ORDER
This is a declaratory action in which Plaintiff seeks, among other things, a declaration of her rights under certain provisions in the federal Medicaid statutes. The matter is before the Court on Defendants’ Motion for Summary Judgment and
I. BACKGROUND
Plaintiff is I.P., a minor, through her authorized legal representative, Cynthia Cardenas. Defendants are officials with the Colorado Department of Health Care Policy and Financing (Department), the agency that administers the Medicaid program in Colorado. 2
Plaintiff was born on May 27, 2004. 3 She suffered a brain injury at birth and as result is permanently disabled. 4 Plaintiff has been receiving Medicaid benefits in Colorado since her birth. 5 As of April 24, 2009, Colorado Medicaid paid a total of $836,673.71 in medical assistance on Plaintiffs behalf. 6 Plaintiff has indicated she intends on remaining enrolled in the Medicaid program. 7
Plaintiff, through her mother, Cynthia Cardenas, filed a medical malpractice suit against Dr. Yadna Jerath and St. Anthony North Hospital fоr the injuries she suffered at birth. 8 In December 2008, Plain-
tiff settled her case against Dr. Jerath in an amount that is under seal with the Jefferson County, Colorado District Court. 9 Pursuant to an agreement between the Department and Plaintiff, the Department was paid $100,000 from that settlement for medical care provided to Plaintiff before the final settlement. 10
In April 2009, Plaintiff reached a confidential settlement with St. Anthony North Hospital. 11 Pursuant to Colorado’s recovery statute, the Department has a lien on thеse proceeds in the amount of $736,673.71. 12 On July 21, 2009, the Jefferson County District Court approved this settlement. 13 The court established the
I. P. Qualified Settlement Fund (QSF) and funded it with $785,000.00 of the settlement. 14 This amount represents the Department’s largest possible claim pursuant to its asserted lien ($736,673.71) plus additional funds to cover legal and administrative fees. 15
On July 15, 2009, filed the instant action. She brought three claims; two are still pending.
16
In her first claim, Plaintiff seeks a declaration that Colorado’s Medi
On March 12, 2010, Defendants moved for summary judgment. 17 On April 16, 2010, Plaintiff moved for partial summary judgment. 18
II. STANDARD OF REVIEW
Under Federal Rule of Civil Procedure 56, summary judgment is warranted when “the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a);
see Anderson v. Liberty Lobby, Inc., 477
U.S. 242, 248-50,
Only disputes over material facts can create a genuine issue for trial and preclude summary judgment.
Faustin v. City & County of Denver,
When the parties file cross motions for summary judgment, the court is entitled to assume that no evidence needs to be considered other than that filed by the parties, but summary judgment is nevertheless inappropriate if disputes remain as to material facts.
Atlantic Richfield Co. v. Farm Credit Bank of Wichita,
III. DISCUSSION
The Court first considers Defendants’ motion for summary judgment.
A. Defendants’ Motion for Summary Judgment
Defendants advance four arguments in support of their motion. The Court addresses each in turn.
1. Whether Plaintiff Waived Her Right to Dispute the Department’s Lien Against the Settlement Proceeds
First, Defendants argue Plaintiff waived her right to dispute the payment of
Plaintiff denies the existence of any such agreement. The question whether the parties entered into a contract is a question of fact.
I.M.A, Inc. v. Rocky Mountain Airways, Inc.,
2. Whether the Court Should Enter Judgment in Favor of Defendants and Against Plaintiff on Plaintiffs First Claim
Next, Defendants argue the Court should enter judgment in their favor on Plaintiffs first claim. Plaintiffs first claim is for a declaration that the lien provisions of Colorado’s Medical Assistance Act are inconsistent with the anti-lien provisions of the Medicaid Act, and preempted by federal statute to the extent they are inconsistent. Colorado’s Medical Assistance Act provides in relevant part:
(a) When the state department has furnished medical assistance to or on behalf of a recipient pursuant to the provisions of this artiсle, and articles 5 and 6 of this title, for which a third party is liable, the state department shall have an automatic statutory lien for all such medical assistance. The state department’s lien shall be against any judgment, award, or settlement in a suit or claim against such third party and shall be in an amount that shall be the fullest extent allowed by federal law as applicable in this state, but not to exceed the amount of the medical assistance provided.
(b) No judgment, award, or settlement in any action or claim by a recipient to recover damages for injuries, where the state department has a hen, shall be satisfied without first satisfying the state department’s lien. Failure by any party to the judgment, award, or settlement to comply with this section shall make each such party liable for the full amount of medical assistance furnished to or on behalf of the recipient for the injuries that are the subject of the judgment, award, or settlement.
(c) Except as otherwise provided in this article, the entire amount of any judgment, award, or settlement of the recipient’s action or claim, with or without suit, regardless of how characterized by the parties, shall be subject to the state department’s lien.
Colo.Rev.Stat. § 25.5-4-301(5).
Plaintiff attempts to invalidate these provisions by comparing the facts of her case to those in
Arkansas Dep’t of Health & Human Servs. v. Ahlbom,
Ahlborn sued ADHS in federal court challenging the lien. The suit made its way to the United States Suprеme Court. The Court held that the Arkansas statute requiring the lien violated the anti-lien provisions in the federal Medicaid law, insofar as the Arkansas statute allowed encumbrance or attachment of proceeds meant to compensate Ahlborn for damages distinct from medical costs.
Id.
at 286, 292,
Plaintiff argues the above-cited Colorado statute is comparable to the Arkansas statute in
Ahlborn
and, thus, like the Arkansas statute, is preempted by the federal Medicаid laws.
21
The Arkansas statute in
Ahlborn
provided in part that “[a]s a condition of eligibility” for Medicaid, an applicant “shall automatically assign his or her right to any settlement, judgment, or award which may be obtained against any third party to [ADHS] to the full extent of any amount which may be paid by Medicaid for the benefit of the applicant.”
Ahlborn,
Although the language in the Arkansas statute in
Ahlborn
is similar to Colorado’s statute here, there is a key distinction between the two. The Arkansas statute specifically called for reimbursement to the “full extent of any amount which may be paid by Medicaid for the benefit of the applicant.”
Ahlborn,
In
Ahlborn,
the Supreme Court examined the same Medicaid provisions at-issue in this case: the third-party liability and assignment provisions
22
and the anti-lien provisions.
23
The third-party liability provisions require, among other things, that
The Ahlbom Court was tasked with reconciling the third-party liability provisions with the Medicaid statute’s anti-lien provisions. The anti-lien provisions state, in relevant part, that “[n]o lien may be imposed against the property of any individual prior to his death on account of medical assistance paid or to be paid on his behalf under the State plan, except-[under two circumstances not relevant here].” 42 U.S.C. § 1396p(a)(l). This Court acknowledges, as did the Ahlbom Court, thаt the anti-lien provisions, at first blush, appear to ban even a lien on that portion of the settlement proceeds that represents payments for medical care:
Read literally and in isolation, the anti-hen prohibition contained in § 1396p(a) would appear to ban even a lien on that portion of the settlement proceeds that represents payments for medical care. Ahlborn does not ask us to go so far, though; she assumes that thе State’s hen is consistent with federal law insofar as it encumbers proceeds designated as payments for medical care. Her argument, rather, is that the anti-lien provision precludes attachment
or encumbrance of the remainder of the settlement.
We agree. There is no question that the State can require an assignment of the right, or chose in action, to receive payments for medical care. So much is expressly provided for by §§ 1396a(a)(25) and 1396k(a). And we assume, as do the parties, that the State can also demand as a condition of Medicaid eligibility that the recipient “assign” in advance any payments that may constitute reimbursement for medical costs. To the extent that the forced assignment is expressly authorized by the terms of §§ 1396a(a)(25) and 1396k(a), it is an exception to the anti-lien provision. See Washington State Dept. of Social and Health Servs. v. Guardianship Estate of Keffeler,537 U.S. 371 , 383-385, and n. 7,123 S.Ct. 1017 ,154 L.Ed.2d 972 (2003).
Ahlborn,
There can be no question, then, that the Department can rеquire a Medicaid recipient like Plaintiff to assign her rights to receive payments from third parties for medical care. Nevertheless, Plaintiff insists that “[a]ny state statute attempting to impose a lien on settlement proceeds, as here, is invalid.”
24
In this regard, Plaintiff seems to takes issue with the Colorado statute’s use of the word “lien,” a term also used in the Arkansas statute in
Ahlbom. Id.
at 277-278,
Accordingly, the Court grants judgment in favor of Defendants and against Plaintiff on Plaintiffs first claim, i.e., on whether Colorado’s recovery statute violates federal law and, thus, whether the Depаrtment’s lien is valid under federal law.
3. Whether Judgment Should Enter Judgment in Favor of Defendants and Against Plaintiff on Plaintiffs Third Claim
Defendants also seek judgment on Plaintiffs third claim.
25
In this claim, Plaintiff seeks a declaration that the assignment provisions of the Medicaid Act, to the extent they provide a limited exception to the Act’s anti-lien provisions, prevent Colorado from recovering more than amounts from the settlement for past medical damages, apportioned in accordance with
Arkansas v. Ahlborn,
In
Ahlbom,
the Court held that the anti-lien рrovisions of the federal Medicaid law precluded Arkansas from encumbering proceeds from Ahlborn’s settlement that represented damages other than medical costs. In that case, the parties stipulated as to what portion of Ahlborn’s damages represented compensation for medical costs.
27
Ahlborn,
As to which post-allocation funds the Department may reach, Plaintiff asserts the Department may be reimbursed only for that portion that represents past med
Because Plaintiff intends on staying on Medicaid, any funds allocated for future medical expenses should rightfully be exposed to the state’s lien so that the state can be reimbursed for its past medical payments. Accordingly, the Court concludes that the Department may seek reimbursement for its past medical expenses from funds allocated to “mеdical expenses,” regardless of whether those funds are allocated for past or future medical expenses.
4. Whether a Judgment against Defendants means a Judgment against Department employees in their individual capacities
Finally, Defendants seek to preclude judgments against them in their individual capacities. In her Complaint, Plaintiff asserted these officials were liable in their individual and official capacity. Under 42 U.S.C. § 1983, state officials may be held individually liable if they cause the deprivation of a federal right.
Kentucky v. Graham,
Plaintiffs asserted basis for holding Defendants individually liable assumes Ahlbom invalidated Colorado’s recovery statute and, thus, that the Department’s lien is invalid:
[A]ny Colorado state official who attempts to enforce Colorado’s invalidated recovery statute by imposing a lien on the property of a Medicaid recipient is acting outside of their official capacity. As a result, Ms. Henneberry and Mr. Ashby in fact acted ultra vires in attempting to enforce an invalid lien upon the settlement funds. 32
The Court’s conclusion that the lien is valid undercuts this theory. Accordingly, Plaintiff has no basis for attempting to hold Defendants individually liable. Thus, Plaintiff cannot maintain her action against these Defendants in their individual capac
The Court now considers Plaintiffs Motion for Partial Summary Judgment.
B. Plaintiffs Motion for Partial Summary Judgment
Plaintiff moves for partial summary judgment on the fоllowing issues: (1) that Defendants do not possess a lien against any personal injury settlement proceeds received by Plaintiff pursuant to the Medicaid statute’s anti-lien provisions and
Arkansas v. Ahlborn,
Both issues have been resolved by the Court’s analysis of Defendants’ Motion for Summary Judgment. It found that (1) Defendants do possess а valid lien against Plaintiffs personal injury settlement proceeds and (2) that the question whether the parties entered into an agreement concerning Defendants’ Medicaid claim is a question of fact on which there exist genuine disputes; thus, the Court will not enter judgment on that issue. Accordingly, the Court denies Plaintiffs motion for partial summary judgment in its entirety.
IV. CONCLUSION
First, the Court concludes that Colorado’s Medicaid lien statute is not invalid,
i.e.,
it is consistent with the federal Medicaid statute’s anti-lien provisions as interpreted by the Supreme Court in
Arkansas Department of Human Services v. Ahlborn,
Second, the Court concludes that the Department can seek reimbursement from that portion of Plaintiffs settlement proceeds that represents medical expenses— past and future — up to the total amount it spent on Plaintiffs behalf as of the date of April 24, 2009. The case will proceed to trial to determine what portion of Plaintiffs settlement represents those medical expenses.
Third, the Court concludes that genuine disputes of material fact prevent this Court from deciding, one way or the other, whether the parties had an agreement regarding how the Department would be reimbursed for its Medicaid expenditures. The Court reserves ruling on what effect, if any, such an agreement would have on the outcome of this case.
Finally, the Court concludes that Plaintiff cannot maintain her action against Defendants in their individual capacity. Plaintiffs action will рroceed against Defendants in their official capacity only. Given these conclusions,
• Plaintiffs First Amended Motion for Partial Summary Judgment (ECF No. 47) is DENIED.
• Defendants’ Motion for Summary Judgment (ECF No. 34) is GRANTED in part and DENIED in part.
• The motion is GRANTED:
• Insofar as Defendants seek to deny Plaintiff a declaration that Colorado’s recovery statute violates the federal Medicaid laws.
• Insofar as Defendants seek “judgment” on Plaintiffs third “claim,” i.e., that the Court adopt the proportionality analysis in Ahlbom and by holding that the Department’s recovery of medical expenses is limited to funds allocated to past medical expenses. The Department canrecover its expenditures from funds allocated to past and future medical expenses. The case mil proceed to trial to determine what portion of Plaintiffs settlement proceeds constitutes “medical expenses.”
• Insofar as Defendants seek to preclude liability against them in their individual capacity. The suit will proceed against Defendants in their offiсial capacity only.
• The motion is DENIED in all other respects, including:
• Insofar as Defendants ask the Court to hold that Plaintiff waived her arguments regarding its Medicaid lien given the parties’ agreement.
Notes
. (ECF Nos. 34, 47.)
. (ECF No. 32 at 3 ¶ 6; ECF No. 46 at 2 ¶ 6.)
. (ECF No 32-1 at 2.)
. (ECF No. 32 at 6 ¶ 32; ECF No. 46 at 3 ¶ 32.)
. (ECF No. 32 at 6 ¶ 33; ECF No. 46 at 3 ¶ 33.)
. (ECF No. 32 at 6 ¶ 34; ECF No. 46 at 3 ¶ 34.)
. (ECF No. 32 at 6 ¶ 36; ECF No. 46 at 3 ¶ 36.)
. (ECF No. 32 at 7 II 37; ECF No. 46 at 4 ¶ 37.)
. (ECF No. 70 at 5.)
. (See ECF No. 32 at 7 ¶ 41; ECF No. 46 at 4 ¶ 41; ECF No. 44 at 3 ¶ 7; ECF No. 51 at 3 ¶ 7.)
. (ECF No. 70 at 6.)
. (See ECF No. 32-1 at 1-2.)
. (ECF No. 70 at 6.)
. (Id.)
. (ECF No. 44 at 3 ¶ 10; ECF No. 51 at 3 ¶ 10.)
. The Court dismissed Plaintiff’s second claim on April 12, 2010. Plaintiff had sought a declaration that Colorado’s Medical Assistance Act lien provisions were inconsistent with the disability trust exception of the Medicaid Act. See 42 U.S.C. § 1396p(d)(4)(A). The Court concluded this exception is not individually enforceable under 42 U.S.C. § 1983, under which Plaintiff brought the claim, and, thus, dismissed the claim. (See ECF No. 41 at 6-7.)
. (ECF No. 32.)
. (ECF No. 44.)
. (ECF No. 32-1 at 3-4, Ex. A-2, and 26-27, Ex. A-6.)
. (ECF No. 32 at 9.)
. (See ECF No. 44 at 4-10; ECF No. 46 at 5-7.)
. See 42 U.S.C. §§ 1396a(a)(25)(A), (B), (H), and 1396k(a)-(b).
. See 42 U.S.C. § 1396p(a).
. (ECF No. 44 at 6.)
. (ECF No. 32 at 17-20.)
. (ECF No. 1 at 13 ¶ 56; ECF No. 70 at 3-4. )
. The stipulation provided that Ahlborn’s recovery against the third-party tortfeasor represented one-sixth of the full value of her overall damages, and that ADHS would be entitled only to that portion of the recovery that represented compensation for medical expenses, which ADHS stipulated was approximately one-sixth of the total it had paid in medical expenses on Ahlborn’s behalf.
Ahlborn,
. (ECF No. 32 at 8 ¶ 50; ECF No. 46 at 5 ¶ 50.)
. (Id.)
. (ECF No. 44 at 10-13; ECF No. 46 at 10-15.)
. (See ECF No. 88 at 6.)
. (ECF No. 46 at 17; see ECF No. 1 at 3.)
. Gary Ashby no longer works at the Department. (ECF No. 32 at 21 n. 3; ECF No. 46 at 17 n. 5.) Accordingly, under Fed.R.Civ.P. 25(d), Ashby's successor, Robert Douglas, is automatically substituted as a party.