The Office of Medicaid and Its Board of Hearings Are Complicit in Denials of Due Process to MassHealth Appellants

Under 130 C.M.R. 610.065(A)(4), the Board of Hearings has the duty “to ensure that all parties have a full opportunity to present their claims orally or in writing and to secure witnesses and evidence to establish their claims.”  Unfortunately, whenever a negative legal opinion is given to the MassHealth worker, it is tactically withheld from the appellant until the time of the fair hearing.  The appellant in such a situation is routinely provided with no information from the Office of Medicaid about any reason for the denial and cannot adequately prepare for a fair hearing.  Without knowing whether there is an issue of fact, or an issue of law, or a combination of factual and legal issues, about why the denial was issued, the appellant’s due process rights are violated and the appellant cannot adequately prepare for a fair hearing.

It is unfair for the Office of Medicaid to be allowed by its own Board of Hearings to maintain a secretive position.  The Board of Hearings, according to M.G.L. c. 118E, s. 48, is supposed to be “independent of all other subdivisions and personnel of the division,” yet requests by appellants for advance information about the denial are routinely rejected by hearing officers.

Due process, according to Armstrong v. Manzo, 380 U.S. 545, 552 (1965), “is an opportunity which must be granted at a meaningful time and in a meaningful manner.”  M.G.L. Chapter 30A, Section 10 states, in relevant part:  “In conducting adjudicatory proceedings … agencies shall afford all parties an opportunity for full and fair hearing.” (emphasis added)  M.G.L. Chapter 30A, Section 11(1) states:  “Reasonable notice of the hearing shall be accorded all parties and shall include statements of the time and place of the hearing. Parties shall have sufficient notice of the issues involved to afford them reasonable opportunity to prepare and present evidence and argument. If the issues cannot be fully stated in advance of the hearing, they shall be fully stated as soon as practicable. In all cases of delayed statement, or where subsequent amendment of the issues is necessary, sufficient time shall be allowed after full statement or amendment to afford all parties reasonable opportunity to prepare and present evidence and argument respecting the issues.” (emphasis added)

As was recently explained by the United States District Court for the District of Idaho in the case of K.W. v. Armstrong, 2014 WL 1247771 (March 24, 2014), where a class action was certified for due process violations similar to what the Office of Medicaid is now doing in Massachusetts, Medicaid requires that the notices “must contain . . . [t]he reasons for the intended action.” See 42 C.F.R. § 431.210(b). The notices must “detail[] the reasons for a proposed termination” sufficiently enough for a recipient to challenge both the application of the law to their factual circumstances and the “factual premises” of the state’s action. Goldberg v. Kelly, 397 U.S. 254, 267–268 (1970). The explanation in the notice itself must be more than a “general explanation” or “conclusory statement,” and must  provide  at  least  “a  brief  statement  of  [the  decision’s]  factual underpinnings.” Barnes v. Healy, 980 F.2d 572, 579 (9th Cir. 1992).  In other words, the law requires an explanation.  The applicant is entitled to know why the application was denied.  Goldberg recognized that without such an explanation, the right to challenge the change is substantially impaired, if not meaningless.  The lack of specificity runs afoul of due process because Goldberg requires a notice tailored to the individual. Goldberg at 267-68 (“[Due process] require that a recipient have timely and adequate notice detailing the reasons for a proposed termination . . . ”). The notice must give an applicant the opportunity to understand “the factual premise” of his or her “particular case.” Goldberg at 268.

In MassHealth appeals involving trusts, where the filing of the MassHealth Essay does not occur until the fair hearing has already begun, the applicant is left until that time to attempt to figure out why the denial was issued. This burden shifting is impermissible, as it is the Office of Medicaid’s duty to state initially the reasons for its action. Goldberg at 267-68.

As the elder law bar knows from dozens of recent appeals, it is not really the case that the issues cannot be fully stated by the Office of Medicaid prior to the date of the hearing; rather, not stating the issues prior to the hearing is a choice, done solely for tactical reasons. If the intentionally secretive position of the Office of Medicaid were disclosed to the appellant, then the appellant could determine how to prepare for the fair hearing, but the Office of Medicaid apparently does not want to allow the appellant to be able to prepare.  To be required to travel to and from a the fair hearing in order to learn why the denial was issued (as well as to sit in front of the hearing officer reading a lengthy, single-spaced memorandum) has been a common occurrence at many recent fair hearings, and would seem to be a foolish waste of everybody’s time.

Even though such an unappetizing maneuver has been the recent pattern and practice of the Office of Medicaid in dealing with fair hearings, familiarity with it does not make it right.  The intentional, routine, tactical nondisclosure by the Office of Medicaid until the time of the hearing denies the appellant the right to a full and fair hearing as required under M.G.L. Chapter 30A, Section 10.  The lawyer representing the Office of Medicaid can claim attorney-client privilege and state that it is up to the client as to whether or not to file the memorandum, and can claim that the appellant is therefore theoretically not entitled to it until it is placed into the fair hearing record, but, notwithstanding that transparent excuse, the Office of Medicaid has a legal duty to provide the appellant with the reasons for the denial and the appellant has the legal right to be able to prepare for the fair hearing.  The appellant has the right to present witnesses, but, without knowing about the reasons for the denial, cannot determine which witnesses should be brought to the fair hearing on factual matters.  The appellant has the right to hire expert witnesses on different types of legal issues, but does not know whether to do so, or what the legal issues or specific questions may be.  The appellant has the right to the issuance of subpoenas to compel testimony or the production of documentary evidence, but does not even know, until the hearing has begun, who was involved in the decision to issue the denial.

Federal Medicaid law at 42 U.S.C. §1396a(a)(19) requires that each state Medicaid program be administered “in a manner consistent with simplicity of administration and the best interests of the recipients,”  and M.G.L. Chapter 118E, Section 12 echoes such requirements.  To be in compliance with federal Medicaid law, the Commonwealth of Massachusetts was required under 42 U.S.C. s. 1396a(a)(3) to institute a fair hearing process.  Federal regulations at 42 C.F.R. Part 431, Subpart E describe the mandated fair hearing process; the regulation at 42 C.F.R. 431.205 provides that “[t]he hearing system must meet the due process standards set forth in Goldberg v. Kelly, 397 U.S. 254 (1970), and any additional standards specified in this subpart.”  The regulation at 42 C.F.R. 431.240 states that “[a]ll hearings must be conducted …[o]nly after adequate written notice of the hearing.” The regulation at 42 C.F.R. 431.210(b) requires that the denial notice must contain “[t]he reasons for the intended action.”  Echoing the federal law, the Massachusetts fair hearing regulation at 130 C.M.R. 610.026(A)(2) states the requirement that the denial notice must contain “[t]he reasons for the intended action.”  As part of the appellant’s due process rights, the Massachusetts fair hearing regulation at 130 C.M.R. 610.046 states that “[a]t least 10 days’ advance written notice will be mailed by the Board of Hearings to all parties involved to permit adequate preparation of the case.” (emphasis added)  The Massachusetts fair hearing regulation at 130 C.M.R. 610.050 states that “[t]he appellant and his or her appeal representative will have reasonable opportunity to examine the entire contents of the appellant’s case file, as well as all documents and records to be used by the MassHealth agency … at the hearing.” (emphasis added)

Any lawyer representing the Office of Medicaid, and not acting as a de facto member of the policy arm of the Office of Medicaid, would have an ethical duty to advise the client to follow all of these laws and regulations.  A lawyer cannot validly claim to be a lawyer representing the client for some purposes and not for others.

Where the Office of Medicaid is not choosing to follow the law, it is the duty of the Board of Hearings not to condone such illegal behavior, but rather to take affirmative steps to ensure that due process is afforded to all appellants.  Unfortunately, it appears that the Director of the Board of Hearings has passively condoned the actions of the Office of Medicaid and failed to provide appropriate training to hearing officers on these key issues of due process.

The Director of the Board of Hearings does seem to realize that what the lawyers at the Office of Medicaid are getting away with is wrong. In Appeal 1409508, a request for the position of the Office of Medicaid was made directly to her instead of to the hearing officer, and she emailed the hearing officer:  “If MassHealth is in possession of a legal memorandum that it will rely upon and submit to the hearing record it should be sent to appellant’s counsel to allow adequate preparation for the hearing.” Unfortunately, the due process problem is not solved by her suggestion, because the lawyer representing the Office of Medicaid can simply wait and submit the memorandum to the MassHealth worker on the date of the hearing. Thus, there is an appearance that the Director of the Board of Hearings cares about due process, but there has been no follow-up action from her to solve the ongoing problem.