Complex regulatory schemes produce complex eases. And the interplay between complex state and federal statutory and regulatory schemes produces very complicated cases. This is just such a case. In it, we consider the scope of our prior decision, Catanzano v. Dowling,
BACKGROUND
A Statutory and Regulatory Framework
The Medicaid program is controlled by Title XIX of the Social Security Act, 42 U.S.C. §§ 1396 et seq. Medicaid is a joint federal and state program designed to provide medical assistance to the financially needy. It is subsidized by the federal government, but administered by the states. Participation by a state in the program is voluntary, but once a state chooses to participate, it must comply with the federal Medicaid Act. See, e.g., Harris v. McRae,
Under New York law, home health services in New York must be provided by Certified Home Health Agencies (“CHHAs”). N.Y. Public Health Law §§ 3602(3), 3614(1). CHHAs employ professional nurses who make their own determinations as to the medical necessity and appropriateness of home health services. In 1991 and 1992, New York amended its laws governing home health care to create a four-step process by which a CHHA must determine whether or not home health services should be provided. N.Y. Social Services Law § 367-j; N.Y.Comp. Codes R. & Regs. tit. 18, § 505.23. Once a patient’s physician has ordered home health services, and periodically thereafter, a CHHA must make a “fiscal assessment,” the form of which differs depending upon the expected length of the period of care. If the period of care is expected to be less than 60 days, the CHHA makes only a two-step determination: 1) is home health care medically necessary and can it be safely provided? 2) are there less expensive ways to deliver the same amount of care? If the period of care is longer than 60 days, the CHHA must make two additional determinations: 3) will the cost of home health care exceed 90 percent of the cost of institutionalization? 4) if so, does the patient meet one of the statutory exceptions to mandatory institutionalization? When a CHHA makes a decision pursuant to steps 3 and 4, it must inform the local Department of Social Services (“DSS”). If the DSS and the CHHA disagree on the amount (if any) of care to be provided, the matter is referred to the “local professional director,” whose decision is binding on the CHHA and the recipient. A recipient who is unhappy with this decision is allowed a full due-process “fair hearing” before an administrative law judge. The statute and regulation do not allow for “fair hearings” when the CHHA denies benefits pursuant to steps 1 or 2, or when the CHHA and the DSS agree to deny benefits under steps 3 and 4.
B. The Instant Case
This case has a long history. It began in 1989 when the CHHA operated by defendant Monroe County Department of Health decided to reduce the amount of Medicaid-funded home health care services that had been prescribed by plaintiff Michele Catanzano’s physician. Catanzano was thirteen years old at the time, and was recovering from spinal fusion surgery. Judge Larimer prehminarily enjoined the reduction in services because Catanzano had not been provided with notice, hearing rights, or “aid-continuing.”
The following year, New York amended its health care law to create the four-step decision-making process discussed above. Catanzano promptly amended her complaint to challenge the amended law. In 1994, finding that “serious violations of federal law have occurred, and continue to occur,” Judge Larimer preliminarily enjoined the operation of the amended laws because, in each of the four steps, recipients’ benefits could be reduced, terminated, or denied without due process “fair hearing” rights. Catanzano,
We rejected that argument and affirmed the decision of the district court. Catanzano v. Dowling,
[T]he decisions made by the CHHA are not purely medical judgments made according to professional standards. Instead, section 367-j(2)(a)(i) requires the CHHAs to determine whether the health and safety of the recipient can be maintained “as defined by the department of health in regulation.” Furthermore, the statute provides the specific alternatives that the CHHA is to consider in making the “efficiency” determinations mandated in step two---- [Finally,] the State has delegated its responsibility for “prior approval” to CHHAs. Prior approval ... is the general term for the process by which it is determined whether requested services are medically necessary____, For benefits other than home health care, patients adversely affected by prior approval determinations are entitled to a fair hearing. The state may not circumvent this requirement by delegating prior approval to CHHAs. Accordingly, the CHHAs are not independent actors doing business with the state, but are entities that have assumed the responsibility for the State’s mandated health care duties.
Id. at 119-20 (citations and internal quotation marks omitted); see also Grijalva v. Shalala,
Following this court’s decision, the district court ordered the parties to prepare a final plan to implement the injunction. The parties could not agree on one crucial element of that plan: whether the CHHAs have the right to refuse to provide home health services to a patient even after the administrative law judge in a fair hearing has found for the recipient and against the CHHA. Judge Larimer concluded that they do not:
While it is true that the Court of Appeals did not directly address this question, the implications of its reasoning are clear, and support plaintiffs’ position.... [T]he State cannot relieve itself of the obligation to provide home health care to eligible applicants merely because a CHHA does not wish to provide care. The State’s position that the “Court of Appeals holding simply means that the State is responsible for certain CHHA decisions to deny, reduce, or discontinue home care” would be made meaningless if CHHAs could refuse to provide care even when the State itself is obligated to provide care. The State’s “responsibility” would provide cold comfort to the applicant if that responsibility could be evaded simply by delegating these decisions to CHHAs.
Catanzano v. Dowling,
On October 24, 1995, Visiting Nurse Service of New York Home Care (“VNS”), the largest not-for-profit provider of home health services in the United States, Metropolitan Jewish Geriatric Center (“MJGC”), one of the largest such providers in New York City, and Home Care Association of New York State, Inc. (“HCA”), an association of CHHAs, filed motions for intervention as of right or alternatively by permission. By decision and order dated December 5, 1995,
DISCUSSION
A Forced Care
‘We review the scope of a district court’s injunction for abuse of discretion,” Ragin v. Harry Macklowe Real Estate Co.,
The defendant and the proposed intervenors (collectively “the CHHAs”) argue that, even though they must provide a due process hearing before denying, reducing, or terminating home health care benefits, they cannot be forced to provide care if the claimant prevails in that hearing. The CHHAs base this argument on three theories, two of which we reject on the ground that they are foreclosed by our prior decision. As to the third theory, however, we find that the district court erred in concluding that it too was foreclosed by our prior decision, and we therefore vacate that portion of the district court’s order and remand with instructions to consider the third theory anew.
I
The CHHAs’ first theory of why they are not bound to provide care to claimants who prevail in their administrative hearings relies on a limited conception of the extent to which they are to be considered state actors. The CHHAs do not deny that the Medicaid fair hearing regulations contemplate that the results of such hearings will be binding on the state. See, e.g., 42 C.F.R. § 431.246 (the agency must provide retroactive benefits and provide for admission to the medical facility if the hearing decision is favorable to the applicant). Instead, the CHHAs argue that this fact is irrelevant to them because they are only state actors in making the eligibility determination, not in shouldering the state’s burden to abide by the administrative hearing decision.
According to the CHHAs, this court’s prior decision established only that CHHAs are state actors when they make determinations as to eligibility pursuant to state regulations. Since the question of whether a person is a state actor will depend “on the nature and context of the function he is performing,” Georgia v. McCollum,
This argument is without merit. The fact that we have concluded that CHHAs are state actors in making the eligibility determination necessarily compels the conclusion that CHHAs are also state actors in being bound by the results of administrative hearings overturning their determinations. The CHHA is “the state” at the fair hearing, and must therefore be required to shoulder “the state’s” burden if it loses at that hearing.
The CHHAs attempt to bolster this theory by arguing that a CHHA’s decision as to whether to provide home health services to a patient is really a two-part decision: 1) is this patient entitled to home health services under the Medicaid statute and regulations? 2) if so, do we believe, in the exercise of our independent medical judgment, that those services should be provided to this patient? This court’s prior decision clearly established
We reject this argument as well. We have already explained that the CHHA makes both the “eligibility” decision and the “professional medical judgment” decision in the same step: indeed, they are the same decision.
We have already held that the CHHAs’ determinations as to medical necessity and safety are those of the state and not private medical judgments. We further note that if the CHHAs’ “medical” judgments were not reversible as a result of the administrative hearings that we have mandated, then there would be no point whatsoever in requiring those hearings. Accordingly, we decline to adopt what is in effect no more than an attempt to make an .end run around our prior decision, and around the fundamental notion that, “[i]n compliance with the principle of ubi jus ibi remedium (“where there is a right there is a remedy1), the statutory right to a fair hearing must include within it the right to effective redress.” Greenstein v. Bane,
II
The CHHAs’ second theory of why they cannot be forced to comply with the administrative hearing decisions is more sophisticated. The district court’s opinion assumes that the state has a duty to provide care to eligible Medicaid applicants: “[T]he State cannot relieve itself of the obligation to provide home health care to eligible applicants merely becausé a CHHA does not wish to provide care.” Catanzano,
In general, that is true. A state’s Medicaid plan must make “medical assistance” available to qualified recipients. 42 U.S.C. § 1396a(a)(10). “The term ‘medical assistance’ means payment of part or all of the cost of ... care and services.” 42 U.S.C. § 1396d(a). The state has no affirmative duty to provide the care itself. See, e.g., K. Edward Greene, Mental Health Care for Children: Before and During State Custody, 13 Campbell L.Rev. 1, 54 (1990) (“A state has a statutory obligation to provide medical assistance (Medicaid)____ However, the state’s obligation is not to actually provide care, but to pay for the cost of care when the
That being so, defendant Wing and the proposed intervenors contend that while this court has held that the CHHAs “have assumed the responsibility for the State’s mandated health care duties,” Catanzano,
This argument, while not without force, must nonetheless fail. Our prior decision in this ease necessarily rejected it. As Judge Larimer noted: “the implications of [the Court of Appeals’] reasoning are clear, and support plaintiffs’ position.” Catanzano,
Under New York law, there is no point in holding that the fair hearing does no more than bind the government to reimburse any future CHHA that would be willing to care for the patient. For under that law, any CHHA that might come along in the future and decide that it is willing to provide care under steps 1 and 2 would not need government approval of its decision in order to be reimbursed. See Catanzano,
If the CHHAs are not bound to provide care by the results of the fair hearing and if our holding did no more than establish the right to a due process hearing through which patients could establish a governmental duty to reimburse in a situation where, by definition, there is no one willing to be reimbursed, and where, if there were someone willing to be reimbursed, the government would be bound to reimburse them regardless of the hearing, then our prior opinion established absolutely nothing. It is a “well-established principle that the doctrine of the law of the case applies to issues that have been decided either expressly or by necessary implication.” DeWeerth v. Baldinger,
In other words, we have held in our prior decision that New York, by setting up the unique structure that governs the provision of home health services in the state, has implicitly but inexorably obligated itself to see to it that home health services are made available to qualified claimants. And since under New York law home health services can only be provided by CHHAs, N.Y. Public Health Law §§ 3602(3), 3614(1), it follows,
Moreover, a close examination of N.Y. Social Services Law.§ 367-j reveals .that the statute itself contemplates the result that the defendant and the proposed intervenors claim cannot come about. There are, under the statute, 'express situations in which the state forces a CHHA to provide aid-continuing and care when it would prefer not to. When a CHHA makes a determination as to eligibility under steps 3 and 4 of the process, it must inform a local social services official. When that official disagrees with the CHHA (such as when the CHHA does not believe that home health care is warranted, but the local official does), the matter is referred to a local professional director. “The local professional director ... must review the [CHHA’s] fiscal assessment and case documentation ... and is responsible for the final determination of ... whether the certified home health agency must continue to provide home health services to the recipient____” N.Y. Social Services Law § 367 — j(1)(i)(iv) (emphasis added); see also N.Y.Comp.Codes R. & Regs. tit. 18, § 505.23(c)(12)(ii)(c) (the local professional director will determine “whether the [CHHA] must provide, or continue to provide, home health services to the recipient”) (emphasis added). As such, the CHHAs’ argument that they simply cannot be forced to provide home health benefits against their will is conclusively undermined. This statutory language makes manifest that, at least in some instances, New York law contemplates that a CHHA can be forced by the decision of an independent government agent to provide services.
Since New York has obligated itself (and thus the CHHAs) to provide home health services to qualified claimants, the CHHAs’ claim that the district court erred in assuming that the state has a duty to provide care must be rejected.
III
The CHHAs’ third theory of why they cannot be forced to offer home health services against their will is that, even if New York has ostensibly obligated them to do so, federal law forbids this result. Because a state that chooses to participate in .the Medicaid program may not implement a Medicaid plan that violates federal law, see, e.g., Caldwell v. Blum,
In claiming that federal law does prohibit a state from so obligating its providers, the CHHAs rely on Medicaid’s “freedom of choice” (or “willing provider”) law. Under 42 U.S.C. § 1396a(a)(23), a Medicaid claimant may obtain services from any qualified provider “who undertakes to provide him such services.” The federal regulations elaborate that “a recipient may obtain Medicaid services from any [provider] that is ... [w]illing to furnish them to that particular recipient.” 42 C.F.R. § 431.51(b)(1)(i). The Health Care Financing Administration noted in its explanation of the 1991 amendments to this regulation that it “added language to counteract a misunderstanding that has arisen in the past: freedom of choice does not obligate a Medicaid provider to furnish services to every recipient. ... [A] recipient may seek to obtain services from any qualified provider, but the provider determines whether to furnish services to that particular recipient.” 56 Fed.Reg. 8835 (1991). The defendant argues that “[u]nder the plain meaning of these provisions, a service provider such as a CHHA cannot be compelled to provide care to a particular recipient.”
The applicability (or inapplicability) of these provisions to the case at bar is hardly plain. It is true that the Health Care Financing Administration noted that “freedom of choice does not obligate a Medicaid provider to furnish services to every recipient.”
That question depends on whether, in addition to placing a limit on the federal rights of the claimant, the freedom of choice law also creates affirmative federal rights in the provider. On that point, the law is not entirely clear. Compare RX Pharmacies Plus, Inc. v. Weil,
Our prior opinion did not discuss this issue. And we did not decide the question by implication. Our decision was concerned with whether, by delegating the benefit entitlement decision to the CHHAs in the face of federal due process requirements, New York State obligated the CHHAs to provide both due process hearings to adversely affected claimants and home health services to those claimants who succeeded in their hearings. We did not consider whether or not federal law forbade the latter obligation. Nor did the district court address the “willing provider” issue in any detail, apparently concluding that our prior opinion had already decided it. See Catanzano,
B. Intervention
We review a district court’s order denying intervention (as of right under Fed.R.Civ.P. 24(a) or by permission under Fed.R.Civ.P. 24(b)) for abuse of discretion. See, e.g., New York News, Inc. v. Kheel,
“In order to intervene as of right under Fed.R.Civ.P. 24(a)(2), an applicant must (1) timely file an application, (2) show an interest in the action, (3) demonstrate that the interest may be impaired by the disposition of the action, and (4) show that the interest is not protected adequately by the parties to the action.” Id. “Failure to satisfy any one of these requirements is a sufficient ground to deny the application.” Farmland Dairies v. Commissioner,
Among the most important factors in a timeliness decision is “the length of time the applicant knew or should have known of his interest before making the motion.” Id. at 1044. The proposed intervenors were well aware long before they filed their motions for intervention that they stood to be forced to provide aid-continuing against their will and judgment. In early 1994, all
Faced with these facts, the CHHAs argue that
[plaintiffs’ entitlement to aid-continuing, although an important issue to all CHHAs, is not the interest that prompted VNS and MJGC to move to intervene in this lawsuit. The issue articulated by VNS and MJGC on their intervention motion is whether an individual CHHA can be forced to provide care against its professional judgment.
The CHHAs claim that they had “no suspicion” that such a result would stem from this lawsuit until the district court’s most recent order, and that that order came as a “total surprise” to them.
It is true that the district court stated in June 1995 that “this issue concerning the CHHA’s right to refuse to provide services to a particular patient was not before the Court or fully addressed as part of the preliminary injunction motion.” But even if the issue itself had not been argued, it was dearly present in the litigation from the very beginning. Aid-continuing rights necessarily involve the provision of care against the will or judgment of the entitlement decision-maker: precisely the issue as to which the CHHAs seek to intervene. Moreover, to the extent that the CHHAs are arguing that they did not realize that individual CHHAs would be required to provide aid-continuing (instead of the government being required to reimburse any CHHAs that willingly chose to provide aid-continuing), this claim is belied by the record. The district court’s first published opinion explicitly stated that CHHAs would be required to provide aid-continuing. See Catanzano,
More important, quite apart from the aid-continuing issue, it has been contemplated from very early on in this litigation that the CHHAs might be forced to care for the claimants who prevailed in their administrative hearings. Indeed, why would the plaintiffs have brought suit demanding due process hearings if they did not expect the results of those hearings to be binding on the CHHAs whose decisions were to be reviewed? Not surprisingly, the record is replete with indications that the parties and the proposed intervenors understood that the CHHAs would be forced to comply with the results of the administrative hearings. For instance, in April 1994, an attorney for the state defendant affirmed that, under the court’s order, the DSS would “have to work with the Department of Health to develop new procedures to assure not only that CHHAs understand their responsibilities under the fair hearing decisions but also that CHHAs promptly comply with the decisions.” In addition, in May 1994, the plaintiffs submitted proposed notice forms (to be issued to claimants whose home health care benefits were denied, reduced, discontinued, or suspended) which provided: “If you think this decision is wrong you can appeal [by requesting a fair hearing]. We’ll correct our mistakes.” Finally, a December 1994 letter penned by one of the proposed intervenors makes perfectly clear that it understood precisely what was at stake in this ease:
We would respectfully urge to your Honor that Plaintiffs have demonstrated no authority for the proposition that the Department may order a CHHA to provide care to a particular patient, notwithstanding legitimate CHHA concerns regarding the*234 health and safety of the patient, the ability to provide the care required, or other significant reasons.
Having reviewed all of the evidence indicating that the proposed intervenors knew or should have known many months (probably years) before they filed their intervention motions that this litigation could require them to comply with the results of the requested administrative hearings, and having considered the entirety of the circumstances of the case and each of the.relevant factors, including the prejudice to the parties and to the proposed intervenors, see Farmland Dairies,
In the alternative, the proposed intervenors ask us to reverse the district court’s denial of permissive intervention under Rule 24(b)(2). “The district court has broad discretion to deny an applicant’s motion for intervention under Rule 24(b)(2). In fact, a denial of permissive intervention has virtually never been reversed.” Kheel,
Although we have concluded that Judge Larimer did not abuse his discretion in refusing to grant intervention, we note that one aspect of the “willing provider” issue — the question of whether federal law prohibits New York State from obligating the CHHAs to provide care against their will — has only recently become central to this case.
CONCLUSION
We affirm the judgment of the district court, except to the extent that it assumed that our prior opinion in this case had decided the question of whether federal law precludes a state from obligating its home health care providers to give care in certain circumstances against their will. We vacate that portion of the district court’s judgment that so held and remand for consideration of that question anew. While we affirm the district court’s denial of intervention, we urge the court to continue to allow the proposed intervenors to have a voice in this action at least as amici curiae.
Notes
. "Aid-continuing” refers to the due process right to continue to receive benefits during the period in which the recipient’s right to the benefits themselves is being determined. See, e.g., Goldberg v. Kelly,
. HCA was already involved in the action as amictis curiae.
. Under “step 1” of the state-mandated entitlement decision making process, the CHHA must decide "whether and how much home health care is medically necessary and whether that care, if any, can be provided safely in the home.” Catanzano,
. Indeed, were there a CHHA that was willing to provide care, the whole process mandated by our prior opinion would be unnecessary. That process is only needed in the absence of a willing CHHA.
. Under the law of the case doctrine, "we will only reconsider a prior decision in the same case if there has been an intervening change in controlling law, there is new evidence, or a need is shown to correct a clear error of law or to prevent manifest injustice.” United States v. Sanchez,
. While this aspect of the "willing provider” theory is new to the case, the interest of the proposed intervenors that it implicates — their desire not to be forced to provide home health services against their will — is the same interest that is implicated by the CHHAs’ other theories in this case. As such, the fact that the district court failed to recognize that our prior opinion did not address this issue does not affect our conclusion that the district court did not abuse its discretion in holding the motions for intervention to be untimely.