Medicaid

Delia v. E.M.A.

E.M.A., a minor, suffered catastrophic injuries during her birth due to the physician's negligence during delivery. As part of its Medicaid program, North Carolina paid for E.M.A.’s medical expenses upon her mother’s agreement to reimburse the Medicaid program for any recovery gained from a third party to cover E.M.A.’s medical expenses. When E.M.A. settled her claim against the physician for a fraction of her medical costs, North Carolina attached a lien equal to one third of the total settlement. In this case, the Supreme Court will resolve a conflict between the North Carolina Supreme Court and the United States Court of Appeals for the Fourth Circuit.  The Court will decide whether a North Carolina law that allows the North Carolina Department of Health and Human Services (“DHHS”) to assert a lien against a Medicaid recipient's recovery from a third party, when limited to the lesser of either the total amount of medical expenses or one third of the Medicaid recipient’s total settlement amount, violates the "no-lien" provision of the Medicaid Act. DHHS argues that the North Carolina statute is consistent with the Medicaid Act’s no-lien provision because it operates as an advanced agreement to apportion one third of the settlement toward medical expenses.  E.M.A. responds that the statute violates the Medicaid Act because it allows DHHS to recover a proportion of the settlement that is greater than her medical expenses.  This case will allow the Court to balance the interest that States have in maintaining solvent Medicaid programs against the interests of Medicaid claimants who fail to recover sufficient damages from third-parties to cover their medical costs.

Questions as Framed for the Court by the Parties: 

Whether N.C. Gen. Stat. § 108A-57 is preempted by the Medicaid Act's anti-lien provision as it was construed in Arkansas Department of Health and Human Services v. Ahlborn, 547 U.S. 268 (2006), an issue on which the North Carolina Supreme Court and the United States Court of Appeals for the Fourth Circuit are in conflict.

Issue

Does N.C. Gen. Stat. §108A-57 violate the anti-lien provision of the Medicaid Act as it was interpreted in Arkansas Department of Health and Human Services v. Ahlborn?

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Douglas v. Independent Living Center of Southern California (09-958); Douglas v. California Pharmacist Association (09-1158); Douglas v. Santa Rosa Memorial Hospital (10-283)

Oral argument: October 3, 2011

Appealed from: United States Court of Appeals for the Ninth Circuit (July 9, 2009)

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