A lawsuit that contends Arkansas is improperly reducing and terminating in-home services for elderly and disabled people will go forward after a federal appeals court on Friday affirmed a lower court's denial of a motion to dismiss the suit.
The lawsuit was filed by Ginger Elder of Jonesboro and later joined by Benjamin Taylor of Fayetteville and Jacquelyn Dearmore of Yellville.
All three plaintiffs receive in-home health care through ARChoices, which provides attendant-care services, home-delivered meals, a personal emergency response system and a range of other Medicaid services.
According to the suit, the plaintiffs' services were reduced or terminated as a result of assessments of their needs using a computerized tool. The plaintiffs had appealed the termination or reductions, but the state Department of Human Services improperly terminated or reduced their benefits while the appeals were pending, the suit contends.
The state had argued that the plaintiffs lacked standing to sue because their benefits had been reinstated. It also said the Human Services Department officials named as defendants have qualified immunity from liability in the matter and that the state has sovereign immunity.
In March, U.S. District Judge Kristine G. Baker denied the state's motion to dismiss the lawsuit.
She said because of the likelihood the plaintiffs can demonstrate that the actions of the defendants resulted in the termination or reduction of benefits before an administrative appeals process was observed, the defendants cannot claim qualified immunity at this stage.
In its ruling Friday, a panel of the 8th U.S. Circuit Court of Appeals affirmed Baker's decision.
"The consolidated complaint alleged that ADHS terminated or reduced the plaintiffs' services despite each of them requesting both an administrative hearing and having their services maintained pending the outcome of that hearing," Chief Judge Lavenski Smith of Little Rock wrote for the panel.
"The ADHS defendants may at some point demonstrate that qualified immunity applies to the plaintiffs' claims, but at this initial pleadings stage, the plaintiffs have adequately alleged facts to survive a dismissal motion raising the defense."
The reinstatement of benefits did not remove the plaintiffs' standing, the ruling said, because their "ARChoices benefits must be reassessed each year," and according to the complaint, the department "has no plans to switch to a different assessment tool, allocation methodology or notice of action than those now used."
The panel also denied the defendants' claim of sovereign immunity, saying the U.S. Supreme Court has recognized that "sovereign immunity does not bar 'certain suits seeking declaratory and injunctive relief against state officers in their individual capacities' based on ongoing violations of federal law."
Legal Aid of Arkansas filed the suit on Elder's behalf in 2019 after the Human Services Department, using a new computerized assessment tool, informed Elder that she would be terminated from the ARChoices program. The department terminated her participation on March 25, 2019, the same day it received a letter from Elder appealing the termination.
The tool uses an algorithm and series of questions about recipients' needs to conduct an annual functional eligibility assessment.
According to the complaint, the plaintiffs allege that their 14th Amendment rights of due process were violated by the actions of the Human Services Department when their benefits were automatically cut off or reduced in violation of federal regulations that require benefits to be maintained during the appeals process.
According to court documents, Elder, who had been receiving attendant care and home-delivered meals since 2015, was assessed using the Arkansas Independent Assessment tool on Jan. 15, 2019. On March 15, 2019, she was notified that she would be terminated from the ARChoices program as of March 25, 2019.
Court records said the department received Elder's appeal letter by the March 25 deadline but she was terminated from the program that same day.
Elder was reinstated on May 26, 2019, three days after the lawsuit was filed in federal court, according to court documents.
Those documents indicated that federal and Medicaid regulations require the Human Services Department to send a notice of adverse action to beneficiaries at least 10 days prior to the date the action is to take effect and is prohibited from reducing or eliminating benefits until the outcome of a hearing if the beneficiary meets the appeal deadline.
According to the complaint, Elder was denied access to the ARChoices program for two months, including home-delivered meals and attendant care. During that time, she incurred at least $900 in increased costs for food and medical supplies. The complaint alleged that Elder has suffered increased anxiety and depression due to the termination of mental health treatment under the program.
The complaint said services for Taylor and Dearmore were significantly reduced as a result of assessments using the computerized tool.
The complaint said Dearmore was forced to skip meals, sit in urine-soaked clothing, forego bathing and miss medical appointments, all of which it said resulted in increased depression. Taylor, the complaint said, had to go without daily baths and suffered a disruption of his daily medicine and meal regimen required to manage an inflammatory intestinal disease. It also said the loss of care Taylor experienced led to a fall that resulted in a cracked rib.
Department of Human Services Secretary Mark White and other top department officials are named as defendants in the suit.
The complaint asks that the defendants be ordered to remedy the conditions that led to the disruptions in care the plaintiffs experienced and in their individual capacities to pay monetary damages to the plaintiffs.
According to Kevin De Liban, an attorney with Legal Aid of Arkansas, which filed the lawsuit on behalf of the plaintiffs, the state's reliance on computer algorithms to determine eligibility for Medicaid in-home services has grown out of an effort to save money at the expense of some of the state's most vulnerable citizens.
Before 2016, he said, assessments were done by a nurse who did in-person home visits but in 2016, the state switched to a computerized algorithm called Resource Utilization Groups -- RUGs -- that resulted in about half of eligible ARChoices beneficiaries receiving cuts in service.
"That, we got thrown out in 2018," De Liban said, "because it was causing people all sorts of problems."
In 2019, he said, the state switched to the current assessment tool, which he said has also been problematic. During the few months of implementation, he said, more than 2,000 of the 8,000 to 9,000 people receiving benefits were terminated from the program, including Elder. He said Taylor and Dearmore remained on the program but with significantly reduced benefits.
"These are people who just a year before DHS had determined were eligible," De Liban said. "The criteria didn't change. The only thing that changed was the system."
According to court documents, the defendants have 14 days to ask for a rehearing before before the full 8th Circuit.
Human Services Department spokesman Gavin Lesnick said in an email Friday night that agency officials are "reviewing the decision as well as our options for appealing."