DREDF Legal Position Paper
Medicaid is the single largest national health insurance program directed at meeting the needs of low-income people with disabilities in the United States. One-fifth of all people with disabilities are enrolled in Medicaid, and approximately 20% of 25 million Americans under age 65 with chronic disabilities have no other source of health insurance. Given the statistical correlation between severe disability and lower incomes, it is not surprising that Medicaid supports a greater percentage of severely disabled individuals than does private insurance. Children with severe disabilities are especially dependent upon Medicaid, with 70% of poor children receiving Medicaid coverage. In California alone, 772,400 people with disabilities are enrolled in Medicaid (“Medi-Cal” as administered in California), approximately 9.6% of the state’s total Medicaid enrollment. 
Medicaid laws entitle enrollees to basic healthcare services such as physician visits while other services are available depending on whether individual states participating in the Medicaid program chose them from an optional menu. In the United States, the vast majority of outpatient healthcare services, 89.3%, takes place in the offices of private providers who accept Medicaid payments, rather than in larger clinical health center facilities.  When these healthcare providers are individually or collectively inaccessible to people with disabilities, Medicaid entitlements are hollow. The reality is that people with disabilities, particularly those with mobility or sensory disabilities, consistently face such barriers as architectural inaccessibility, a lack of accessible examination tables and diagnostic equipment, inaccessible restrooms, difficulty scheduling specialist referrals, and refusals to provide reasonable assistance and translation of spoken and written words. Widespread and systemic inaccessibility translates into drastically reduced levels of basic medical care. For example, 41% of women without disabilities have received a Pap smear, and 44% have had a mammogram. These same figures are respectively 23% and 13% for women with disabilities. 
The failure to ensure accessible healthcare runs the gamut of healthcare entities, from the state to intermediate non-profit public and private health maintenance organizations (HMOs)  to individual clinics and healthcare professionals. This is not a matter of coverage. Rather it is a matter of ensuring that individuals with disabilities who hold Medicaid coverage on paper receive in reality the same choice, quality of care and access to covered services as Medicaid holders without disabilities.
This paper sets forth the legal basis for requiring states and intermediate health management organizations to assure that offered Medicaid healthcare services are available on an equal basis to individuals with disabilities. Most of the enforcement of federal non-discrimination laws pertaining to healthcare to date has focused on the bottom rung: the individual offices of healthcare providers. While there can be no doubt that the ultimate goal of any legal action is to make the providers accessible, a strategy that addresses the responsibility of the State agency and the intermediate health management organizations would be more efficient, less costly and have a greater impact. The premise of our argument is that a very important part of the “benefit” offered to healthcare beneficiaries is the ability to choose your doctor. When choices are limited by inaccessibility of all kinds, a person with a disability is not being provided with an equal benefit in contradiction of non-discrimination principles. For example, a state may contract with an HMO to administer Medicaid healthcare services and the HMO’s plan purports to give its enrollees a choice of 100 neurologists. If only 2 of those neurologists are physically accessible, and there is no provision made to provide the services in an alternative setting, then Medicaid enrollees with disabilities do not have equal access to the benefit offered in violation of Section 504 of the Rehabilitation Act (§ 504) and the Americans with Disabilities Act of 1990 (ADA). 
We would argue that choosing a heath care provider is a highly personal decision that is made based on many factors. One neurologist may be chosen above another based on her track record, experience or personal rapport with the patient. Simply providing for accessibility based on a single factor such as location is not sufficient. We believe that it is the responsibility of the state agency to ensure that its program beneficiaries with disabilities have equal access to the selection of doctors offered by any designated plan. Likewise we believe that intermediary HMOs have their own responsibility to ensure that all participating providers either offer accessibility or provide alternative arrangements. Furthermore, we assert that a state or HMO’s legal and ethical responsibility for ensuring accessibility cannot be measured according to the administrative, practical or financial limitations that individual providers may claim as a defense to providing accessibility or modifications. By working together, states, HMOs and individual providers can develop innovative financial, technological and standardized ways of delivering accessible, culturally competent healthcare choices that will fulfill every stakeholder’s responsibilities.  The following is an outline of applicable law.
Laws Applicable to State Medicaid Agency
1. Medicaid Act
Regulations published under the Medicaid Act place ultimate responsibility for access to healthcare services under the Medicaid program on the state. The basic rule is that “[e]ach State must ensure that all services covered under the State plan are available and accessible to enrollees of MCOs [managed care organizations], PIHPs [prepaid inpatient health plans], and PAHPs [prepaid ambulatory health plans].” 42 C.F.R. §438.206(a). This is elaborated further in subsection (b)(1) which requires the state to “ensure, through its contracts, that each MCO, and each PIHP and PAHP consistent with the scope of the PIHP’s or PAHP’s contracted services,” … [m]aintains and monitors a network of appropriate providers that is supported by written agreements and is sufficient to provide access to all services covered under the contract.” 42 C.F.R. §438.206(b)(1). The MCO, PIHP, and PAHP must consider “[t]he geographic location of providers and Medicaid enrollees, considering distance, travel time, the means of transportation ordinarily used by Medicaid enrollees, and whether the location provides physical access for Medicaid enrollees with disabilities.” 42 C.F.R. §438.206(b)(1)(v).
States cannot avoid their own accessibility obligations under federal law merely by enlisting middle-man healthcare organizations to recruit individual providers who will give the actual services. Contractually requiring HMOs and healthcare plans to comply with the ADA is a good first step, but if a state does not provide further monitoring, enforcement or reporting mechanisms, it can hardly claim to “ensure” that Medicaid services are “available and accessible” to Medicaid enrollees with disabilities. Furthermore, even though HMOs and individual providers and clinics do have their own obligations to comply with federal and state disability non-discrimination laws, those same laws enable them to raise legal defenses based on their own, perhaps more limited, financial and administrative resources. States that attempt to meet their own healthcare accessibility responsibilities under federal law merely by telling entities further down the chain that they must meet their obligations are trying to hide behind a different set of legal obligations. This is unacceptable. Under the Medicaid Act,  state Medicaid agencies receive federal monies to design and implement a healthcare system that delivers the state plan’s healthcare services to all Medicaid enrollees, including enrollees with disabilities.
2. Section 504 and the ADA
The Rehabilitation Act of 1973  is the first federal law to address broadly discrimination against all people with disabilities by the federal government and entities that interact with the federal government in specified ways. Section 504 of the Rehabilitation Act prohibits discrimination against otherwise qualified disabled persons under any program or activity receiving federal financial assistance.  Enrollees under state Medicaid programs are clearly “otherwise qualified disabled persons” under the Medicaid program, and are entitled to receive such mandatory Medicaid services as physician services, laboratory and x-ray services, and inpatient and outpatient hospital services. When these services are either not provided, because a healthcare provider’s office and/or examination and diagnostic equipment is inaccessible, or healthcare services are provided inadequately because of a lack of effective communication or physical accommodation, plaintiffs are being discriminated against in a program that receives federal financial assistance.
State departments that are subject to § 504 because they receive federal funding are equally subject to Title II of the ADA,  which requires that “no qualified individual with a disability shall, by reason of such disability, be excluded from participation in or be denied the benefits of the services, programs, or activities of a public entity, or be subjected to discrimination by any such entity.” 42 U.S.C. §12132. Medicaid is a federal program that is operated and administered by the state, and though states may choose to provide Medicaid through managed care networks or fee-for service individual providers (i.e., the enrollees may go to any healthcare provider who accepts Medicaid payments), the state remains responsible under federal law for operating a program that is free of discrimination on the basis of disability.
Regulations enacted under § 504 prohibit state Medicaid agencies from providing directly or through contractual, licensing, or other arrangements , “any aid, benefit, or service that denies people with disabilities the opportunity to participate in or benefit from Medicaid, affords people with disabilities an opportunity to participate in or benefit from healthcare services that are not equal to that afforded others, or provides people with disabilities with an aid, benefit or service that is not as effective as that provided to others. 45 C.F.R. §84.4(1)(i), (ii), (iii) “Nondiscrimination on the Basis of Handicap in Programs and Activities Receiving Federal Financial Assistance” (emphasis added). States are also prohibited from operating Medicaid using methods of administration “that have the purpose or effect of defeating or substantially impairing accomplishment of the objectives of the recipient’s program with respect to handicapped persons.”  As a public entity, regulations enacted under Title II of the ADA requires the state to “make reasonable modifications in policies, practices, or procedures when the modifications are necessary to avoid discrimination on the basis of disability, unless the public entity can demonstrate that making the modifications would fundamentally alter the nature of the program service or activity.” 28 C.F.R. §35.130(b)(3). The simple fact that a state sub-contracts with myriad third party organizations to provide professional services does not absolve the state from its 504 or ADA obligations. 
For a Medicaid enrollee without disabilities, “healthcare” encompasses not only the bare right to receive examinations and treatment, but also the opportunity to choose those healthcare providers who will administer healthcare services. This element of choice is critical to most patients, and strongly tied to a patient’s level of satisfaction with his or her healthcare.  However, choice is precisely what is denied to many Medicaid enrollees with disabilities when a state administers Medicaid services through providers who operate in inaccessible buildings, use inaccessible diagnostic equipment, or refuse to provide personnel trained in safe transfers or translators competent in alternative methods of communication.
A state’s practical failure to provide enrollees with disabilities access to healthcare choice and quality can be further exacerbated by a move to managed care. Increasingly, states are choosing to subcontract with managed care organizations (MCOs) such as the five County Organized Health Systems (COHS) in California,  in which enrollment with the COHS is essentially mandatory for all Medicaid enrollees residing within a specific geographic area. Enrollees may only receive healthcare from providers who are approved or provided by COHS. In such instances, the state gives the MCO the right to act as the exclusive provider of Medicaid services for people with disabilities, but also allows the MCO to choose health provider sites and locations that are architecturally inaccessible, offer no alternative means of communication, or fail to have either accessible diagnostic equipment or personnel trained to safely offer lifts and transfers. As a result, enrollees with disabilities are either outright denied the opportunity to participate in or benefit from Medicaid services, or at the very least, are offered little or no choice about who will provide those services. Either way, enrollees with disabilities are not afforded the opportunity to participate in or benefit from Medicaid in a manner equal to that afforded Medicaid enrollees without disabilities, and are not provided with a benefit or service that is as effective in affording equal opportunities to obtain the same benefit. 28 C.F.R. §35.130(b)(3)(i)-(iii).
In Anderson v. Department of Public Welfare ,  a federal court endorsed the idea that the state’s Medicaid responsibility encompassed a responsibility to ensure that HMO managed care providers met the accessibility requirements of federal law. The Pennsylvania Medicaid agency mandated Medicaid recipients in five counties to receive healthcare services through a network of HMOs called “HealthChoices.” The state agency did not consider, either at the initial HMO bidding process or when the state conducted “readiness reviews” of the HMOs that were awarded contracts, whether Healthchoices providers practiced in accessible offices. Ultimately, the court found HealthChoices inaccessible because the program “does not comply with the minimum program accessibility regulations promulgated under Title II and Section 504” for new and existing construction. The class plaintiffs had an actionable claim against the state agency because it failed to ensure that every HealthChoices providers met the “new construction” and “existing facilities” requirements of Title II, and thereby failed to ensure that individuals with disabilities had a meaningful opportunity to benefit from and participate in HealthChoices. In partially granting the Plaintiffs’ Motion for Summary Judgement, the Court issued an Order that required the state to ensure that every participating HealthChoices provider met the accessibility requirements of Title II of the ADA.
In addition to lacking the choice that is afforded to Medicaid enrollees without disabilities, enrollees with disabilities are also subject to discrimination due to a state’s failure to reasonably accommodate them in the state’s Medicaid program. The 2 nd Circuit in Henrietta D. v. Bloomberg recognized in a federal benefits context that:
a claim of discrimination based on a failure reasonably to accommodate is distinct from a claim of discrimination based on disparate impact. Quite simply, the demonstration that a disability makes it difficult for a plaintiff to access benefits that are available to both those with and without disabilities is sufficient to sustain a claim for a reasonable accommodation. 
The general dearth of accessible and culturally competent healthcare providers is not a secret. Nor is it difficult to understand that Medicaid enrollees who cannot enter provider offices, get on exam tables, or communicate with practitioners will not have difficulty accessing their healthcare benefits. Yet states still fail to take such minimal actions as gather disability access data, inform enrollees of their federal rights, or monitor, advise and support HMOs and providers in meeting their federal obligations. These are all procedural modifications that need to be undertaken by a state if they are to achieve the kind of systemic reform needed in Medicaid programs that currently leave many enrollees with disabilities bereft of the most basic healthcare services. 
A state can also develop myriad ways to ensure that enrollees with disabilities have an equal opportunity to receive and benefit from the healthcare services offered under the state’s Medicaid program. For example, states can administratively or contractually reward HMOs that develop capitation rates and cost-sharing methods that encourage providers to give appropriate care to patients with disabilities who may require longer or more frequent visits. States could also provide financial or tax incentives to individual provider offices for obtaining accessible equipment, or establish a rolling timeline for providers according to which newly-purchased equipment is to be accessible as old equipment is replaced. By failing to pursue these and other reasonable modifications,  states administer a “hands-off,” third-party contracting system in which Medicaid enrollees with disabilities have no meaningful access, or choice concerning, guaranteed Medicaid services in contravention of § 504 and the ADA. 
Laws Applicable to Private Health Maintenance Organizations
1. Medicaid Act
Regulations under the Medicaid Act state that Medicaid contracts and subcontracts are required to “specify the amount, duration, and scope of medical services to be provided or paid for.” 42 C.F.R. § 434.6(a)(4). In addition, “[N]o subcontract terminates the legal responsibility of the contractor to the [state] agency to assure that all activities under the contract are carried out.” 42 C.F.R. § 434.6(c) Taken together, these regulations indicate that any entity that receives funds to carry out the state’s Medicaid program must contractually involve itself with the actual medical services that enrollees are to receive, and thereafter retains continued responsibility for ensuring that subcontractors deliver those medical services. If an HMO’s enrollees cannot receive specified medical services because the HMO has contracted with providers or a provider network that is physically inaccessible, culturally incompetent, or refuses to provide reasonable accommodations, then the HMO is responsible for the providers’ contractual failure to provide the owed services.
It should be noted that the above regulations do not apply to all entities that contract with a state’s Medicaid agency. For example, a pure fiscal agent, which is defined as “an entity that processes or pays vendor claims for the agency” [42 C.F.R. § 434.2], is not required to enter contracts with providers that raise specifics of the medical services which the latter will provide. However, it is clear that since 1990, all HMOs, including those that are not involved in the delivery of services themselves but only arranging for such, are subject to the requirements of 42 C.F.R § 434.6.
2. Section 504 of the Rehabilitation Act
Medicare and Medicaid payments have been interpreted as federal financial assistance in virtually every circuit when raised in the context of 504 litigation brought against various healthcare entities receiving such payments on behalf of individuals receiving health services.  When an HMO receives Medicaid monies, it receives federal financial assistance and therefore must ensure that “no otherwise qualified individual with a disability … shall, solely by reason of her or his disability, be excluded from the participation in, be denied the benefits of, or be subjected to discrimination” in any aspect of the HMO’s activities.  HMOs are in the business of healthcare. They (i) enter a contract with a state Medicaid agency; (ii) recruit and enter contracts with healthcare providers, (iii) design and offer healthcare plans to enrollees that will provide the medical services that they are eligible for under Medicaid. All of these aspects of the HMO’s activities are subject to a non-discrimination requirement, which includes a positive mandate to provide reasonable accommodation where necessary. Moreover, HMOs frequently emphasize and offer as a selling point the fact that their plans offer a prime choice of healthcare providers, including specialists. If these choices are not actually provided to enrollees without disabilities because the HMO has contracted with or employed inaccessible providers, then enrollees with disabilities are not receiving the offered benefit and the HMO is in violation of Section 504.
HMOs are also potentially subject to the same duty that the state is under, to make reasonable modification to policies, practices and procedures so that enrollees with disabilities may have access to the HMOs goods and services. In Zamora-Quezada v. HealthTexas ,  the court recognized that where HMOs enter contractual arrangements with healthcare providers that financially discourage providers from treating people with disabilities, the HMO may be in violation of Section 504. The HMOs in that case divided the risk of service provision with providers in a way that required providers to assume greater risk for patients that had a greater cost per month. The court refused HealthTexas’ motion to dismiss, and ruled that the plaintiffs’ assertion, that the HMO’s financial arrangements resulted in discrimination because they encouraged providers to force plaintiffs to seek healthcare elsewhere, was a viable claim under 504 and the ADA.
By doing so, the court implicitly acknowledged that when an HMO enters a contract with providers, that contract influences how providers deliver healthcare. This fact, combined with the recognition that Section 504 requires the recipients of federal funds to make “special efforts” when “there is a public service that plaintiffs are entitled to use but that is not practically available to them,”  means that HMOs arguably must make affirmative accommodations in all aspects of their business. The “facially neutral” checklist that an HMO may use to assess its providers may be discriminatory if it fails to recognize that the absence of specific accessibility requirements will result in unequal access for Medicaid enrollees with disabilities. Similarly, HMOs have a responsibility to offer enrollees contracts that notify enrollees with disabilities of their federal accessibility rights as well as the right to obtain administrative information in alternative formats. An HMO’s overall administration of its Medicaid healthcare plans cannot disregard the HMO’s own financial and administrative capacity to inform about, incentivize, and monitor accessibility measures from plan providers for enrollees with disabilities. The HMO may be a “middle-man” in a state’s Medicaid enterprise, but it remains liable for complying with its own obligations under federal disability law, whether acting as an employer or a contractor.
3. Americans with Disabilities Act
Title III of the ADA applies to “public accommodations,” which includes a “professional office of a health care provider, hospital, or other service establishment.” 42 U.S.C. § 12181(7)(f). As such, any person who owns, leases or leases to, or operates a place of public accommodation is prohibited from discriminating against individuals “on the basis of disability in the full and equal enjoyment of the goods, services, facilities, privileges, advantages, or accommodations of any place of public accommodation.” 42 U.S.C. § 12182(a). Moreover, “[I]t shall be discriminatory to subject an individual or class of individuals on the basis of a disability or disabilities of such individual or class, directly, or through contractual, licensing, or other arrangements, to a denial of the opportunity of the individual or class to participate in or benefit from the goods, services, facilities, privileges, advantages, or accommodations of an entity.” It is equally discriminatory for a public accommodation to provide an opportunity to participate in or benefit from goods, services, facilities, privileges, advantages, or accommodations “that is not equal” to that afforded to other individuals,” or one “that is different or separate from that provided to other individuals” unless such action is necessary for equal effectiveness. 42 U.S.C. § 12182(b)(1)(A)(i)-(iii).
If an HMO directly provides health services to its enrollees, then the HMO itself falls under Title III, and must provide effective communications and engage in reasonable policy modification and readily achievable barrier removal to ensure that patients with disabilities have a full range of Medicaid healthcare choices. Even if an HMO is only an “insurer” in that it contractually arranges for the provision of healthcare services to its Medicaid enrollees without actually employing healthcare providers or operating clinics or hospitals, it remains subject to the ADA.  While there is no uniform cross-circuit opinion on the matter, courts have recognized that Title III of the ADA encompasses insurance companies, and insurance policies themselves are a “good or service” that can be discriminatory in violation of Title III. 
Those cases that have denied Title III coverage over insurance companies have usually done so on the basis that the establishment’s good or service is not being offered in a physical location (e.g., over the internet),  or that the non-discrimination prohibition only applies to the actual proffering of the good and not its contents on paper (e.g., an insurance policy must be offered to people with disabilities as to people without disabilities, but the policy’s terms of coverage can distinguish those with and without disabilities). Both reasons are inapposite in the context of health insurance. Medicaid enrollees do not simply purchase an abstract financial interest on paper. Rather they are legally entitled to receive healthcare services that can only be given effectively in person, at a physical location. They are being discriminated against when they try to physically receive the benefits of the policy, benefits that can only be given in person, at a physical location. An apt comparison would be to a life insurance company that only paid out the proceeds of its policies at certain physical locations, most of which are inaccessible and staffed by individuals with sharply varying degrees of disability experience and interpersonal competence, leaving beneficiaries with disabilities little or no opportunity to recover their benefits. No court has ever found that in such a case, the insurance company would be exempt from Title III coverage, and HMOs, in particular, have been found subject to Title III of the ADA, when they deny or limit medical care because of an enrollee’s disability. 
On the other hand, the view that Title III does cover the terms of insurance policies leads to an additional argument. If the contents of HMO contracts with enrollees can be subject to the non-discrimination requirement of Title III, then the contracts that the HMOs enter with individual providers and enrollees are equally subject to Title III. That is, the HMO is required within all of its contracts to fulfill the ADA’s “affirmative duty in some circumstances to provide special, preferred treatment, or ‘reasonable accommodation’.”  This argument essentially reiterates an HMO’s liability under Section 504. When an HMO undertakes to give its Medicaid plan members quality healthcare and selection, and then contracts with inaccessible or culturally unaware providers, the HMO violates Title III of the ADA by giving members without disabilities a product or good that is not equal to the one offered to members with mobility or sensory disabilities. Equally, when an HMO does not give healthcare professionals with whom it contracts any assistance or information about how to achieve accessibility, does not inform its enrollees of their right to reasonable accommodations, and refuses to provide network information in alternative formats, the HMO fails to provide reasonable modifications of its policies and procedures as required under Title III of the ADA.
Laws Applicable to Individual Healthcare Providers and Practitioners
1. Section 504
Individual healthcare providers and provider partnerships that receive Medicare and Medicaid payments are subject to 504 as programs or activities that receive federal financial assistance.  The provider is required to ensure that “no otherwise qualified individual with a disability … shall, solely by reason of her or his disability, be excluded from the participation in, be denied the benefits of, or be subjected to discrimination” in that provider’s healthcare services, whether or not the particular individual with a disability is enrolled in Medicare or Medicaid herself. 
Healthcare providers who receive Medicaid or Medicare payments must comply with Section 504 by providing services that are accessible to all who qualify for the program to the extent that doing so does not result in an undue burden on the recipient or fundamentally alter the service.  In effect then, as contractors under a state’s Medicaid or MediCare program, providers have the same general obligation as states and HMOs to provide patients with disabilities the same healthcare choice and quality as that offered to patients without disabilities. The difference lies in what will constitute an “undue burden” or “fundamental alteration” for providers, given that most individual providers have fewer administrative, financial, and other resources than either states or larger HMOs. For example, an individual practitioner in an older office may be able to show that the structural alterations, purchase of accessible equipment and engagement of translators that would be required for his or her office to be fully accessible would be an undue burden, and therefore not required. However, the practitioner is still required explore other alternative means of providing “meaningful access” to patients with disabilities, such as making appointments with them at the accessible hospital where the practitioner has hospital privileges, or training staff to transfer patients safely to inaccessible examination tables. The provider bears the burden of establishing that it is not required to provide accessible services because doing so would constitute an “undue burden” or a “fundamental alteration” of its services.
2. Title III of the ADA
Individuals healthcare providers and hospitals are explicitly subject to Title III of the ADA, which covers “public accommodations,” a wide term that encompasses private non-governmental entities whose operations affect commerce. Title III breaks its accessibility component into several specific directives. As a public accommodation, providers must make reasonable modifications to policies, practices and procedures to enable people with disabilities to gain full and equal access to their healthcare services, unless the provider can establish that a requested modification would constitute a fundamental alteration of the healthcare service itself.  For example, a policy of providing no assistance to patients who need help undressing or a practice of buying particular models of inaccessible examination tables or diagnostic equipment must be modified to enable patients with mobility impairments to receive equal healthcare services; these are also modifications that are unlikely to constitute fundamental alterations for even the smallest practice. 
Providers must make such auxiliary aids and services as sign language interpreters, assistive listening devices, and large print and Braille information available where required to enable effective communication with patients with disabilities. Again, such aids and services must be provided unless the practitioner can establish that doing so would constitute an undue burden (e.g., cause significant difficulty or expense to the practitioner).  Healthcare providers must also remove architectural barriers such as steps, narrow doorways or inaccessible toilets and drinking fountains in existing facilities where doing so is “readily achievable.” This standard is lower than the level of barrier removal required of state and local government entities under Title II, but can still achieve results, especially for larger providers with greater resources (e.g., hospitals).
Historically, private actions brought against individual healthcare providers have achieved mixed results, due in part to the standing requirements for injunctive relief and other procedural requirements.  For example, a couple, one of whom used a wheelchair, brought suit against a local hospital to have its birthing center made wheelchair-accessible, in anticipation of future pregnancies. The defendants did not even reach the point of having to assert a fundamental alteration or undue burden defense as the court ruled that the couple was only asserting a speculative future harm that they could not prove.  The U.S. Department of Justice (DOJ), which is not subject to the same restrictive standing requirements as private individuals, has had more consistently positive results when pursuing administrative complaints and bringing actions under Title III against healthcare providers and hospitals. However it is difficult to achieve the kind of wide-scale systemic reform that is needed to achieve full choice and accessibility in healthcare through the specific individual cases and settlements generally pursued by the DOJ.
3. State Disability Anti-Discrimination Laws
Individual states may also have legal accessibility requirements that apply to individual providers, as well as larger commercial or non-profit HMOs. These state protections are potentially broader or more favorable to specific plaintiffs. California’s Unruh Civil Rights Act,  for example, states that “[a]ll persons within the jurisdiction of this state are free and equal, and no matter what their … disability are entitled to the full and equal accommodations, advantages, facilities, privileges, or services in all business establishments of every kind whatsoever.”  This broad injunction against discrimination applies to commercial and non-profit providers of health insurance and healthcare services, and catches individual providers, hospitals and HMOs operating in California. An action brought under the Unruh Civil Rights Act could be brought independently in California state court, or combined with federal disability law claims and pursued in federal district court.
DREDF is a national cross-disability law and policy center dedicated to strengthening and protecting the civil and human rights of people with disabilities. For over 25 years, DREDF has promoted the long-term goal of equal citizenship and full integration of people with disabilities into the mainstream of community life through training, technical assistance, local and national policy monitoring and legislative development, advocacy, and litigation. DREDF staff members have been involved in significant health access policy and training since 1999.
1 2000 State and National Medicaid Enrollment and Spending Data, based on data from the Medicaid Statistical Information System (MSIS).
2 D.K. Cherry, C.W. Burt, and D.A. Woodwell, National Ambulatory Medical Care Survey: 2001 , 337 Advance Data from Vital and Health Statistics of the National Center for Health Statistics 17 (2003).
3 Leighton Chan et al , Do Medicare Patients with Disabilities Receive Preventive Services? A Population-Based Study , 80 Arc. Phys. Med. Rehabil. 642 (June 1999).
4 HMOs can be structured in a variety of ways, but for the purposes of this paper, an HMO is an entity that assumes the risk for the cost of providing services, either directly or through arrangements with service providers, to enrolled Medicaid recipients, and in exchange receives from the state agency a fixed premium for each enrollee. This definition is meant to be broad enough to encompass managed care organizations (that generally hold a comprehensive risk contract with the state), and prepaid ambulatory and inpatient health plans (that are paid according to capitation payments or other arrangements that do not use State plan payment rates).
5 Section 504 and Title II of the ADA do contain a “program accessibility” condition that is usually understood to allow a covered entity to offer program services in some accessible locations without requiring accessibility in every location. 28 C.F.R. § 35.150. However, the program accessibility concept is inapposite in this context. It is a regulation that simply gives a measure of flexibility to public entities when they run services, programs or activities in buildings that existed before January 26, 1992. For example, if a public entity provides cash benefits in such an existing facility, it may choose to process those benefits for persons with disabilities in only one accessible location rather than make every benefits office in the building accessible. Even in the existing facility context, this flexibility is really only appropriate when the offered service is basically identical. In relation to schools, the Department of Justice (DOJ) has recognized that where “’magnet’ schools, or schools offering different curricula or instruction techniques are available, the range of choice offered to students with disabilities must be comparable to that offered to other students.” Title II Technical Assistance Manual, II-3.4200. Every healthcare provider offers a particular combination of such critical factors as experience, training and interpersonal skill. Nurses, doctors and specialists are not fungible goods.
6 For example, the state could incentivize the acquisition of accessible exam tables and diagnostic equipment, HMOs could provide an administrative framework for all participating providers to share central accessible locations or translation services, all stakeholders could cooperate in the development of legislative and professional measures that would incorporate accessibility standards within existing licensing and regulatory schemes.
7 For example, Title III of the ADA obligates a private healthcare provider operating in an existing facility to remove architectural barriers such as narrow doors or steps, but only to the extent that such barrier removal is “readily achievable.” 42 U.S.C.A. § 12182(b)(2)(A)(iv), (v); 28 C.F.R. § 36.304. Also see “Laws Applicable to Individual Healthcare Providers and Practitioners , infra .
8 42 U.S.C.A. § 1396-1396v.
9 P.L. 93-112, 87 Stat. 355, (and as subsequently amended), 29 U.S.C.A. §§ 701 et. seq.
10 “Program or activity” is defined as “a department, agency, special purpose district, or other instrumentality of a State or of a local government; or the entity of such state or local government that distributes such assistance …” 29 U.S.C.A. §794(b)(1)(A) and (B). See Wolford by Mackey v. Lewis , 860 F.Supp. 1123 (S.D.W.Va. 1994) (prima facie case established against the state of West Virginia for denial of meaningful access to Medicaid services by denying residential care facility residents transportation when it was reasonable to do so).
11 42 U.S.C.A. §§ 12101 et. seq. For the purposes of this paper, § 504 and Title II of the ADA are invoked by the same conduct on the part of a state or state agency that receives federal funds, and provide for the same remedial relief. See 42 U.S.C.A., §§ 12134(b), 12133 (Section 505 of the Rehabilitation Act in turn incorporates the remedies, rights, and procedures set forth in Title VI of the Civil Rights Act of 1964 for violations of § 504 of the Rehabilitation Act. See 29 U.S.C.A. § 794a(a)(2). The U.S. Supreme Court has also explicated the relationship between Title II of the ADA and § 504 as they both apply to public service entities that receive federal funding. See Olmstead v. Zimring, 119 S.Ct. 2176, 2182-2183 (1999),
12 45 C.F.R. § 84.4(b)(4).
13 The same principle applies when a state delegates Medicaid service delivery through local, semi-autonomous entities such as city or county-run agencies. See Reynolds v. Giuliani , 118 F.Supp.2d 352, 386 (S.D.N.Y. 2000) (state retains ultimate responsibility under the Medicaid Act for ensuring that federal benefits are distributed in compliance with federal requirements). The city or county government entities that distribute Medicaid funds at the local level also have their own legal responsibility under Section 504 and Title II of the ADA, of course.
14 Research in this area has found a strong link between a patient ability to choose her own physician and high overall patient satisfaction. See J. Schmittdiel et al. , Choice of a Personal Physician and Patient Satisfaction in a Health Maintenance Organization , 278(19) JAMA 1596 (1997). A study of patients selecting a family physician found that patients engage in a deliberate choice process that is significantly influenced by a physician’s expertise and his office staff, see R. Arora, J. Singer, and A. Arora, Influence of Key Variables on the Patients’ Choice of a Physician , 13(3), Qual. Manag Health Care 166 (2004).
15 Santa Barbara, San Mateo, Santa Cruz, Solano (which includes Napa County), and Orange County (which includes Monterey County).
16 1 F.Supp.2d 456 (E.D. Penn. 1998).
17 The court referred to the “program accessibility” standard of 28 C.F.R. §§ 35.130(b)(4), 35.150(a)(1), and its direction that accessibility be assessed by viewing a program in its entirety, but the argument was not raised, and the court did not consider, that provider choice is itself an integral component of the Medicaid program.
18 331 F.3d 261, 276-277 (2d Cir. 2003); cert denied 541 U.S. 936 (2004).
19 While this first section does not explicitly address the role of local governments such as cities and counties in a state’s Medicaid program, local government entities are themselves subject to Title II of the ADA and Section 504 when they receive Federal Medicaid monies. They will have essentially the same obligations to ensure healthcare choice, screen and enforce accessibility among providers, and accommodate enrollees with disabilities in their administration of Medicaid healthcare plans.
20 Both Section 504 and the ADA allow states to avoid making reasonable accommodation if doing so would “fundamentally alter” the program in question or cause an “undue burden” to the state, but there is no reason at this point to assume that a state undertaking any mandated effort to ensure Medicaid accessibility should trigger either of these defenses. 28 C.F.R. § 35.130(b)(7) or 28 C.F.R. § 41.53
21 The Second Circuit is one of the latest courts to recognize that a claim of discrimination under both Section 504 and the ADA can be based on a failure to reasonably accommodate, even if people with disabilities were not explicitly treated differently or subjected to facially neutral rules or policies that screen them out (disparate impact). See Henrietta D. v. Bloomberg , 331 F.3d 261, 275-277 (2d Cir. 2003), further discussed in note __ and accompanying text.
22 Prior to 1990, Medicaid regulations recognized a distinction between HMOs and health insuring agencies (HIOs), in that the latter paid for medical services, but generally did not itself provide or arrange for most services. Congress, recognizing that HIOs were becoming increasingly involved in the delivery of services directly or through arrangements with providers, decided in 1990 to subject HIOs operational on or after January 1, 1986 to HMO requirements. If an HIO does anything other than act as a “fiscal agent,” it is now subject to the same regulatory requirements as an HMO, though there are a few specific regulatory exemptions for HIOs operating under a section 1915(b) waiver prior to January 1, 1986. See “Medicaid Program; Modification of Certain Requirements for Health Insuring Organizations,” 55 FR 51292-01.
23 United States v. Baylor Univ. Med. Ctr. , 736 F.2d 1039, 1042 (5 th Cir. 1984) (Medicare and Medicaid payments to a hospital’s inpatient and emergency services program constituted federal financial assistance under Section 504); Glanz v. Vernick , 756 F.Supp. 632 (D.Mass. 1991) (clinic’s receipt of Medicaid reimbursement brought clinic’s healthcare program within Section 504, regardless of whether a particular plaintiff received services paid for through Medicaid); Zamora-Quezada v. HealthTexas Medical Group of San Antonio , 34 F.Supp.2d 433 (W.D. Tex. 1998) (all of HMO’s receipt of Medicare funds made all its operations subject to Section 504, not only those services provided to Medicare enrollees).
24 See 29 U.S.C. §§ 794(b)(3)(A)(I)-794(b)(4) (for purposes of Rehabilitation Act, a program that receives federal assistance is defined as “all the operations of … an entire corporation, partnership, or other private organization … which is principally engaged in the business of providing … health care … any part of which is extended Federal financial assistance.”)
25 If an HMO is more than a mere contractual “middle-man” and actually employs healthcare providers directly, then the HMO may also be vicariously liable under Section 504 for the discriminatory practices of its employee providers. The 9 th Circuit has applied the doctrine of respondeat superior to Section 504 claims, and held that the recipient of federal funds is liable for the acts of its employees when they violate an individual’s 504 rights, regardless of whether the HMO itself engaged in discrimination. See Bonner v. Lewis , 857 F.2d 559, 566-567 (9 th Cir. 1988) (Director of Arizona Dept of Corrections potentially liable for prison officials’ refusal to provide accommodations to inmate with visual disabilities); Doe v. State of Hawaii Dept. of Ed , 351 F.Supp.2d 998 1011-1012 (following Bonner in holding state education department vicariously liable for vice-principal and program worker’s violations of Section 504, though acknowledging that Barnes v. Gorman , 536 U.S. 181, 122 S.Ct. 2097 (2002) may cast the reasoning in Bonner into doubt).
26 34 F.Supp.2d 433 (W.D. Texas 1998).
27 Dopico v. Goldschmidt , 687 F.2d 644, 652-3 (2d Cir. 1982) (wheelchair-using plaintiffs had a cause of action under the Rehabilitation Act when local transportation officials failed to make urban mass transportation accessible).
28 Note however, that private pension and disability plans that are negotiated between an employer and its employees may not be considered a “public accommodation since they are a benefit of employment and not offered to the general public. See Parker v. Metropolitan Life Ins.Co. , 121 F.3d 1006, 1010-12 (6 th Cir. 1997); Morgan v. Joint Administration Board , 268 F.3d 456 (7 th Cir. 2001). However, this consideration is unlikely to come up in the Medicaid context.
29 Conners v. Maine Medical Center , 42 F.Supp.2d 34 (D.Me. 1999); Winslow v. IDS Life Ins. Co. , 29 F.Supp.2d 557 (D.Minn. 1998). Cf. Doe v. Mutual of Omaha Insurance Company , 179 F.3d 557. 560 (7 th Cir. 1999) (content of insurance policy not covered by Title III); Chabner v. United of Omaha Life Insurance Company , 225 F.3d 1042, 1047 (9 th Cir. 2000) (Title III only requires insurance offices to be physically accessible but does not cover policy terms).
30 This argument is effectively rebutted in the Amicus Brief of the U.S. Attorney General submitted in Hooks v. OKBridge, No. 99-50821 (5 th Cir. 1999), 1999 WL 33806215. The language of Title III does not restrict itself to services offered “at” or “in” a place of public accommodation, and limiting the scope of Title III’s coverage to physical locations selling goods or services that are open to the public is a completely illogical and unnecessary interpretation of a law in which Congress intended to “invoke the sweep of congressional authority … in order to address the major areas of discrimination faced day-to-day by people with disabilities.” 42 U.S.C.A. § 12101(b)(4). At the time the ADA was enacted, the internet did not exist in its present form and commercial traffic on the World Wide Web was prohibited, so Congress can hardly be faulted for failing to explicitly include internet commerce in Title III.
31 Dunlap v. Association of Bay Area Governments , 996 F.Supp 962 (N.D. Cal. 1998) (court refused to dismiss employee’s claim that employer’s HMO discriminated against plaintiff by refusing to authorize necessary medical care); Zamora-Quezada v. HealthTexas , 34 F.Supp.2d 433.
32 Dunlap , id. at 965.
33 In 2000, Kaiser Permanente, the largest non-profit HMO in the country, was sued by three wheelchair users who claimed that Kaiser failed to provide equal and adequate care for patients with physical disabilities due to inaccessible examination equipment and pervasive barriers. The patients, represented by Disability Rights Advocates in California, reached a landmark settlement agreement in 2001 that requires Kaiser to review, create and maintain disability accessible facilities and policies.
34 See supra , note 21 and accompanying text. Medicaid and MediCare payments constitute “federal financial assistance” under 504, and when “an entire corporation, partnership, or other private organization, or an entire sole proprietorship … which is principally engaged in the business of providing … health care” receives such payments, the healthcare program must meet Section 504’s non-discrimination mandate. 29 U.S.C. § 794(b)(3)(A).
35 Davis v. Flexman , S.D. Ohio 1999, 109 F.Supp.2d 776.
36 There is additional consideration given to small healthcare providers with fewer than 15 employees. Such recipients may refer a person with a disability to another provider if, after consultation with the person seeking its services, the recipient finds that there is no method of making its program or activity, when viewed in its entirety, readily accessible without making a significant alteration in its existing facilities. See 45 C.F.R. § 84.22 (c). The referring provider also “has the responsibility of determining that the other provider is in fact accessible and willing to provide the service.” 45 C.F.R. Pt. A, App. A at 341.
37 42 U.S.C.A. § 12182(b)(2)(A)(ii); 28 C.F.R. § 36.302.
38 Modifications to policy, practices or procedures can include requiring providers to actively develop a non-discrimination policy that is to be posted prominently. See D.B. v. Bloom , 896 F.Supp.166 (D.N.J. 1995) (dentist ordered to pay client’s over $32,000 in attorney fees, $25,000 in compensatory damages under a state discrimination law claim, after refusing to treat a patient who he discovered was HIV-positive).
39 42 U.S.C.A. § 12182(B)(2)(A)(III); 28 C.F.R. § 36.303.
40 42 U.S.C.A. § 12182(b)(2)(A)(iv), (v); 28 C.F.R. § 36.304. New construction, that is, facilities intended for first occupancy after January 26, 1993, are simply required to be readily accessible, 42 U.S.C.A. § 12183; 28 C.F.R. §401. The altered portions of facilities altered after January 26, 1992 are to be accessible “to the maximum extent feasible,” 42 U.S.C.A. § 12183; 28 C.F.R. §§ 36.402-405.
41 See generally B.P. Tucker, Access to Healthcare for Individuals with Hearing Impairments , 37 Hous. L.Rev. 1101 (2000).
42 McInnes-Misenor v. Maine Medical Center , 211 F.Supp.2d 256 (D.Me. 2002).
43 Cal. Civ. Code § 51
44 Moreover, California’s definition of a person with a disability is broader than the definitions found in such federal laws as the Section 504 and the ADA, which could be useful for any particular plaintiff.
45 See Washington v. Blampin , 226 C.A.2d 604, 38 C.R. 235 (1964) (Act was applicable to physician’s office and court pointed out that various statutes refer to medical practice as a ‘business,’ holding that the broad language of “services in all business establishments of every kind whatsoever” was intended to cover the professions). See also Leach v. Drummond Med. Group 144 C.A.3d 362, 369, 370 (1983) (corporate medical group that refused future medical services to plaintiffs with disabilities were within the broad scope of Unruh Civil Rights Act).