Health Law Daily Tennessee lacked standing to challenge Medicaid coverage for refugees
Wednesday, March 21, 2018

Tennessee lacked standing to challenge Medicaid coverage for refugees

By Jeffrey H. Brochin, J.D.

The Tennessee General Assembly and two of its elected officials lacked standing to sue in either an official capacity or in an individual capacity over mandatory Medicaid funding for refugees, a federal district court in Tennessee has ruled. None of the petitioners had such a personal stake in the outcome of the controversy as to warrant invoking federal court jurisdiction (Tennessee v. U.S. Department of State, March 19, 2018, Anderson, S.).

Aid to refugees. Although the original Medicaid statute was silent as to the availability of Medicaid benefits to aliens, in 1973 HHS issued a rule requiring coverage of all lawful permanent residents and other aliens permanently residing in the United States. The purpose of the 1973 rule was to implement a previous U.S. Supreme Court decision, which held that state laws denying welfare benefits to resident aliens violated the Equal Protection Clause of the Fourteenth Amendment and impermissibly encroached upon exclusive federal power over the admission of aliens and the conditions of their residence.

In 1980 Congress passed the Refugee Act of 1980 which among other things, set comprehensive and uniform provisions for refugee resettlement. To administer the act’s Refugee Resettlement Program, HHS established the Office of Refugee Resettlement (ORR) to make grants to and contract with states to assist refugees after their initial resettlement. By the early 1990s, ORR no longer reimbursed the states for the full cost of providing medical assistance to refugees and in October 2007, Tennessee withdrew from the program, effective June 2008.

In 2016 the Tennessee General Assembly adopted a resolution to commence legal action against the federal government claiming that the federal government mandated appropriation of state revenue with respect to refugee resettlement in Tennessee. The resolution stated that requiring Tennessee to provide Medicaid benefits to eligible refugees—or risk losing all Medicaid funding—subjected the state to coercion in violation of the Tenth Amendment. The resolution called on the Attorney General of Tennessee to initiate litigation on the state’s behalf, however, in July 2016, the Tennessee Attorney General declined to file suit because of doubts that the 10th Amendment theories likely provided a viable basis for legal action. He subsequently delegated his authority to staff counsel for the General Assembly. The instant lawsuit ensued seeking declaratory relief and an injunction prohibiting resettlement of additional refugees in Tennessee unless and until the federal Government paid for and absorbed the costs of the resettlement program "without any involuntary contribution" from the State.

Personal stake in the outcome. The court restated the principle that because Tenth Amendment challenges often involve controversial policy questions that put the courts at particular risk of encroaching on the proper domain of the political branches, before proceeding to the merits of a claim, the court must ensure that a state asserting such a claim has alleged a "particularized, concrete, and otherwise judicially cognizable" injury. Only one party to a lawsuit need have standing to survive a motion to dismiss, and the critical question becomes whether at least one petitioner has alleged such a personal stake in the outcome of the controversy as to warrant his or her invocation of federal-court jurisdiction.

Individual capacity and official capacity. The U.S. Department of State contended that neither of the elected officials who brought suit on behalf of Tennessee had standing in an individual capacity or in their official capacities. Due to the lack of allegations of personal injury, the court turned its focus to the issue of official capacity. The officials argued that official capacity was satisfied because the General Assembly had standing to sue and designated them to act on its behalf. Furthermore, they contended that the Department of State’s actions impeded and interfered with their ability to fully discharge their duties as members of the General Assembly and of their respective legislative committees. However, the court rejected that theory of injury as wholly abstract, being based on the idea that compelled expenditures of state funds for the Refugee Resettlement Program would interfere with their ability to appropriate state funds for other purposes and therefore dilute their legislative power.

General Assembly itself lacked standing. Aside from the issue of official capacity standing, the court also rejected the notion that the legislators could file suit on behalf of the General Assembly, because the General Assembly itself lacked standing to file suit in the matter. State law conferred upon the Attorney General the authority to initiate suit on behalf of the state or the General Assembly, but the relied-upon resolution did not give the plaintiff-legislators the authority to file suit because a resolution cannot amend a statute or constitutional provision.

Based on the foregoing reasoning, as well as considerations of ripeness, the court found a lack of standing by the legislators or the General Assembly, and granted the Department of State’s motion to dismiss for lack of jurisdiction.

The case is No. 1:17-cv-01040-STA-egb.

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