Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca8-05-02791/USCOURTS-ca8-05-02791-0/pdf.json

Parties Involved:
Kelly Bowlin
Appellee
Nancy Montanez
Appellant

Document Text:

United States Court of Appeals

FOR THE EIGHTH CIRCUIT

___________

No. 05-2791

___________

Kelly Bowlin, on behalf of herself *

and all others similarly situated, *

*

 Appellee, *

* Appeal From the United States

v. * District Court for the

* District of Nebraska.

Nancy Montanez, as the Director of *

the Nebraska Department of Health *

and Human Services, *

*

Appellant. *

___________

Submitted: February 15, 2006

Filed: May 4, 2006

___________

Before RILEY, HEANEY, and MELLOY, Circuit Judges.

___________

HEANEY, Circuit Judge.

This case involves a certified class of over 764 single, working mothers and

other caretaker relatives in Nebraska who lost their Medicaid benefits due to their

increased income from employment. The class contends that they are eligible for

temporary medical assistance (TMA) benefits described in 42 U.S.C. § 1396r-6, which

provides up to one year of transitional medical coverage to certain categories of

people who have lost Medicaid because of an increase in the amount of their earned

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The Honorable Laurie Smith Camp, United States District Judge for the

District of Nebraska.

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income. The district court1

 granted the class’s motion for summary judgment in all

respects and directed the Director of the Nebraska Department of Health and Human

Services to provide TMA to the class members, pursuant to § 1396r-6. The Director

appeals, arguing that the district court erred in concluding that the class members were

entitled to TMA benefits, and in granting the plaintiffs’ motions for summary

judgment. We affirm.

TMA is “a federally funded state program of medical care for the needy and

others.” Kai v. Ross, 336 F.3d 650, 651 (8th Cir. 2003). Title XIX of the Social

Security Act grants federal medical assistance to participating states through its

Medicaid program. Id. Although a state’s participation in the Medicaid program is

optional, participating states in compliance with the applicable federal rules and

regulations are given matching funds by the federal government. Id. The federally

funded public-assistance program, Aid to Families with Dependent Children (AFDC),

operated in conjunction with Medicaid to provide assistance to the needy and others

under 42 U.S.C. §§ 1396-1396v. Under the federal statutes, a person receiving AFDC

was also automatically eligible for Medicaid. 

In 1996, the Welfare Reform Bill, under the enactment of the Personal

Responsibility and Work Opportunity Reconciliation Act (PWORA), replaced AFDC

with Temporary Assistance to Needy Families (TANF). Under PWORA, recipients

of TANF were no longer automatically eligible for Medicare benefits. When the

AFDC program was terminated, the legislature enacted 42 U.S.C. § 1396u-1 to extend

TMA to individuals who had received AFDC and others who were similarly situated,

pursuant to 42 U.S.C. § 1396r-6.

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In Nebraska, a Medicaid recipient’s countable income, and thus, eligibility for

benefits, is determined by using one of several income methodologies. Section

1396u-1 requires that the income methodology used under the state’s AFDC program

be used to determine a recipient’s countable income, unless the state has chosen to use

a less restrictive income methodology. § 1396u-1(b)(2)(C). The Director concedes

that Nebraska has used a less restrictive income methodology for the medically needy

category than was used for Nebraska’s AFDC program in 1996. According to the

income methodology used for persons considered medically needy, Kelly Bowlin’s

income fell below the AFDC income standard in place on July 16, 1996. Her monthly

countable income under the state medically needy plan was determined to be $270.55,

which was less than the $492.00 limit. In September of 2003, Bowlin received a

$0.50 per hour raise from her employer. That December her countable income was

determined to be $569.22, or $77.22 over the medically needy income limit. As a

result, the Department of Health and Human Services determined that Bowlin was

ineligible for Medicaid coverage on January 1, 2005, and she was denied TMA.

 Bowlin asserts that she is entitled to TMA. In response to the Director’s

termination of her medical benefits, Bowlin filed a complaint on behalf of herself and

a class of needy Nebraska caretaker relatives who were certified as follows:

All caretaker relatives in Nebraska with earned income: a) who have

received Medicaid under the medically needy category without a spend

down for at least three of the six months prior to having their Medicaid

benefits terminated due to their earned income; b) who, but for their

earned income would continue to receive Medicaid under the medically

needy category without a spend down; and c) who have not been or will

not be afforded the transitional Medicaid benefits provided for in 42

U.S.C. § 1396r-6.

(J.A. at 241.) 

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The Director does not dispute that the plaintiffs are caretaker relatives who

received Medicaid in at least three of the last six months immediately preceding aid

ineligibility, and whose benefits were terminated because of hours of or income from

employment. Bowlin argues on behalf of the class that as a medically needy person

she is covered by the language of 42 U.S.C. § 1396u-1, and is entitled to receive TMA

pursuant to 42 U.S.C. § 1396r-6. The Department of Health and Human Services

argues in response that only those persons who received AFDC are entitled to TMA

benefits.

“We review the grant of summary judgment de novo, applying the same

standard as the district court.” Ahlborn v. Arkansas Dep’t of Human Servs., 397 F.3d

620, 622 (8th Cir. 2005). “We will affirm the grant of summary judgment if there is

no genuine issue as to any material fact and the moving party is entitled to judgment

as a matter of law. Id. 

An individual is eligible for TMA if she or he: 

was receiving aid pursuant to a plan of the State approved under

part A of subchapter IV of this chapter in at least 3 of the 6

months immediately preceding the month in which such family

becomes ineligible for such aid, because of hours of, or income

from, employment of the caretaker relative (as defined in

subsection (e) of this section) or because of section

602(a)(8)(B)(ii)(II) of this title (providing for a time-limited

earned income disregard), shall, subject to paragraph (3) and

without any reapplication for benefits under the plan, remain

eligible for assistance under the plan approved under this

subchapter during the immediately succeeding 6-month period in

accordance with this subsection. 

42 U.S.C. § 1396r-6(a)(1). This section is applicable to Bowlin if § 1396u-1 applies

to the medically needy who received Medicaid benefits. See Kai, 336 F.3d at 653

(“[B]y virtue of Section 1925, 42 U.S.C. § 1396r-6, persons who were part of the

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group covered by [§ 1396u-1] are entitled to Temporary Medical Assistance if their

eligibility is lost by reason of a state’s amending its laws.”). Section 1396u-1 reads

in relevant part:

(a) References to subchapter IV-A are references to pre-welfare-reform

provisions

Subject to the succeeding provisions of this section, with respect to a

State any reference in this subchapter (or any other provision of law in

relation to the operation of this subchapter) to a provision of part A of

subchapter IV of this chapter, or a State plan under such part (or a

provision of such a plan), including income and resource standards and

income and resource methodologies under such part or plan, shall be

considered a reference to such a provision or plan as in effect as of

July 16, 1996, with respect to the State.

(b) Application of pre-welfare reform eligibility criteria

(1) In general

For purposes of this subchapter, subject to paragraphs (2) and (3),

in determining eligibility for medical assistance –

(A) an individual shall be treated as receiving aid or assistance

under a State plan approved under part A of subchapter IV of this

chapter only if the individual meets –

(i) the income and resource standards for determining

eligibility under such plan, . . .as in effect as of July 16,

1996 . . . .

(2) State option

For the purposes of applying this section, a State – 

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(A) may lower its income standards applicable with respect

to part A of subchapter IV of this chapter, but not below the

income standards applicable under its State plan under such

part on May 1, 1988;

(B) may increase income or resource standards under the

State plan referred to in paragraph (1) over a period

(beginning after July 16, 1996) by a percentage that does

not exceed the percentage increase in the Consumer Price

Index for all urban consumers (all items; United States city

average) over such period; and

(C) may use income and resource methodologies that are

less restrictive than the methodologies used under the State

plan under such part as of July 16, 1996.

(Emphasis added). 

In Kai, this court considered the plain meaning of § 1396u-1 and explained that:

the effect of [§ 1396u-1] is clearly to make eligible for medical

assistance not only persons who were receiving AFDC . . . but also

certain other persons. . . . [T]he provision is expressly made “subject to

paragraphs (2) and (3).” The phrase “subject to” must mean that, in the

event of any conflict between (2) or (3) and (1), the former two

paragraphs will prevail, or, in the present context, that (2) and (3) add

persons to the group that is already eligible under (1) by virtue of being

AFDC recipients. It appears to us that plaintiffs are members of a group

that was added in this way.

336 F.3d at 654. The plaintiffs in that case were beneficiaries of an income

methodology that was less restrictive than Nebraska’s AFDC methodologies. The

court held that when the less restrictive methodology was removed by statute, the state

was required to extend TMA benefits to them, pursuant to § 1396r-6. Id. Similarly,

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in analyzing § 1396u-1(b)(1), the district court concluded that Bowlin is equally

entitled to TMA:

The final sub-category under the State option plan, (C), addresses

income and resource methodologies. Unlike the two previous categories,

the language of this last section does not limit itself only to an AFDC or

AFDC replacement program. Instead, the plain language illustrates that

a State may use less restrictive methodologies than those used “under the

State plan under such part [AFDC] as of July 16, 1996.”

Bowlin v. Montanez, No. 4:04CV3218, slip op. at 9-10 (D. Neb. Apr. 5, 2005)

(quoting § 1396u-1(b)(1)(c)). We hold that under the plain meaning of the statute,

Bowlin and the class members are persons that Congress intended to be treated as

having received AFDC benefits under § 1396u-1, and that they are entitled to TMA

benefits. We therefore affirm the district court.

______________________________

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