Document: 457 U.S. 991 102 S.Ct. 2777 73 L.Ed.2d 534 Barbara BLUM, Commissioner of the New York State Department Social Services, et al., Petitionersv.William YARETSKY al. No. 80-1952. Argued March 24, 1982. Decided June 25, Syllabus As a participating in Medicaid program established by Security Act, provides assistance to eligible persons who receive care private nursing homes, which are designated as either "skilled facilities" (SNF's) or "health related (HRF's), latter providing less extensive, and generally expensive, medical than former. The homes directly reimbursed for reasonable cost health services. To obtain assistance, an individual must satisfy eligibility standards terms income resources seek medically necessary requirement, federal regulations require each home establish utilization review committee (URC) physicians whose functions include periodically assessing whether patient is receiving appropriate level care, thus patient's continued stay facility justified. Respondents, were patients SNF, instituted class action Federal District Court after home's URC decided that they should be transferred lower HRF so notified local officials, administrative hearings resulting affirmance state officials officials' decision discontinue benefits unless respondents accepted transfer HRF. Respondents alleged, inter alia, had not been afforded adequate notice decisions reasons supporting them their right hearing challenge those decisions, required Due Process Clause Fourteenth Amendment. later added claims procedural safeguards also apply transferring higher transfers any kind initiated themselves patients' attending physicians. Ultimately court approved consent judgment establishing rights applicable URC-initiated levels ruled respondents' favor all its agent. permanently enjoined petitioner SNF's HRF's from permitting ordering discharges members different without prior written evidentiary hearing. Appeals affirmed, holding involved "state action" purposes Held : 1. have standing adequacy facility-initiated care. Although threatened only with although halted implementation such threat might determine, independently at current was imaginary speculative but quite realistic. However, sufficient immediacy reality presently adjudication procedures transfers. Thus exceeded authority under Art. III adjudicating governing Pp. 999-1002. 2. failed homes' discharge prove petitioners violated secured 1002-1012. (a) mere fact business subject regulation does itself convert into A normally can held responsible when it has exercised coercive power provided significant encouragement choice law deemed State. 1003-1005. (b) responds adjusting render decisions. Moreover, pertinent statutes do constitute affirmative commands summary thought inappropriately placed facilities. State, requiring completion forms relating condition homes. Those ultimately turn on judgments made parties according professional Similarly, imposing penalties fail inappropriate dictate particular case. And even though subsidizes facilities, pays expenses patients, licenses thereby converted action." Nor perform function "traditionally exclusive prerogative State," Jackson v. Metropolitan Edison Co., 419 345, 353, 95 449, 454, 42 477, nexus between challenged action. 1005-1012. 2nd Cir., 629 F.2d 817, reversed. Judith A. Gordon, City, petitioners. John E. Kirklin, respondents. Justice REHNQUIST delivered opinion Court. 1 represent challenging reside opportunity question may strictures 2 * Congress 1965 Title XIX U.S.C. § 1396 seq., (1976 ed. Supp.IV), provide financial States choose reimburse certain costs incurred poor. (HRF's).1 former.2 Nursing chosen services, N.Y.Soc.Serv.Law 367-a.1 (McKinney Supp.1981). 3 An meet two conditions assistance. He defined he See 1396. assure satisfied,3 justified.4 CFR §§ 456.305, 456.406 (1981). If determines discharged more intensive, notify agency administering assistance.5 456.337(c), 456.437(d) (1981); 10 NYCRR 416.9(f)(2), (3), 421.13(f)(2), (3) (1980). 4 At time complaint filed, Yaretsky Cuevas American Home, SNF located City. Both recipients program. In December 1975 did need City then city, this prepared reduce terminate payments Following hearings, social service affirmed reduced 5 commenced suit, acting individually behalf Medicaid-eligible residents homes.6 Named defendants Commissioners Services Health. alleged part decisions.7 maintained these actions They sought injunctive relief damages.8 6 January 1978 certified class9 issued preliminary injunction, restraining reducing terminating timely decision, defendants' proposed action, pending resolution claim. App. 100-101, ¶ 2.10 court's accompanying relied primarily existing regulations. Id., 112-115. 7 1979 pretrial order identified new claim raised panoply higher, i.e., well recommending addition, claimed 157, II(J); 166-167, II(J). asserted deprived interests protected Amendment product 167, II(J).11 8 October incorporating previously awarded injunction additional substantive 227-239. left several issues most important, our purposes, "whether there constitutional pre-transfer and/or agents." 234-235, VIII(A)(1). Ultimately, answered favor, elaborating reasons. 240. petitioners, members, advance "the validity appropriateness 242-243. 9 Second Circuit portion Court's we described above. 817 (1980).12 one, physicians, "involve affecting constitutionally property liberty interests." 820. premised identification authorities "responded" benefits. Ibid. Citing 351, 453, 477 (1974), viewed response sufficiently close "nexus" URC's justify treating itself. We granted certiorari consider Appeals' conclusions about nature 454 815, 90, 70 83 now reverse judgment. II 11 first address regarding jurisdiction III. contend respondents, object According obtained complete 1979, Since other kind, no object, consequently enter 12 It axiomatic judicial conferred plaintiff shows "that personally suffered some actual injury result putatively illegal conduct defendant." Gladstone, Realtors Village Bellwood, 441 91, 99, 99 1601, 1607, 60 66 (1979). enough complains will injure someone. complaining party show within concretely affected. injurious one possess virtue stake litigating another similar, subject. Moose Lodge 107 Irvis, 407 163, 92 1965, 1968-69, 32 627 (1972). 13 appear recognize principles, adverse determinations undisturbed. These reflected facilities necessary. Consequently, maintain serious administrators reach similar initiate hearings. Petitioners belittle suggestion, noting implementing care; bars adopting own. concede, however, permits decide 14 conclude substantial adequacy. reaching conclusion, mindful primary conception . instance himself immediately harmed, harm, Poe Ullman, 367 497, 504, 81 1752, 1756, 989 (1961). Of course, "[o]ne await consummation preventive relief." Pennsylvania West Virginia, 262 553, 593, 43 658, 664, 67 L.Ed. 1117 (1923), quoted Babbitt Farm Workers, 442 289, 298, 2301, 2308, 895 "[T]he becomes perceived real immediate controversy. ." O'Shea Littleton, 414 488, 496, 94 669, 676, 38 674 (1974). Even accepting petitioners' characterization scope permanent embodied judgment, remain free determine possibility "imaginary speculative." Younger Harris, 401 37, 42, 91 746, 749, 27 669 (1971). light already make assessments, supra, S.Ct., 676 ("past wrongs evidence bearing repeated injury"). 15 cannot conclude, URC's, "of reality," Golden Zwickler, 394 103, 108, 89 956, 959, 22 113 (1969), Nothing record available suggests intensive inconceivable day confront eventuality, would "tak[e] us area speculation conjecture." 676.13 16 occur assessment wholly gratuitous advisory. Transfers recommended needs satisfied she currently resides. threaten elderly physical psychological trauma, infer refusal accept could potentially traumatic consequences. same said typically increase match increased Respondents' attack presupposes adeprivation interests. Finally, since July 1978, adhered policy refuse URC-recommended jeopardizing 180, 56. No force respect until mandated adoption. 17 therefore, presented 18 Constitution "[n]o shall deprive person life, liberty, due process law." Civil Rights Cases, 109 3, 18, 835 (1883), principle become firmly embedded inhibited section fairly States." Shelley Kraemer, 334 1, 13, 68 836, 842, 1161 (1948). "That erects shield against merely conduct, however discriminatory wrongful." (1974); Adickes S. H. Kress & 398 144, 90 1598, 26 142 (1970). 19 Faithful adherence requirement requires careful attention gravamen plaintiff's complaint. case, objected involuntary safeguards.14 named York. regulating including But procedures, arguments concede originates privately owned operated. Their lawsuit, seeks hold liable parties, adopt prohibit complain. 20 This case obviously cases defendant his received imprimatur "state" See, e.g., Flagg Bros., Inc. Brooks, 436 149, 98 1729, 56 185 (1978); supra; (1972); supra. differs consists enforcement laws lawsuit; motives triggered attributed Peterson Greenville, 373 244, 1119, 323 (1963). both types shed upon analysis resolve present 21 First, apparent extensively regulated, "[t]he Amendment." U.S., 350, 453. "there regulated entity treated itself." purpose invoked specific complains. importance assurance evident when, parties. Second, factual setting significant, precedents indicate encouragement, overt covert, 166, 1738; 357, 456; 173, 1971; 170, 1615. Mere approval acquiescence initiatives 164-165, 1737-38; 456. 23 Third, if powers State." 454; see 157-161, 1733-36. B 24 Analyzed finding stand. reasoned implemented because responded adjustment benefits, That actions. complain administrators, whom concededly There suggestion influenced degree State's obligation adjust conformity changes 25 rest rationale, however. argue "affirmatively commands" Were accurate, before us. support them. earlier explained, essential criteria services necessary, physician certify admitted thereafter. 1396b(g)(1) Supp.IV). "long term placement form" devised Health, called DMS-1. 415.1(a), 420.1(b) completed form provides, numerical score corresponding physician's mental health. note, forms, necessary.15 authorize admission despite "low" form. 415.1(a)(2), 420.1(b)(2) (1978).16 say form, decision. transfer, admit, patients. either.17 cited "to efforts possible indicated needs," 416.9(d)(1), 421.13(d)(1) (1980).18 designed "provide provider copy alternate home." 416.9(d)(4), 421.13(d)(4) 28 rely making nor demonstrate State.19 unlike Polk County Dodson, 312, 445, 509 (1981), public defender acts "under color of" meaning 1983 representing indigent criminal proceeding.20 employed appointed respondent, concluded "[t]his assignment entailed obligations way dependent authority." 318, 449. course client framed accordance canons ethics, rather dictated rule imposed true inappropriate.21 29 next point which, say, impose range inappropriate. One excludes participation providers "[f]urnished items substantially excess beneficiary's needs." 420.101(a)(2) authorized fine violate 414.18 (1978). concluded, violating add nothing 30 alternative position, command issue, reviews approves rejects merits. bear construction. file (1978), 456.271, 456.372 authorizes approve disapprove retain specifically disclaim responsibility. Instead, obliged payment change 435.916 Adjustments benefit involvement too slim basis predicate 31 vague generalization relationship exists regulates considered joint participant For proposition Burton Wilmington Parking Authority, 365 715, 856, 45 subsidization operating capital 90% licensing taken together assertions true, nonetheless unable agree held, enterprises necessarily provide, fall ambit Burton. 357-358, 456-57. programs undertaken funding activities persuasive demonstrating business. 454. argument regard assertion statute every provisions legislature funds needy. N.Y.Const., XVII, 3. mandate provision much long-term skilled receipt moneys. 1396a(a)(13)(B), 1396d(a)(4)(A) themselves. duties correct, follow day-to-day administration traditionally exclusively sovereign public. Indeed, claim, they. IV 33 care.22 contrary accordingly 34 Reversed. 35 WHITE, concurring judgments. 36 issue Blum Yaretsky, 80-1952 [457 991, 2777, 534], satisfies state-action responsible. Lugar Edmondson Oil 922, 937, 2744, 2754, 482. takes implicated here appears clear import majority's conclusion "decisions 2788, I agree. 37 allegations Rendell-Baker Kohn, 830, 2764, 418, requirement. focuses employment school receives sources respects. me, critical factor absence allegation based put forth majority states, "in contrast extensive generally, various regulators showed relatively little interest school's personnel matters." 841, 2772. remains, attributable state. Accordingly, concur 39 BRENNAN, MARSHALL joins, dissenting. 40 intended effect restraint abuse power, courts sensitive manner exercised. era active government intervention remedy ills, character in, influence over, often through complex opaque regulatory frameworks, always apparent. task assigns rendered burdensome, courts' faithfully, consistently purpose, more, less, important. 41 deciding action"1 context brought ed., ultimate determination simply inhibit. Where employee, inquiry straightforward. performed employees, what realistic delicate appraisal total taken. "Only sifting facts weighing circumstances nonobvious significance." 722, 860, 939-942, 2755-2756, 482.2 today departs precept, ignoring framework recitation abstract tests pigeonhole approach correct abstract, worth faithfully applied. Bolstered own preconception decisionmaking operator, resident, subjects scheme perfunctory examination. fails perceive decisive simple, demonstrably flawed, proceeds premise factually unfounded. describes resident involving independent treatment resident. Building premise, difficulty concluding plays role decision: By resident's prescribed, responding "medical Ante, 1008. accurate transfer. doctor prescribes drugs actor amounts depending drug prescribed. 44 level-of-care characterized "independent" home, ante, 1000, far exercise desire save money. sure, reference underlying program—to needed surprisingly, relies doctors implement aspect idea mutually intermediate care—embodied reflects model On contrary, institutionalized enshrined legislative constructs, serve governmental cost-containment policies. fiscal underpinning history "intermediate care" concept. 1967, concerned increasing Congress' motivation reimbursement intermediate-care flowed concerns. Senate Finance Committee Report Amendments S.Rep.No.744, 90th Cong., 1st Sess., 188 (1967), expressed concern Medicaid: "[B]ecause advantage matching formulas," tended classify " 'skilled home' care." consequence, noted, "a strong introducing vendor available." amendment XI creating track "categorically needy" medicaid summarized floor: 46 "The bill living boarding houses rate sharing institutions title XIX. Such safety sanitation comparable given 47 "This reduction allowing relocate numbers welfare institutions." Cong.Rec. 32599 (1967) (emphasis added). 48 cost-saving mechanism, Government Program elaborate systems periodic "utilization review."3 With Medicaid, attempts assign "levels anomalous. While used "skilled-nursing facilities," institutional all, nexus, geared determined physician; analogous choosing medication rehabilitative patient. inherent imprecision using broad noted commentators.4 vigor context, infra, 1022-1024, extraordinarily un character. From purely standpoint, shifting "higher "lower care," almost invariably involves another, rarely makes sense. commentator observed: "These eject helpless, disoriented people places lived months years choosing, never seen before. overwhelming that, extraordinary preparatory hardly ever made, move harmful preponderance frail elderly." B. Vladeck, Unloving Care 140 49 arbitrariness statutory system comparison proportion (ICF's) States. 1973 survey revealed 47.9% SNF's, 52.1% ICF's. ICF beds varied enormously example, 10% Louisiana, Maine, Oregon, Virginia SNF's; number housed nearly 80%, Florida Georgia figure closer 90%.5 Quite obviously, answer disparity lies considerations judgments, varying policies, enforcement, 50 York, operator "maintain planning document continuing 416.9(d)(1) (1980).6 responsibility operators is, goal costs,7 termination follows forthwith facility's below noted: has, essence, delegated recipient's 'private' party," 820 (CA2 1980), assigning need. alone evaluating Here clearly extends supplying 51 Ignoring determination, cursory, misleading, discussion my view, actually leaves doubt further goals, precision made. 52 notes admitting dismisses significance blandly "completed health," commenting: "As 'low' (1978)." 1006 (footnote omitted emphasis concludes: "We decision." 1006-1007 look candid score. 53 York's 54 "admit orders promulgated published department (New LongTerm Placement Form [DMS-1] Numerical Standards Master Sheet [DMS-9] ) include, minimum: 55 "(1) assessment, seeking patient, department." 415.1 (1978) details DMS-9 gives them, particularity entitled residential all. scores dysfunctions. incontinent urine often, 20; seldom, 10; never, 0. rating stool incontinence: 40; tabulation "function status." walk "some help," points; "total walk, 105 points. help" dress, 80 required, Ratings "mental alert, sometimes 0 impaired, receives, sometimes, ratings set "impairments." vision unimpaired, partial sight, point; blind, 57 criterion "predictor score" 180. 415.1(a)(2) (health-related facility), 60. 420.1(b)(2). admission, denial guidelines regulations, doubt, directly, solely, "responsible complains," 1004 omitted), decision.8 58 denying tabulated DMS-9, emphasizing perceives method gaining home. route whole outside realm hinges "physician's assessment" characterizing physician, upon, quote, following language bears noting: 59 "[F]or failing [as measured DMS-9], certification signed member agent district director designee indicating reason(s) [the required]." clear, potential qualify DMS-1, direct themselves, facility—and, agents parcel cost-control process.9 n. 8, framework, personal stage, limited "scoring" DMS-9. 61 Yet end initial certification. Within five days matter again subjected transferee facility. tabulate denied sanctioned agent.10 facility, like operates "written control plan, [of health]." 416.9, 421.13 body final instance. vast cases, "level treatment" specified criteria. deviation literal application permitted involvement. absent exceptional formularized unconscionable. indeed, admissions procedure administered bodies structure operations conform requirements, guidelines—albeit somewhat flexible "psychosocial" factors account. page 1025-1026. 62 "[w]e 1006-1007. "[i]n patients." 1007. course. where, ask, frequent admission? "continued promote efficient effective use days, thereafter, patient." 416.9(b)(1) (1980) (skilled facilities) 421.13(b)(1) days). 63 parallel standards.11 Again, DMS-1 channel principal determinants status, whenever achieve nonphysician representative agent, directed member. examine documentary information. 172-173. resolved adversely notified. allowed relevant information, remains 416.9(b)(2), 421.13(b)(2) again, standards, pervade determinations. Evaluations tabulation, "psycho-social" evaluation respecting physical, emotional, characteristics plan (prepared regulations), "additional 416.9(b)(4), (v), 421.13(b)(4)(v) added).12 64 concludes scheme: 65 wrong. fair reading (and Government) created, administer, tool impetus concern. precisely operators, assume burden Thus, but, paraphrase Court, "[t]hese requirements 1008, 18. Where, here, policy, deficiency dramatized inattention special apart institution, sustained funds, pervasively ensure properly undertaking disabled program, undercuts sterile Nation exist, profit, sufferance Medicare agencies. interdependence pronounced practically residents. And, rates, affords profit well. striking are, definition, utterly placement. many, totality network community. environment, authority, food, clothing, shelter, and, respect, functional equivalent Cf. Marsh Alabama, 326 501, 276, 265 (1946). Surely, especially alert situations "has elected place prestige behind" owner. 725, 861. Yet, whatever status where charge, while paying operators. "pervasively regulated" Governments; virtually oversight. stage protect residents' confronted challenge: plaintiffs office answering safely chooses undertakings institutions, aid directs, supports, encourages take 69 hypothesize many affect State.13 downward connected above,14 standard everything pay fixed salary. Because complain, renders actors Amendment, dissent. 365-a.2(b) Supp.1982). services." 1396d(a)(15). 1396d(c), (f). refer type HRF's. 414.1(a) Compare 416.1-416.2 421.1-421.2 stipulated rates SNF's. 169, 12. supplied assist reimbursing safeguard unnecessary charges consistent efficiency, economy, quality 1396a(a)(30). 1396b(g)(1)(C), 1396b(i)(4), 1395x(k). committees composed being reviewed. 456.306, Under law, for, afford views, committee's final. 456.336(f), (h), 456.436(f), (i) 731.11, 741.14 "who been, forced leave terminated 'Utilization Review' findings alleging receive." 19, chapter Gray Panthers, organization among objectives development persons." 21, 5. reductions arbitrary caused improperly constituted acted Ten individuals, intervened suit. Each intervenor intervenors recommendations. "all who, recommendations ineligible benefits." 45. access files records. 101-102. upheld portions Blum, 592 (2nd Cir. 1979). redefined 151. modified relieving authorities, funding. F.2d, 822. reversed precluded rejecting officer's recommendation favorable verbatim transcript exhibits. 822-825. suggest "must allege injured, other, unidentified belong purport represent." Warth Seldin, 422 490, 502, 2197, 2207, 343 (1975). Unless individuals "can requisite controversy [petitioners], 'none class.' 494, 675, (1974)." "From beginning lawsuit safeguards. attaches Brief 21-22 original). condition. Five eleven questions devoted values. C-1 values completing second ibid. dissent's mechanical incomplete. six ask daily supervision registered nurse, complications arise therapy qualified receiving. brings questions; inexplicable dispositive. dissent belittles depart URC, "part process." Post, 1022. signifies fact, disputed expenditures. concerning prescribe emphasize, admitted. Apropos observes, post, 1023, once admitted, requires, disbursement assess contained forms. aware, 10, 416.9(a)(2)(i), 421.13(a)(2)(i) consultation before, condemns conducting "cursory" review, 1019, pointedly asks "where admission?" 1024. dissent, headlong dive sea forgets earlier, 1979. Therefore, focused explain text, concerned. 456.280(b)(6), 456.380(b)(6) staff preparation plans, summarize return community, achieving maintaining best obtainable 416.1(k)(2)(ii), 421.3(b)(2) (1976). characterizes "factually unfounded," 1014, depend asserts exist money, explains 1014-1019. otherwise. needs. words, "downward" encouraged efficiency reasons, it. concrete terms, objects "fault" expensive accounting. involve law" 1983. Nevertheless, reasoning equally one. send teams on-site inspections During inspections, employees report 1396a(a)(26), (31), 1396b(g)(1)(D) 456.611 officials. correctly argue, none record. postscript arguments, avoid seek. pass assertion, decline 926-932, 2748-2751, 482, violation avenues claiming Amendment's Clause. "color constitutionality regulation, practice challenged. just easily actor." Lugar, addressed decidedly damages availed unconstitutional attachment procedure, enlisted impair benefit. party's seizure characterize 'state actor' 941, 2756. affirmatively deprivations enforces imprint seem circumstance significant. 1395x(k), 1396a(a)(31), 1396b(g)(1)(C) Supp.IV); dwell very detailed except note certifications loss commensurate extent failure review. 1396b(g), (i)(4) (1976b 456.650-456.657 Bishop, Plough, Willemain, Home Levels Care: Problems Alternatives, Health Financing Rev., 2, pp. 33, 138 "There reason believe ten times likely Oklahoma get it, least something care.' 137. deems appropriate, sanction. furnish "items needs" excluded state-imposed penalties. scheme, ensuring proper 1396a(26)(A), 1396a(31)(A), acknowledge serves demean overplacement variously estimated percent. 4. mistakes inquiry, instrument recording 1006, 15. background filling out applied determination. prescribed disregarded. precatory. Notably, specify "patient 1977." 416.9(a)(1), 421.13(a)(1) 416.9(b)(4)(vi), 421.13(b)(4)(vi). recorded exercised, why exempt inquiry? 1977. 416.9(b)(4)(vii), 421.13(b)(4)(vii) ("the 1977 developed department"). seems me 456.301, agents, 456.606. selected 173. qualifies offers, insufficient. confirms "and consultation." 416.9(a)(2)(ii). disagrees 416.9(a)(2)(iv), 421.13(a)(2)(iv). must, district" "any 416.9(a)(3), 421.13(a)(3). reliance case." 1007, 17. position work schizophrenic best: expressly supply controlling operator's admit event, misses point. duty Whether "patient's definition "need." finally assigned 416.9(f), 421.13(f) concurs "send statement forth, detail, changed agent's (DMS-1) finding." 416.9(f)(2)(i), 421.13(f)(2)(i) 421.13(f)(3)(i), 416.9(f)(3)(i). state-established difficult understand reviewing substance severely regulation. valid affected non-payment. 405.1121(k)(4), 442.311(c) 414.14(4) case—the decides presents live controversy—concerns 1000. Utilization Review decree entered below, today. hand decision—indeed, Committees Medicaid. absolutely meaningful text. view constitutes remove circumstances, owner, request, actor. sweeps broadly reaches arising standards.

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