Ohio Dep't of Medicaid v. Thomas Price
864 F.3d 469
| 6th Cir. | 2017Background
- Ohio submitted a Medicaid state-plan amendment seeking federal reimbursement for medical care of juvenile pretrial detainees (under age 19), acknowledging those individuals were currently ineligible under the statutory "inmate" exclusion.
- CMS denied the amendment, interpreting 42 U.S.C. § 1396d(a)(29)(A) and its implementing regulation (42 C.F.R. § 435.1010) to treat juvenile pretrial detainees as "inmates of a public institution" and thus ineligible for federal financial participation (FFP).
- CMS explained the regulatory exception for persons "in a public institution for a temporary period pending other arrangements appropriate to [their] needs" does not apply to individuals involuntarily confined pending adjudication.
- Ohio challenged the denial administratively and then petitioned for judicial review of the Secretary’s final decision in federal court.
- The Sixth Circuit evaluated statutory meaning and agency interpretations under Chevron deference for the statute and Auer deference for the agency’s interpretation of its own regulation.
Issues
| Issue | Plaintiff's Argument (Ohio) | Defendant's Argument (CMS/Secretary) | Held |
|---|---|---|---|
| Whether § 1396d(a)(29)(A) "inmate" excludes juvenile pretrial detainees | "Inmate" should not categorically include juveniles awaiting adjudication; statute does not require age/status distinction | Statute’s plain language and ordinary meaning of "inmate" includes anyone confined involuntarily; Congress did not carve out age/status exceptions | Held for CMS: statutory text permits treating juvenile pretrial detainees as inmates and excluding them from FFP |
| Whether 42 C.F.R. § 435.1010(b) (temporary-period exception) covers juvenile pretrial detainees | The regulation’s "temporary period pending other arrangements" fits juvenile detainees; regulation should control and allow funding | The regulation is reasonably read to require voluntariness (involuntary confinement excludes detainees); CMS interpretation controls | Held for CMS: regulation is ambiguous as applied and the agency’s interpretation is controlling under Auer |
| Applicability of administrative deference doctrines (Chevron/Auer) | Ohio argued agency should be bound by its regulation; deferential standards may not justify ignoring regulation’s plain import | CMS asked for Chevron deference on statute and Auer deference for its regulation interpretation; long-standing agency position supports deference | Held: Chevron applies to the statute; Auer deference applies to CMS’s interpretation of § 435.1010 and the agency’s denial was not arbitrary or capricious |
| Whether granting Ohio’s amendment would contravene Medicaid’s purpose (supplant state/local responsibility) | Ohio: parents (not state) typically pay for juveniles in custody under Ohio law, so federal funding would not supplant state/local responsibility | CMS: allowing FFP would shift costs traditionally borne by states/counties to federal government and undermine longstanding policy denying FFP for inmates | Held for CMS: permitting funding would conflict with the inmate exclusion’s purpose and longstanding agency policy; Ohio’s state-law cost-shifting to parents does not negate the exclusion |
Key Cases Cited
- Chevron U.S.A., Inc. v. Nat. Res. Def. Council, Inc., 467 U.S. 837 (agency construction of ambiguous statute reviewed for permissibility under Chevron)
- Auer v. Robbins, 519 U.S. 452 (agency interpretation of its own ambiguous regulation controlling unless plainly erroneous)
- Motor Vehicle Mfrs. Ass’n v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29 (arbitrary and capricious standard under the APA)
- Douglas v. Indep. Living Ctr. of S. Cal., Inc., 565 U.S. 606 (agency authority and review of state Medicaid plans)
- Brown v. Plata, 563 U.S. 493 (context on state responsibility for prisoner healthcare cited for background)
- Harris v. Olszewski, 442 F.3d 456 (6th Cir. precedent on deference and Medicaid program administration)