When Sandra Bontrager tried to get Medicaid coverage for a costly dental surgery procedure two years ago, she didn’t think that her request would eventually lead to a federal lawsuit and a ruling striking down the state’s policy about how Indiana covers those Medicaid services.
But that is what happened on Nov. 4 when Chief Judge Philip Simon in the Northern District of Indiana ruled the state must fully cover dental services that are medically necessary for Medicaid participants and that it can’t cap coverage at a certain amount. The reason: limiting coverage would deny some low-income individuals the ability to get needed care.
Now, the Office of the Indiana Attorney General will likely appeal the Goshen woman’s case to the 7th Circuit Court of Appeals and the fate of the state’s policy remains uncertain. If upheld, the result could lead Indiana down a road other states have taken – scrapping dental coverage for Medicaid participants all together. If the judge’s ruling is overturned, then some people won’t be able to obtain coverage for certain dental service and, in effect, those procedures could be off limits to low-income Hoosiers.
“I think it’s great that Judge Simon’s ruling stands for the idea of entire participation,” said Indianapolis attorney Jackie Bowie Suess, who represents Bontrager in the federal suit. “If the state’s going to participate in an important federal program like Medicaid, it has to follow the rules. Everyone is sympathetic to budget concerns, but that doesn’t mean you have the right to deny people services when you’ve already promised them coverage to the extent the law requires.”
This Indiana case is part of a bigger national discussion that involves adult dental benefits for low-income residents being eyed for reduction or elimination as states struggle with the effects of the recession and skyrocketing Medicaid enrollment. To contain costs, many states have been cutting back on optional benefits, including adult dental services, according to an annual 50-state survey released by the Kaiser Commission on Medicaid and the Uninsured.
Now, as Indiana’s coverage of these adult dental procedures remains in question, the state could be forced to address whether it can afford to maintain those services.
Simon’s recent ruling came in the class-action lawsuit of Sandra M. Bontrager v. Indiana Family and Social Services Administration, Michael A. Gargano and Patricia Cassanova, No. 3:11-CV-216, a case originally filed in Elkhart Superior Court but later removed to federal court.
The suit focuses on how Indiana participates in the federal Medicaid program and provides dental coverage. The state isn’t required to provide dental care reimbursements to low-income participants, but state officials have chosen to do that through a process outlined in 405 Indiana Administrative Code 5-14-1. If a state chooses to provide benefits, it must comply with federal Medicaid law requiring consistent, equal coverage for program participants.
Bontrager’s dentist determined in 2009 that she needed two implants and abutments for her lower jaw. Because she is a Medicaid program participant, the dentist submitted a request to the private company contracted to handle the state’s preauthorization process and determine whether a procedure is medically reasonable and necessary as defined by state administrative code.
Although the contractor initially determined the requested services weren’t “covered dental services,” more than a year of appeal procedures determined those were medically reasonable and necessary. Bontrager resubmitted the preauthorization request with an expectation she would be able to get the dental work done.
However, the Indiana Family and Social Services Administration responded in 2011 that even with the determination that the dental work was covered and medically necessary, a new state regulation that began Jan. 1, 2011, limited total dental service reimbursement to $1,000 per person during any 12-month period, regardless of the medical reasonableness or necessity. Prior to this year, the cap had been $600 per participant.
According to court filings, the state argues the cap is needed to potentially save millions of dollars annually and that it doesn’t impact most participants because 99 percent have annual dental costs less than $1,000. The state argues that invalidating that cap could lead to discontinuing the Medicaid dental program altogether. The plaintiffs argue the state can only really cover a procedure by fully paying, while the defendants argue that it can cover those medically necessary expenses by partially paying for them.
Saying that this dispute casts Indiana into the “byzantine world of state and federal Medicaid laws, regulations and cases,” Simon wrote that the case boils down to disagreement about what it really means to “cover” a procedure that’s been deemed medically necessary.
“I think this is a close question, but … I have decided that the State is required to fully cover medically necessary dental expenses,” he wrote, granting a motion for preliminary injunction against Indiana.
Simon addressed a question that remains unanswered by the 7th Circuit about whether a private cause of action is allowed under the federal Medicaid law. The state contends one doesn’t exist, but Simon disagreed and relied on a 1993 appellate decision – Miller ex. Rel. Miller v. Whitburn, 10 F.3d 1315, 1319-21 (7th Cir. 1993) – to find a private cause of action does exist. The appellate court hasn’t addressed the issue in the past decade, and this case could set the stage for that issue to be analyzed.
Simon also disagreed that the $1,000 cap is a “utilization control procedure,” something the state contends it is allowed to implement under federal law, although the law doesn’t define what that term means. The judge determined that utilization control procedures should be used to prevent fraud and paying for unnecessary services. Simon rejected Indiana’s argument that the $1,000 cap is a permissible limit on the “amount, duration, or scope” of a service as specified in both federal and state statute.
Even though state legislators could as a result of this ruling decide to stop providing dental care coverage to Medicaid participants, Simon said he’s not in a position to consider those public policy consequences and must follow precedent and the law.
“I fully understand the State’s attempt to limit the costs of its Medicaid program, particularly given the severe economic downturn and the attempt by governments around the country to implement austerity measures,” he wrote. “But a slew of cases hold that no matter how ‘pressing budgetary burdens may be … cost considerations alone do not grant participating states a license to shirk their statutory duties under the Medicaid Act.’”
The state is still reviewing the ruling and has indicated a decision would be made by the end of November on whether an appeal will be filed, according to the federal court docket.
Suess said that the judge’s decision to strike down the cap is a very big deal for Bontrager. For the Goshen woman, the legal issues and federal court holding that could apply to thousands of Indiana Medicaid participants isn’t at the heart of this case.
“She’s been fighting, through the administrative appeal process, for years to try and get the dental services she needs in order to eat properly,” her attorney said. “Throughout this entire ordeal, she’s been unable to chew food normally and, therefore, eat normally. She’s ecstatic about the decision and is very excited to finally get the implants and dentures she needs. … I’m hopeful she can get them before Christmas to enjoy a full, healthy meal with her family during the holidays.”•