Tristani Ex Rel. Karnes v. Richman
652 F.3d 360
3rd Cir.2011Background
- Three Pennsylvania Medicaid beneficiaries (Tristani, Valenta, A.H.) challenged DPW liens on third-party recoveries for medical expenses.
- District Court certified a § 1292(b) interlocutory appeal to address DPW lien authority and consistency with Ahlborn.
- Plaintiffs claimed DPW liens violated the anti-lien and anti-recovery provisions of the Social Security Act (42 U.S.C. §1396p).
- PA law assigns to DPW the right to recover medical costs and requires either sole or joint prosecution of third-party claims with DPW participating or intervening.
- The DPW sought to recover only medical costs via liens, with allocation rules determining how much of a settlement is medical vs. non-medical.
- The Third Circuit held that liens limited to medical costs are not prohibited and upheld PA’s current apportionment framework, remanding related issues for further proceedings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Can DPW impose liens on settlements for medical costs? | Beneficiaries retain property interest; anti-lien blocks such liens. | Liens on medical-cost portions are permitted as an exception to anti-lien. | Liens on medical-cost portions are not prohibited. |
| Is Pennsylvania's default allocation of settlements valid under Ahlborn? | Default 50% allocation may overreach and violate Ahlborn. | Default allocation aligns with Ahlborn's guidance and is subject to appeal. | Current framework with a right to appeal is valid; prior non-appealable scheme invalid. |
| Does PA's allocation scheme conflict with anti-recovery or anti-lien provisions when altered by Ahlborn? | Reimbursement/assignment provisions mandate state action; anti-recovery bars beneficiary windfalls. | Reimbursement/assignment provisions create implicit exceptions to anti-lien/anti-recovery. | Scheme harmonizes with statute; anti-lien/anti-recovery not violated by the allocation framework. |
| Does § 1409(b)(5)(vi) (beneficiary can include DPW benefits in suit) preempted by the Social Security Act? | Beneficiary-right to recover DPW medical costs enhances compensation. | Reimbursement/assignment provisions intend state-directed recovery; §1409(b)(5)(vi) conflicts. | §1409(b)(5)(vi) is preempted; beneficiaries cannot include DPW benefits in their own suit. |
| Is the District Court's remand warranted on allocation procedures consistent with Ahlborn? | Remand not necessary; the court should align with Ahlborn without new procedures. | Remand is appropriate to ensure proper allocation under current framework. | Remand directed to proceed in light of this opinion. |
Key Cases Cited
- Arkansas Dept. of Health & Human Services v. Ahlborn, 547 U.S. 268 (U.S. 2006) (assumed, for argument, an exception to anti-lien for medical-cost recoveries)
- Griffin v. Oceanic Contractors, Inc., 458 U.S. 564 (U.S. 1982) (statutory interpretation requires considering the whole statute)
- Kokoszka v. Belford, 417 U.S. 642 (U.S. 1974) (interpret statutes in light of their objects and purposes)
- Yamaha Motor Corp., U.S.A. v. Calhoun, 516 U.S. 199 (U.S. 1996) (a certified question's scope includes issues fairly included in the certified order)
- Lorillard v. Pons, 434 U.S. 575 (U.S. 1978) (legislative history informs statutory interpretation and implied exceptions)