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Supreme Court Delivers Important Decision Impacting Medicaid Providers and Patients

Joe Ravi, CC BY-SA 3.0, via Wikimedia Commons

The U.S. Supreme Court's recent decision in Health and Hospital Corporation of Marion County v. Talevski, is monumentally important for the health care provider and patient communities, albeit in a somewhat subtle manner. The Court held that the estate of a nursing home resident has a private cause of action under 42 U.S.C. section 1983 to force a county that owns and operates a nursing home to comply with some patient care standards of the Federal Nursing Home Reform Act (FNHRA), a federal statute that itself does not create a private right of action. Section 1983 claims to enforce federal statutory requirements have been recognized for more than half a century, and they are founded on application of well-established precedents focused on the language of the federal statute at issue and the relevant regulatory/enforcement scheme. See Blessing v. Freestone, 520 U.S. 329, 340 (1997) (outlining three-factor analysis for determining whether provision of Social Security Act gives rise to federal right privately enforceable via Section 1983). The county in Talevski, however, was not content with such a case-specific analysis alone. While arguing FNHRA in particular cannot be the subject of a Section 1983 claim under the Blessing factors, the county asserted more fundamentally that Section 1983 can never be used to privately enforce any federal law that was passed pursuant to Congress’s Spending Clause powers.

Talevski put at issue a broad line of Supreme Court precedents dating back to the 1960s that holds “§ 1983 generally supplies a remedy for the vindication of rights secured by federal statutes,” Gonzaga Univ. v. Doe, 536 U.S. 273, 284 (2002), which includes social welfare programs passed under Congress’s Spending Clause powers. The Medicaid program is perhaps the most well known of these programs, where Congress allocates federal funds to states to implement Medicaid programs – states have leeway in designing and running their program so long as they comply with certain conditions spelled out in federal law. These federal conditions do not necessarily create private rights of enforcement. That’s where Section 1983 private enforcement has been used.

Prior remarks by some justices on the Court suggested the Talevski county’s categorical attack could have traction. At least three justices in the Court’s conservative majority had indicated in prior dissenting or concurring opinions their tacit or express view that Spending Clause legislation enacting social welfare programs created contractual relationships between the federal and state governments. Adopting such framing, the county argued that a Section 1983 claim amounts to a third-party beneficiary action to enforce contractual rights, which was not recognized at common law when Section 1983 was enacted in the 1870s. Accordingly, the county argued, Section 1983 cannot be employed by private litigants to require states to comply with any social welfare program enacted through Spending Clause legislation.

In a 7-2 decision, the Court held the provisions in FNHRA at issue passed the Blessing factors and could be enforced through Section 1983. In so holding, the Court squarely turned away the county’s broader challenge to using Section 1983 to enforce any Spending Clause enactments. The Court’s majority opinion found that Section 1983 must be interpreted by the plain meaning of its unambiguous terms: that any individual may invoke this cause of action against any other person who, acting “under color of” state law, has deprived them of “any rights, privileges, or immunities secured by the Constitution and laws” of the United States. The Court noted that Congress attached no modifiers to the phrase “and laws” and thus “laws” must mean “laws.” Section 1983 is available to potentially enforce any “laws” no matter the source of Congressional authority to enact such laws. In passing, the Court also rejected the county’s historical claims and found that third party contract actions did exist when Section 1983 was enacted.

Talevski robustly upholds and preserves the continuing viability of an effective tool used by providers and patients to secure rights and benefits guaranteed under the Medicaid program. Over its nearly 60-year lifespan, the Medicaid Act has arguably become the most impactful social welfare legislation in the country’s history, under the Spending Clause or otherwise. Medicaid today covers nearly 82 million people in the United States – approximately one in four Americans. Section 1983 claims have for many decades served as a mainstay of private enforcement to ensure that states honor the benefits and rights under the program.

According to recent tracking by the National Health Law Program, the courts of appeals in 11 out of the 12 federal circuits have ruled upon 59 cases raising enforceability of various provisions of the Medicaid Act through a Section 1983 claim. Such activities have resulted in court precedents affirming that Section 1983 is available to privately enforce twenty different provisions of the Medicaid Act, including requirements protecting FQHC payment nursing home reform, the free-choice-of-provider provision, and guarantees for reasonable and prompt delivery of covered care.

Talevski is deservedly being lauded by provider advocates whose mission has been to secure Medicaid’s guarantees to improve the health of millions of Americans. A similar sentiment was reflected in an amicus brief submitted by dozens of former HHS secretaries and senior administrators (the same administrators who had been tasked with enforcing the Medicaid laws): that the federal government alone is not equipped to serve as the exclusive enforcer of Medicaid requirements and that Section 1983 private enforcement has been, and thanks to Talevski, will continue to serve a vital role in the overall scheme to realize the Medicaid Act’s goals.

For more information, please contact Long X. Do.

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