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Parties Involved:
Kitty Rhoades
Appellee
Kelly Townsend
Appellee
D. U.
Appellant

Document Text:

In the

United States Court of Appeals

For the Seventh Circuit

No. 15‐1243

D.U., a minor,

Plaintiff‐Appellant,

v.

KITTY RHOADES and

KELLY TOWNSEND,

Defendants‐Appellees.

Appeal from the United States District Court for the

Eastern District of Wisconsin.

No. 2:13‐cv‐01457 — Nancy Joseph, Magistrate Judge.

ARGUED MARCH 30, 2016 — DECIDED JUNE 3, 2016

Before WOOD,Chief Judge, andPOSNER and ROVNER, Circuit

Judges.

ROVNER, Circuit Judge.  D.U. is a minor who was receiving

the assistance of a Medicaid‐funded private duty nurse for

seventy hours each week after a catastrophic accidentrendered

her severely disabled. After many years of care, the State of

Wisconsin determined thatfull‐time skilled nursing assistance

was no longer medically necessary for D.U.’s care, and the

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2 No. 15‐1243

State denied further authorization of that level of care. D.U.

then sued Kitty Rhoades, Secretary for the Wisconsin Depart‐

ment of Health Services (“DHS”), and KellyTownsend, a nurse

consultant in the Quality Assurance and Appropriateness

Review Section (“QAARS”) in the DHS Office of the Inspector

General, asserting that the reduction in hours of her private

duty nurse is a violation of the Medicaid Act. See 42 U.S.C.

§ 1396 et seq. D.U. moved for a preliminary injunction, asking

the court to compel the State to provide seventy hours of

private duty nursing care each week pending the outcome of

the lawsuit. The district court denied the motion for a prelimi‐

nary injunction. Although we conclude that the district court

erred in assessing D.U.’s likelihood of success on the merits of

her claim, we affirm because D.U. has failed to demonstrate

that she will sufferirreparable harm if the injunction is denied.

I.

In 2005, when she was three years old, D.U. was severely

injured in a car accident. She initially qualified for Wisconsin

Medicaid services on financial grounds, and was provided

extensive medical care through that program until August

2013. After a change in family circumstances in 2013, D.U. no

longer qualified on financial grounds for State‐provided

services. Wisconsin nevertheless continued to provide the

same services under the State’s “Katie Beckett Program,”

which funds Medicaid benefits for children who are otherwise

ineligible because of the assets or income of their parents. See

42 U.S.C. § 1396a(e)(3) (allowing states to provide Medicaid

benefits at home to severely disabled children who would

otherwise require institutional care). Other than the financial

Case: 15-1243 Document: 42 Filed: 06/03/2016 Pages: 15
No. 15‐1243 3

qualifications, benefits under the Katie Beckett Program are

subject to the same rules as ordinary Medicaid benefits.

Certain services must be reviewed and authorized by DHS

beforeWisconsin Medicaid will pay forthem.Medical services

are approved if an application and supporting documentation

demonstrate thatthe services are medically necessary.The care

that D.U. requested and received for many years was private

duty nursing care. A patient qualifies for private duty nursing

if she requires skilled nursing care for eight or more hours each

day. In D.U.’s case, private duty nursing was provided by the

State for seventy hours per week. “Skilled nursing” includes

the provision of medically complicated care “furnished

pursuant to a physicianʹs orders which require the skills of a

registered nurse or licensed practical nurse and which are

provided either directly by or under the supervision of the

registerednurse orlicensedpractical nurse.”Wis.Admin Code

§ DHS 101.03(163). The regulation lists examples of services

that would qualify as skilled nursing:

(a) Intravenous, intramuscular, or subcutaneous

injections and hypodermoclysis or intravenous

feeding;

(b) Levin tube and gastrostomy feedings;

(c) Nasopharyngeal and tracheotomy aspiration;

(d) Insertion and sterile irrigation and replacement

of catheters;

(e) Application of dressings involving prescription

medications and aseptic techniques;

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(f) Treatment of extensive decubitus ulcers or other

widespread skin disorder;

(g) Heat treatments which have been specifically

ordered by a physician as part of active treatment

and which require observation by nurses to ade‐

quately evaluate the patientʹs progress;

(h) Initial phases of a regimen involving administra‐

tion of medical gases; and

(i) Rehabilitation nursing procedures, including the

related teachings and adaptive aspects of nursing

that are part of active treatment, e.g., the institution

and supervision of bowel and bladder training

programs.

Wis. Admin Code § DHS 101.03(163).

In February 2013, the State authorized a continuation of

private duty nursing for D.U. through the end of July 2013.

However, the authorization noted that D.U., whose condition

had substantially improved over the years, was now “border‐

line” for meeting the criteria to qualify for private duty nursing

care. D.U. was instructed to submit additional information

with her nextrequest. In August 2013, the State informed D.U.

and her father that D.U. no longer qualified for private duty

nursing services. In order to transition D.U. to an alternate

level of care, the State authorized three additional months of

private duty nursing. In November, as the clock ran out on

authorized services, D.U.filed a new requestfor seventy hours

per week of private duty nursing. At the State’s request, D.U.

submitted additional information, but the request was ulti‐

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No. 15‐1243 5

mately denied on the ground that the documentation submit‐

ted by D.U. did not support a need for at least eight hours of

skilled nursing care per day. Although an administrative

appeal was available, D.U. did not appeal the denial of skilled

nursing services. Instead, she filed this suit and moved for a

preliminary injunction requiring the State to continue provid‐

ing skilled nursing services. The district court concluded that

the evidence that D.U. submitted in support of her request for

injunctive relief failed to demonstrate a likelihood of success

on the merits. The court therefore denied D.U.’s request for an

injunction, and D.U. filed this interlocutory appeal.

II.

On appeal, D.U. contends that the court misapplied the

medicalnecessity standardandalso erredin assessing whether

D.U. metthe standardfor apreliminary injunction. “Aplaintiff

seeking apreliminary injunction must establish that he is likely

to succeed on the merits, that he is likely to suffer irreparable

harm in the absence of preliminary relief, that the balance of

equities tips in his favor, and that an injunction is in the public

interest.” Winter v. Natural Resources Defense Council, Inc.,

555 U.S. 7, 20 (2008). A preliminary injunction is an extraordi‐

nary remedy and is never awarded as of right. Id. at 24. We

review the district courtʹs findings of fact for clear error, its

legal conclusions de novo, and its balancing of the factors for a

preliminary injunction for abuse of discretion. Stuller, Inc. v.

Steak N Shake Enterprises, Inc., 695 F.3d 676, 678 (7th Cir. 2012);

United Air Lines, Inc. v. Air Line Pilots Assʹn, Intʹl, 563 F.3d 257,

269 (7th Cir. 2009); Hodgkins ex rel. Hodgkins v. Peterson, 355

F.3d 1048, 1054‐55 (7th Cir. 2004).

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The district court began and ended its analysis on the first

factor, finding that D.U. was unlikely to succeed on the merits

and therefore was not entitled to a preliminary injunction. The

district court framed the issue as “whether D.U. has estab‐

lishedthat she has a more than negligible chance of persuading

the trier of fact by a preponderance of the evidence that at least

70 hours of private duty nursing services is medically neces‐

sary.” Applying this standard, the court found that the records

submitted did not demonstrate that D.U.’s private duty nurse

was medically necessary for her care.

D.U. contends that, in reaching this conclusion, the district

court misapplied the standards under the Early and Periodic

Screening, Diagnostic and Treatment Services (“EPSDT”)

provision of the Medicaid Act. See 42 U.S.C. § 1396d(r). The

EPSDT provision mandates that the states provide certain

categories of care to all Medicaid‐eligible patients under the

age of twenty‐one. In addition to screening services, a catch‐all

provision of EPSDT requires participating states to provide to

these children “[s]uch other necessary health care, diagnostic

services, treatment, and other measures described in subsec‐

tion (a) of this section to correct or ameliorate defects and

physical and mental illnesses andconditionsdiscovered by the

screening services, whether or not such services are covered

under the State plan.” Private duty nursing is one of the

categories of services mandated under EPSDT, but states are

free to limit the provision of services based on medical neces‐

sity. 42 C.F.R. § 4.230(d). Although EPSDT broadened the

categories of care that participating states are required to

provide to Medicaid‐eligible children, it did not change the

medical necessity limitation.

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No. 15‐1243 7

Medical necessity is not expressly defined in the Medicaid

Act, but Wisconsin law provides that:

“Medically necessary” means a medical assistance

service under ch. DHS 107 that is:

(a)Required to prevent, identify ortreat a recipientʹs

illness, injury or disability; and

(b) Meets [certain] standards[.]1

Wis. Admin. Code § DHS 101.03(96m). The medical necessity

determination is made in Wisconsin by QAARS consultants

such as defendant Kelly Townsend, who review information

submitted by the applicant’s health care providers.

1

  The nine enumerated standards are: “1. Is consistent with the recipientʹs

symptoms or with prevention, diagnosis or treatment of the recipientʹs

illness, injury or disability; 2. Is provided consistent with standards of

acceptable quality of care applicable to the type of service, the type of

provider and the setting in which the service is provided; 3. Is appropriate

with regard to generally accepted standards of medical practice; 4. Is not

medically contraindicated with regard to the recipientʹs diagnoses, the

recipientʹs symptoms or other medically necessary services being provided

to the recipient; 5. Is of proven medical value or usefulness and, consistent

with § DHS 107.035, is not experimental in nature; 6. Is not duplicative with

respect to other services being provided to the recipient; 7. Is not solely for

the convenience ofthe recipient, the recipientʹs family or a provider; 8.With

respectto prior authorization of a service and to other prospective coverage

determinations made by the department, is cost‐effective compared to an

alternative medicallynecessaryservice which is reasonably accessible to the

recipient; and 9. Is the most appropriate supply or level of service that can

safely and effectively be provided to the recipient.” Wis. Admin. Code

§ DHS 101.03(96m).

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8 No. 15‐1243

In support of the motion for preliminary relief and in an

attempt to demonstrate the medical necessity of eight hours

per day of skilled nursing care, D.U. submitted the statement

of Karen Roberts, who had served as D.U.’s case manager and

registered nurse for seven years; letters from two physicians

who treated D.U.; and some of D.U.’s medical records. One

doctor stated that the skilled nursing services provided to D.U.

have “assisted in her recovery/functionality and helped to

avoid inpatient hospital stays.” That physician also stated that

D.U. has “greatly benefitted from skilled nursing services,”

and therefore requested “a continuation of this very important

and beneficial service.” R. 53. The other doctor chronicled

D.U.’s progress over the years, noting that, initially D.U. was

“in her own world, wheel chair bound, aphasic, g‐tube fed and

having seizures,” but that now she is “socially interactive,

walking with assistance, verbalizing, self feeding, and only

occasionally having seizures.” The second doctor attributed

D.U.’s impressive progress to the skilled nursing care she

received over the years and concluded that for “continued

improvement, she will require at least 70 hours of skilled

nursing a week,” but the doctor did not identify the specific

skilled nursing tasks required for D.U.’s care. This is the only

document that quantifies in any manner the number of hours

of skilled nursing services required for D.U.’s care.

D.U.’s nurse, Karen Roberts, submitted the most extensive

evidence of the services required to care for D.U., listing in a

seventy‐eight paragraph affidavit the services that she was

providing to D.U. as of August 2014. Roberts listed D.U.’s

diagnoses as “post traumatic hydrocephalus, post traumatic

seizure disorder, general epilepsy with myoclonic seizures, rt.

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No. 15‐1243 9

spastic hemiparesis, parietal‐occipital shunt, visual‐hearing

disorder, spastic cerebral palsy‐displegia, incontinence of

bowel/bladder, early puberty, development and cognitive

delay, vocalization and speech delayer non‐verbal, limited fine

motor and gross motor abilities, apraxia/dyspraxia, ataxia.”

Among the services that Roberts provided to D.U. are speech

therapy, monitoring of food and liquid intake, monitoring of

D.U.’s ability to chew and swallow (and providing suction as

needed to prevent choking), training and assistance in eating

and nutrition, auditory stimulation, vision therapy, neuro‐

muscular electrical stimulation, occupational and physical

therapy,placement of splints andbraces as needed, monitoring

for and treatment of leg spasms, assessment of and interven‐

tion for mood and behavioral issues, assessment of motor and

sensory functions, assistance with wheelchairtraining anduse,

assistance with weight‐bearing exercises and gait training,

transportation to and assistance in hippotherapy and aqua‐

therapy, assistance in all activities of daily living, daily

assessment of blood circulation in the extremities to prevent

complications from poor circulation, consulting with physi‐

cians regarding D.U.’s care, transportation in a specialized van

to all needed locations, and continual assessment for skin

breakdown, deformities and contractures.

The State takes the position that, although D.U.’s health

care providers describe skilled nursing care as beneficial to

D.U., only one of the care givers described seventy hours of

skilled nursing care as medically necessary at this stage of

D.U.’s treatment. And none of the care givers identify eight

hours of specific skilled nursing tasks required for D.U.’s care

each day. Kelly Townsend, the nurse who evaluates requests

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10 No. 15‐1243

for Medicaid‐funded private duty nursing, also submitted an

affidavit, explaining the basis of the denial for D.U. According

to Townsend, the skilled nursing activities identified in D.U.’s

application for a private duty nurse consisted primarily of

assessing andmonitoringD.U., services that couldbeprovided

in a medical office or by a parent, a trained school aide or child

care worker. Townsend averred that private duty nursing will

not be deemed medically necessary for assessing and monitor‐

ing tasks that could be provided by other persons with proper

training. Private duty nursing will also not be approved for

other activities, such as showering, applying lotion, assessing

urine output, providing verbal cues for eating andchecking for

skin breakdown, because these tasks can be performed by

personal care workers, home health aides or family members.

Nor is private duty nursing deemed necessary for routine

transportation or taking a child to medical appointments.

Townsend noted that most of the care provided by D.U.’s

private duty nurse is not listed in Wisconsin Medicaid guide‐

lines as the type of care that requires skilled nursing.

Townsend conceded that the services listed in the guidelines

are not exclusive, but she averred that the guidelines demon‐

strate the nature of the services and the severity of medical

needs that require skilled nursing services. She opined that

many of the services listed by D.U.’s nurse were the type of

care that can be provided by a paraprofessional such as a home

health aide or personal care worker, or by parents, informal

supports or therapists. Townsend also said that parapro‐

fessionals, teachers, school aides, family members and other

care givers could be taught how to respond to potential

medical needs and how to determine when additional medical

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No. 15‐1243 11

services are required. Townsend noted that D.U. had been

trending for some time towards no longer requiring eight

hours per day of skilled nursing, that she had been “border‐

line” for meeting the criteria at the time of herlast approval for

private duty nursing services, and that her records indicated

that she was medically stable and no longer in need of eight

hours per day of skilled nursing intervention. As for informa‐

tion submitted by D.U.’s father, Townsend noted that the

relatively infrequent focal seizures that D.U. experienced were

not inherently dangerous or life threatening, do not result in

loss of consciousness, and can be assessed by trained care

givers to determine if medical intervention is required.

Moreover, D.U. had not experienced more severe seizures that

required medication injections in the three months priorto the

application.2 Townsend noted that D.U. might qualify for a

lesser amount of skilled nursing services known as “intermit‐

tent skilled nursing,” but that she had not applied for it.

Based on this evidence, the district court found that D.U.

failed to establish a likelihood of success on the merits. But the

threshold for demonstrating a likelihood of success on the

merits is low. Michigan v. United States Army Corps of Engineers,

667 F.3d 765, 782 (7th Cir. 2011). In framing the probability of

success necessary for a grant of injunctive relief, we have said

repeatedly that the plaintiff’s chances of prevailing need only

2

   D.U. noted in her opening brief that the State requested seizure and

injection logs, and then denied private duty nursing when D.U. failed to

produce the logs. D.U. postulated that she would have been approved for

skilled nursing had she provided the requested logs. Yet she also inexplica‐

bly failed to produce the logs (if they exist) to the district court.

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12 No. 15‐1243

be betterthan negligible. See Girl Scouts of Manitou Council, Inc.

v. Girl Scouts of the United States of America, Inc., 549 F.3d 1079,

1096 (7th Cir. 2008) (to obtain preliminary relief, the plaintiff

must show it has a better than negligible chance of success on

the merits of at least one of its claims); Lineback v. Spurlino

Materials, LLC, 546 F.3d 491, 502‐03 (7th Cir. 2008) (same);

Curtis v. Thompson, 8 F.2d 1291, 1296 (7th Cir. 1988) (same). In

requiring D.U. to establish “that she has a more than negligible

chance of persuading the trier offact by a preponderance ofthe

evidence that at least 70 hours of private duty nursing services

is medically necessary,” the district court may have overstated

D.U.’s burden at this stage of the proceedings:

This circuit employs a “sliding scale” approach in

deciding whether to grant or deny preliminary

relief; so that even though a plaintiff has less than a

50 percent chance of prevailing on the merits, he

may nonetheless be entitled to the injunction if he

can demonstrate that the balance of harms would

weigh heavily against him if the relief were not

granted[.]

Curtis, 8 F.2d at 1296. As we noted in Curtis, the sliding scale

approach is limited by the plaintiff first demonstrating “at

least” a negligible chance of success on the merits. Id. But once

that low threshold is met, the court must consider and balance

the remaining factors.

For a number of reasons, we conclude that D.U. met that

threshold here. First, D.U. demonstrated several diagnoses

associated with severe impairments. Second, she had qualified

for private duty nursing for a number of years and had only

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No. 15‐1243 13

recently been rated as “borderline” for this type of care. The

State’s use of the word “borderline” suggests that D.U. is very

close to qualifying for this care if she provides adequate

documentation supporting the opinions of her doctors and

nurse. Third, one of her doctors and the nurse who treated her

for seven years were of the opinion that D.U. still requires this

level of care. Finally, a second doctor noted that skilled nursing

care would be beneficialtoD.U., which wouldsuggestthatthis

level of care would meet at least some of the nine criteria under

the Wisconsin statute. Wis. Admin. Code § DHS 101.03(96m).

In fact, the evidence submitted by both doctors and by D.U.’s

nurse suggest that skilled nursing care would meet those nine

criteria, but the district court undertook no analysis of those

factors after concluding that D.U. failed to meet the threshold

requirement. Although D.U. may not have yet presented

enough documentation in support of her claim to meet the

preponderance of the evidence standard necessary to ulti‐

mately prevail, she has certainly presented enough evidence to

show that she has a more than negligible chance of succeeding

on the merits.

Because D.U. has met that threshold inquiry, we turn to the

other factors for obtaining a preliminary injunction. D.U.

objects that the court failed to consider the other factors,

including whether she will sufferirreparable harm withoutthe

care of a private duty nurse, whether the balance of equities

tips in her favor and whether an injunction is in the public

interest.3 Plaintiffs seeking preliminary relief must demon

3

  On the last two factors, she makes only undeveloped and conclusory

(continued...)

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14 No. 15‐1243

strate that irreparable injury is likely in the absence of an

injunction. Winter, 555 U.S. at 22. In Winter, the Court noted

that “[i]ssuing a preliminary injunction based only on a

possibility of irreparable harm is inconsistent with our charac‐

terization of injunctive relief as an extraordinary remedy that

may only be awarded upon a clear showing that the plaintiff

is entitled to such relief.” Id.

In seeking to demonstrate that she will suffer irreparable

harm, D.U. cites the depletion of a special needs trust that was

establishedafterthe settlement of claims relatedto the accident

that caused her injuries. She contends that the trust has been

paying for her skilled nursing care since the State stopped

providing it, and that the trust was intended to supplement

Medicaid services, not supplant it. At oral argument, her

attorney explained that the settlement of claims resulted in a

structured settlement that provided an initial fund plus a

monthly annuity that was designed to allow herto continue to

qualify for public assistance. By the time of oral argument,

counsel stated that the initial fund had been depleted to a

value of $269, and that the monthly annuity was being used to

pay for skilled nursing services. D.U. is also receiving services

from a Medicaid‐funded personal care worker, although

Townsend noted that D.U. was not using the full amount of

personal care worker services that had been authorized as of

January 2014. The only harm that D.U. claims at this time is the

depletion of funds.

3

  (...continued)

claims. Because we ultimately conclude that she failed entirely to demon‐

strate irreparable harm, we need not consider these factors further.

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No. 15‐1243 15

Because money damages could make D.U. whole again

should she prevail in her lawsuit, she does not meet the

standard for irreparable harm. Girl Scouts, 549 F.3d at 1095 (a

party seeking a preliminary injunction must demonstrate,

among other things, that traditional legal remedies, such as

money damages, would be inadequate). See also Sampson v.

Murray, 415 U.S. 61, 90 (1974) (noting that “[m]ere injuries,

however substantial, in terms of money, time and energy

necessarily expended in the absence of a stay, are not enough”

to demonstrate irreparable harm and that the “possibility that

adequate compensatory or other corrective relief will be

available at a later date, in the ordinary course of litigation,

weighs heavily against a claim of irreparable harm.”). At oral

argument, D.U.’s attorney asserted that there was no mecha‐

nism in Wisconsin law for obtaining a refund of the money

expended on skilled nursing. But if D.U. prevails on the merits

of her suit, a federal court order will provide the only process

required.BecauseD.U.failedtodemonstrate irreparable harm,

the district court did not err in denying the preliminary

injunction.

AFFIRMED.

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