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You can search the entire site. or go to the recent opinions, or the chronological or subject indices. Baker v. State, Dept of Health & Social Services (08/29/2008) sp-6301
Notice: This opinion is subject to correction before
publication in the Pacific Reporter. Readers are
requested to bring errors to the attention of the Clerk
of the Appellate Courts, 303 K Street, Anchorage,
Alaska 99501, phone (907) 264-0608, fax (907) 264-0878,
e-mail corrections@appellate.courts.state.ak.us.
THE SUPREME COURT OF THE STATE OF ALASKA
| CARMEN S. BAKER and | ) Supreme Court No. S-12598 |
| CATHERINE BURTNESS, on behalf | ) |
| of themselves and all those similarly | ) Superior Court No. 3AN-06-10871 CI |
| situated, | ) |
| ) | |
| Petitioners, | ) |
| ) | |
| v. | ) O P I N I O N |
| ) | |
| STATE OF ALASKA, DEPARTMENT | ) No. 6301 - August 29, 2008 |
| OF HEALTH AND SOCIAL | ) |
| SERVICES, KARLEEN JACKSON, | ) |
| in her official capacity as Commissioner | ) |
| of the Department, DIVISION OF | ) |
| SENIOR AND DISABILITIES | ) |
| SERVICES, and ROD MOLINE, in his | ) |
| official capacity as Director of the | ) |
| Division, | ) |
| ) | |
| Respondents. | ) |
| ) | |
Petition for Review
from the Superior Court of the State of
Alaska, Third Judicial District, Anchorage,
Peter A. Michalski, Judge.
Appearances: James J. Davis, Jr., and
Goriune Dudukgian, Northern Justice Project,
Anchorage, for Petitioners. Joanne M. Grace,
Assistant Attorney General, Anchorage, and
Talis J. Colberg, Attorney General, Juneau,
for Respondents.
Before: Fabe, Chief Justice, Matthews,
Eastaugh, and Carpeneti, Justices.
CARPENETI, Justice.
I. INTRODUCTION
In 2006 the State of Alaskas Department of Health and
Human Services implemented changes in the administration of its
Personal Care Attendant program which resulted in the termination
or reduction of in-home care services to over 1,000 individuals.
This class action challenges the sufficiency of the notices sent
by the state to those individuals whose services were reduced.
Because the notices did not sufficiently explain the reasons for
reductions in service, we hold that they failed to comply with
constitutional and regulatory requirements. Accordingly, we
reverse the decision of the superior court and remand for further
proceedings.
II. FACTS AND PROCEEDINGS
A. The Personal Care Attendant Program
Through Medicaid, the State of Alaska provides personal
care assistance to low-income, disabled Alaskans who cannot
independently perform basic tasks of daily life such as eating,
bathing, and using the toilet. The purpose of the Personal Care
Attendant (PCA) program is to enable an individual, of any age,
whose needs would otherwise result in placement in an acute care
hospital or nursing facility or loss of that individuals
employment solely related to activities of daily living (ADL) to
remain at home or prevent job loss.1
Until recently, an individuals PCA needs were assessed
ad hoc by one of several non-governmental PCA-service providers.
There was little or no uniformity among service providers or
oversight from the state, so recipients with similar needs could
receive vastly different levels of service. It is not clear from
the record in this case how often recipients needs were
reevaluated under this regime.
In 2006 the state legislature concerned that program
funding was not being evenly or judiciously distributed directed
the Department of Health and Human Services to overhaul the
programs administration. In order to establish standards for
determining (1) initial eligibility for PCA services and (2) how
many service hours to provide, the department developed the
Personal Care Assessment Tool (PCAT), an objective assessment
tool to evaluate the actual needs of recipients on an annual
basis.2 The PCAT is a thirteen-page worksheet-like form that is
filled out by a state-contracted registered nurse (assessor) on
the basis of information gathered during a personal interview
with a current or prospective PCA-service recipient in that
persons home. During the interview, the assessor personally
observes the individual in her home environment and asks
questions of the individual and the individuals caregivers and
family members about the individuals living situation, abilities
and disabilities, cognition, behavior, nutrition, and medical
needs. From this raw information, the assessor assigns a
numerical code to each of hundreds of items on the PCAT form.3
The assessor uses some of [these numbers] to score eligibility
for PCA services, and, if the individual is deemed eligible, the
assessor may refer to the numbers . . . in determining the amount
of PCA services a recipient needs.
The final result of this process is a PCAT Authorized
Service Plan (service plan). The service plan is a four-page
chart that notes for each of several defined activities the time
estimate for that activity, considerations for that activity, and
finally, the departments determination of how often and for how
long the recipient will receive assistance for that activity.4
The PCAT was adopted in April 2006.5 In the nine
months that followed, the personal care needs of over 1,000 PCA
service recipients were reassessed using the PCAT. On the basis
of those assessments, the services of 901 individuals were
reduced, and 102 were terminated. As to sixty-five others, the
department was uncertain whether their services were being
increased or decreased, because the old service plans [were] not
available for comparison.
B. Notice of Reduction of Benefits
The department drafted form letters to notify affected
PCA service recipients that their services were to be either
terminated or reauthorized. Among other things, the
reauthorization (reduction6) notice stated that new regulations
had been implemented requiring all recipients to be reassessed by
the standardized PCAT; explained that the assessment will be the
basis upon which a service plan will be developed; reminded
recipients that a state contractor had met with them to assess
their needs using the PCAT; and informed recipients that, [a]s a
result of the needs identified in the PCAT and . . . review of
other supportive documentation, the [state] has approved a
service plan authorizing [service recipients] to receive [X]
hours per week of personal care services. The notice summarized
the services that would be provided and referenced the detailed
service plan, which was attached.
C. Proceedings
In August 2006 two individuals who had received notices
that their services were being reduced or terminated filed a
class-action lawsuit. Carmen Baker and Catherine Burtness
(collectively Baker) alleged that the departments notices
violated procedural due process because they failed to convey
critical and necessary data that would allow the recipients to
appeal the departments determination. Baker requested a
temporary restraining order and preliminary injunction requiring
that the department (1) re-serve all class members with due
process compliant notices; (2) stay upcoming administrative
hearings; and (3) reinstate the PCA benefits of all recipients
who received defective notice that their services were to be
reduced or terminated.
During pendency of this litigation the department
revised the notices, though without conceding that they were in
any way deficient. The termination notice was substantially
altered, but the department made only minor and insignificant
adjustments to the reduction notice at issue here.7 The revised
notices were issued after October 12, 2006. Approximately 647
individuals received the original reduction notices issued prior
to that date.
The court granted Bakers motion, but only as to those
individuals who had received the original, unrevised termination
letter issued prior to October 12, 2006. It held that, while the
revised notices (both termination and reduction) complied with
due process, the old version of the termination letter was
insufficient; it lack[ed] any specific information concerning the
PCA recipients personal evaluation or PCAT calculation, giving
the letters recipient very little direction as to whether to
proceed with their appeal. As to the reduction letters (both the
original and revised versions) and the revised termination
letters, the court held that they were sufficient in this regard.
Baker filed this petition for review on February 12,
2007. Asserting that the original reduction notice, like the
termination notice, did not comply with due process, Baker asks
that we overturn the superior courts denial of injunctive relief
for those who received the original reduction notice.
Specifically, Baker asserts that the reduction notices fail to
explain, in any understandable way, the standards and methodology
used by the State in reaching its ultimate decision to reduce
recipients PCA benefits. Additionally, Baker argues that the
notice is misleading. The department did not oppose this courts
consideration of Bakers petition, and we granted it.
III. STANDARD OF REVIEW
The parties agree that state action reducing the
benefits at issue here invokes procedural due process concerns.8
Whether the departments original reduction notice complied with
due process presents a question of constitutional law which we
review de novo, adopting the most persuasive rule of law in light
of precedent, reason and policy.9
IV. DISCUSSION
A. Due Process Requires that the State Provide the Reason
for Its Action.
In Goldberg v. Kelly10 the United States Supreme Court
held that to satisfy constitutional due process an agency
contemplating a termination or reduction of public assistance
benefits must provide the recipient timely and adequate notice
detailing the reasons for a proposed termination, and an
effective opportunity to defend.11 The underlying policy
rationale is that recipients of public assistance benefits should
be afforded a degree of protection from agency error and
arbitrariness in the administration of those benefits.12 These
constitutional mandates have been embodied in the federal and
state regulations governing administration of the Medicaid
program, which, among other things, require that a notice provide
the reasons for the [agencys] intended action.13 Baker
argues that the department has failed to meet this requirement
because the notices do not show the methodology, standards, or
calculations that the department used to determine benefits. The
department responds that considering the states interaction with
the recipients before it sent the letters and the information
included in the letters, recipients had notice of the states
revised assessment tool, the information on which the assessment
was based, and the reasons for the states determination of the
level of benefits they were entitled to receive.
As a preliminary matter, we reject the suggestion that
notice here can be broadly construed to include not only the
written letter, but also the information the recipients already
had about the assessment process and the information the
recipients already had about themselves. The department urges us
not to evaluate the letter in a vacuum, but although the
Constitution arguably allows for a broad construction of notice,14
the federal regulations applicable here do not: Section 431.201
defines notice as a written statement that meets the requirements
of 431.210.15 Further, we agree with diverse authorities holding
that although an agency may have latitude to provide notice by a
variety of media under Goldberg, the agency must actively provide
complete notice16 and should not improperly place[] on the
recipient the burden of acquiring notice[;] due process directs
[the agency] to supply it.17 For these and other reasons,18 we
hold that the department cannot presume that recipients already
have a basis for understanding why services are being reduced;
whatever information the department is required to provide must
be part of the written notice itself.
B. To Satisfy Due Process, the Notice Must Show How and
Why the Department Determined that a Reduced Level of
Benefits Was Warranted.
Beyond establishing that adequate notice must detail[]
the reasons for a proposed termination of benefits, Goldberg does
not specify what information the notice must provide to satisfy
due process.19 The obvious challenge for any court applying
Goldberg is to determine what level of detail is required. As a
first step, many courts have invoked the balancing test set forth
in Mathews v. Eldridge20 to consider what burden can reasonably be
placed on an agency to eliminate the risk of erroneously
depriving an individual of a benefit in light of the value of
that benefit to the individual.21 Where the recipient has a
brutal need22 for the benefit at issue, as in the case of welfare
recipients, courts have traditionally required that agencies go
to greater lengths incurring higher costs and accepting
inconveniences to reduce the risk of error.23 Recipients of PCA
services are arguably as dependent on their benefits as are
welfare recipients; without them, they may be unable to do things
as basic as bathing, preparing a meal, or using the toilet. An
error in the agencys determination to reduce PCA services could
result in serious harm to the service recipient. It follows that
the agency should be required to make every reasonable effort to
reduce the risk of erroneously depriving PCA services recipients
of their benefits.24 In the context of notice, such effort might
amount to erring on the side of providing too much detail
respecting the basis for the agencys decision rather than too
little.
Citing Ford v. Shalala,25 Baker asserts that to meet
this high standard the notice must explain the formula by which
the benefit amount was calculated, identify the underlying facts
upon which the calculations were based, and include a breakdown
of the sums attributable to each factor in the equation so that
benefit recipients can check the factual [and] mathematical
accuracy of [the] intended action.26 We agree that decisional law
strongly supports the position that due process requires an
explanation of the specific reasons for reducing . . . benefits.27
Although some courts have upheld notices that failed to set forth
the calculations used by an agency to determine a reduction of
benefits,28 these cases can be distinguished,29 and the higher
standard in Vargas should govern here.30 That is, to the extent
feasible, the department should be required to show how and why
it determined that a reduction in PCA services was in order.
The department does not dispute that the Shalala
standard applies where numerical calculations are critical to the
determination of eligibility or benefit amount. But it argues
that Shalala is inapplicable here because there are no numerical
calculations to show; rather, the department asserts, its
analysis is subjective a personal assessment of human
capabilities. The final product of the departments assessment
is the service plan, a line-item allotment of service-minutes to
various activities. The department claims that these final
numbers are a result of applying standards31 to information
provided by the individual, a process that requires some element
of human judgment, not a calculator.
While it is true that the department is not working
from a strict mathematical formula, it must still comply with the
spirit of the law, which requires that it be as transparent as
possible in its methodology. Despite some subjective elements in
the departments decision making, we agree with Baker that due
process demands that recipients facing a reduction of their
public assistance benefits be provided a meaningful opportunity
to understand, review, and, where appropriate, challenge the
departments action. The state must do more than it has done to
ensure that recipients have the information they need to
understand and, if necessary, to challenge the states action
concerning their benefits.
C. Inclusion of the PCAT Form with the Notice Would
Satisfy Due Process.
To the end of providing sufficient detail to satisfy
due process, Baker requests that the department provide a copy of
the recipients PCAT form by all accounts the basis upon which a
service plan [is] developed with the notice. At oral argument,
the department conceded that this is simple for the state to do
and noted that it was already doing this. But the department
argues that due process does not require inclusion of the PCAT so
as to invalidate those notices that were sent without it. It
also asserts, without explanation, that to require inclusion of
the PCAT would be an undue burden on the department and that the
information provided by the PCAT would not assist a recipient in
preparing an appeal.
Whether due process requires the department to provide
notice recipients a copy of the PCAT form turns on whether the
information provided in the form (1) played a role in the
assessors determination of how many hours of service should be
authorized; (2) would assist the recipient in understanding why
service hours were being reduced; (3) would enable the recipient
to review the agencys assessment of his or her needs; and (4)
would assist the recipient in preparing a meaningful defense in
the event that he or she wishes to appeal the agencys
determination.32
The PCAT is the critical document translating the raw
information provided by the individual to authorized hours of PCA
services. The assessor asks questions of the individual and
codes the response to each question with a number value. The
assessor then uses [these numbers] to score eligibility for PCA
services and may refer to the numbers to determine the amount of
benefits to provide. The department asserts that the numbers on
the PCAT are merely shorthand symbols representing the extent to
which the individual is able to perform a given activity
independently. But it is clear that the number assigned to each
question reflects the assessors attempt to distill raw and
sometimes subjective information into standardized form. The
department itself notes that the model assessment tool from which
the PCAT was derived provides an accurate foundation for
measuring the social, medical, and nursing needs of an
individual. Moreover, the department concedes that the
legislative mandate that led to the development of the PCAT was
to assess individuals according to uniform measures. The
department refers to the PCAT as a scoring sheet[]. Regardless
of whether the numbers are mere code or shorthand, it is apparent
that they have a degree of influence on the ultimate amount of
service hours allotted to the individual. There may not be a
mathematical formula per se, but the PCAT is the departments best
effort to reduce subjective information the acuity of the
assessor into objective form. The PCAT clearly plays a
significant role in the final determination.
The department asserts that the PCAT would not provide
recipients with information that would contribute to their
decision whether to request, or how to prepare for, a hearing.
We disagree. It is true that if a recipient disputes, for
example, that fifteen minutes, twice a day is sufficient time to
prepare necessary light meals, she can request a hearing based on
nothing more than her belief that the agency has underestimated
the time that it takes to make a sandwich on her service plan.
But if the recipient wishes to appeal the reduction of hours
generally, it would be helpful to understand the basis for the
agencys determination, and this cannot be gleaned from the
service plan alone. The PCAT provides insight into what the
assessor understood of the individuals abilities and
disabilities, and while this information may not be necessary to
perfect an appeal to the agency, it may well contribute to the
recipients decision to initiate one.
The goal of the assessment process is to take raw
information from the service recipient and translate it into
hours of service needed. This requires analysis, and it follows
that documentation of that analysis, to the extent that it
exists, should be provided to the recipient. It may be that the
PCAT is only a part of that analysis, but it is a critical
component, and the department has not advanced a compelling
argument for why it should not include the PCAT or otherwise
provide the information that it used to determine the numbers on
the service plan. If the only burden is an administrative one,
the cost and inconvenience of copying the PCAT and attaching it
to the notice is not unreasonable under the circumstances here.
V. CONCLUSION
We REVERSE the superior courts holding that the
reduction notices at issue comply with due process and REMAND for
further proceedings consistent with this opinion.
_______________________________
1 7 Alaska Administrative Code (AAC) 43.750(a) (2007).
2 7 AAC 43.750(c); 7 AAC 43.751.
3 The meaning of the numbers varies with different
categories of information. For example, in Section A
(Professional Nursing Services) 0 means that the indicated
[c]ondition/treatment [was] not present in the last 7 days while
3 means that it was present 5-6 days a week. Alternatively, in
Section C4B (Cognition) 0 means Can recall details and sequences
of recent experiences and remember names of meaningful
acquaintances, while 3 means Cannot recall entire events or names
of spouse or other living partner even with prompting. Generally
speaking, a 0 is better; higher numbers indicate poorer health or
greater need of assistance for the given activity.
4 For example, the activity bathing is defined as How
person takes full-body bath/shower, sponge bath, transfers in/out
of tub/shower. (EXCLUDE washing of back, hair). The time
estimate for bathing is 15-30 minutes, and considerations include
If shower used and shampoo done, then consider as part of
activity[], assistive devices for independence. The particular
recipient described in the example was allotted thirty minutes
per day, seven days per week for a total of 210 minutes per week
of bathing services.
5 7 AAC 43.751.
6 Throughout this litigation, the parties refer to the
reauthorization notice as a reduction notice, but neither
reduction nor any similar words are anywhere on the face of the
notice; it states only that services have been authorized. For
simplicity, we will continue to refer to the notice as a
reduction notice, recognizing, however, that the state would
prefer not to characterize it as such.
7 Specifically, the department deleted the recitation of
the minutes approved at the bottom of page 1 and the top of page
2. Second, [it] included a new box at the top of the letter for
administrative purposes.
8 See Goldberg v. Kelly, 397 U.S. 254, 261-62 (1970).
9 See Green Party of Alaska v. State, 147 P.3d 728, 732
(Alaska 2006); Treacy v. Municipality of Anchorage, 91 P.3d 252,
260 (Alaska 2004).
10 397 U.S. 254.
11 Id. at 267-68.
12 See Banks v. Trainor, 525 F.2d 837, 842 (7th Cir.
1975).
13 42 C.F.R. 431.210(a)-(e) (2007) (requiring that
notices issued in the administration of the federal Medicaid
program provide (1) a statement of what action the department
intends to take; (2) the reasons for the action; (3) the specific
regulation supporting the action; (4) an explanation of the
individuals right to request a hearing; and (5) an explanation of
the circumstances under which the benefit is continued if a
hearing is requested); see also 42 C.F.R. 431.206; 7 AAC 49.070.
14 See Goldberg, 397 U.S. at 268. In that case, notice
amounted to a letter from the agency and a personal meeting with
a caseworker. The Court did not describe the contents of the
letter, but it saw no constitutional deficiency in the content or
form of the notice and was satisfied that the recipient was
adequately informed of the legal and factual bases for the
agencys position. Id. The Court added that this combination [of
a written letter and a personal meeting] is probably the most
effective method of providing notice to the recipient. Id.; see
also Rosen v. Goetz, 410 F.3d 919, 931 (6th Cir. 2005) (holding
that due process does not specifically require notice to come in
just one letter, as opposed to two).
15 42 C.F.R. 431.201 (emphasis added).
16 Ortiz v. Eichler, 616 F. Supp. 1046, 1062 (D. Del.
1985).
17 Schroeder v. Hegstrom, 590 F. Supp. 121, 128 (D. Or.
1984) (quoting Philadelphia Welfare Rights Org. v. OBannon, 525
F. Supp. 1055, 1061 (E.D. Pa. 1981)); see also Vargas v. Trainor,
508 F.2d 485, 489 (7th Cir. 1974). In Vargas, the agency argued
that the notice sufficed because it invited the recipient to seek
additional information; the court rejected this, stating that the
notice recipient would be unable or disinclined, because of
physical handicaps and, in the case of the aged, mental handicaps
as well, to take the necessary affirmative action. Id. The court
was further concerned that, given the human tendency to presume
that an action taken by a government agency is correct, many of
the mistakes that will inevitably be made will stand uncorrected.
Id. at 490; see also Schroeder, 590 F. Supp. at 127-28 (citing
Dilda v. Quern, 612 F.2d 1055, 1057 (7th Cir. 1980)).
18 For one, in the case of Petitioner Burtness, nearly
three months elapsed between her personal assessment on May 19
and issuance of notice on August 11. Further, the assessment
meeting does not afford protection against agency errors as the
recipient is not given the opportunity to review the completed
PCAT for obvious misinterpretations, misunderstandings, or
clerical errors.
19 397 U.S. at 267-68.
20 424 U.S. 319 (1976).
21 Id. at 334-45; see also Schroeder, 590 F. Supp. at 128-
29.
22 Goldberg, 397 U.S. at 261.
23 See Schroeder, 590 F. Supp. at 128-29 (citing several
cases, including Dilda v. Quern, 612 F.2d 1055, 1057 (7th Cir.
1980); Vargas v. Trainor, 508 F.2d 485, 489 (7th Cir. 1974); and
Philadelphia Welfare Rights Org. v. OBannon, 525 F. Supp. 1055,
1061 (E.D. Pa. 1981)).
24 See Goldberg, 397 U.S. at 261 (holding that extent to
which procedural due process must be afforded the recipient is
influenced by the extent to which he may be condemned to suffer
grievous loss and noting recipients brutal need for the services
at issue); Ford v. Shalala, 87 F. Supp. 2d 163, 182 (E.D.N.Y.
1999) (holding that even substantial governmental burden
expensive information gathering and processing system overhaul
and computer reprogramming that would take up to two years to
implement must be met in order to provide specific reasons where
government proposed terminating or reducing recipients SSI
benefits). See also Vargas, 508 F.2d 485 (holding notice
inviting benefits recipients to seek additional information
insufficient where recipients were often unable, by virtue of
physical or mental handicaps, to take necessary affirmative
action).
25 87 F. Supp. 2d 163.
26 Id. at 178 (citations omitted); see also Dilda, 612
F.2d at 1057; Banks v. Trainor, 525 F.2d 837, 841-42 (7th Cir.
1975).
27 Schroeder, 590 F. Supp. at 128 (emphasis added) (citing
Vargas v. Trainor, 508 F.2d 485 (7th Cir. 1974)).
28 See Garrett v. Puett, 707 F.2d 930, 931-32 (6th Cir.
1983) (declining to follow the decisions of the Seventh Circuit
in Vargas, Dilda, and Banks).
29 Courts have easily distinguished Garrett and cases
similarly adverse to Vargas on the basis that they address across-
the-board changes based on changes in state or federal law, not
the reduction or termination of benefits on an individual, case-
by-case basis. Ortiz v. Eichler, 794 F.2d 889, 894 (3d Cir. 1986)
(distinguishing Garrett, 707 F.2d 930); Schroeder, 590 F. Supp.
at 129 (distinguishing Garrett, 707 F.2d 930). Garrett is also
distinguishable in that the statute there only required
consideration of an additional factor in the computation, whereas
in the Seventh Circuit cases, the very method of calculating
benefits was changed. See, e.g., Banks, 525 F.2d at 839 (noting
that the income method of calculating benefits replaced a method
which was based on a percentage of the food allowance for an
individual household).
30 See supra note 17.
31 The department claims the only standards it uses are
clearly indicated on the service plan, referencing the
considerations that factor into the assessors determination of
how many minutes to allot to each activity.
32 See, e.g., Ortiz, 616 F. Supp. 1046, 1062 (D. Del.
1985).
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