Pa. Medicaid Plan Violates Due Process Rights, Class Action Alleges

A PA Medicaid class action lawsuit has been filed against the current Pennsylvania Governor’s administration, alleging the new process implemented by the state’s Department of Human Services to assign benefit plans to low-income Pennsylvania residents violates residents’ rights of due process. This allegedly illegal process is part of the state’s waiver plan to expand the scope of Medicaid under the new Affordable Care Act.

This PA Medicaid class action lawsuit was filed in a joint effort by Community Legal Services and the National Health Law Program, who claim that Pennsylvania’s Dept. of Human Services had relied on improper and secret calculations to determine which of three available benefit plans a Pennsylvania low-income resident would be assigned according to the Healthy PA program.

At the end of August of this year, President Obama’s administration granted approval to Pennsylvania’s health program waiver after months of negotiations between Governor Tom Corbett and Medicare and Medicaid Services. The Pennsylvania health benefits program relies on the involvement of private insurance company and also requires that some of those enrolled in the program pay premiums to continue coverage under the health plan.

Under the health program, three health plans have been established: “Healthy Plus” (which is available for Pennsylvania residents currently receiving medical assistance for serious health issues), and “Healthy” and “Healthy PA PCO” for individuals with less severe health needs. These new Pennsylvania health benefits packages are scheduled to take effect on Jan. 1, 2015.

According to the PA Medicaid class action lawsuit, Pennsylvania residents were sent notices informing them that they had not been assigned to the Healthy Plus Benefits package. The notice also invited these individuals to complete an online questionnaire if they believed they had been mistakenly assigned to the Healthy or Healthy PA PCO health plans.

The PA Medicaid class action lawsuit alleges these notices were extremely complex and required letter recipients to possess a college-level reading comprehension in order to understand the contents of the notice. Because of this, the health notices allegedly left Pennsylvania residents wondering whether or not the other two available health plans would meet their medical needs. The Medicaid class action lawsuit claims:

“As a result of the misleading and deceptive statements in the pre-transition letters, individuals tentatively assigned to the Healthy or Healthy PA PCO benefits packages were unable to determine whether these benefit packages would meet their needs, and therefore whether they should complete the health screening questionnaire.”

The departments who filed this PA Medicaid class action lawsuit are hoping to represent about 200,000 Pennsylvania residents who were sent notices of their assignment into Healthy or Healthy PA PCO benefit plans. According to the class action lawsuit, of the 200,000 individuals who received the notices informing them of their ineligibility for the Healthy Plus plan, only 2,600 completed the online questionnaire to contest their placement into the other available Pennsylvania health plans.

Kait Gillis, Pennsylvania’s Department of Human Services spokeswoman, has stated, “The referenced health screening process was federally approved and is intended to better and more responsibly identify health care needs of consumers,” taking a defensive stance against the Medicaid class action allegations.

Gillis also responded, “Individuals are able to ‘raise their hand’ to communicate additional medical needs they believe necessitate a different plan. If subsequent medical needs arise at a later time there will be opportunities to be reconsidered for enrollment in a different plan,” in regards to the PA Medicaid class action lawsuit allegations that the program’s assignment violates due process.

The plaintiffs are represented by Louise Hayes of Community Legal Services Inc.

The PA Medicaid Class Action Lawsuit is Melissa Mendez, et al. v. Beverly Mackereth, et al., Case No. 2:14-cv-07199, in the U.S. District Court for the Eastern District of Pennsylvania.