KP v. Hamos, 2:12-cv-02044

Six Medicaid-eligible children with mental health disorders sue Julie Hamos in her official capacity as Director of the Illinois Department of Healthcare and Family Services.
Plaintiffs allege defendant refused to provide treatment in integrated settings (residential or intensive home/community-based services) and instead placed them in psychiatric hospitals.
SASS screens before Medicaid-funded inpatient psychiatric admissions; DHS administers the Individual Care Program, and HFS is responsible for Medicaid reimbursement and referrals.
Plaintiffs seek residential treatment or intensive home/community services and allege denial of Individual Care Grants; several delays or denials are alleged, including for K.P., J.F., and others.
Plaintiffs contend the risk of future hospitalizations and higher costs could be mitigated by integrated treatment; they bring counts under the Medicaid Act, ADA, and Rehabilitation Act seeking declaratory, injunctive, and damages relief.
The court analyzes a motion to dismiss Counts II–IV; recommends partial grant/partial denial, and discusses procedural posture regarding §1983 and RA/ADA claims.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Are the ADA/ Rehabilitation Act discrimination claims stated?	Plaintiffs allege need for integrated treatment and no opposition to such placement.	Defendant contends plaintiffs seek hospitalization or fail to allege integration benefits.	Plaintiffs state plausible integration-discrimination claims.
May §1983 claims accompany ADA/RA claims against the state agency?	§1983 claims are viable for ADA/RA violations against the public entity or recipient of federal funds.	Not explicitly addressed; argues potential impediments to §1983 recovery.	Court denies dismissal of §1983 claims at this stage and keeps open for summary judgment.
Damages for Rehabilitation Act claims and §1983 against official capacity	Plaintiffs seek compensatory damages under RA and §1983 for deliberate indifference.	Damages require deliberate indifference and §1983 damages against official capacity barred.	§1983 damages against officials in their official capacity barred; RA damages possible with deliberate indifference; sufficient allegations found.

Olmstead v. L.C. ex rel. Zimring, 527 U.S. 581 (1999) (integration mandate: unjustified institutionalization violates ADA/RA)
Radaszewski ex rel. Radaszewski v. Maram, 383 F.3d 599 (7th Cir. 2004) (integration mandates can support disability discrimination claims)
Grzan v. Charter Hospital of Northwest Indiana, 104 F.3d 116 (7th Cir. 1997) (discusses 'otherwise qualified' standard in RA claims; not controlling for integration cases)
Zachary M. v. Bd. of Educ. of Evanston Twp. High Sch. Dist. No. 202, 829 F. Supp. 2d 649 (N.D. Ill. 2011) (discusses RA/ADA claims and damages considerations)
Phipps v. Sheriff of Cook County, 681 F. Supp. 2d 899 (N.D. Ill. 2009) (deliberate indifference standard for RA damages recognized by district court)
Barnes v. Gorman, 536 U.S. 181 (2002) (compensatory damages available under RA when discriminatory intent shown)