Tiffany et al v. Michigan Department of Health and Human Services et al

Filing 42

ORDER Directing Supplemental Briefing and Staying Briefings on 41 Motion for Temporary Restraining Order. (Defendants' Supplemental Briefs due by 11/20/2015) (Plaintiffs' Supplemental Briefs due by 12/4/2015) (Defendants' Supplemental Reply Brief due by 12/11/2015) Signed by District Judge Thomas L. Ludington. (Sian, M)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
NORTHERN DIVISION
JAMES TIFFANY, et al.,
Plaintiffs,
v.

Case No. 15-cv-12157
Honorable Thomas L. Ludington

MICHIGAN DEPARTMENT OF HEALTH AND
HUMAN SERVICES, et al.,
Defendants.
_______________________________________/
ORDER DIRECTING SUPPLEMENTAL BRIEFING AND STAYING BRIEFING ON
MOTION FOR TEMPORARY RESTRAINING ORDER
On August 28, 2015, Plaintiffs filed an amended complaint naming as Defendants
Michigan Department of Health and Human Services, Community Mental Health for Central
Michigan, and Mid State Health Plan Network Pre-Paid Inpatient Health Plan. See Am. Compl.,
ECF No. 21. Plaintiffs allege that the State of Michigan’s reduction of General Funds allotted to
healthcare led to Defendants no longer providing certain mental health services and no longer
paying some of Plaintiffs’ Medicaid deductible on their behalf.1 According to Plaintiffs, the
implementation of this decision violated their due process rights under Goldberg v. Kelly, 397
U.S. 254 (1970); violated their rights under the Equal Protection clause of the United States
Constitution; and violated the Michigan Mental Health Code, Mich. Comp. L. § 330.1001ff. Id.
All three Defendants moved to dismiss on the ground that Plaintiffs’ complaint does not state a
claim for which relief may be granted. See Defs.’ Mots. Dismiss, ECF Nos. 27, 31, & 32. The
parties timely briefed all three motions.

1

The Medicaid deductible is a certain amount of health services that must be paid out-of-pocket by an
individual before they qualify for Medicaid funding during a specific coverage period.

On November 6, 2015, Plaintiffs moved for a temporary restraining order and
preliminary injunction. See Pls.’ Mot. TRO, ECF No. 41. Plaintiffs argue in their motion that
Defendants have begun the process of terminating benefits and they seek an immediate order
from the Court enjoining Defendants from doing so. Initially, Defendants had continued benefits
in exchange for an extension of time to respond to Plaintiffs’ first complaint. Defendants then
continued benefits indefinitely after Plaintiffs sought a Medicaid review hearing. Defendants
maintained the position that Plaintiffs were not entitled to a Medicaid review hearing. Now,
according to Plaintiffs, Defendants have moved forward with terminating benefits.
In the course of conducting research on Plaintiffs’ claims and Defendants’ arguments
regarding the sufficiency of those claims, the Court located two cases that appear to be the law of
the Sixth Circuit and relevant to Defendants’ motions. The two cases are Benton v. Rhodes,
586 F.2d 1 (6th Cir. 1978), and Rosen v. Goetz, 410 F.3d 919 (6th Cir. 2005). None of the parties
have discussed the two cases in their papers.2
In Benton, the Sixth Circuit heard a class challenge to Ohio’s “proposed reduction of a
number of optional benefits from the state’s medicaid program[.]” Benton, 586 F.2d at 1. The
Sixth Circuit held that “when a state decides to terminate optional benefits on the basis of lack of
appropriated funds, or for any other state reason, this is a matter of state law or policy which it
was permitted to adopt.” Id. at 3. Further “nothing in the Federal or State Constitutions giv[es]
prospective recipients of optional benefits a constitutional right to their perpetual continuance.”
Id. Additionally, the Sixth Circuit concluded that it “do[es] not regard the case of Goldberg v.
Kelly as apposite. Goldberg involved the termination of public welfare payments.” Id. at 4
(internal citations omitted). The facts of Benton “involve[d] only the termination of optional
2

In its Reply Brief, Defendant Michigan Department of Health and Human Services cites to Benton in
passing as support for the proposition that “[b]ecause Plaintiffs allege no claim against the Department itself,
dismissal is the appropriate remedy.” Def.’s Reply Br. 3, ECF No. 36.

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benefits which the state was never required to provide in the first place. The [r]equired payments
under medicaid [were] still being made.” Id.
Thirty years later, in Rosen, the Sixth Circuit confronted a challenge to the reduction in
Tennessee’s state Medicaid program. The Sixth Circuit determined that individual recipients are
entitled to Medicaid hearings when there coverage is eliminated “so long as they raise a valid
factual dispute about their continued eligibility for coverage[.]” Rosen, 410 F.3d at 927. They are
not so entitled, however, to receive a hearing in order to make “a mere challenge to the change in
law or policy.” Id. In addition, the court once more held Goldberg inapposite because “plaintiffs
have not shown that the requirement of establishing a valid factual dispute before being entitled
to a hearing violates due process.” Id. at 928. Indeed, Goldberg itself “declined to reach the issue
of ‘whether due process requires only an opportunity for written submission, or an opportunity
both for written submission and oral argument, where there are no factual issues in dispute or
where the application of the rule of law is not intertwined with factual issues.’” Id. (citing
Goldberg, 397 U.S. at 268 n.15). The Rosen court, relying on Benton, went on to note that “since
Goldberg, the Court has explained that the due process requirement that the government provide
a hearing before the termination of benefits turns on the sensible fact/law dichotomy that CMS,
the State and Benton have drawn.” Id.
Both cases provide additional guidance that may be helpful to resolving the disputes in
this case. The above summaries were just that, summaries. They are intended to aid the parties in
their study of the two cases. The parties will be instructed to submit supplemental briefs
providing: analysis of the two cases and their applicability to this dispute; discussion of the
factual distinctions between Benton, Rosen, and the present case; and any additional authority

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that may help address Benton and Rosen. Extensive factual exposition unmoored from analysis
of Benton and Rosen is not required and, in fact, discouraged.
Defendant Michigan Department of Health and Human Services will be given ten pages
in which to address these issues. Defendants Community Mental Health and Mid State Health
Plan Network will be given a combined ten pages in which to address these issues in a single
supplemental brief. Plaintiffs’ shall respond with a brief no longer than fifteen pages. Defendant
Michigan Department of Health and Human Services may then file a reply brief no longer than
five pages. Defendants Community Mental Health and Mid State Health Plan Network may also
file a combined reply brief no longer than five pages.
While supplemental briefing is being conducted, briefing on Plaintiffs’ motion for a
temporary restraining order will be stayed. The briefing stay will be lifted on the day
Defendants’ supplemental reply briefs are due.
Accordingly, it is ORDERED that Defendants are DIRECTED to file supplemental
briefs on the Court’s docket, in compliance with the directions set forth herein, on or before
November 20, 2015.
It is further ORDERED that Plaintiffs are DIRECTED to file a supplemental response
brief on the Court’s docket, in compliance with the directions set forth herein, on or before
December 4, 2015.
It is further ORDERED that Defendants are DIRECTED to file any supplemental reply
brief they wish to be considered on the Court’s docket, in compliance with the directions set
forth herein, on or before December 11, 2015.

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It is further ORDERED that briefing on Plaintiffs’ motion for a temporary restraining
order, ECF No. 41, is STAYED until December 11, 2015.

Dated: November 10, 2015

s/Thomas L. Ludington
THOMAS L. LUDINGTON
United States District Judge

PROOF OF SERVICE
The undersigned certifies that a copy of the foregoing order was served
upon each attorney or party of record herein by electronic means or first
class U.S. mail on November 10, 2015.
s/Michael A. Sian
MICHAEL A. SIAN, Case Manager

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