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Court of Appeals rules against FSSA

January 1, 2008
The Indiana Court of Appeals reversed a trial court's dismissal of an action against the Family and Social Services Administration regarding the denial of Medicaid applications, finding the FSSA relied on an incorrect statute to justify the denial of new evidence supporting a disability claim on the appellate level.

In William Curtis, Gary Stewart, and Walter Raines, on behalf of themselves and those similarly situated v. E. Mitchell Roob Jr., as Secretary of Indiana Family and Social Services Administration, and Jeff Wells, as director of the Office of Medicaid Policy and Planning in the FSSA, No. 49A02-0801-CV-23, the Court of Appeals found the FSSA wasn't following federal or Indiana's Medicaid statutes that provide if the decision of a local evidentiary hearing is adverse to the applicant or recipient, the agency has to tell the applicant of his right to request his appeal be a de novo hearing.

The plaintiffs in this case allege the FSSA violated due process rights of Medicaid claimants with its policy that prohibits applicants from offering evidence at the appeal hearing that wasn't introduced in the initial application. When the plaintiffs were denied benefits after review of their applications, they requested the review of the denial by an administrative law judge. The administrative law judge wouldn't accept new evidence that wasn't included in the original application.

In its brief in this case, the FSSA doesn't even acknowledge any provisions of Indiana's Medicaid statutes, instead relying on a provision in the Administrative Orders and Procedures Act that allows an administrative law judge to exclude "irrelevant" evidence, Judge Melissa May wrote in a footnote.

"Our own Medicaid statutes explicitly permit the ALJ to receive additional evidence in the Medicaid hearing: 'At the hearing, the applicant and county office may introduce additional evidence,'" she wrote.

Medicaid regulations explicitly refer to a de novo hearing, which allows for the consideration of new evidence. In light of the Medicaid fair hearing regulations, the complaint by the plaintiffs shouldn't have been dismissed, the court ruled.
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