Dale Singleton v. Commw. of Ky.
2016 U.S. App. LEXIS 21694
| 6th Cir. | 2016Background
- In 2006 Congress amended 42 U.S.C. § 1396p(c)(1)(F) to require that, for an annuity to avoid being treated as a below‑market transfer, the State must be named as remainder beneficiary for at least the total amount of medical assistance paid on behalf of the institutionalized individual (fixing a drafting error that had said "annuitant").
- Kentucky promulgated a regulation in March 2007 that mistakenly tracked the pre‑amendment language (using "annuitant") and did not reflect Congress’s correction; the regulation remained unchanged until 2014.
- The Kentucky Medicaid Department, through Branch Manager Marchetta Carmicle, applied the corrected federal rule (naming the State for the institutionalized individual) rather than the erroneous state regulation when adjudicating annuity treatment.
- Mary and Claude Singleton purchased an annuity structured to comply with the federal rule after being told the Department enforced federal law; Medicaid paid $98,729.01 for Claude’s care and recovered that amount from the annuity after both spouses died; the Singletons’ estate sued.
- The Singletons sued under § 1983 and state law, alleging Carmicle and the State illegally enforced the federal rule instead of the state regulation; Carmicle moved to dismiss under Rule 12(b)(6) asserting federal preemption and qualified immunity.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Kentucky regulation allowing a different annuity beneficiary rule was enforceable against the State/official | Singletons: Kentucky could adopt a more generous, less restrictive methodology under §1396a(r)(2)(A) and the regulation entitled claimants to treatment differing from federal law | Carmicle: federal Medicaid statute and the State‑plan requirement preempt any contrary state regulation; federal rule controlled | Court: Federal law preempted the contrary Kentucky regulation; regulation void |
| Whether Carmicle violated plaintiffs’ constitutional rights by enforcing the federal rule | Singletons: enforcement deprived them of property and amounted to unconstitutional taking/seizure under Fourth, Fifth, Fourteenth Amendments | Carmicle: she acted pursuant to controlling federal law; no cognizable violation because state rule was preempted | Court: No constitutional violation; claims fail as a matter of law |
| Whether Carmicle is entitled to dismissal on qualified immunity grounds at 12(b)(6) | Singletons: qualified immunity requires fact development; should await discovery/summary judgment | Carmicle: preemption disposes of the substantive claim—no violation and thus no clearly established right | Court: Because federal law compelled her actions, the complaint fails to state a claim; qualified immunity analysis need not await discovery |
| Proper remedy and posture for appeal (interlocutory appeal by official) | Singletons: challenged district court’s refusal to resolve immunity at pleading stage | Carmicle: appealed interlocutorily after district court denied dismissal on immunity grounds | Court: Reversed district court and remanded for proceedings consistent with opinion (dismissing claims against Carmicle) |
Key Cases Cited
- Hughes v. McCarthy, 734 F.3d 473 (6th Cir.) (context on spousal asset exclusions and Medicaid eligibility)
- Ark. Dep’t of Health & Human Servs. v. Ahlborn, 547 U.S. 268 (Sup. Ct.) (limits on state recovery and Medicaid reimbursement principles)
- Wos v. E.M.A. ex rel. Johnson, 133 S. Ct. 1391 (Sup. Ct.) (state law yields to direct conflict with federal law)
- Ashcroft v. Iqbal, 556 U.S. 662 (Sup. Ct.) (Rule 12(b)(6) pleading standard)
- Pearson v. Callahan, 555 U.S. 223 (Sup. Ct.) (qualified immunity framework)