Appeal and cross-appeal from a judgment of the United States District Court for the District of Connecticut, Jose A. Cabranes, Judge, enjoining defendant Connecticut Department of Income Maintenance to ensure that "skilled nursing facilities" provide appropriate adaptive wheelchairs and related services for their resident Medicaid recipients, and to take "corrective action as needed" against skilled nursing facilities that fail to do so.
Kearse and Cardamone, Circuit Judges, and Pollack, District Judge.*fn*
Plaintiffs Dale Hillburn, et al., recipients of aid under the Medicaid program, Title XIX of the Social Security Act ("Title XIX" or "Medicaid Act"), as amended, 42 U.S.C. §§ 1396-1396p (1982 & Supp. I 1983 & Supp. II 1984), who reside in "skilled nursing facilities" ("SNFs") in the State of Connecticut ("State"), appeal on behalf of themselves and a class of those similarly situated, from a final judgment entered in the United States District Court for the District of Connecticut after a bench trial before Jose A. Cabranes, Judge, granting the relief sought in their complaint to the extent of enjoining defendant Commissioner of the Connecticut Department of Income Maintenance (together "CDIM") to ensure that SNFs with which CDIM has Medicaid provider agreements provide appropriate adaptive wheelchairs and related services to members of the plaintiff class, and to take "corrective action as needed" against SNFs that fail to provide such wheelchairs and services. On appeal, plaintiffs contend principally that the district court's judgment is not broad enough and that the court should have considered plaintiffs' claims relating to essential programs other than adaptive wheelchairs and "order[ed CDIM] to implement the federal Medicaid law in Connecticut SNFs." CDIM cross-appeals, contending principally that the district court erred in finding its reviews of the care provided by SNFs inadequate, and that the injunction inappropriately requires CDIM to terminate its provider agreements with SNFs that fail to provide appropriate adaptive wheelchairs and related services even if the SNFs remain certified for participation in the Medicaid program by other regulatory bodies. We conclude that the injunction against CDIM was proper and that plaintiffs were not entitled to broader relief, and we accordingly affirm the judgment of the district court.
As the term is used in the Medicaid Act, an SNF is, essentially, an institution whose staff includes at least one registered professional nurse full time, whose policies are developed with the advice of a group of professional personnel including at least one physician, and which is engaged primarily in providing skilled nursing care and related services to resident patients who require medical or nursing care. See 42 U.S.C. § 1395x(j) (1982 & Supp. II 1984); id. § 1396a(a)(28). Plaintiffs were, at the time this suit was filed, disabled residents of SNFs in Connecticut. The principal defendant, and the only party against which the district court's judgment is directed, is CDIM, which is the single Connecticut agency responsible for administering the State's Medicaid plan.
CDIM itself does not provide health care services but enters into "provider agreements" with Connecticut SNFs that are certified to participate in the Medicaid program. The provider agreements, which are renewed yearly, state that the SNF will provide care and services in conformity with Title XIX and will meet the conditions of participation detailed in regulations promulgated by the United States Department of Health and Human Services ("HHS"), see 42 C.F.R. §§ 405.1101-405.1137 (1985).
Under the federal Medicaid laws, CDIM has two methods of making payment for SNF care: (1) payments to SNFs according to per diem rates for "skilled nursing facility services," as defined in 42 U.S.C. § 1396d(f) and 42 C.F.R. § 440.40(a) (1985), and (2) payments to suppliers for other Medicaid benefits. In general, CDIM pays SNFs for services rendered to Medicaid-eligible persons resident in such facilities principally on a per diem basis calculated with reference to the SNF's costs, which include expenditures not only for salaries, fees, supplies, staff training, and so forth, but also for equipment purchased by the SNF. Under this method of payment, CDIM's reimbursement of an SNF for a particular expenditure may take as long as 18 months. For certain equipment that may not fall within the definition of "skilled nursing facility services" (hereinafter "separate Medicaid benefits"), CDIM pays the supplier of the equipment directly, and the SNF incurs no cost.
An adaptive wheelchair is a piece of equipment designed to support and properly position the body of a disabled person; it is used for a person whose disabilities preclude the effective use of a standard wheelchair. An adaptive wheelchair must be designed with a particular individual in mind and is usually unsuitable for use by any other individual. Such wheelchairs have only recently become commercially available for adults and may be expensive to purchase and maintain.
A. The Complaint and CDIM's Revision of Policy
Prior to the commencement of this lawsuit in February 1982, CDIM's policy was to reimburse SNFs for the cost of adaptive wheelchairs as part of their per diem rates rather than to pay the suppliers of such chairs directly. The thrust of plaintiffs' complaint was that this policy had resulted in SNFs' failing to provide needed adaptive wheelchairs to their disabled Medicaid-eligible residents because the cost was great and the delay in reimbursement too long. Contending that CDIM's policy therefore violated Medicaid regulations, plaintiffs sued on behalf of themselves and a class eventually certified as
all Medicaid recipients residing in or admitted to Skilled Nursing Facilities in the State of Connecticut on or after February 18, 1982, who, under defendant's policies and practices, cannot obtain the adaptive wheelchairs necessary to maintain their health and insure their effective development.
Plaintiffs also complained that as SNF residents they were treated differently from Medicaid-eligible persons who did not reside in SNFs. For the latter group, CDIM paid the suppliers directly for needed adaptive wheelchairs. Plaintiffs contended that CDIM's policy of using only the per diem method of reimbursement for such chairs for Medicaid-eligible SNF residents thus discriminated against them in violation of § 504 of the Rehabilitation Act of 1973, 29 U.S.C. § 794 (1982 & Supp. II 1984), and the Equal Protection Clause of the Constitution.
The complaint principally sought injunctive relief requiring CDIM and SNFs to provide adaptive wheelchairs to members of the plaintiff class and to provide "related professional support services necessary to ensure that such adaptive wheelchairs are safely and properly used."
A five-day trial was held between December 17, 1982, and April 3, 1984, with substantial continuances on consent of the parties in an effort to promote settlement. After several days of trial had been completed, CDIM amended its policy in October 1983 (and modified it further in February 1984), undertaking to make payment directly to suppliers for the cost of adaptive wheelchairs for Medicaid-eligible SNF residents.
In light of its amended policy, CDIM moved in November 1983 for dismissal of the complaint, contending that its new payment system rendered the action moot. The district court denied the motion. It concluded that since, under the new policy, SNFs were given the responsibility for identifying those SNF residents who needed adaptive wheelchairs and for monitoring their use, "it cannot be said with assurance that the new policy will cause adaptive wheelchairs to be provided to all members of the plaintiff class."
With its motion to dismiss, CDIM filed a motion in limine seeking to exclude all future evidence at trial "concerning the care, habilitation or development of retarded persons residing in [SNFs] . . . unless such testimony is strictly limited to what professional services are required to 'adequately and safely use adaptive wheelchairs in nursing homes.'" The court stated that CDIM was perhaps attempting to tie plaintiffs too inflexibly to the language of the complaint, and it denied the motion without prejudice, noting that Fed. R. Civ. P. 1 provides that the Rules "shall be construed to secure the just, speedy, and inexpensive determination of every action," and that Fed. R. Civ. P. 8(f) provides that "all pleadings shall be so construed as to do substantial justice."
B. Plaintiffs' Efforts To Broaden the Scope of the Action
In June 1984, two months after the close of trial, plaintiffs moved to expand the definition of the plaintiff class in order to, inter alia, include in the class all persons who were or would be unable to obtain adaptive wheelchairs "as part of an overall therapeutic program that is necessary to maintain their health and insure their effective development." CDIM objected to this redefinition on the ground that it in effect sought to amend the complaint to expand plaintiff's claims into areas unrelated to adaptive wheelchairs; it argued that Fed. R. Civ. P. 15(b) did not authorize such a posttrial amendment of the complaint because these broader issues had not been tried with the express or implied consent of CDIM. The court denied plaintiff's motion to redefine the class insofar as it sought expansion of the class's substantive claims, noting that CDIM had "objected consistently to the introduction of evidence concerning programming to maximize the 'physical, mental and psychosocial functioning' of class members." The court expressly intimated no view as to the appropriateness of a properly filed motion to amend the complaint.
In October 1984, plaintiffs formally moved pursuant to Fed. R. Civ. P. 15(a) and (b) to amend the complaint, seeking principally to expand the action beyond the claims relating to adaptive wheelchairs and related services in order to demand "programming . . . to maximize the physical, mental and psychosocial functioning" of class members. After receiving extensive oral argument and briefing, the court observed that the motion had been inexplicably delayed, without permission, until long after the trial had ended and the case had been submitted to the court for decision; that CDIM had objected at trial to the introduction of evidence relating to these broader issues and would be prejudiced by the amendment; and that the amendment might necessitate supplemental evidentiary proceedings. Concluding that "re-opening discovery and trial of the action at this late date would not serve the interests of justice," the court denied the motion to amend the complaint.
C. The District Court's Findings, Conclusions, and Judgment
In a Memorandum of Decision dated July 17, 1985 ("Opinion"), the court ruled that plaintiffs were entitled to some relief, although most of their claims had been mooted by CDIM's new policy. First, the court found that adaptive wheelchairs are medical necessities for many severely disabled persons:
23. An adaptive wheelchair can be helpful in preventing the development of contractures. . . . Adaptive wheelchairs also reduce pain and discomfort caused by improper body positioning, and promote skin integrity by alleviating pressure points. . . . By providing appropriate body alignment, adaptive wheelchairs also facilitate safe and proper breathing, swallowing, and digestion. . . .
24. For many severely disabled persons, including some residents of SNFs, adaptive wheelchairs are a medical necessity. . . . Failure to provide an adaptive wheelchair can lead to deterioration of health and skills, and increases the risk of injury and death. . . .
25. An individual who needs an adaptive wheelchair and does not have one will not be able fully to benefit from the physical therapy that is necessary to promote his health and physical well-being. . . . For this reason, some class members receive little or no needed physical therapy. . . .
26. Many residents of SNFs who have been provided with adaptive wheelchairs have exhibited noticeable improvement as a direct result of using their adaptive wheelchairs. . . .
Opinion at 15-16. The court concluded that "the prescription of an adaptive wheelchair, like that of any necessary item of medical care, is a service that the SNF is required to provide as a condition of participation in the Medicaid program." Id. at 38.
The court held that insofar as plaintiffs had challenged CDIM's failure to pay suppliers directly for adaptive wheelchairs for Medicaid-eligible SNF residents, their claims were mooted by CDIM's 1983 amendment to its policy. The court decided, however, to construe the complaint as asserting also that CDIM had violated pertinent Medicaid standards by failing to ensure that SNFs properly (a) evaluated class members for appropriate adaptive wheelchairs and (b) provided appropriate services related to such wheelchairs. As thus construed, the complaint was not mooted by CDIM's new policy. Under that policy, the SNFs, not CDIM, had the responsibility for identifying SNF residents needing adaptive wheelchairs, performing interdisciplinary assessments of each resident's need, training their staffs in the safe and efficient use of such wheelchairs, and monitoring the residents who receive such chairs. The court noted that the costs incurred by SNFs in meeting these responsibilities would be reimbursed as part of their per diem rates, with the usual delays, and hence there still might exist some disincentive for SNFs to seek adaptive wheelchairs for their residents who are Medicaid recipients.
The court concluded that CDIM had failed to comply with its obligations under federal law to ensure the adequacy of the SNFs' provision of such wheelchairs and services. It noted that CDIM is obligated by 42 C.F.R. §§ 456.600-456.614 (1985) to have medical review teams make periodic inspections of the adequacy of the care and programs provided by SNFs with which CDIM has provider agreements, and to have these teams report on "(1) 'the adequacy, appropriateness and quality of all services provided in the facility or through other arrangements, including physician services to recipients,' and (2) 'specific findings about individual recipients in the facility.' 42 C.F.R. § 456.611." Opinion at 40. It noted further that CDIM is required to "'take corrective action as needed based on the report and the recommendations of the team. . . .' 42 C.F.R. § 456.613." Opinion at 40.
The court found that, notwithstanding these requirements, CDIM's medical review teams made no effort to assess the appropriateness of the plan of care ordered by a physician for an SNF resident and hence CDIM could not properly evaluate the adequacy of care provided by SNFs. Thus, the court concluded that CDIM had failed to comply with its obligations under federal law to ...