverse notices must provide an explanation of the circumstances under which Medicaid will be continued if a hearing is requested. 42 C.F.R. *431.210(e); 907 KAR 1:563 Sec. 5. The original adverse notices sent to Plaintiffs explained it this way: If the request for an administrative hearing is postmarked or received within ten (10) calendar days of the adverse advance notice date of the denial specified on the notice for denial of level of care, Medicaid vendor payments shall continue until the date the hearing decision is rendered. See Exhibits A through J of the Complaint. This language is confusing in many ways. First, it is unclear whether the request for appeal has to be mailed or be received within ten days. Also there are two dates on the notice, but no date is identified as the adverse advance notice date. 4. Numerous and Conflicting Notices Violate Due Process - In Plaintiff Hannah*s case, she received so many conflicting notices and was so confused that she took no action, resulting in the loss of her HCBS and subsequently her Medicaid card. On April 11, 2003, she received an adverse notice advising that she no longer met the payor criteria for continued stay in a facility. See Complaint, Exhibit D. Ten days later, on April 21, 2003, she received two notices from defendants, one advising that she no longer qualified for Medicaid (Exhibit Q), and one advising that she still qualified for Medicaid (Exhibit R). See Complaint ** 93 - 94; Janet Hannah ** 4-5. See also Exhibit F - Vada Jewell Kerr ** 25-26; Complaint * 60. Self-contradicting notices that create confusion on the part of recipients about how to decide whether they are entitled to a hearing, and how to express that decision, are notices that "unreasonably discourage the exercise of a recipient*s established right." Ward v. Thomas, 895 F. Supp. 401, 404 (D. Conn.1995). 5. Benefits Are Not Continued Pending Appeal - Defendants assert, without any documentation, that individuals who have appealed an adverse level of care decision within ten days will continue to receive benefits pending appeal, as required by 42 C.F.R. *431.230 and 907 KAR 1:563 Sec. 5. Defendants* Memorandum at 13. In fact, when the new regulations went into effect, many HCBS Medicaid recipients had their services terminated even if they have appealed within ten days. In Plaintiff Tivitt*s case, this resulted in loss of benefits for almost two months before services resumed. See Exhibit N - Ovaleria Dubree ** 10-11. In Plaintiff Garmon*s case, she requested a timely appeal on June 6, but had no services at all until July 23, when she was offered sharply limited services. See Complaint * 73; Exhibit H - Thelma Garmon. *17. D. Plaintiffs Are Not Required to Exhaust Their Administrative Remedies Defendants assert that this case should be dismissed because Plaintiffs have failed to exhaust their administrative remedies. In support of this contention, Defendants cite Crayton v. Callahan, 120 F.3d 1217 (11th Cir. 1997), a case in which the court found that plaintiffs failed to exhaust their administrative remedies with a federal defendant, the Social Security Administration. The Crayton plaintiffs raised claims under the judicial review provision of the Social Security Act, *504 of the Rehabilitation Act, 29 U.S.C. 794, and the due process clause of the Fourteenth Amendment. Plaintiffs bring this case unde r 42 U.S.C. *1983 and the Supremacy Clause for alleged violations, by state actors, of the federal Medicaid Act and the due process clause. Therefore, it is more appropriate to consider whether exhaustion is required in *1983 cases. In Patsy v. Board of Regents, 457 U.S. 496, 501 (1982), the Supreme Court restated the general rule that "exhaustion is not a prerequisite to an action under *1983," especially where plaintiffs have raised federal constitutional issues. The Court noted that Congress* intent in enacting the Civil Rights Act of 1871 was to protect citizens against the states and it assigned to the federal courts the role of protecting constitutional rights. Id. At 500-03. The Court made clear in Patsy that exhaustion of administrative remedies is only required if Congress has specifically carved out an exception in a particular type of case. Id. at 507 (Congressional act that requires adult prisoners to exhaust administrative remedies indicates exceptions must be enacted). See also Woods v. Smith, 60 F.3d 1161, 1165 (5th Cir. 1995); Wilbur v. Elton Harris, 53 F.3d 542, 545-56 (2nd Cir. 1995). There is no specific carving out of the general exhaustion rule in the Medicaid Act. The only administrative remedy for beneficiaries under that law is the entitlement to a fair hearing when benefits are denied. 42 U.S.C. *1396a(a)(3). As Plaintiffs have learned, that process cannot begin to address the type of challenge that they have brought here. The state ALJs will not consider whether the state*s new level of care regulations deny mandatory medical services to Plaintiffs in violation of the Medicaid Act. They will only consider whether Plaintiffs* medical and functional limitations meet the new criteria. Plaintiffs have been more successful in advancing their due process arguments in fair hearings, but it is even more clear that exhaustion is unnecessary when raising constitutional claims. Patsy, 457 U.S. at 500. See also Rosado v. Wyman, 397 U.S. 397 (1970) (exhaustion of administrative remedies doctrine does not apply where plaintiffs do not seek review of an administrative order, but instead are challenging, under *1983, a state law that allegedly violates the Social Security Act). IV. CONCLUSION Defendants have made no serious effort to meet the FRCP 56(c) requirements They have made no showing that there is no genuine issue of material fact or that they are entitled to judgment as a matter of law. Plaintiffs respectfully submit that the motion for summary judgment must be denied. This Court should also deny Defendant*s motion to dismiss, as Plaintiffs have demonstrated in their Complaint and in this Memorandum that they have properly asserted a cause of action against Defendants under 42 U.S.C. *1983, under the Supremacy Clause of the United States Constitution and under the due process clause of the Fourteenth Amendment. Plaintiffs respectfully request oral argument because of the complexity of the issues. Respectfully submitted, Anne Marie Regan, Attorney at Law Office of Kentucky Legal Services Programs, Inc. 1139 East Broadway Louisville, KY 40204 Phone: 502-584-0349; Fax: 502-584-0349 Email: email@example.com Eric Carlson, Attorney at Law Herbert Semmel, Attorney at Law National Senior Citizens Law Center 3435 Wilshire Boulevard, Suite 2860 Los Angeles, CA 90010-1938 Phone: 213-639-0930, ext. 313 Fax: 213-639-0934 Email: firstname.lastname@example.org email@example.com Edward C. King, Attorney at Law Eugene Coffey, Attorney at Law National Senior Citizens Law Center 1101 14th Street, N.W., Suite 400 Washington, D.C. 20005 Phone: 202-289-6976, ext. 208, 206 Fax: 202-298-7224 Email: firstname.lastname@example.org email@example.com ATTORNEYS FOR PLAINTIFFS CERTIFICATE OF SERVICE I certify that a true copy of the foregoing Memorandum In Opposition to Defendants* Motion to Dismiss or for Summary Judgment was mailed this ____ day of December 2003 to Ann T. Hunsaker, Attorney for Defendants, Assistant Counsel, Cabinet for Health Services, Office of General Counsel, 275 East Main Street, 5th Floor West, Frankfort, KY 40621. _________________________________________ANNE MARIE REGAN 1The emergency regulations, 907 KAR 1:022E, have now been replaced by virtually identical permanent regulations, 907 KAR 1:022. In all respects pertinent to the issues before the Court, the regulations are identical. Sets of the former regulations, the emergency regulations (showing changes from the former regulations), and the permanent regulations are attached as Exhibits A, B and C. 2At page 4 of their brief, Defendants use language which may mislead the Court to believe that the United States Center for Medicare and Medicaid Services has approved Kentucky*s emergency regulations and the actions of the state which Plaintiffs challenge in this case: "At all times relevant to this appeal, the Department*s State Plan and all State Plan Amendments have been approved by CMS." Actually, the state first submitted but then withdrew its request for approval of the new regulations as an amendment of the State Plan. The Court should be aware that no approval of the new regulations has been given by CMS, and no request for approval is pending. See e-mail from CMS Regional Office, attached to Affidavit of Anne Marie Regan, Exhibit D. Federal regulations require such approval. 42 C.F.R. * 430.12. 3 The actual term used in the Medicaid statute is "nursing facility services." See 42 U.S.C. *1396d(a)(4). 4 HCBS is a "waiver" program in the sense that a state which agrees to participate is, for purposes of that particular waiver program only, freed from certain normal federal Medicaid requirements not relevant here. See 42 U.S.C. *1396n(a). 5 Plaintiffs have attached as Exhibits the Declarations of Plaintiffs, doctors and a nurse which clearly demonstrate that Plaintiffs continue to be in dire need of the mandatory nursing facility services at issue here. (Exhibit F - Declaration of Veda Jewell Kerr; Exhibit G - Declaration of Gena Bell; Exhibit H - Declaration of Thelma Garmon; Exhibit I - Declaration of Patricia Moore; Exhibit J - Declaration of Lydia Allgood; Exhibit K - Declaration of Janet Hannah; Exhibit L - Declaration of Paul Dunn, M.D.; Exhibit M - Declaration of Mohammad Shahzad, M.D.; Exhibit N - Declaration of Ovaleria Dubree) 6New data released by the Cabinet for Health Services since this lawsuit was filed indicate that, in fact, from April through September of this year, based on the new level of care criteria, 2488 individuals have been denied HCBS, while 345 individuals have been denied nursing home services (a total of 2833 denials). During the six months prior to the enactment of the emergency regulation, there were 423 HCBS denials and 38 nursing facility denials (a total of 461). Plaintiffs assume that these numbers have increased substantially in the past two months, but exact figures are not available to Plaintiffs. See Exhibit A to Plaintiffs* Memorandum Of Law in Support of Motion for Class Certification, p. 14. 7Defendants also refer to five pre-Gonzaga cases, ostensibly as instances of courts holding "specifically ...that certain Medicaid provisions create no enforceable rights." Defendants* Memorandum at 20-21. None support Defendants* argument that this Court should find lack of jurisdiction under Section 1983. One, Harris v. James, 127 F.3d 993 (11th Cir. 1997), did hold what Defendants say, that the Medicaid transportation regulations did not create a privately enforceable right, but the Sixth Circuit has specifically rejected Harris, finding the Medicaid transportation regulation enforceable under Section 1983. Boatman v. Hammons, 164 F.3d 286, 289 (6th Cir. 1998). In Rodriguez v. City of New York, 197 F.3d 611 (2d Cir. 1999), plaintiffs sought to require New York to include safety monitoring among the services available in that state*s optional home care program. The court did not find Section 1983 inapplicable to that claim, but found no support for the claim in the Medicaid Act. The other three cases cited by Defendants involve the federally administered Medicare program, to which Section 1983 is inapplicable. 8Plaintiffs also assert supplemental jurisdiction under 28 U.S.C. *1367 to enforce the corresponding Kentucky laws and regulations that require due process protections for Medicaid recipients. 9 The Moffitt case describes the procedures then in use in Kentucky to determine continuing eligibility for Medicaid recipients in intermediate care facilities. It cites to some state laws and regulations that are no longer in effect, but the decision on the due process issues remains valid. 10On appeal, the Sixth Circuit held that the District Court*s ruling on the constitutional issues was unnecessary since plaintiffs were granted the relief they sought under the Medicaid Act. Daniels v. Menke, 1998 U.S. App. LEXIS 7973 at p. 7 (6th Cir., April 22, 1998). 11 Nowhere is it written that issues may be raised under the Medicaid statute only through invocation of Section 1983. Numerous Medicaid claims have been reviewed by the courts and decided without any mention of Section 1983. See, e.g., Planned Parenthood Affiliates of Mich. v. Engler, 73 F.3d 634 (6th Cir. 1996); Hope Medical Group for Women v. Edwards, 63 F.3d 418 (5th Cir. 1995); Elizabeth Blackwell Health Ctr. for Women v. Knoll, 61 F.3d 170 (3d Cir. 1995); Hern v. Beye, 57 F.3d 906 (10th Cir. 1995); Preterm, Inc. v. Dukakis, 591 F.2d 121 (1st Cir. 1979); see also Planned Parenthood Ass*n of Utah v. Dandoy, 810 F.2d 984 (10th Cir. 1987) (enjoining state agency from enforcing a state law that conflicts with federal Medicaid law). 13This same language was used in notices to those Plaintiffs receiving long -term care in nursing homes as well as to those receiving care at home through the HCBS program, even though the HCBS participants are not "in a facility," further adding to the recipient*s confusion.
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