U.S. Appeals Court Overturns Decision Allowing Medicaid Recipient to Hire Her Own Health Care Workers

The Seventh Circuit vacates a district court decision that allowed an Indiana Medicaid recipient to hire her own in-home health care providers as a reasonable accommodation under the Americans with Disabilities Act, holding that more evidence is needed to determine if the recipient’s request can be granted consistent with federal requirements for funding. Vaughn v. Walthall (U.S. Ct. App., 7th Cir., No. 19?1244, August 5, 2020).

Indiana resident Karen Vaughn is a quadriplegic who received in-home care for 30 years. Ms. Vaughn was approved for Medicaid through two waiver programs that provided more than 20 hours of care per day using Medicaid-approved providers at Medicaid rates. After Ms. Vaughn was hospitalized and later transferred to a nursing home, the state refused to release her because it could not find home-health agencies that were willing to provide care at Medicaid’s low reimbursement rates. Ms. Vaughn requested that the state allow her to directly hire her own providers who did not have the credentials required by the state. The state refused, and Ms. Vaughn was placed in a nursing home.

Ms. Vaughn sued the state under the Americans with Disabilities Act, arguing that being allowed to hire her own providers was a reasonable accommodation. The district court granted summary judgment to Ms. Vaughn and issued an injunction requiring the state to do whatever is necessary to provide the care that Ms. Vaughn wanted. The state appealed, arguing that the request for an accommodation was not reasonable because allowing unlicensed personnel to provide medical care and receive reimbursement would fundamentally alter the state’s Medicaid home?health programs. After oral argument, the state began a pilot program that allowed certain Medicaid recipients to self-direct medical care with limitations.

The United States Court of Appeals for the Seventh Circuit reverses and remands, holding that more evidence is needed to determine if summary judgment is appropriate. According to the court, it cannot tell on the record if Ms. Vaughn’s “request to employ less-skilled providers may be granted consistently with federal requirements for program approval and funding.” The court notes that “an accommodation that requires the state to provide care at its own expense, outside its federally authorized and reimbursable Medicaid programs, is not a reasonable modification of its Medicaid programs.” The court vacates the injunction and orders the lower court to consider whether the pilot program will meet Ms. Vaughn’s needs.

For the full text of this decision, go to: https://media.ca7.uscourts.gov/cgi-bin/rssExec.pl?Submit=Display&Path=Y2020/D08-05/C:19-1244:J:Wood:aut:T:fnOp:N:2559042:S:0

Did you know that the ElderLawAnswers database now contains summaries of more than 2,000 fully searchable elder law decisions dating back to 1993? To search the database, click here.