Indiana Public Health Agency Asks Supreme Court to Limit Medicaid Recipients' Right to Sue

For decades, people who rely on federal assistance programs such as Medicaid have been able to sue state agencies when they do not receive the benefits they are entitled to. A government agency in Indiana, the Health and Hospital Corporation of Marion County, is now asking the U.S. Supreme Court to change that.

The justices are scheduled to hear arguments on Nov. 8 in a case that originated in northwest Indiana and could carry sweeping national consequences. WFYI's Farah Yousry discussed the case with Tony Cook, an investigative reporter at the Indianapolis Star who has covered the mismanagement of taxpayer money and concerns about care quality at nursing facilities owned by the corporation.

Cook explained that the corporation, known as HHC, owns 78 nursing homes across Indiana. It also operates the public hospital in Indianapolis and the Marion County Public Health Department. According to Cook, the agency acquired the nursing homes to tap additional Medicaid money available to government-owned facilities, then diverted much of that money to help fund the hospital.

The reporting found that quality at these homes has trailed the rest of the country, Cook said. Staffing is also low by national standards, with Indiana's nursing homes ranking 48th in the nation. Cook noted that staffing is central to quality because staff members help residents on a daily basis.

The Supreme Court case grew out of a lawsuit brought by the family of a former resident of an HHC nursing home. The family alleges the resident was over-medicated, chemically restrained and involuntarily transferred to other facilities. Cook said nursing home claims are typically filed as malpractice cases in state court, but those cases face obstacles including caps on damages and a medical review panel process that can take years. In this instance, the family sued under federal law, arguing that HHC violated the Federal Nursing Home Reform Act.

In its defense, HHC has asked the Supreme Court to consider whether beneficiaries of federal entitlement programs should be allowed to sue at all. Cook called that a huge question that could affect millions of people nationwide and could stop them from suing state or local governments if they believe their rights are being violated or their benefits wrongly denied.

Pressure on the agency has grown, according to Cook. Advocates for low-income people, older adults and people with disabilities are alarmed by the potential impact, as are liberal policy groups that want to defend Medicaid, which they view as a Democratic achievement worth protecting and expanding. Cook pointed out that all of HHC's board members are appointed by the mayor, the city council or the county commission, all of which are controlled by Democrats.

The dispute has become what Cook described as a political firestorm. Democratic state lawmakers and city council members are calling on HHC to drop its petition, and they made their displeasure known at the agency's most recent board meeting. So far, Cook said, HHC has largely declined to comment and has held its position. What happens before oral arguments on Nov. 8 remains to be seen.