Epperson et al v. Director, Ohio Department of Job and Family Services

Filing 68

ORDER granting 45 Plaintiffs' Motion to Certify Class as set forth in the order. Signed by Judge Sandra S Beckwith on 4/11/12. (mb)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF OHIO
WESTERN DIVISION
Betty A. Ledford, by and through
her Daughter and Next Friend,
Karen Epperson, et. al.,

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Plaintiffs,
vs.
Michael B. Colbert, in his
capacity as Director of the Ohio
Department of Job and Family
Services,
Defendant.

Case No. 1:10-cv-706

ORDER
Before the Court is Plaintiffs’ motion for class
certification. (Doc. 45) Defendant opposes the motion (Doc. 51),
and Plaintiffs have filed a reply. (Doc. 55) For the following
reasons, the Court will grant the motion.
FACTUAL BACKGROUND
The named Plaintiffs in this case are four women who are
either widows of veterans or veterans themselves.1 Plaintiffs
each reside in an Ohio Medicaid-eligible assisted living
facility, and receive Medicaid services under what is known as

1

Suit was originally brought by Plaintiffs Betty Ledford and
Ida Gates. Ms. Ledford passed away on July 31, 2011, and Ms.
Gates, after the complaint was filed, dis-enrolled from Ohio’s
Assisted Living Waiver program, as it no longer met her needs.
The original complaint was amended to add Fern Darowski and Olive
Ray Crumbly as plaintiffs. (Doc. 44).
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the “waiver” program, which generally permits payment for home
and community based services in lieu of admission to a nursing
facility. Each plaintiff receives a Department of Veterans
Affairs Aid and Attendance Allowance (VA benefits) based on their
spouses’ military service, their own military service (if
applicable), and their own medical needs.
The Ohio Department of Jobs and Family Services (“ODJFS”) is
the Ohio agency that administers the state’s Medicaid program.
After a recipient’s eligibility for Medicaid is established,
ODJFS examines a recipient’s available income to determine how
much the recipient must contribute toward her care.

(This

process is called the post-eligibility income determination.)
ODJFS, pursuant to state regulations, treats Plaintiffs’ VA
allowance as non-exempt income for the purposes of posteligibility income determination. Plaintiffs allege this violates
the due process clause and an applicable section of the Social
Security Act governing Medicaid, 42 U.S.C. §1396a(r). Plaintiffs
contend that this statute clearly exempts the first $90 per month
they each receive as VA benefits, and this $90 cannot be counted
in the post-eligibility income determination used to pay Medicaid
providers.
Plaintiffs seek to represent a class consisting of “all Ohio
residents who have been participants in the State of Ohio’s Home
and Community Based Medicaid Waiver programs since October 12,

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2010, or who may become participants thereafter and who are
entitled to a VA pension payment, including any payment made for
aid and attendance or for unreimbursed medical expenses, and have
had the first $90 of this allowance included as part of their
income in calculating the payment they must make to their
Medicaid Home and Community Based Waiver service providers.”
Plaintiffs now seek certification of this class, arguing
they have satisfied the requirements of Fed. R. Civ. P. 23.
Defendant disagrees, contending that Plaintiffs’ proposed class
is overly broad, and that therefore Plaintiffs have failed to
show numerosity, commonality of claims, or that they will
adequately represent the class’s interests.

Defendant further

contends that even if Plaintiffs have met the Rule 23
requirements, class certification is unnecessary, as if
injunctive relief is obtained through an individual action, all
Plaintiffs will benefit.
DISCUSSION
In determining whether to certify a class, the Court must
not weigh or make a preliminary determination of the merits of
the action.
(1974).

Eisen v. Carlisle & Jacquelin, 417 U.S. 156, 178

For purposes of a class certification motion, the Court

must accept as true the allegations of the complaint. Shelter
Realty Corp. v. Allied Maintenance Corp., 574 F.2d 656, 661 n.25
(2d Cir. 1987); Blackie v. Barrack, 524 F.2d 891, 901 n.17 (9th

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Cir. 1975), cert. denied, 429 U.S. 816 (1976). The Court “may
consider reasonable inferences drawn from facts before [it] at
that stage of the proceedings.” Senter v. General Motors Corp.,
532 F.2d 511, 523 (6th Cir. 1976).
The Court must rigorously analyze the Plaintiff’s
allegations and evidence under Rule 23 because actual, and not
assumed, compliance with Rule 23's requirements is indispensable.
General Telephone Co. v. Falcon, 457 U.S. 147, 160 (1982).
Within the framework of Rule 23, the Court has substantial
discretion to grant class certification pursuant to its inherent
power to control pending litigation. Reeb v. Ohio Dept. Of Rehab.
& Correction, 435 F.3d 639, 643 (6th Cir. 2006).
A. Proposed Class
Defendant’s main contention is that Plaintiffs’ proposed
class is too broad for class certification. Defendant relies on
the statutory language of the relevant federal statute:
(A) For purposes of sections 1902(a)(17) and 1924(d)(1)(D)
[42 USCS §§ 1396a(a)(17)and 1396r-5(d)(1)(D)] and for
purposes of a waiver under section 1915 [42 USCS § 1396n],
with respect to the post-eligibility treatment of income of
individuals who are institutionalized or receiving home or
community-based services under such a waiver, the treatment
described in subparagraph (B) shall apply ...
(B)(i)In the case of a veteran who does not have a spouse or
a child, if the veteran–
(I) receives, after the veteran has been
determined to be eligible for medical assistance
under the State plan under this title [42 USCS §
§1396 et. seq.], a veteran’s pension in excess of
$90 per month, and
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(II) resides in a State veterans home with respect
to which the Secretary of Veterans Affairs makes
per diem payments for nursing home care pursuant
to section 1741(a) of title 38, United States
Code,
any such pension payment, including any payment made due to
the need for aid and attendance, or for unreimbursed
medical expenses, that is in excess of $90 per month shall
be counted as income only for the purpose of applying such
excess payment to the State veterans home’s cost of
providing nursing care to the veteran.
(ii) The provisions of clause (i) shall apply with respect
to a surviving spouse of a veteran who does not have a child
in the same manner as they apply to a veteran described in
such clause.
42 U.S.C. §1396a(r)(1).

Defendant notes that subsection

(B)(i)(II) speaks about veterans who “reside... in a State
veterans home.”

Defendant maintains that this language clearly

indicates that veterans and widows who are part of home and
community based waiver programs are not within the reach of the
statute, because they do not live in a State veterans home.
Second, Defendant points to language in subsections (B)(i)
and (B)(ii), which speaks of a “veteran who does not have a
spouse or a child” and the “surviving spouse of a veteran who
does not have a child.” Defendant contends that this language
clearly indicates that any class must be limited to veterans
without spouses and children, and veteran’s widows without
children. Since Plaintiffs fail to limit the class as such, the
class is overly broad.
Plaintiffs respond that the specific subsections of 1396a(r)

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must be read in context with the statute as a whole, and
harmonized with the Veterans’ Benefits statutes.

Plaintiffs note

that the Veterans’ Benefits statutes define “child” as a
dependent child, not just any child. 38 U.S.C. §101(4)(A).
Plaintiffs also argue that the entire statutory scheme of these
VA benefits is to help provide minimal subsistence income to a
veteran and dependent family members, and it would be
inconsistent with this purpose if the exclusion of the $90 from
the veterans’ post-eligibility income was limited to veterans
without children.

Finally, Plaintiffs argue that section

1396a(r)(1)(A) itself indicates the improbability of Defendant’s
contentions.

Section(1)(A) notes a number of additional statutes

to which the “treatment described in subparagraph (B) will
apply.”

One of these statutes, 42 U.S.C. § 1396r-5(d)(1), is a

Medicaid provision designed to calculate the monthly income
allowance for a spouse and the family allowance for dependent
children.

Plaintiffs assert that if Section 1396(a)(r)(1)

applied only to veterans without spouses and children or widows
of veterans without children, there would be no need to include
Section 1396r-5(d)(1) under subsection (A) in the statute.
As stated above, a court must not weigh the merits of the
case during a class certification motion.

Defendant’s argument

that the Medicaid statute applies only to those veterans in State
veterans homes is a repeat of the argument made in its first

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motion for partial summary judgement.

As discussed in this

Court’s order denying that motion (Doc. 26), that interpretation
of the statute does not address the language in subsection
(1)(A), which states that “the treatment described in
subparagraph (B) shall apply.” (emphasis added)

It is not

appropriate for the Court to determine at the class certification
level whether the waiver of the first $90 of VA benefits is
indeed limited only to those veterans or widows of veterans who
reside in State veterans homes.
Defendant’s second argument, that the language of the
statute limits its application to those veterans without spouses
and children (and to widows of veterans with no children)
similarly fails.

It again ignores the relationship between

subsections (1)(B) and (A), and asks the Court to delve into the
merits of the action.

Limiting the class in that fashion would

be premature at this stage.

As Plaintiffs seek certification

under Rule 23(b)(2), notice to all members of the class is not
required, and the class need not be as tightly defined as other
prospective Rule 23(b) classes, where notice to each prospective
class member is mandatory.

Weathers v. Peters Realty Corp., 499

F.2d 1197, 1200 (6th Cir. 1974)(“Nature of primary relief sought
in Rule 23(b)(2) class category, injunctive or declaratory
relief, does not require that class be as narrowly confined as
under either Rule 23(b)(1) or (3).”)

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Finally, it must be noted that pursuant to Rule 23(c)(1)(C),
this order can be altered or amended before final judgment.

If

subsequent litigation determines that subclasses are necessary or
that the relevant statute does indeed apply only to those
veterans and widows who reside in nursing homes and are
childless, appropriate amendments to the class certification
order can be made at that time.

The Court finds that the

Plaintiff’s proposed class is not overly broad.
B.

Rule 23(a).
The proposed class representative must satisfy four

requirements of Rule 23(a):
(1)

(2)

questions of law or fact must be common to
the entire class (the “commonality
requirement”);

(3)

the claims or defenses of the named
representative must be typical of the claims
or defenses of the class (the “typicality
requirement”); and

(4)

1.

the members of the class must be so numerous
that joinder of all members is impracticable
(the “numerosity requirement”);

the named representative must fairly and
adequately represent the interests of the
class as a whole (the “adequacy of
representation” requirement).

Numerosity
There is no hard and fast rule about the number of potential

class members required for certification. Classes as small as 17
identified individuals have been certified; see Afro-American
Patrolmens League v. Duck, 503 F.2d 294, 298 (6th Cir. 1974).
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The key to determining whether certification is appropriate under
Rule 23(a)(1) rests on the impracticability of joinder.

In re

American Medical Systems, 75 F.3d 1069, 1079 (6th Cir. 1996).
Numerous factors play into the impracticability of joinder,
including “the size of the proposed class, geographic dispersion
and financial resources of class members, and judicial economy.”
Prater v. Ohio Educ. Ass’n, 2008 U.S. Dist. Lexis 88511, at *6,
2008 WL 2566364 (S.D. Ohio June 26, 2008).
Plaintiffs have not provided a specific number of putative
class members to the court, but note that the exact number and
identities of class members are under the exclusive control of
Defendant.

Defendant’s arguments against numerosity rest on the

same assertions that the class is overly broad.

As discussed

above, the Court will not resolve that issue as it would go
directly to the merits of the matter, a factor not suitable for
the class certification motion.

The proper focus is whether the

class proposed by the Plaintiffs is so numerous as to make
joinder impossible.
Although the exact number of members of the putative class
has not been determined, documents provided by Defendant indicate
that in 2010, 28,519 veterans and widows participated in the Ohio
Medicaid Home and Community Based Waiver programs, and thus had
their monthly VA benefits counted in determining their payment
obligations to the Medicaid provider.

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Joinder of all these

parties would be impractical.

The putative class members are

elderly individuals who, by the nature of the Ohio Medicaid Home
and Community Based Waiver program, are in declining health and
have limited financial resources.

It would be very difficult for

these individuals to afford and pursue such action on their own,
particularly since the action is focused only on $90.
Furthermore, the very delicate health of the proposed class
members indicates how impractical joinder would be: individual
members may be likely to move in or out of the class, as they can
easily fall so ill as to require nursing home care, or even die.
A suit would be constantly interrupted as new members were joined
to the suit and other parties would necessarily be removed.
Additionally, Defendant’s policy uniformly affects individuals
throughout the state of Ohio, and the proposed class
representatives reside in four different Ohio counties.2

Thus,

the Court finds that the class is sufficiently numerous to
satisfy this subsection of the Rule.
2. Commonality and Typicality
Rule 23(a)(2)’s commonality requirement is satisfied if the
resolution of at least one common issue will affect the class as
a whole.

See Fallick v. Nationwide Mut. Ins. Co., 162 F.3d 410,

424 (6th Cir. 1998).

A “perfect fit” of all issues is not

2

Ms. Ledford lives in Butler County, Ms. Darowski lives in
Lucas County, Ms. Crumbly lives in Warren County, and Ms. Gates
lives in Hamilton County.
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required.

Rather, the commonality required by Rule 23(a)(2) is

“qualitative rather than quantitative, that is, there need be
only a single issue common to all members of the class.” American
Med. Systems, 75 F.3d at 1080.

The resolution of the common

issue should advance the litigation. Sprague v. General Motors
Corp., 133 F.3d 388, 397 (6th Cir. 1998).
Rule 23(a)(3) requires that the named class representative’s
claims be “typical” of the absent class members’ claims.

A

plaintiff’s claim is “typical if it arises from the same event or
practice or course of conduct that gives rise to the claims of
other class members, and if his or her claims are based on the
same legal theory.”

American Med. Systems, 75 F.3d at 1082

(internal citation omitted).
Plaintiffs maintain that the common question in this case is
whether Ohio’s policy of counting the first $90 of their VA
benefits as income when calculating their payments to Medicaid
providers violates federal law.

This issue is shared by all

members of the proposed class, as all members participate in the
Ohio Medicaid Home and Community Based Waiver program and are
veterans or widows of veterans entitled to VA benefits.
Defendant again rests on its assertion that Plaintiffs’ class is
overly broad, as it includes every veteran in the program, not
simply those without spouses or children.
Plaintiffs also contend that the representative class

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members’ claims stem from the same policy and practice that gives
rise to the claims of the other members of the class, and
therefore the class meets the typicality requirement of Rule 23.
At the time the original complaint was filed, Ms. Ledford and Ms.
Gates were spouses of veterans, received VA benefits, and had the
first $90 of those benefits counted toward their post-eligibility
income.

The amended complaint adds as class representatives Ms.

Crumbly, a veteran’s widow, and Ms. Darowski, a veteran herself,
who were also recipients of the Assisted Living Wavier program
and had the first $90 of their VA benefits counted toward their
liability.
Plaintiffs have identified an issue common to the entire
class of proposed plaintiffs: whether those individuals who both
receive VA benefits and are part of the Ohio Medicaid Home and
Community Based waiver program can have the first $90 of their VA
payments counted as post-eligibility income.

Resolution of this

question will advance the litigation as a whole and affect each
member of the class, even if it is later determined that the
questioned Medicaid statute applies only to a more narrowlydefined class.

Similarly, the claims of the class

representatives are typical, as their interests are aligned with
the absent class members and the pursuit of their claims will
also advance the interests of the entire class.

Thus, the Court

finds that the requirements of commonality and typicality are

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satisfied.
3. Adequacy of Representation
Rule 23(a)(4) requires that the “representative parties will
fairly and adequately protect the interests of the class.”

To

satisfy this subsection of the Rule, Plaintiffs must show that
the class representatives’ interests do not conflict with the
absent class members’ interests, and that the representatives and
their attorneys are able to, and will, vigorously prosecute the
action on behalf of the class.

To defeat “adequacy,” a defendant

must point to a “fundamental conflict” that exists between the
named plaintiffs and the absent class members.

See, e.g., Valley

Drug Co. v. Geneva Pharmaceuticals,350 F.3d 1181 (11th Cir. 2003)
(reversing certification of an antitrust direct purchaser class
due to fundamental economic conflicts between the representatives
and the putative class members.)
Plaintiffs argue there is no conflict of interest between
the putative class representatives and the rest of the class.
All the representatives, as well as the putative class, are
recipients of VA benefits, participate in the Ohio Medicaid Home
Community Based Waiver program, and are subject to Ohio’s policy
of having the first $90 of the VA benefit counted as posteligibility income.

Defendant continues to maintain that the

proposed class is overly broad, and since each of the prospective
class representatives has at least one child, Defendant argues

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they cannot adequately represent the absent childless class
members.
Despite Defendant’s contentions, there is no fundamental
conflict between the proposed class representatives and the
absent class members.

It is true that each of the class

representatives has at least one child.

But that fact does not

give rise to a fundamental conflict between the members of the
class who have children and those without — there would be no
reason for the proposed class to pursue the case less
aggressively or to fail to look out for the interests of the
childless members of the class.

The interest is the same.

The

Court finds the Plaintiffs are adequate representatives for the
putative class.
As for the adequacy of proposed class counsel, Rule 23(g)
requires the Court to consider several factors, including the
work counsel has done in identifying potential claims; counsel’s
experience in handling class actions, other complex litigation,
and counsel’s knowledge of the law applicable to the case; and
the resources counsel will commit to representation of the class.
The Court may also consider any other issue concerning counsel’s
ability to fairly and adequately represent the class.
Counsel for Plaintiffs, ProSeniors, Inc., have experience in
federal and class action litigation, and have worked diligently
on the current case.

Defendant has not raised specific

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objections to proposed class counsels’ qualifications.

This

Court has little difficulty concluding that class counsel will
fairly and adequately represent the class in this case.
C. Fed. R. Civ. P. 23(b).
If Plaintiffs satisfy all four requirements of Rule 23(a),
they must also satisfy one subsection of Rule 23(b).

Rule

23(b)(1)(A) applies to situations that raise a substantial risk
of inconsistent adjudication; Rule 23(b)(1)(B) applies when the
disposition of the plaintiff’s claim poses a risk of adjudicating
the interest of absent parties, or impeding their ability to
protect those interests.

Certification under Rule 23(b)(2) is

appropriate when the party opposing the class has acted or
refused to act on grounds generally applicable to the class,
making final injunctive or declaratory relief appropriate.

And

Rule 23(b)(3) applies if the Court finds that common issues
predominate over any individual issues, and that a class action
is the superior method of resolving the dispute.
Plaintiffs seek certification under Rule 23(b)(2), arguing
that the Defendant has a uniform policy in Ohio with respect to
the treatment of VA benefits, and that injunctive and declaratory
relief is appropriate for all class members.

The requirements of

Rule 23(b)(2) are satisfied when “(1) the class as a whole is
generally affected by an act or refusal to act or policy of the
opposing party, and (2) the primary relief sought is in the

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nature of injunctive relief.”

Hiatt v. County of Adams, 155

F.R.D. 605, 610 (S.D. Ohio 1994), citing Sweet v. General Motors
Corp., 74 F.R.D. 333, 336 (N.D. Ohio 1976).
In this case, all members of the class, who both receive VA
benefits and participate in Ohio’s Medicaid Home and Community
Based Waiver program, are affected by Ohio’s policy of counting
the first $90 of the VA benefits as post-eligibility income.
Additionally, the primary relief sought by the Plaintiffs is
injunctive and declaratory in nature: that the Defendant refrain
from counting the first $90 of VA benefits as part of Plaintiffs’
post-eligibility income, and that the Court impose a permanent
injunction requiring the Defendant to modify its policies to
achieve this relief.
members.

This injunction would affect all class

Therefore, Plaintiffs have met the requirements of Rule

23(b)(2).
D. Necessity
Defendant finally argues that even if this Court finds that
Plaintiffs have satisfied the requirements of Rule 23(a) and (b),
it should still not certify the class because the claims could be
pursued through an individual’s civil suit requesting injunctive
relief, the result of which would automatically benefit others.
Defendant cites to a number of cases from the 1970s and 1980s
that take this position, what some courts refer to as a
“necessity requirement”.

Dionne v. Bouley, 757 F.2d 1344, 1355-

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56 (1st Cir. 1985).
The continuing validity of this “necessity requirement” is
in question.

See Nehmer v. United States Veterans Admin., 118

F.R.D. 113, 118-19 (N.D. Cal. 1987)(finding it questionable
whether this requirement was still good law in the 9th Circuit).
Furthermore, even if the requirement is still applicable here,
other considerations factor into the necessity of a class action
as opposed to individual actions.

In this case, the age, ill

health, and limited income of the putative plaintiffs all
indicate a real danger that any individual case brought by any of
them would become moot.

A concern that a case may become moot

can render denial of class certification inappropriate, even when
the class is arguably unnecessary.

Dionne, 757 F.2d at 1356.

Therefore, this Court will not hold the Plaintiffs to a strict
necessity requirement.

CONCLUSION
For all of the foregoing reasons, Plaintiffs’ motion for
class certification under Rule 23(a) and (b)(3) (Doc. 44) is
granted. The following class is certified:
All Ohio residents who have been participants in
the State of Ohio’s Home and Community Based
Medicaid Waiver programs since October 12, 2010,
or who may become participants thereafter and who
are entitled to a VA pension payment, including
any payment made for aid and attendance or for
unreimbursed medical expenses, and have had the
first $90 of this allowance included as part of
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their income in calculating the payment they must
make to their Medicaid Home and Community Based
Waiver service providers.
SO ORDERED.
DATED: April 11, 2012

s/Sandra S. Beckwith
Sandra S. Beckwith
Senior United States District Judge

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