University of Michigan Law School
Civil Rights Litigation Clearinghouse
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Case Name Kelley v. California Department of Health Care Services PB-CA-0054
Docket / Court BS170173 ( State Court )
Additional Docket(s) BS170173    Appellate Court (CA)
State/Territory California
Case Type(s) Public Benefits / Government Services
Case Summary
Prior to 1988, Medicaid eligibility for married individuals was determined by assessing the value of assets held jointly by the couple. Because of this, when one spouse required care and was unable to work ("institutionalized spouse"), the eligibility mechanism often depleted the assets and income ... read more >
Prior to 1988, Medicaid eligibility for married individuals was determined by assessing the value of assets held jointly by the couple. Because of this, when one spouse required care and was unable to work ("institutionalized spouse"), the eligibility mechanism often depleted the assets and income of the other ("community spouse"). This is known as spousal impoverishment. Congress consequently enacted the Medicaid Catastrophic Coverage Act in 1988, which sought to provide protections against spousal impoverishment by allowing the community spouse to retain some assets while not disqualifying the institutionalized spouse from Medicaid.

However, these protections only applied if the institutionalized spouse actually went to live in an institutional setting and did not cover "institutionalized spouses" who opted for home- or community-based services. Congress addressed this issue with the passage of the Affordable Care Act (ACA) in 2010 by expanding the definition of an "institutionalized spouse" to include persons who required a "nursing facility level of care" but could do so from home. The ACA became effective on January 1, 2014.

On July 6, 2017, two married individuals with medical disabilities brought this class action suit against the California Department of Health Care Services (DHCS) in the California Superior Court for the Central District of Los Angeles. The plaintiffs sued on behalf of all individuals with a common need for home- and community-based care. Despite changes to Medicaid eligibility determination, the plaintiffs alleged that the DHCS had not adopted the changes and thus were unlawfully denying them access to health services. Additionally, the plaintiffs argued that DHCS's policy discriminated on the basis of disability because it de facto segregated disabled individuals from their spouses. The plaintiffs sought declaratory and injunctive relief as well as attorney's fees. The case was assigned to Judge James C. Chalfant.

On July 19, 2017, the DHCS released guidance that expanded the state's definition of "institutionalized spouse" to comport with the federal definition under the ACA. More than a year later, the DHCS supplied additional guidance to counties on the expanded definition in August of 2018.

In light of the DHCS's policy changes and following numerous amended complaints that are unavailable to the Clearinghouse, the plaintiffs filed a fourth amended complaint on May 16, 2019. In it, the plaintiffs maintained a desire for declaratory and injunctive relief. The plaintiffs alleged that, despite DHCS's change in policy and guidance, it had still fallen short of its responsibilities in providing health services. Specifically, the plaintiffs claimed that the DHCS failed to adequately (1) identify eligible individuals (2) notify eligible individuals (3) enforce the expanded spousal impoverishment protections by supervising counties (4) create a process to retroactively determine eligibility and (5) provide for retroactive compensation for individuals who would have qualified for the program beginning in 2014. Thus, while the plaintiffs had voluntarily dismissed their class allegations on March 27, 2018, the lawsuit still carried class-wide implications because injunctive relief would require the DHCS to identify, notify, and retroactively compensate all eligible persons.

On November 8, 2019, the plaintiffs petitioned for a writ of traditional mandamus. On January 14, 2020, the court granted the plaintiffs' petition in part. Specifically, the court reasoned that DHCS did not cause unreasonable delay in providing health services because it did provide guidance to counties on the expanded spousal impoverishment protections. However, the court agreed with the plaintiffs that the DHCS failed to properly notify all potentially eligible individuals and provide for a process to retroactively compensate individuals who were eligible for, but did not receive, Medicaid services.

In that ruling, the court ordered the plaintiffs to prepare a proposed judgment and writ, serve the proposal upon the DHCS, confer about any issues, and then declare whether there are or are not unresolved objections. On March 9, 2020, the parties declared that there were no remaining unresolved objections in the agreement, though the exact details of the agreement are unknown to the Clearinghouse. The parties additionally reached a settlement agreement regarding attorney's fees on January 26, 2021.

Matthew Feng - 07/21/2021


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Issues and Causes of Action
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Issues
Benefit Source
Medicaid
Constitutional Clause
Due Process: Procedural Due Process
Content of Injunction
Discrimination Prohibition
Defendant-type
Jurisdiction-wide
Disability
disability, unspecified
Discrimination-basis
Disability (inc. reasonable accommodations)
Plaintiff Type
Private Plaintiff
Causes of Action Americans with Disabilities Act (ADA), 42 U.S.C. §§ 12111 et seq.
Medicaid, 42 U.S.C §1396 (Title XIX of the Social Security Act)
State law
Defendant(s) California Department of Health Care Services
Plaintiff Description Two low-income, married individuals with medical disabilities
Class action status sought No
Class action status outcome Not sought
Filed Pro Se No
Prevailing Party Plaintiff
Public Int. Lawyer No
Nature of Relief Declaratory Judgment
Attorneys fees
Injunction / Injunctive-like Settlement
Source of Relief Litigation
Filed 07/06/2017
Case Closing Year 2021
Case Ongoing No
Court Docket(s)
State Trial Court
01/26/2021
BS170173
PB-CA-0054-9000.pdf | Detail
Source: Westlaw
General Documents
State Trial Court
07/06/2017
Class Action Verified Petition for Writ of Mandate (Code Civ. Proc. & 1085); Class Action Complaint for Declaratory and Injunctive Relief
PB-CA-0054-0004.pdf | External Link | Detail
Source: Public.Resource.Org
State Trial Court
05/13/2019
Joint Stipulation and Order Re: Filing of Verified Fourth Amended Petition for Writ of Mandate (CODE CIV. PROC. § 1085); Administrative Mandamus (CODE CIV. PROC. § 1094.5); Complaint for Declaratory and Injunctive Relief [Fourth Amended Complaint]
PB-CA-0054-0003.pdf | External Link | Detail
Source: Public.Resource.Org
State Trial Court
11/08/2019
Petitioners' Memorandum of Points and Authorities in Support of their Petition for Writ of Mandate (CODE CIV. PROC. §§ 1094.5 and 1085)
PB-CA-0054-0001.pdf | External Link | Detail
Source: Public.Resource.Org
State Trial Court
01/14/2020
Tentative decision on: (1) petition for writ of administrative mandate: denied; (2) petition for writ of traditional mandate: granted in part
PB-CA-0054-0002.pdf | External Link | Detail
Source: Public.Resource.Org
show all people docs
Plaintiff's Lawyers Chan, Denny W. (California) show/hide docs
PB-CA-0054-0003
Gershon, Elissa Staci (California) show/hide docs
PB-CA-0054-0003 | PB-CA-0054-0004
Jones, Gregory R (California) show/hide docs
PB-CA-0054-0001 | PB-CA-0054-0003 | PB-CA-0054-0004
Kim, Ji Won (California) show/hide docs
PB-CA-0054-0001 | PB-CA-0054-0003 | PB-CA-0054-0004
Leach-Proffer, Anne E (California) show/hide docs
PB-CA-0054-0003
Miara, Jenna L (California) show/hide docs
PB-CA-0054-0003
Newman, Robert D. Jr. (California) show/hide docs
PB-CA-0054-0003 | PB-CA-0054-0004
Racela, Corilee (California) show/hide docs
PB-CA-0054-0003 | PB-CA-0054-0004
Ramsey, Claire M (California) show/hide docs
PB-CA-0054-0003 | PB-CA-0054-0004
Rothschild, Richard (California) show/hide docs
PB-CA-0054-0003 | PB-CA-0054-0004
Singh, Dipti (California) show/hide docs
PB-CA-0054-0004
Weir, Charles Edward (California) show/hide docs
PB-CA-0054-0003 | PB-CA-0054-0004 | PB-CA-0054-9000
White-Sperling, Jennifer Elizabeth (California) show/hide docs
PB-CA-0054-0003
Zirker, Elizabeth Anna (California) show/hide docs
PB-CA-0054-0003 | PB-CA-0054-0004
Defendant's Lawyers Becerra, Xavier (California) show/hide docs
PB-CA-0054-0003
Byerts, Michael Edward (California) show/hide docs
PB-CA-0054-0003 | PB-CA-0054-9000
Waldow, Richard T. (California) show/hide docs
PB-CA-0054-0003

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