Gallardo v. Marstiller

STATE REIMBURSEMENT FOR PAST MEDICAL EXPENSES

Gallardo argues that a plain reading of the federal Medicaid Act § 1396p(a)(1) (“anti-lien”) and § 1396p(b)(1) (“anti-recovery”) provisions preclude a state from receiving compensation for past medical care. Brief for Petitioner, Gianinna Gallardo at 24. Gallardo explains that the Supreme Court in Arkansas Dept. of Health and Human Servs v. Ahlborn (“Ahlborn”) found that the anti-lien provision bans even a lien on a portion of the settlement for medical expenses. Id. at 25. Gallardo contends that the payment-recovery provision defines when a state can acquire a beneficiary’s right to a third-party’s payment for Medicaid medical expenses. Id. Gallardo interprets the statute to mean that the state acquires the beneficiary’s right to past payments that the state already paid for and covers only “health care items or services already furnished by Medicaid . . .” Id. at 26. Gallardo explains that the third-party provision, § 1396a(a)(25)(A), which allows states to seek reimbursement for past medical expenses, is limited by § 1396a(a)(25)(B) because the extent of the third-party is only “for medical assistance that ‘has been made available’ by Medicaid.” Id. at 28.

In response, Marstiller argues that the federal Medicaid Act actually requires that states have a law “giving the program a right to reimbursement” from a third party. Brief for Respondent, Simone Marstiller at 12. While Mastiller agrees that the Medicaid Act generally forbids the imposition of a lien to recover payments made to a Medicaid beneficiary, Marstiller argues that the Medicaid Act’s § 1396k and § 1396a(a)(45) provide exceptions that allow states to act as beneficiaries and receive reimbursement for medical care. Id. at 13. Marstiller argues that, under § 1396k, Medicaid can impose a lien on a tort settlement. Id. Further, Marstiller asserts that under § 1396k(a)(1)(A) an individual assigns the state “any rights to support” and “to payment from any third party.” Id. at 14. Marstiller contends that the broad language of the statute allows for payments to medical care recovery for any of the assigned patents’ support rights to the state. Id. Marstiller also argues that Congress permits States to acquire medical care damage costs through 42 U.S.C. § 1396k(a)(1)(A). Id. In addition, Marstiller argues that the language of § 1396a(a) requires states to create laws that allow an individual to assign rights to states for “third-party payments for medical care.” Id. at 15.

SCOPE OF § 1396k AND PRIORITY OF ASSIGNMENTS

Gallardo argues that Florida cannot recover under § 1396k(a)(1)(A) (the “assignment-cooperation” provision) because Florida did not actively pursue claims against the tortfeasors. Brief for Petitioner, Gianinna Gallardo at 28. Additionally, Gallardo contends that if there was ambiguity in the reading of the assignment-cooperation provision, the Court should read the payment-recovery provision to govern. Id. at 30. Gallardo instead finds that Marstiller’s reading of § 1396k(a)(1)(A) is inconsistent with the statute, which would find that the statute only entitles collection of past medical care expenses. Id. Gallardo argues that any other interpretation of the statute is incorrect because once a beneficiary recovers from a tort settlement or judgment, the beneficiary is ineligible to receive Medicaid assistance “in the future.” Id. at 31. Further, Gallardo asserts that under § 1396k(a)(1)(C) and § 1396k(b), a state can only collect on medical payments that are already made. Id.

Marstiller responds that Medicaid should receive priority in reimbursement because Congress designated Medicaid to receive payments on behalf of a beneficiary to preserve Medicaid funds for others. Id. at 39-40. Marstiller contends that the history of the Medicaid Act indicates that an individual can assign a state their right to past and future medical care payments. Id. at 25. Marstiller explains that § 1396k(a)(1)(A), which requires states to have a third-party liability provision, should not be read “subordinate” to or “atextually” limited by other third-party provisions like § 1396a(a)(25). Id. Marstiller also points to legislative intent and argues that Congress, in 1968, asked states to include third-party liability provisions in Medicaid plans to both “ascertain” third-party liability and find avenues to collect reimbursement. Id. Thus, Marstiller argues that when Congress enacted § 1396k, it defined § 1396a(a)(25)(A) to require States to ensure that third parties were responsible for “any medical care rendered to Medicaid patients . . .” Id. at 27. Marstiller concludes that presently, § 1396k grants States the right to acquire rights assigned to it by beneficiaries to receive payment from third parties. Id. Marstiller further argues that Congress has subsequently expanded state authority to acquire rights through beneficiary assignment with the addition of § 1396a(a)(45) and 1396a(a)(25)(H). Id. at 27–28. Marstiller contends that § 1396a(a)(25)(H) ensures that a “payment right” can arise through subrogation. Id. at 29.

SCOPE OF RECOVERY

Gallardo explains that the state cannot collect on medical care that is not yet furnished, under § 1396a(a)(A)(25)(H) (the “payment-recovery” provision). Id. at 32. Gallardo argues that Florida’s reading of the assignment-cooperation provision is flawed when taken in the context of the third-party liability provision and payment-recovery provision because Florida found no temporal limitation. Id. Gallardo asserts that Florida’s reading is flawed because the assignment-cooperation provision cannot require a beneficiary to assign reimbursement rights to expenses that have not happened and may never occur. Id. at 33. Thus, Gallardo emphasizes the payment-recovery provision because it is applicable to the state’s right to a third-party payment, and given its more recent enactment, should hold precedence over any other provision. Id. at 34. Gallardo finds that the Ahlborn would resolve any ambiguity if a plain reading of the statute did not suffice. Id.

Additionally, Gallardo contends that Ahlborn stands for the proposition that the statute does not permit states to recover on anything beyond medical expenses. Id. Gallardo also argues that the Eleventh Court mistakenly decided on the assignment-cooperation provision. Id. at 36. Gallardo asserts that this case is about whether a state can recover fees under a federal statute. Id. Second, Gallardo argues that the presumption is inapplicable to this case because the federal statute preempts state law no matter how the issue is explained because the statute presents a minimum amount of damages a state can recover. Id. Gallardo contends that Ahlborn and Wos v. EMA apply here and compel the Supreme Court to not apply the presumption against preemption because neither case applied presumption. Id.

Marstiller finds that the Supreme Court in Ahlborn held that the State could only recover for “payments of medical care.” Brief for Respondent, Simone Marstiller at 15–16. Thus, Marstiller argues that Gallardo’s interpretation of § 1396k to only allow for the collection of past medical care payments is flawed because there is no timing requirement in the statute. Id. at 18. Second, Marstiller asserts that Gallardo’s argument that § 1396k(a)(1)(C) does not require identification of “parties liable for future medical care” is flawed because Medicaid plans should identify future liable parties. 18. Third, Marstiller contends that Gallardo’s argument is not applicable to § 1396k because the petitioner’s guardians had settled the case. Id. at 19. Marstiller argues that in Ahlborn, the Court found that in § 1396k, Medicaid can recover by “imposing a lien on a tort recovery obtained.” Id. Further, Marstiller asserts that Gallardo transferred her rights to receive medical care payments to Medicaid. Id. at 20. Additionally, Marstiller reads Ahlborn to allow Medicaid to receive payments for “tort damages that are medical expenses,” including payments from the beneficiary’s own costs of care. Id. Further, Marstiller argues that Gallardo’s reliance on Ahlborn to cover only past medical costs comes from the argument of the state’s understanding of the Gallardo’s formulation of how much the State could receive. Id.

Marstiller agrees with the Eleventh Circuit that § 1396a(a)(25)(H) is not read over § 1396k. Id. at 30. Marstiller instead argues that the Court should reaffirm the Eleventh Circuit’s deference under the presumption against preemption to Florida law if any ambiguity were found in Florida’s right to reimbursement. Id. at 45. Marstiller contends that Gallardo’s reading of Florida’s third-party-recovery law as against § 1396k and § 1396a(a)(25)(H) and Medicaid’s anti-lien provision would preempt state law. Id. at 46. Marstiller argues that the Court disfavors preemption when a state law and federal statute coexist to implement similar goals or “within a complementary framework.” Id. Marstiller further argues that § 1396k and § 1396a(a)(25)(H) do not have a preemptive effect against Florida law because the two sections require states to comply with requirements to receive Medicaid funds. Id. at 47.