SCOTUS accepts Indiana nursing home case

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The U.S. Supreme Court has accepted a case from northern Indiana that is seen as potentially inducing a flood of claims against nursing homes and enabling patients to circumvent caps states have set on compensation for medical malpractice.

Health and Hospital Corp. of Marion County along with Valparaiso Care and Rehabilitation and American Senior Communities LLC had their petition for certiorari granted by the Supreme Court on May 2. The case, Health and Hospital Corp. of Marion County, et al. v. Talevski, 21-806, has been added to the October 2022 term.

The lawsuit was originally brought by on behalf of Gorgi Talevski, a dementia patient whose physical and mental condition deteriorated, his family asserted, because of improper medical care. Through his wife, Ivanka, Talevski sued Valparaiso Care and Rehabilitation under 42 U.S.C. § 1983 for violations of the Federal Nursing Home Reform Act.

The U.S. District Court for the Northern District of Indiana dismissed, finding FNHRA does not allow individuals to bring a private right of action that could be redressed under Section 1983. At that point, Andrew Tutt, senior associate at Arnold & Porter in Washington, D.C., took up the case and appealed the ruling to the 7th Circuit Court of Appeals.

In applying the three-step test put forth in Blessing v. Freestone, 520 U.S. 329 (1997), the 7th Circuit reversed the district court.

“Valparaiso Care and its fellow defendants have not shown that, despite the express rights-creating language in the statute we are considering, there is no private action here,” Judge Diane Wood wrote for the court in Talevski v. Health and Hospital Corporation of Marion County, et al., 20-1664. “Were there any lingering doubt, it should be put to rest in the general guidance provided in section 1396r(h)(8): ‘The remedies provided under this subsection are in addition to those otherwise available under State or Federal law and shall not be construed as limiting such other remedies, including any remedy available to an individual at common law.’”

After the appellate court denied a petition for rehearing, the Health and Hospital Corp. petitioned the U.S. Supreme Court.

Talevski argued the case is a “poor vehicle” for the Supreme Court to review the questions presented by the petitioner and, therefore, certiorari should be denied. In his response brief, Talevski pointed out the lawsuit is continuing in the district court, and the Health and Hospital Corp. could win at summary judgment or trial. Because the case has not been stayed, the issues raised could become moot before the Supreme Court can issue an opinion.

However, the Health and Hospital Corp. urged the Supreme Court to take the case to clean up the confusion exacerbated by the 7th Circuit’s ruling.

“In reaching its erroneous result, the Seventh Circuit in one fell swoop federalized medical malpractice law for patients in nursing facilities throughout its jurisdiction, sweeping aside carefully chosen state policies in favor of a one-size-fits-all resort to Section 1983,” HHC argued in its petition for cert. “The states in the Seventh Circuit, of course, had no idea that they were consenting to such a bargain when they accepted Medicaid funds. But, respectfully, that kind of disruption of state policies is the inevitable consequence of this Court’s private right of action jurisprudence.”

The Health and Hospital Corp. boiled the dispute down to two central questions:

  • Whether, under the original understanding of 42 U.S.C. § 1983, a third-party beneficiary may enforce federal spending clause legislation that imposes conditions on a state’s receipt of federal funds.
  • Whether claims by nursing facility residents and their families — “second-guessing garden-variety treatment and transfer decisions made by physicians and nursing facility administrators” — may be pursued under Section 1983 and the Federal Nursing Home Amendments Act of 1987, 42 U.S.C. § 1396r.

After the petition was filed, Indiana Attorney General Todd Rokita filed a brief on behalf of Indiana and 16 other states in support of the Health and Hospital Corp. Also, the American Health Care Association and the Indiana Health Care Association jointly filed a brief in support of the petitioner.

“The net result of all of this is that following the Seventh Circuit’s judgment, public actors that own or operate (skilled nursing facilities)/(Medicaid-participating nursing facilities) are subject to damages suits under 42 U.S.C. § 1983 and related claims for attorney’s fees under 42 U.S.C. § 1988(b) based on alleged violations of (the Omnibus Budget Reconciliation Act of 1987),” the American Health Care Association asserted. “Meanwhile, similarly situated private actors are not subject to such damages litigation because OBRA’s amendments to the Medicare and Medicaid Acts did not include an express or implied private right of action.

Talevski pushed back on the petitioners’ call for the Supreme Court to revisit its jurisprudence — especially as crafted in Wilder v. Virginia Hospital Association, 496 U.S. 498 (1990), which allowed Section 1983 claims to be brought by private parties to enforce rights in federal spending clause legislation.

In particular, Talevski argued if Congress did not intend for spending clause legislation to create enforceable rights, it would have taken action by now.

“Petitioners ask the Court to put a gloss on § 1983 based on how petitioners contend the Congress in 1871 expected it to apply,” Talevski asserted in the response brief. “But the text of the statute is clear: ‘Every person who, under color of any statute … subjects … any citizen of the United States … to the deprivation of any rights … secured by the … laws, shall be liable to the party injured in an action at law, suit in equity, or other proper proceeding for redress.’

“The meaning of those words — ‘any’ ‘right’— was as clear in 1871 as it is today. And it dictates that federal Spending Clause legislation creates rights enforceable under § 1983 because the meaning of those words in 1871 controls the statute’s interpretation, not the expected application of those words.”

In addition to granting the petition, the Supreme Court also granted a motion to substitute Ivanka Talevski as the respondent in place of Gorgi Talevski. According to a footnote in the respondent’s brief, Gorgi Talevski died Oct. 6, 2021.

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