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Proposal to Cut In-Home Supportive Services to Disabled

Federal District Court Rules that California’s Proposal Violates the Americans with Disabilities Act, Medicaid Act, and Due Process

By Sujatha Jagadeesh Branch and Melinda Bird

A federal court in California blocked, in October 2009, a plan to cut the state’s Personal Care Services program; the plan would have used new eligibility standards to reduce or terminate services to over 130,000 low-income Californians with disabilities (V.L. v. Wagner, 669 F. Supp. 2d 1106 (N.D. Cal. 2009)). California’s personal care services program (known as in-home supportive services or IHSS) provides Medicaid recipients with home-based assistance such as help with bathing, dressing, and feeding; domestic services such as shopping and cleaning; and paramedical and protective supervision services.

In issuing a preliminary injunction, the federal district court relied on the Americans with Disabilities Act (ADA), the Medicaid Act, and constitutional due process. The court found that the state’s attempt to reduce eligibility for IHSS would result in “human suffering,” causing irreparable harm to the plaintiffs by rendering them unable to care for themselves and putting them at risk of needing services in “emergency rooms, hospitals, and other institutions” (V.L., 669 F. Supp. 2d at 1009). In weighing the state’s argument about the need for budget cuts, the court took into account that the need for more expensive hospitalization and institutionalization would outweigh the short-term savings.

Factual Background

Thirty-two states have elected the Medicaid Plan option to provide personal care services to Medicaid recipients (Kaiser Family Foundation, Kaiser Commission on Medicaid and the Uninsured, Medicaid Home and Community-Based Service Programs: Data Update (2009)). In 2006, of Medicaid recipients who received home and community-based services as an alternative to institutional care, about one-third received personal care services (id.).

In California, to be eligible for personal care services Medicaid recipients must be aged (65 or over), blind, or disabled. County workers must determine that the recipient needs the service in order to remain safely at home and must calculate the allowable hours of service based on an individual-needs assessment and so-called time-for-task guidelines. Although the maximum number of hours one may receive monthly is 283, the average is 85 hours (see California Legislative Analyst’s Office, Considering the State Costs and Benefits: In-Home Supportive Services Program (2009)).

California’s widely publicized budget crisis has lasted several years and causes yearly deficits of tens of billions of dollars. During this fiscal crisis, state decision makers seized on a “functional index” as a basis for cutting the personal care services program.

As part of their overall assessment of each IHSS applicant or recipient, county social workers assign a functional index rank for each activity of daily living; those ranks are multiplied by a weighted average to obtain a functional index score. The functional index ranks and scores were designed as a system for quality control and were never used to determine eligibility for personal care services in California. However, given the perceived need to cut costs quickly to resolve the budget crisis, state decision makers apparently believed that basing cuts on the functional index was a credible way of saving money. The final state budget bill passed in August 2009 contained a new statute denying any personal care services to a recipient whose composite functional index score was below 2 and eliminating domestic and related services (such as shopping and cooking) for anyone whose functional index rank was below 4 for these services. Experts describe such services as the ‘“glue’ that permits older people to stay in their homes” (Stephen P. Wallace et al., University of California at Los Angeles Center for Health Policy Research, Community-Based Long-Term Care: Potential Consequences of California’s 2009 Budget Cuts 13 (2009)).

Preparing to Challenge the Cuts in Medicaid Personal Care Services

After several months of confusion, the state announced that the cuts would take place on November 1, 2009. Personal care services recipients were filled with anxiety because they had never been informed of their functional index and hence did not know whether their services would be cut. Recipients, advocates, providers of services for seniors, and unions representing the thousands of affected home care workers all expressed public outrage, with rallies across the state. Even county officials who administered personal care services denounced the cuts, as they shared recipients’ and providers’ concerns and were apprehensive about the fiscal impact of the cuts on counties, which would be responsible for covering much more expensive care in emergency rooms, hospitals, and institutions.

Public interest legal organizations were flooded with calls from frantic recipients and prepared to file suit. These organizations were fortunate to be able to forge a partnership with the six unions (locals of the Service Employees International Union, or SEIU, and the American Federation of State, County, and Municipal Employees, or AFSCME) representing home care providers all over the state. This partnership was natural since recipients of personal care services and the union members who provided the services had common interests: preserving needed services and retaining the workers’ jobs. Because providers and recipients commonly have close, often familial, relationships, each group was concerned about the other’s well-being. The unions hired their own law firm, which worked in close partnership with the public interest firms via a joint prosecution agreement, a shared Web-based site for document management, and regular meetings of cocounsel. An important benefit of this collaboration was that the union networks worked closely with counsel for plaintiffs and with numerous other nonprofit organizations to help, by organizing outreach and training, spread the word about anticipated cuts.

Filing the Lawsuit

One month before the cuts were scheduled to take effect, on behalf of four individual personal care services recipients and the six unions representing personal care service providers, we filed, on October 1, 2009, a class action complaint in the U.S. District Court for the Northern District of California. The complaint asserted eight claims for relief, alleging violations of due process, the ADA, Section 504 of the Rehabilitation Act, the Medicaid Act, and the American Recovery and Reinvestment Act (the complaint and other case documents are at http://bit.ly/cbcc6v).

In the following week we moved for preliminary injunction and class certification, filing scores of declarations from affected recipients, their family members and care providers, declarations from officials in six California counties, dozens of declarations from the directors of social service agencies that work with personal care services recipients, and declarations from five experts from universities across the nation—all well-known scholars and academics—regarding the impact of the proposed cuts.

One heartrending declaration was submitted by David Oster, a class representative who explained that, because of autism and bipolar disorder, he was able to live in his own apartment only through heavy reliance on his longtime personal care services provider, who comes several times a week to look after him, preparing nutritious meals and prompting him to clean, care for himself, and stay on his medications. When Oster found out about the proposed cuts, he went into a tailspin that resulted in placement in a psychiatric hospital. He was terrified about losing his hard-won independence.

Preliminary Injunction Motion Granted, Followed by Finding of Contempt

The hearing on the motion for preliminary injunction was held on October 19, 2009, just weeks before the cuts were to take place. Outside the courthouse, recipients and providers staged a rally to show their support of the plaintiffs. The courtroom was packed with supporters, class representatives, other recipients, and union members. U.S. District Court Judge Claudia Wilken issued that same day a minute order stopping the cuts. On October 23 Judge Wilken issued her final, detailed order, finding that plaintiffs had a substantial likelihood of prevailing on their Medicaid Act, ADA, Rehabilitation Act, and due process claims.

Notably the court ruled that plaintiffs had a significant likelihood of prevailing on the merits of the following claims:

In granting the preliminary injunction the court used strong language about the “humanitarian disaster” and “premature deaths” likely to result if the cuts were to take place. Plaintiffs amply demonstrated the immediate harm that they would suffer without a preliminary injunction: inability to take medications; inability to obtain food, medication, and other necessities; going without essential medical care due to an inability to get to their doctors’ offices; becoming homeless; and being institutionalized (id. at 1121).

The court further ordered the defendants, to the extent they had already acted to cut personal care services, to do everything necessary to ensure that “no otherwise eligible individual is denied eligibility for, or terminated from…,” services solely based on functional index and that providers are paid in a timely manner (id. at 1123).

Defendants failed to comply fully with the court’s preliminary injunction, so we moved for contempt and for sanctions. In an order dated November 25, 2009, the court held defendants in contempt; the court found that defendants failed to ensure that services were not cut as a result of recipients’ functional indexes, misled counties about whether all necessary action had been taken to update recipients’ files, sent out erroneous time cards that misled recipients and their providers about how many hours of personal care services were authorized, and failed to rescind notices regarding service cuts. The court ordered drastic action—such as daily telephone appearances to update the court regarding compliance—to remedy the contempt.

The State’s Appeal of the Preliminary Injunction

Appealing the district court’s order, the state challenged the enforceability of the Medicaid Act on preemption grounds and argued that U.S. Supreme Court’s ruling in Olmstead v. L.C., 527 U.S. 581 (1999), and the ADA’s “inclusion mandate” were inapplicable unless institutionalization was “imminent.” Four amicus curiae briefs were filed by a wide range of organizations and entities in support of the personal care services recipients and their providers:

Oral argument in the Ninth Circuit was held on June 15, 2010. Pursuant to the parties’ agreement, district court proceedings are stayed pending appeal, and the preliminary injunction remains in place.

Disability Rights California is lead counsel in V.L. v. Wagner. Cocounsel Altshuler Berzon LLP represents the union plaintiffs, while Disability Rights Legal Center, Law Offices of Charlie Wolfinger, the National Health Law Program, and the National Senior Citizens Law Center represent recipient class members (see Disability Rights California’s V.L. v. Wagner Web page for information and updates,www.disabilityrightsca.org/advocacy/v.l.-v-Wagner/index.htm).

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