Plaintiffs Sue New Mexico over Loss of Services Following DD Waiver Overhaul
February 11, 2014 08:33 AM
On January 15, in Waldrop, et al v. New Mexico Human Services Department et al, seven adult plaintiffs and their legal guardians, along with Disability Rights New Mexico and the Arc of New Mexico, filed a lawsuit against the state of New Mexico (the State). Specifically, this lawsuit accuses the State of violating the rights of the beneficiaries of the State’s Home and Community Based Waiver program for people with developmental disabilities (the DD Waiver) following the State’s overhaul of the DD Waiver.
According to the Complaint, New Mexico submitted its original application for the DD Waiver to the United States Department of Health and Human Services (HHS) in 1983. HHS approved the application, and authorized 200 “slots” for the DD Waiver in the first three years. The number of participants in the DD Waiver reached almost 3,800 by 2008, and remained constant since then.
As a result of its rebalancing policies, in the 1990s, the State was able to close “two large segregated institutions” that served the disabled, resulting in many moving into the community and receiving Medicaid services there. New Mexico spends more on average for those in its DD waiver as compared to the national average, as the DD waiver is now able to serve most of its high need population.
In March 2011, the State decided to overhaul the DD Waiver as a means to reduce per beneficiary expenditures, according to the Complaint. Through 2011 and 2012, the State publically disclosed its overhaul plan, but often did so with “highly inconsistent information.” Formal regulations were adopted effective November 1, 2012, and implemented May 2013. As a result, the plaintiffs and their legal guardians were informed that they would face significant reductions in benefits. These reductions reduce the level of care to that below what was established as medically necessary by the plaintiffs’ treating physicians and other caregivers.
The Supports Intensity Scale
The State uses the Supports Intensity Scale (SIS) in its overhaul of the DD Waiver. The SIS groups beneficiaries into lettered groups A-G (SIS groups), with Group A being low needs beneficiaries, Group F being beneficiaries with “extraordinary medical needs” and Group G being for those “with the most substantial behavioral needs.” Beneficiaries can also apply to be placed in Group H (see below for details). Each person in each group has the same capped budget, despite variations of needs within the groups.
According to the Complaint, as a result of the overhaul, those in the lower needs groups are unable to get 24-hour residential support services. Also, most of the DD Waiver beneficiaries lose therapies (occupational, physical, and speech) and supported employment. Most beneficiaries are now required to have a maximum of two therapies, and must choose which therapy to eliminate if they have more. Therapies that are not cut are often limited in hours.
The Complaint set forth the following allegations with regard to the overhaul:
Lack of notice and opportunity to contest overhaul
Some beneficiaries did not receive a notice of reduction of services, and when notice was received, it lacked “the legal or factual bases for the reduction, an explanation of how the SIS system operates, [and] a proper explanation of the recipients’ appeal rights as required by federal law.” Lacking such information made it impossible for the plaintiffs and other beneficiaries “to meaningfully contest reductions in these services.”
The State also uses a non-disclosed algorithm to calculate SIS group determination. As a result, the plaintiffs accuse the defendants of “using the SIS tool in a manner that arbitrarily denies people with developmental disabilities essential Medicaid-funded services.” The State does not explain the algorithm to either the beneficiaries or the service providers.
Further, services provided under the overhaul lack customization to the individual, and are not adequately based on input from the beneficiaries’ physician or care team.
Arbitrary verification process
The overhaul contains a “verification process” used to change a beneficiary’s SIS group. Plaintiffs allege that this process “is not published, [is] conducted without any formal rules, and is arbitrary and capricious.” In addition, the plaintiffs allege that the defendants do not give them adequate notice of this process, and the process is often conducted in secret.
Group H inaccessibility
In the Complaint, the plaintiffs allege that despite the Waiver program assigning a “Group H” for beneficiaries who, under the overhaul, can receive added benefits if they show that current benefits insufficiently provide for their health and safety, this group is inaccessible. Specifically, the State has not provided written criteria, or clearly communicated to beneficiaries of how to apply or what services are provided. As a result, the Plaintiffs “have experienced confusion and delay” and “have been unable to access” the benefits associated with Group H.
Increased institutionalization risk
The Complaint asserts that the overhaul “effectively elimitat[es] the Home and Community Based waiver option for hundreds of participants, including [the] [p]laintiffs.” Meanwhile, the plaintiffs allege that the defendants have not demonstrated that 24-hour community based care would be more expensive than ICF/MR facility costs, and that in fact the opposite is true. Further, the plaintiffs allege that the overhaul places them “at high risk for unnecessary or premature entry into ICF/MR facilities or nursing homes” in order to continue to receive 24-hour services.
The plaintiffs request an injunction preventing the defendants from implementing the overhaul, as well as reinstatement of all lost services. The plaintiffs rest these requests on eight legal claims, including that the defendants violated: the Medicaid Act’s fair hearing requirements, due process guarantees, and freedom of choice provisions; the Americans with Disabilities Act (ADA); and the procedural due process clause of the 14th Amendment of the U.S. Constitution.
To see the full complaint, click here.
Arbitrary limitation of benefits. The National Council on Medicaid Home Care – a NAHC affiliate - promotes greater oversight mechanisms in states’ Medicaid programs, so that the programs cannot arbitrarily and capriciously limit care for beneficiaries in a way that compromises their health and safety.
Undermining rebalancing. The Council continues to oppose policies of states that have the effect of hindering rebalancing. By cutting needed benefits, the State creates an increased risk that severely developmentally disabled people like the plaintiffs will be hospitalized or institutionalized.
The facts alleged in this Complaint support the conclusion made in Senator Harkin’s Report that the victory of Olmstead, a case brought against the state of Georgia fifteen years ago, is incomplete. Home care providers should be aware that despite large national strides towards rebalancing, there is still unmet demand for home and community-based services (HCBS) caused by such short-sighted policies as alleged in recent litigation in New Mexico (as described herein) and Florida, and demonstrated in New Hampshire and Georgia.
As the Department of Justice suggested in the Florida case, states can adjust to this demand through cost-effective, “reasonable modifications,” such as providing more HCBS options/funding and pro-active HCBS screenings.
Compared to other states, New Mexico utilizes long-term services and supports (LTSS) with mixed results. While the State spent 63.9% of its Medicaid and state funded LTSS in HCBS, ranking it 1st among the states for that metric, AARP still ranked the State 26th overall in LTSS utilization in its 2011 scorecard. While obtaining high marks in choice of setting and provider (5th overall) and affordability and access (13th overall) LTSS metrics, the State scored low marks in quality in life and quality in care (35th overall) and support for family caregivers (45th overall) LTSS metrics.
The Council encourages providers to continue to advocate for greater support of HCBS through their state associations, as well as through state and federal governments. Home care providers are encouraged to keep abreast of HCBS developments in their states, and nationally, and to contact the Council with any questions or concerns.