Where There is a Right, There Must Be a Remedy (Even in Medicaid)

The anticipated growth of Medicaid under the ACA will likely aggravate an ongoing dispute surrounding private enforcement of the Medicaid Act. The Medicaid Act does not provide a private right of action except when a person who is eligible for Medicaid is denied entry into the program. Nevertheless, historically, both Medicaid providers and beneficiaries have been able to protect their rights through 42 U.S.C. § 1983, which allows individuals to seek redress against states in federal court for violations of statutory or constitutional rights, or through the Supremacy Clause, which prevents states from enacting laws that violate superseding federal laws. These actions both shield the individuals who seek federal court protection and flag state noncompliance for the understaffed HHS, but such litigation is imperiled by increasingly aggressive state sovereignty arguments in federal courts and by a conservatively-leaning Supreme Court. The question is which story the Supreme Court will believe the next time a state successfully petitions for certiorari. This article explores the power struggle that Medicaid invites and its potential escalation due to the pressures that will follow the ACA’s implementation. Part I describes the three phases of private enforcement litigation and how they have affected Medicaid reimbursement rates. This part also highlights the deceptive stability that has taken root in the lower federal courts by describing recent state attempts to end private enforcement actions. The first part concludes by briefly considering the nature of the federalism arguments that states are making. Part II explains why lawmakers missed an important opportunity to add an explicit right of action to the Medicaid Act when drafting the ACA, while at the same time they created a law that will increase the need for federal oversight. The second part also explores how the ACA contributes to the Medicaid power struggle. The Article concludes that private actions in federal court provide indispensable balance as well as a much needed de facto oversight mechanism for the already overextended, underfunded HHS. (This paper was prepared for a symposium issue entitled Medicaid Matters, which is related to a workshop that took place at the University of Kentucky in March of 2013.