Opinion ID: 793926
Heading Depth: 2
Heading Rank: 1

Heading: qualified immunity of hanley and jeffus.

Text: 23 Ordinarily, a party cannot appeal from a denial of summary judgment. Pool v. Sebastian County, Arkansas, 418 F.3d 934, 937 (8th Cir.2005). There is an exception to this rule for government officials whose motion for summary judgment based on qualified immunity is denied. Id. Under this exception, we may immediately review the issue of whether the defendants engaged in conduct that violated the plaintiffs' clearly established rights. Id.; see also Harlow v. Fitzgerald, 457 U.S. 800, 818, 102 S.Ct. 2727, 73 L.Ed.2d 396 (1982) (holding that government officials performing discretionary functions generally are shielded from liability for civil damages insofar as their conduct does not violate clearly established statutory or constitutional rights of which a reasonable person would have known). 24 We must first consider whether the Medicaid Act confers any federally enforceable rights upon the plaintiffs. This question has been largely answered by our prior opinions in this case. The claims for damages made by the plaintiffs here relate only to two subsections of the Medicaid Act: 42 U.S.C. § 1396d(a)(13) (Count Four of the Complaint), and 42 U.S.C. § 1396a(a)(30)(A) (Count Three of the Complaint). In Pediatrics I and Pediatrics II, respectively, we specifically held that each of these subsections created enforceable federal rights. Pediatrics I, 293 F.3d at 480-81 (holding that § 1396d(a)(13) created enforceable rights for recipient beneficiaries, which CHMS providers could assert on behalf of the beneficiaries); Pediatrics II, 364 F.3d at 930 (Over ten years ago, our court held that § 1396a(a)(30)(A) created enforceable rights for Medicaid recipients and providers. We find it entirely appropriate for the Plaintiffs to base their procedural due process claim on their clearly established rights to have equal access to quality medical care as defined by § 1396a(a)(30)(A). (Citation omitted)). Thus, the argument that there is no federally enforceable rights here is at odds with both the law of the case doctrine and the principle of stare decisis. 8 25 The law of the case doctrine prevents the relitigation of a settled issue in a case and requires courts to adhere to decisions made in earlier proceedings, except where the result would be manifestly unjust. Kan. Pub. Employees Ret. Sys. v. Blackwell, Sanders, Matheny, Weary & Lombardi, L.C., 114 F.3d 679, 687 (8th Cir.1997). Stated another way, when our court considers a case on appeal, every issue disposed of on appeal has thus been finally decided. Klein v. Arkoma Prod. Co., 73 F.3d 779, 784 (8th Cir.1996). The doctrine is intended to `insure uniformity of decisions, protect the expectations of the parties and promote judicial economy.' In re Just Brakes Corporate Sys., Inc., 293 F.3d 1069, 1072 (8th Cir.2002) (quoting Klein, 73 F.3d at 784). The doctrine does not apply, however, where an intervening decision of a higher tribunal clearly demonstrates that the prior decision is wrong. Madison v. IBP, Inc., 330 F.3d 1051, 1059 (8th Cir.2003). 26 42 U.S.C. § 1396d(a)(13) entitles Medicaid eligible children to 27 diagnostic, screening, preventive, and rehabilitative services, including any medical or remedial services (provided in a facility, a home, or other setting) recommended by a physician or other licensed practitioner of the healing arts within the scope of their practice under State law, for the maximum reduction of physical or mental disability and restoration of an individual to the best possible functional level. 28 In Pediatrics I, we affirmed the district court's holding that this subsection of the Medicaid Act created an enforceable federal right to early intervention day treatment when recommended by a physician. Pediatrics I, 293 F.3d at 477-78. No petition for rehearing was filed by the ADHS. Cf. Klein, 73 F.3d at 784 n. 7 (Generally, parties must bring any perceived errors in a panel opinion to the court's attention through a petition for rehearing.) 29 Similarly, 42 U.S.C. § 1396a(a)(30)(A), commonly referred to as the equal access provision of the Medicaid Act, requires state Medicaid plans to employ methods and procedures related to use and payment of care and services as necessary to ensure that the state's payments are consistent with efficiency, economy, and quality of care and are sufficient to enlist enough providers so that care and services are available under the plan at least to the extent that such care and services are available to the general population in the geographic area. Relying in part on our earlier opinion in Arkansas Medical Society, Inc. v. Reynolds, 6 F.3d 519 (8th Cir.1993), we held that this part of the Medicaid Act created a clearly established federal right to equal access to quality medical care. Pediatrics II, 364 F.3d at 930. ADHS petitioned for rehearing en banc from this decision, but nowhere in the petition did ADHS suggest that it was error to find that the equal access provision created an enforceable federal right. 30 Given our clear prior panel holdings, the question of whether §§ 1396d(a)(13) and 1396a(a)(30)(a) confer enforceable federal rights upon the plaintiffs appears settled in the affirmative. Although ADHS suggests that Pediatrics I did not finally answer whether CHMS providers had an enforceable right under § 1396d(a)(13), we explicitly stated that the providers have standing to assert the rights of their CHMS patients. 293 F.3d at 478. Thus, there is little merit to that argument. 31 ADHS invites us to overturn our prior decisions based on the view that they are inconsistent with the Supreme Court's decision in Gonzaga University v. Doe, 536 U.S. 273, 122 S.Ct. 2268, 153 L.Ed.2d 309 (2002). According to ADHS, Gonzaga clarified that an enforceable right is only created where the statute explicitly states as much, and is only enforceable by the person or entity that the statute states is the beneficiary. 32 At the outset, we note that Gonzaga was issued on June 20, 2002. Our decision in Pediatrics I was filed ten days earlier, but the mandate did not issue until July 1, 2002, with no petition for rehearing before that time. See Fed. R.App. P. 40(a) (granting a party fourteen days from the entry of judgment to file a petition for rehearing). Likewise, our decision in Pediatrics II was not issued until April 16, 2004. Thus, Gonzaga is not an intervening decision of a superior tribunal, as is required before we may overturn matters previously settled as the law of the case. Madison, 330 F.3d at 1059. 33 Perhaps more importantly, we do not read Gonzaga to require a different result than we reached in our earlier decisions. In Gonzaga, the question presented was whether a student could bring a damages claim pursuant to 42 U.S.C. § 1983 for a University's violation of the Family Educational Rights and Privacy Act of 1974 (FERPA). 536 U.S. at 276, 122 S.Ct. 2268. FERPA was enacted pursuant to Congress's spending power, and directed the Secretary of Education to withhold funds from institutions that released students' private information without their consent. Id. at 278, 122 S.Ct. 2268. A student at Gonzaga's school of education sued the school under FERPA when he found out that the school's teacher certification specialist disclosed allegations of sexual misconduct to Washington's teacher certification agency without his permission. Id. at 277, 122 S.Ct. 2268. 34 Writing for the majority, Chief Justice Rehnquist first recognized that there was some circuit and district court discord and confusion about what type of statutory rights were enforceable by a § 1983 damages action. Id. at 278, 122 S.Ct. 2268. The Court noted that the starting point must be an inquiry into whether Congress intended to create a federal right. Id. To determine this, one must consider the benefit conferred by the statute, the intended beneficiary, and whether the statute provides for some type of enforcement action short of a private cause of action. Id. at 285-90, 122 S.Ct. 2268. The Court stated that the creation of such rights must be done in clear and unambiguous terms. Id. at 290, 122 S.Ct. 2268. The Court ultimately held that FERPA provisions failed to create privately enforceable rights, since it had no explicit rights-creating language, spoke in terms of aggregate as opposed to individual privacy protections, and directed the Secretary of Education to enforce it. Id. 35 ADHS would have us read Gonzaga in a manner that forecloses private causes of action based on the Medicaid Act. However, an earlier case, Wilder v. Virginia Hospital Association, 496 U.S. 498, 110 S.Ct. 2510, 110 L.Ed.2d 455 (1990), has already considered whether (now-repealed) provisions of the Medicaid Act, which required the state to reimburse hospitals for costs of certain services, conferred a § 1983 right of action on behalf of health care providers. The Court first held that [t]here can be little doubt that health care providers are the intended beneficiaries of the provision, since it was about payment of services provided by them. Id. at 510, 110 S.Ct. 2510. The Court then concluded that the mandatory language of the provision-requiring some level of payment for the health care providers' services even though the ultimate amount was left mostly to the state's discretion-created an enforceable right to payment under § 1983. Id. at 512-13, 110 S.Ct. 2510. Although Gonzaga takes a more restrictive view of rights-creating statutes, it did not overrule Wilder. Thus, the proposition that the Medicaid Act may create enforceable rights, even for health care providers, is far from novel. 36 Secondly, the plaintiffs still prevail within the terms of the Gonzaga analytical framework. As to § 1396d(a)(13), the statute calls for state payment of part or all of the costs of diagnostic, screening, preventive, and rehabilitative services when recommended by a doctor for the maximum reduction of physical or mental disability and restoration of an individual to the best possible functional level. The intended beneficiaries of this subsection are, obviously, the needy child, and by corollary, those who incur costs in providing those services. Moreover, this portion of the statute does not speak in terms of amorphous concepts; it requires therapeutic services for an individual. Id. We acknowledge that the federal government is charged with responsibility for supervising a state's participation in the Medicaid program, a factor that Gonzaga holds indicative of no private right being created. This, however, cannot overcome the fact that the statute itself indicates positively both the scope of the provision and who is the intended beneficiary. Thus, a private cause of action lies for enforcement of § 1396d(a)(13). 37 Similarly, 42 U.S.C. § 1396a(a)(30)(A), is intended to benefit both CHMS recipients and providers, and creates enforceable rights for both groups. That subsection requires states to provide methods and procedures for payment of care and services in a manner that ensures equal access to quality care for needy children. Id. The beneficiaries are both the recipients of the services and the recipients of the state's payment, who are the CHMS providers. The statute is clear on its scope: to ensure payments are not too high, but yet high enough to secure the participation of enough clinics so that needy children receive equal access to quality health care. 38 In sum, as our prior cases have held, the rights conferred by §§ 1396d(a)(13) and 1396a(a)(30)(A) are clearly established federal rights. Moreover, even accepting ADHS's invitation to reconsider prior established precedent, we find no error in the district court's holding that these provisions of the Medicaid Act are enforceable by both CHMS recipients and providers through a § 1983 private cause of action. 39 We must now consider whether the evidence, viewed in the light most favorable to the plaintiffs, Plemmons v. Roberts, 439 F.3d 818, 822 (8th Cir.2006), supports the view that Hanley and Jeffus violated the plaintiffs' Medicaid Act rights. The district court found that, taking all evidence and inferences in the plaintiffs' favor, they could show that Jeffus and Hanley manipulated the prior authorization system in a way that denied children essential medical services solely because they wanted to cut costs. After carefully reviewing the record, we agree with the district court. 40 The evidence presented to the district court is recounted fully above, and will be merely summarized here. There is certainly evidence that documented AFMC's wrongdoing: Dr. Whitaker testified about how his approvals had been altered by a nurse, and Brenda Gassaway, a nurse, testified consistently with that. When brought to the attention of supervisors, nothing was done to correct this misconduct. To the contrary, Gassaway herself was fired. 41 The more difficult question is whether ADHS's directors can be tied to this wrongdoing. Although disputed and certainly not proven, the inference of wrongdoing is supported by the plaintiffs' evidence. Deposition testimony indicated that AFMC's primary concern was to save ADHS money, and Gassaway stated that her superiors told her that this was the reason they were able to maintain the contract with ADHS. In other words, AFMC won and kept the contract as ADHS's prior authorization agent because it would deny or reduce a significant number of claims when compared to the services paid prior to AFMC's arrival. There was also testimony that ADHS worked overtly to ensure that claims were denied by sending directives to AFMC about the extent of services that AFMC could approve. As recognized by the district court, Hanley and Jeffus implemented a policy [of prior authorization] that reduced the scope and duration of day treatment for beneficiaries of the Medicaid Act. (Dist. Ct. Order of Feb. 7, 2005 at 38.) Taking the evidence in the plaintiffs' favor, one could infer that their primary motivation was to save money, although the statutes require them to act in the best interest of the needy children. That is a violation of the rights clearly established under the §§ 1396d(a)(13) and 396a(a)(30)(A) and our prior caselaw, and thus neither defendant is entitled to summary judgment on the issue of qualified immunity. The district court properly so held.