Opinion

Rosen v. Tennessee Commissioner of Finance & Administration

280 F. Supp. 2d 743

Court: District Court, M.D. Tennessee
Filed: Dec 19, 2002
Status: Published
Author: Haynes
On the bench: Haynes
Cited by: 4 cases
Authority: More cited than 63.6%

holding that four-year statute of limitations should apply to all portions of § 1981

How later courts described this case

holding that four-year statute of limitations should apply to all portions of § 1981
applying four-year limitations period to failure to promote claims

Written by the judges who cited it.

The opinion

MEMORANDUM

HAYNES, District Judge.

TABLE OF CONTENTS

I. PROCEDURAL HISTORY.751

II. SUPPLEMENTAL CLAIMS.755

III. PLAINTIFFS’ FIFTH MOTION FOR PRELIMINARY INJUNCTION.755

IV. ISSUES TO BE DECIDED.756

Y. SUMMARY OF RULING.757

VI. FINDINGS OF FACT.758

A. Origin of the TennCare Program.758

B. The New TennCare Waiver.759

C. Policies and Procedures for the New TennCare Program.761

1. The July 1, 2002 to December 31, 2002 Reverification Rules and

Policies.762

2. TennCare’s Policies and Rules for Reverification and Enrollment

after January 1, 2003.765

D. Defendant’s Administration of the New TennCare Program.767

1. TDHS’s Management Capacity as Administrator.768

2. Notice and Appeal Practices from July 1, 2002 to December, 2002.771

3. Pacific Health’s Monitoring of TDHS’s Administration.776

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4. Appeals Process.778

5. Accommodations for Enrollees with Severe and Persistent Mental

Illness (“SPMI”) and Seriously Emotionally Disturbed Children (“SEDC”).780

6. Accommodations for Enrollees with Limited English Proficiency

(“LEP”).789

7. The Effects of Multiple Eligibility Reverification.790

a. Waiver Eligible Redetermination Process.791

8. The Medical Care Advisory Committee (“MCAC”).792

E. Individual Plaintiffs .792

F. Other Individuals and Class Members.798

G. Organization Plaintiffs.805

H. TennCare Advocacy Groups.805

VII. CONCLUSIONS OF LAW.

A. The Purposes of the Medicaid Act.

B. Plaintiffs’ Standing.

1. Individual Plaintiffs.

2. Organizational Plaintiffs.

C. Plaintiffs’ Implied Right of Action to Enforce Medicaid Regulations

D. Plaintiffs’ MCAC Claims.

E. Plaintiffs’ Procedural Due Process Claims.

1. Plaintiffs’ Claims of Notice Violations.

a. Adequacy of Notices to SPMI and SED Enrollees .

b. Lack of Notice of Good Cause.

c. Inadequate Notices of Appeals at the Termination Stage..

d. Inadequate Notice of Reasons of Denial.

F. Plaintiffs’ Rights to Accommodations .

G. Lack of LEP Accommodations.

H. Arbitrary Policies and Administration.

1. The 45 Day Rule .

2. TennCare’s Failure to Consider All Eligibility Statements.

3. A Current CRG/TPG Assessment for SPMI and SED Enrollees

4. SPMI and SED Enrollee’s Personal Signature Requirement ..

I. Limiting Scope of Appeals and Coverage.

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VIII. RELIEF AWARDED . .842

INTRODUCTION:

Plaintiffs, Michael Rosen, Barbara Hus-key, Emanuel Martin, by his next Mend, Cheryl Martin; Wanda Campbell, Connie Hoilman, Mark Hughes, Jacob B., by his next Mend, Martin B.; Jackie Baggett, Brenda Clabo, and Pradie Tibbs, on behalf of all others similarly situated; filed this action under 42 U.S.C. § 1983 against the Defendant, the Tennessee Commissioner of Finance Administration. Plaintiffs assert claims that the Commissioner’s administration of Tennessee’s TennCare plan, a managed health care program established under Title XIX of the Social Security Act, 42 U.S.C. 1396

et seq.,

violates Plaintiffs’ procedural rights under the Due Process Clause of the Fourteenth Amendment and applicable federal regulations. This action has been an extensive and complex proceeding.

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I. PROCEDURAL HISTORY

In earlier proceedings, the Court granted the original Plaintiffs’ second motion for a preliminary injunction to reinstate their coverage under TennCare, citing the lack of any response by the Defendant to the merits of the motion. (Docket Entry No. 27). Plaintiffs’ first motion for preliminary injunction (Docket Entry No. 2) was denied as moot. (Docket Entry No. 27). The Court ordered reinstatement of Tenn-Care coverage to all class members who were denied coverage without the benefit of due process.

Id.

In response, the Defendant temporarily suspended termination of insured and uninsured enrollees. The Defendant then filed a motion for relief (Docket Entry No. 29), citing the parties’ ongoing settlement discussions that delayed Defendant’s response to Plaintiffs’ preliminary injunction motions. (Docket Entry No. 29). On May 5, 2000, the Court granted that motion (Docket Entry No. 106) that had actually become moot. In the interim, on September 13, 1999, the Court granted a joint motion to modify the January 20, 1999 Order. (Docket Entry No. 53).

Under the September 13, 1999 Order, the Defendant used its TennCare eligibility base of insured and uninsureds to notify and allow

Rosen

class members to re-enroll in TennCare without an eligibility review or payment of past premiums.

Id.

at 2 . In a word, this Order allowed the State to substitute the prior notice procedure for immediate reinstatement of those persons affected by the Court’s earlier Order.

Id.

at 3-4 . Under this Order, 14,994 class members re-enrolled.

Id.

Class members who did not respond, would receive a second notice and notices of re-enrollment would be posted at public places.

Id.

at 5 . Re-enrollment was reopened for sixty (60) days.

Id.

at 6 . Further, by April, 2000, the Defendant agreed that enrollees who had lost Medicaid coverage and were not enrolled as uninsured or uninsurable, would be given notice of their rights to reapply as an uninsured or uninsurable or to have an administrative appeal of their earlier losses of coverage.

On April 28, 2000, Plaintiffs renewed their motion for preliminary injunction (Docket Entry No. 87) citing continuing violations of the Court’s September 13, 1999 Order because none of the notices required by that Order had been mailed and the Defendant failed to provide due process requirements in the TennCare administrative appeal process. (Docket Entry No. 88). A state audit had documented these appellate deficiencies. Plaintiffs also cited other instances of terminations of coverage without notice or receipt of notice after termination. Reverification notices were sent during one quarter in 2000 for 100,000 enrollees on their continued eligibility for TennCare coverage. (Docket Entry No. 144, Transcript of Proceedings, October 3, 2000, at 12-17).

• On May 5, 2000, Plaintiffs filed an application for a Temporary Restraining Order (Docket Entry No. 92), citing the Defendant’s continuing violations of the Court’s injunction and Plaintiffs’ procedural due process rights. The Court granted the Plaintiffs’ application for a temporary restraining order (Docket Entry No. 96), requiring compliance with 42 C.F.R. § 431 , Subpart E before any termination or disruption of a class member’s TennCare coverage.

On September 7, 2000, Plaintiffs filed a motion to hold the Defendant in contempt because the notices required by the September 19, 1999 Order still had not been mailed. (Docket Entry No. 112). A hearing was held on October 2 and 3, 2000, on whether to issue the preliminary injunction and to hold the Defendant in contempt. Pending a decision, the prior Restraining Order was subsequently modified and extended by agreement of the parties.

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(Docket Entry No. 166). Before a decision, the parties engaged in negotiations and at the parties’ request, the Court reserved consideration of the Plaintiffs’ contempt motion. The parties then agreed to settle their remaining disputes and submitted an Agreed Order on March 7, 2001 that was entered on March 8th. (Docket Entry No. 171).

In the March 8th Order, the parties, in sum, agreed to allow uninsured class members the right to re-enroll in the TennCare program with revised procedures to address Plaintiffs’ due process claims. For a period of two years after the entry of the Order, the Defendant was required to file quarterly reports to document their compliance with the terms of the Order and the parties’ Settlement Agreement.

Id.

at 11 . The particular provisions of the Agreed Order at issue are discussed

infra.

On July 27, 2001, Plaintiffs’ filed a motion to enforce the March 8th Agreed Order (Docket Entry No. 184), asserting: (1) that the Defendant was imposing upon class members the financial requirement of payment of all past premiums to be reinstated with TennCare coverage and (2) that the Defendant was denying due process to class members with Serious and Persistent Mental Illness (“SPMI”) and Severely Emotional Disturbed Children (“SEDC”). The latter class members are applicants whom the Defendant referred to local community health centers to evaluate their eligibility. Class members were told by these local agencies that they lacked any process to perform their roles as facilitators of these persons’ eligibility for TennCare coverage. These class members allegedly also did not receive adequate notice of TennCare coverage for mentally ill persons or were denied coverage with an inadequate statement of reasons for the denial and/or without citation to relevant law for the denial of coverage. The latter were cited as due process violations of federal regulations governing the Tenn-Care program. In the earlier Agreed Order, the Defendant promised to abide by these regulatory due process requirements.

After an evidentiary hearing on September 13, 2001, the Court granted the Plaintiffs’ motion to enforce the Agreed Order. (Docket Entry Nos. 200 and 201). As a matter of law, the Court concluded that under Sixth Circuit precedents, the Agreed Order and Settlement Agreement must be construed to preserve the basic relief for which the Plaintiffs bargained. As pertinent here, the Court found that the Agreed Order was designed to provide a remedy for applicants who did not receive due process in their terminations from TennCare. Further, the Court concluded that enforcement of the past premium rule completely foreclosed any meaningful remedy to these class members. This conclusion did not bar the Defendant’s collection of past due premiums under its deferred payment policy for current TennCare enrollees. Further, the Court concluded that the Defendant’s existing process for TennCare applicants with serious mental illnesses did not provide adequate notice of the application procedures to inform these class members of their coverage eligibility. The Defendant effectively denied these class members’ applications and failed to comply with due process requirements set forth in the Agreed Order by providing inadequate statements of reasons for the denials and failing to cite the applicable law for the denials.

At a chambers conference on September 27, 2001, the State informed the Court and counsel for the plaintiffs that the next day the Defendant would issue changes in the TennCare program that would take effect October 1, 2001. The Defendant had requested from the federal Center for Medicare and Medicaid Services (“CMS”) an

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amendment to the federal waiver controlling the TennCare program. The amended new TennCare plan would permit the state to close TennCare to adult uninsura-bles. According to the state, projected spending through the end of fiscal year 2001 (June 2002) exceeded both state appropriations and the federal spending cap imposed by the federal waiver. In addition, the number of individuals enrolled in TennCare was approaching the enrollment cap set by the federal waiver. Initially, the TennCare plan had an enrollment cap of 1,300,000 enrollees that was later extended to 1,500,000. (Docket Entry No. 230, Defendant’s Memorandum, Attachment Nos. 2 and 3). Under the original plan, as the number of enrollees reached the enrollment cap, the plan would limit the further enrollment of uninsureds.

Id.

The Plaintiffs sought and obtained a temporary restraining order (Docket Entry No. 217) barring implementation of the rule closing TennCare to adult unin-surables, based upon the pertinent provisions of the Agreed Order reciting the State’s agreement to reopen enrollment to uninsured adults during finite enrollment periods under stated conditions. (Docket Entry No. 171, Agreed Order at 3). In addition, Plaintiffs’ asserted a breach of other provisions in the Settlement Agreement that was attached to the parties’ joint motion to approve the settlement. The Joint Motion to approve the Settlement Agreement, signed by both parties on March 8, 2001, also stated that the policy of reopening enrollment to uninsured adults

“is consistent with Tenn-Care’s original design and the state’s longstanding goals for the program.”

(Docket Entry No. 170, Joint Motion at 3) (emphasis added). The Plaintiffs also cited the Settlement Agreement that contains a section requiring prior consultation with the Plaintiffs on future policies and procedural changes.

Plaintiffs’ filed their fourth motion for a preliminary injunction this time to bar the Defendant’s implementation of his proposed October, 1, 2001 amendment to the TennCare plan to exclude adult uninsura-bles from its medical coverage. (Docket Entry No. 204). Plaintiffs contended, in essence: (1) that the Defendant’s October 1st amendment to the TennCare plan was not reviewed by a Medical Care Advisory Committee (“MCAC”), as required by federal Medicaid regulations; (2) that the Defendant’s amendment to TennCare also breached the parties’ Settlement Agreement and Agreed Order in this action to maintain TennCare’s current program design; (3) that the Defendant’s amendment deprived the Plaintiffs of the benefits bargained for and contemplated in the parties’ Settlement Agreement; and (4) that the Defendant failed to give the requisite prior notice of this plan amendment, as required by the parties’ Settlement Agreement.

In response, the Defendant argued, in sum: (1) that Plaintiffs lacked standing to challenge its new amendment to the Tenn-Care program; (2) that the Agreed Order provided only procedural protections and did not bar unilateral substantive changes to TennCare’s plan; (3) that the notice requirements in the Agreed Order and Settlement Agreement applied only to procedural changes; (4) that the TennCare plan for uninsurables is not subject to federal regulations requiring review by a Medical Care Advisory Committee; (5) that if applicable, Plaintiffs could not enforce this regulation; (6) that the Tenn-Care program had serious financial difficulties and the State could not be limited in its policy decisions absent a clear agreement to do so; (7) that acute care remained available for uninsurables through other public and private health programs; and (8) that the Eleventh Amendment barred the relief sought.

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The Court earlier granted Plaintiffs’ application for temporary restraining order on this plan amendment (Docket Entry No. 217) and after a hearing on the motion for preliminary injunction, the Court entered a provisional preliminary injunction to extend the temporary restraining order until a decision on the preliminary injunction issues. (Docket Entry No. 237). For that injunction, the Court adopted its findings in the Temporary Restraining Order that the Defendant violated the notice requirements of the parties’ Settlement Agreement.

Id.

The Defendant requested expedited consideration of the preliminary injunction issues.

The Court granted Plaintiffs’ fourth motion for preliminary injunction, concluding first that Plaintiffs possessed standing to challenge the Defendant’s October 1st policy, as class representatives and as parties to the Settlement Agreement and Agreed Order. (Docket Entry Nos. 258 and 259). Second, the Court concluded that Medicaid statutes and regulations can be enforced by enrollees and applicants for enrollment in a Medicaid Waiver Plan.

Id.

Third, the Defendant did not honor Medicaid’s regulations’ requirement to consult a Medical Care Advisory Committee in adopting its October 1st policy, despite a prior ruling of this Court that such consultation was a “clear” and “mandatory” requirement.

Id.

Fourth, the Agreed Order and Settlement Agreement, when construed together, required the Defendant to provide Plaintiffs thirty (30) days prior notice of any change in TennCare’s “program design” and “policies.”

Id.

The Defendant did not provide such notice for its October 1st amendment. Fifth, under the Supremacy Clause of the federal constitution, the Court’s prior Orders that awarded relief for violations of Plaintiffs’ procedural rights and substantive entitlements to TennCare coverage and those Orders cannot be superceded by the October 1st rule changes.

Id.

Sixth, the Eleventh Amendment did not bar in-junctive relief against a state official alleged to be violating a federal law.

Id.

Class members who are uninsurable were found to be irreparably injured by this October 1st policy that would result in loss of medical care and medications necessary for their serious medical conditions.

Id.

In addition to a preliminary injunction, the Court appointed a Special Master.

Id.

On October 29, 2001, the Defendant appealed the Court’s preliminary injunction issued on October 25, 2001, and its September 14, 2001 Order. (Docket Entry No. 260). On appeal, the Sixth Circuit affirmed this Court’s ruling on the September Order, but vacated the injunction on the October 1st amendment.

Rosen v. Tenn. Commissioner of Finance & Administration,

288 F.3d 918 (6th Cir.2002). The Sixth Circuit did not reach the merits of this Court’s ruling on the October 1st amendment, finding that the original plaintiffs lacked standing as current enrollees to challenge the prospective closure of enrollment to new uninsurable applicants.

Id.

In its opinion the Sixth Circuit stated that:

A review of the plaintiffs’ amended complaint challenging the October 1 rule and their motion for a temporary restraining order to block implementation of the rule reveals that both focus solely on the plaintiff class members who are not presently members of TennCare; nowhere in these filings do the named plaintiffs claim that the rule will affect them. As explained above, it is the plaintiff’s burden to demonstrate the bases [sic] for standing. Without the benefit of specific allegations as to how there is an imminent threat of injury to the named plaintiffs — i.e., an immediate threat of one or more of them being removed from the TennCare rolls such that the October 1 rule would affect them — it is impossible for this court to hold that the threat posed to the named

*755

plaintiffs by the operation of the October 1 rule is anything other than “conjectural” and “hypothetical.”

288 F.3d at 929-30 .

II. SUPPLEMENTAL CLAIMS

On remand, Plaintiffs filed a motion for leave to file a supplemental complaint (Docket Entry No. 337) contemporaneously with another motion for a preliminary injunction. The Court granted the motion to file the supplemental complaint. (Docket Entry No. 375). The supplemental complaint added as named Plaintiffs, Sherry Justice, Mid-South Arc, a non-profit Tennessee corporation, and the Tennessee Disability Coalition (“TDC”), a non-profit Tennessee corporation, with three additional legal claims. (Docket Entry No. 376). Later, Plaintiffs Motion for Leave to File a Second Revised Supplemental Complaint (Docket Entry No. 382) that was granted. (Docket Entry No. 454). This latter complaint added as Plaintiffs, Gayle Cummings, Bach Thuy Nguyen and Di Nguyen who were affected by an administrative change in the eligibility determinations in the new TennCare program. (Docket Entry No. 382).

Plaintiffs then filed another motion to file a third supplemental complaint (Docket Entry No. 424), that added as Plaintiffs Wilson Dale Jackson, Melanie Jackson, Sean Addison by his mother Lisa Addison, and Lorri Griffin, who are allegedly adversely impacted by the new eligibility process. (Docket Entry No. 440). The Court granted that motion. (Docket Entry No. 439). These latter Plaintiffs are individuals who had begun or had completed the reverification process and asserted,

inter alia,

denial of notices and appeals from denials of their applications in the reverification process. (Docket Entry Nos. 440 through 444). In the supplemental complaints, Plaintiffs assert that they are not receiving adequate notices, hearings and appeals as well as the loss of continued coverage pending the disposition of their appeals, in violation of 42 C.F.R. Part 431, Subpart E.

III. PLAINTIFFS’ FIFTH MOTION FOR PRELIMINARY INJUNCTION

On June 26, 2002, Plaintiffs filed their fifth motion for preliminary injunction (Docket Entry No. 339), as supplemented by amended answers and declarations that, in effect, seeks to prevent the implementation of the new TennCare demonstration waiver that took effect on July 1, 2002. (Docket Entry Nos. 342 through 360, 392). The Defendant filed a response (Docket Entry No. 373), to which the Plaintiffs filed a reply (Docket Entry No. 374).

The new TennCare program significantly changed the structure and scope of TennCare program, to include three distinct benefit or coverage categories: (1) TennCare-Medicaid, that covers those persons who qualify for Medicaid eligibility; (2) TennCare-Standard, that covers non-Medicaid eligible participants; and (3) TennCare-Assist that assists persons without insurance to buy or maintain health insurance. This latter category element takes effect in fiscal year 2004, subject to legislative appropriation of the necessary funds. In a word, under the new Tenn-Care program, eligibility for the non-Medicaid applicants is limited to those persons: (1) whose income is below a level to be specified annually;

(2) who do not currently have insurance or access to insurance; or (3) who are uninsurable or medically eligible.

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In their fifth motion, Plaintiffs assert, in sum, that: (1) the State has failed and is failing to identify and reasonably accommodate class members with disabilities or limited English proficiency (“LEP”) during the notice, eligibility reverification determination and appeal processes, in violation of Section 1(A)(7) of the Settlement Agreement, which is incorporated by reference into the Agreed Order of March 12, 2002 (Docket Entry No. 171); (2) the State’s inadequate procedures and administration will result in the denial, reduction or termination of TennCare coverage without adequate notice and opportunity to appeal, as guaranteed by Paragraph 1 of the Agreed Order (Docket Entry No. 171) and 42 C.F.R. Part 431, Subpart E; and (8) the State’s procedures were adopted without prior consultation with a duly constituted MCAC, as required by 42 U.S.C. § 1396a (a)(4) and 42 C.F.R. § 431.12 . Plaintiffs request the Court to enjoin the Defendant from denying, reducing or terminating TennCare benefits for plaintiff class members without first complying with the provisions set forth in the Agreed Order of March 12, 2001; 42 U.S.C. § 1396a (a)(4); and 42 C.F.R. § 431.12 .

In response, the Defendant argues, in essence that: (1) none of the individual or organizational plaintiffs has demonstrated standing to advance their claims; (2) Section 1(A)(7) of the Settlement Agreement does not impose the obligations Plaintiffs seeks, but instead requires only review and recommendations for State policies and procedures to accommodate for persons with known disabilities or LEP; (3) this accommodation requirement has been fulfilled in accordance with the Settlement Agreement; (4) subjecting class members to the normal Medicaid eligibility process violates neither the Agreed Order nor 42 C.F.R. Part 431, Subpart E; (5) transition period procedures and processes to enable plaintiff class members to exercise their rights to notice and opportunity for hearing before termination or denial of coverage, comply with Paragraph 1 of the Agreed Order and 42 C.F.R. Part 431, Subpart E; (6) the MCAC regulation is inapplicable to section 1115 waiver programs; (7) the MCAC regulations do not create a private right of action for non-Medicaid eligible individuals to enforce; and (8) the Defendant, in fact, consulted with a MCAC for its new TennCare program.

An evidentiary hearing was held on July 19 and 22, 2002, and oral argument by the parties’ counsel on August 16, 2002. (Docket Entry No. 388). The parties reached an agreement on two of the issues in Plaintiffs’ motion for preliminary injunctions. (Docket Entry No. 394). At and after the evidentiary hearing, the parties submitted additional exhibits.

See

Docket Entry Nos. 378, 379, 384, 397 through 405, 408 through 415, 419 through 421, 428 through 434. On October 24, 2002, the parties filed a Stipulation with several exhibits. (Docket Entry No. 437). On November 27, 2002, after a status conference, the parties filed a Stipulation on the then current statistical results of the reverification process. (Docket Entry No. 448).

IV. ISSUES TO BE DECIDED

As to the pending motion for preliminary injunction, the Court conducted a status conference at which the parties identified the core issues that essentially are as follows:

1. Whether Plaintiffs have the standing to challenge the Defendant’s new Tenn-Care policies and administration of the new TennCare program and if so, whether Plaintiffs’ have an implied right of action under the Social Security Act to assert those claims under 42 U.S.C. § 1983 .

2. Whether the State’s procedures will result in the denial, reduction or termi

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nation of TennCare coverage 'without adequate notice and opportunity to appeal, as guaranteed by numbered Paragraph No. 1 of the Agreed Order and 42 C.F.R. Part 431, Subpart E of the Medicaid Act regulations.

3. Whether the Defendant has failed and is failing to identify and reasonably accommodate class members with disabilities or LEP during notice, eligibility determination and appeal processes, in violation of Section 1(A)(7) of the Settlement Agreement, which is incorporated by reference into the Agreed Order of March 12, 2002 (Docket Entry No. 171).

4. Whether the State’s new TennCare Plan and polices were adopted without prior consultation with a duly constituted MCAC, as required by 42 U.S.C. § 1396 (a)(4) and 42 C.F.R. § 431.12 .

5. Whether the State’s public necessity rule to close enrollment in TennCare to new adults uninsurables is a violation of this Court’s Agreed Order of March 8, 2001, and 42 C.F.R. § 431.12 , requiring the State to consult a MCAC before adopting the new rule.

See

Docket Entry No. 450 and Plaintiffs’ Proposed Revised Findings of Fact and Conclusions of Law.

The Court held a status conference to inquire about consolidation of the hearing on Plaintiffs’ motion for preliminary injunction with a resolution of the merits of all of Plaintiffs’ claims under Fed.R.Civ.P. 65(a)(2), and to set a deadline for submissions for all claims, defenses, and evidence. (Docket Entry No. .435). The parties agreed to the consolidation.

In addition to the issues on Plaintiffs’ motion for preliminary injunction, the remaining issues that arise from the Plaintiffs’ supplemental complaints (Docket Entry No. 382) involve claims about the Defendant’s January 1, 2003 verification and application policies. These issues, in sum, are whether the Defendant’s policies to terminate automatically TennCare coverage without an appeal; to limit the scope of an administrative appeals; and to eliminate TennCare coverage pending an appeal, violates the Medicaid Act, 42 C.F.R. § 431 , Subpart E and other regulations, as well as the Agreed Order. The parties agreed that the latter issues are purely legal questions and did not require any evidentiary submissions. (Docket Entry No. 435, Agreed Order).

This Memorandum addresses all remaining issues in the Plaintiffs’ motion for preliminary injunction and Plaintiffs’ other legal claims in their supplemental complaints. Pursuant to Fed.R.Civ.P. 52(a) and 65(d), this Memorandum sets forth the Court’s findings of fact and conclusions of law on all pending claims.

V. SUMMARY OF RULING

For the reasons set forth below, the Court concludes that the State’s new re-verification procedures for July 1, 2002 to present has resulted in the termination of TennCare coverage for a substantial number of TennCare enrollees without adequate notice and opportunity to appeal, as guaranteed by applicable Medicaid regulations, 42 C.F.R. Part 431, Subpart E and Paragraph 1 of the Agreed Order (Docket Entry No. 171). Defendant’s terminations of enrollee’s coverage, including for failure to submit a timely application, were done without adequate prior notice of the Defendant’s intended action and without a statement of the applicable federal regulation for reverification in violation of Medicaid regulations. Further, the terminations were without prior notice of the Defendant’s good cause extension rule for timely submission of reverification papers, as required by federal Medicaid regulations. The Court also concludes that the Defendant’s January 1, 2003 policy, impermissi-bly eliminates appeals for termination of

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coverage and improperly restricts the scope of administrative appeals.

The Court further concludes that the Defendant has failed and is failing to identify and to make reasonable accommodations for substantial numbers of class members with mental and physical disabilities during the eligibility reverification process as well as during the appeal processes. These inadequacies violate federal Medicaid policy and Section 1(A)(7) of the Settlement Agreement, that is incorporated by reference into the Agreed Order of March 12, 2002. (Docket Entry No. 171).

The Court once again concludes that the Defendant’s failure to secure prior consultation with a duly constituted MCAC in the submission of the amended TennCare waiver program violated 42 U.S.C. § 1396a (a)(4) and 42 C.F.R. § 431.12 .

Accordingly, the Court requires the Defendant to reinstate those Plaintiffs and members of the Plaintiffs’ class who were enrollees and have had their TennCare coverages terminated during the reverifi-cation process from July 1, 2002 to the present. Any further termination of Tenn-Care coverage under the new TennCare policies for any class member and all en-rollees must include continued coverage pending the conclusion of the enrollee’s administrative appeal. The Defendant cannot bar an applicant’s or enrollee’s challenge to TennCare rules policies and procedures in an administrative appeal.

VI. FINDINGS OF FACT

A. Origin of the TennCare Program

On November 18, 1993, the Tennessee Commissioner of Public Health received approval of the State’s application for its “TennCare” waiver plan from the Administrator of the former Health Care Financing Administration (“HCFA”) in the United States Department of Health and Human Services that is now the Centers for Medicare and Medicaid Services (“CMS”). (Docket Entry No. 230, Defendant’s Memorandum, Attachment No. 2). The TennCare plan was a “waiver-only demonstration” that was subject to “special terms and conditions”. The purpose of the TennCare plan was to provide medical benefits not only to Medicaid recipients, but also to other persons who were not covered under Title XIX of the Social Security Act. The HCFA’s Administrator’s approval provided that:

Under the authority of section 1115(a)(2) of the SSA, expenditures made by the state for the items identified below (which are not otherwise included as expenditures under section 1903) shall, for the period of this project, be regarded as expenditures under the State’s Title XIX plan

i. Expenditures which would otherwise be precluded by section 1903(f) For the following eligibility groups:

+ those who are uninsurable because of pre-existing conditions; and

+ those who are uninsured.

Id.

at Attachment, Administrator’s November 18,1993 letter at 3.

The old TennCare program was administered by the TennCare Bureau with defined procedures and policies for initial eligibility and reverification determinations. As discussed earlier in the procedural history section of this Memorandum, those policies and procedures were subject to successful legal challenges and Court Orders.

As to benefits, the former TennCare provided medical services and prescription drugs to eligible persons who were covered by Medicaid; who were financially unable to secure private medical insurance; and/or who were uninsurable by private medical insurance due to their medical condition. Federal participation was, in essence, a type of block grant based upon what Medicaid would have expended in

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Tennessee without the TennCare program. The federal funds are supplemented with state funding. The combined funds were expended for Medicaid enrollees and waiver eligible enrollees.

B. The New TennCare Waiver

On May 30, 2002, CMS, the current governing federal agency, approved Tennessee’s proposed amendment to its Tenn-Care waiver program.

Under the new TennCare waiver, the federal government continues to provide a majority of the funding for TennCare, but the terms of federal financial participation have changed. As opposed to the former block grant approach, the federal contribution is now set at a specified amount per month for each Medicaid-eligible participant, supplemented with other federal and state funds. There are supplemental federal funds to pay for non-Medicaid participants. To the extent that federal money is unavailable for these later costs, the State must bear the difference. (Docket Entry No. 380, Johnson Testimony at 149-51). Under the new program, coverage is reviewed and waiver eligible coverage is based upon the amount of state funds appropriated annually by the state legislature.

For enrollees, the principal changes in the new TennCare program are its different coverage groups and application procedures. The first coverage group is Tenn-Care Medicaid, covering those who qualify for Medicaid eligibility and that coverage is essentially the same as under the old TennCare program. (Defendant’s Exhibit No. 1, Johnson Declaration ¶ 2). The second category is TennCare-Standard, that covers non-Medicaid eligible participants with a benefit package comparable to the Health Maintenance Organization (“HMO”) option available to state employees.

Id.

¶ 2-3 The third category is Tenn-Care-Assist, that provides assistance to persons to buy or maintain private health insurance, but that coverage does not start until the fiscal year 2004, subject to state legislative appropriations.

See

Defendant’s Revised Proposed Findings of Fact and Conclusions of Law at 2, n. 2.

TennCare Standard coverage, however, has two categories, i.e., the “uninsured” category, for individuals who have been denied Medicaid, but who are uninsured, lack access to insurance, and have income that does not exceed specified levels to be set annually by the Legislature. This income cannot exceed 200% of the federal poverty level for children and 100% for adults. A new applicant whose income falls within the levels established by the Legislature may qualify for TennCare Standard as a uninsured person, but only during a time designated as a period of open enrollment. TennCare Standard coverage also includes the Medically Eligible (“ME”), enrollees who are comparable to the “uninsurable” group in the old Tenn-Care program. An individual who is enrolled in TennCare as uninsured or unin-surable as of June 30, 2002, and who has been found, through the eligibility redeter-mination process, to be ineligible for Tenn-Care Standard as a qualified uninsured person due solely to excess income, may qualify under the ME component of Tenn-Care Standard, provided additional specified criteria are met.

Id.

¶ 3 .

As of June 30, 2002, all individuals enrolled in TennCare as waiver-eligibles, i.e., uninsured and uninsurables, are subject to a reverification process for eligibility as determined under the terms of the new waiver for TennCare Standard. An enroll-ee qualifies as an uninsured person, if ap

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plicable income levels are met and other eligibility criteria are satisfied, despite the absence of an open enrollment period.

Id.

¶ 3 and Attachment A. During the reverifi-cation process, the applicable income limits will be 100% of the federal poverty level for adults and 200% of the federal poverty level for children.

Id.

¶ 7 .

See also

Docket Entry No. 381, Johnson Testimony at 230-32, 235.

According to Reynolds, at that time, State officials were also well aware of the complexity of the Medicaid eligibility requirements and that substantial numbers of eligible people fail to obtain or maintain Medicaid coverage because they cannot complete that program’s complex eligibility process. (Docket Entry No. 257, Reynolds Testimony at 40-59). As discussed

infra,

the initial Medicaid eligibility process is described by witnesses for both parties as complex and demanding.

The overarching theme in Plaintiffs’ proof questions the capacity of TDHS and its eligibility caseworkers to implement the reverification process without effectively depriving enrollees of their rights under Subpart E of the Medicaid regulations. In Plaintiffs’ view, TDHS lacks sufficient staff to meet the increased workload from the TennCare reverification processes. Plaintiffs also cite TDHS’s history of inadequate implementation of its other Medicaid eligibility obligations under other federal regulations and guidelines. Plaintiffs contend that the procedural rights of a substantial number of enrollees to be heard prior to termination as well as their rights to appeal a wrongful termination have been and will be violated. Further, Plaintiffs assert that the new TennCare regulations lack adequate accommodations for persons with mental disabilities and language difficulties, as required by the Agreed Order and the parties’ Settlement Agreement. Finally, Plaintiffs challenge the new TennCare reverification programs as imposing an excessive and unnecessary burden on enroll-ees to appeal wrongful denials and to maintain coverage pending appeal.

1. TDHS’s Management Capacity as Administrator

For the first six months of the new TennCare reverification program, TDHS was selected to be responsible for that

*769

process. Prior to the new TennCare program, TDHS determined Medicaid eligibility of applicants as well as eligibility for other federal assistance programs.

For its other eligibility duties, Plaintiffs presented proof that in 2000 and 2001, federal officials found that TDHS did not assess Medicaid eligibility as required by Section 1931 of the Social Security Act, and was not properly conducting

ex parte

reviews of ail possible sources of eligibility before terminating Medicaid coverage. (Plaintiffs’ Exhibit No. 62, Department of Health and Human Services TANF/Medic-aid Review (4-30-01), at 7-8, 30). Only on July 1, 2002 did TDHS issue a policy to comply with Section 1931.

Id.;

Defendant’s Exhibit No. 7, Rudolph Declaration ¶ 12. TDHS agreed to remedy that, but did not integrate the policy change with its computer system and TDHS workers will have to perform their new functions manually.

During the first two weeks of each month, TDHS sets appointments to process only federal food stamp applications. (Defendant’s Exhibit No. 28, Rudolph Third Declaration, ¶ 4; Plaintiffs’ Exhibit No. 80, Blackburn Second Declaration, ¶ 4). Thus, any TennCare appointment for reverification has a limited time span to be scheduled and completed. Moreover, Plaintiffs note that TDHS also administers the Families First program, now called the Temporary Assistance for Needy Families (“TANF”) and the successor to the former Aid to Families with Dependant Children (“AFDC”). (Docket Entry No. 391, Transcript at 69). The TANF is described as the “most complicated” program to administer.

Id.

at 69, 70 . There were not any precise statistics provided for TDHS’s caseload for its TANF responsibilities,

id.

at 70 , but TANF has an estimated 62,000 “caseload.” (Docket Entry No. 381, Ded-mon Testimony at 246).

With its new TennCare functions, TDHS estimated its eligibility counselors can determine Medicaid and TennCare eligibility for 396,895 “new” cases. (Docket Entry No. 381, Dedmon Testimony at 247-48). In Plaintiffs’ view, TDHS underestimated the number of its new cases because TDHS only counted a case as “new” if the file had not been “closed for longer than six months.” (Plaintiffs’ Exhibit No. 77, at 4). For this estimate, TDHS also assumed that 25% or 156,000 of the approximately 625,000 TennCare enrollees as of April 22, 2000 who are subject to recertification will “choose not to participate” and thus, will not require TDHS resources. (Plaintiffs’ Exhibit No. 77, at 4; Docket Entry No. 381, Dedmon Testimony at 251). Tenn-Care earlier estimated that less than half of that number, or about 75,000, would become ineligible after the reverification process. (Plaintiffs’ Exhibit No. 1, Reynolds Deposition, at 46-47).

Prior to the addition of these “new” TennCare cases, TDHS had 1,275 eligibility counselors to handle an unduplicated caseload of 338,-844. (Defendant’s Exhibit No. 5, Dedmon Declaration ¶ 2; Plaintiffs’ Exhibit No. 78, 3rd unnumbered page).

TDHS has added 252 eligibility counselors to respond to the additional workload for the TennCare reverification. (Defendant’s Exhibit No. 5, Dedmon Declaration ¶ 2). Based upon this data, the average caseload per TDHS eligibility counselor has increased to 482 cases from 265 cases.

*770

Defendant’s TennCare reverification process requires a determination of Medicaid eligibility be followed by a determination of TennCare Standard, if the person does not qualify for Medicaid. (Defendant’s Exhibit No. 1, Johnson Declaration ¶¶ 7-8).

For this reverification process, the TDHS caseworker must interview the en-rollee and review the enrollee’s documentary proof of identity, age, citizenship or alien status, address, income, resources (including bank accounts, savings bonds, property and automobiles), cost of utilities, life insurance and health insurance. (Defendant’s Exhibit No. 1, Johnson Declaration, Attachment B, 9th-10th unnumbered pages, (“What to Bring with,You to the TDHS Office”)). An unemployed person must submit proof of unemployment benefits or a layoff notice.

Id.

Persons who have a “physical or mental problem” are told that “We will need your medical records.”

Id.

TDHS’s preliminary test of the Tenn-Care reverification process revealed that the average interview alone required one hour. (Plaintiffs’ Exhibit No. 77, at 4). This estimate, however, did not include the assignments of eligibility determinations for TennCare Standard to TDHS that had not been developed at the time of the TDHS’s estimate. (Docket Entry No. 381, Dedmon Testimony at 256-58). Moreover, the TDHS estimate also did not account for time required to secure and review an enrollee’s medical records.

Id.

Cyndy Johnson, the Defendant’s expert consultant from Pacific Health Policy Group (“Pacific Health”), conceded that TDHS’s estimate of one hour as the length of an interview for each case might not be adequate. (Plaintiffs’ Exhibit No. 50, Johnson Deposition at 86-87). Using TDHS’s assumptions, Johnson calculated that TDHS would be unable to complete the reverification of the current enrollee population by December 31, 2002. Johnson calculated that TDHS could interview about 60,000 enrollees a month with its existing staff and new hires.

Id.

at 85-86 . Johnson conceded that the Defendant’s actual plan is for TDHS to process 415,000 applications over a five month period, an average of 83,000 a month.

Id.

at 249-50 .

TDHS experienced difficulties before the first of the three monthly mailings of notices to enrollees. (Plaintiffs’ Exhibit No. 80, Blackburn Second Declaration, ¶ 5; Defendant’s Exhibit No. 28, Rudolph Third Declaration ¶ 5). The first set of notices of this reverification process were mailed to at least 115,000 class members on June 28, 2002. (Docket Entry No. 342, Plaintiffs’ Notice of Filing Documents, Exhibit 28, Initial Reverification Notice and Attachment). By August 15, 2002, more than a month after the preliminary mailing to 11,700 enrollees, and two weeks after a mailing to another 134,000 households, only 13,000 enrollees had been scheduled for redetermination appointments. (Defendant’s Exhibit No. 28, Third Declaration of Mary Ann Rudolph ¶ 4). Subsequent monthly mailings of reverification notices were sent to more than 300,000 individuals in August, September and October. (Docket Entry No. 448). 555,253 individuals have been sent reverification notices since July 30, 2002.

Id.

In addition to staffing, TDHS eligibility workers need training in the complex new TennCare rules and procedures that is critical to TDHS’s performance in accordance with its projected. (Docket Entry No. 381, Teasley Testimony at 168-69). Training for the Defendant’s new policies and procedures was completed before July 1, 2002. (Docket Entry No. 380, Johnson Testimony at 221-22). Yet, in response to Plaintiffs’ criticisms, the Defendant added to the policy and procedures. These policy changes require additional time to train

*771

TDHS staff on implementation (Docket Entry No. 380, Johnson Testimony at 242-43), but there are not any formal plans to retrain them on the new policy revisions. (Docket Entry No. 381, Teasley Testimony at 171).

Given Johnson’s testimony and the Defendant’s actual number of reverifications, the Court finds that TDHS made erroneous estimates of its increased caseload and the amount of interview time required for the TennCare reverifications. These facts lead the Court to find that, in all likelihood, for this limited period of reverification TDHS lacked the administrative resources to process

all

enrollees so as to complete the reverification process in the 45-day periods governing the reverification decisions.

2. Notice and Appeal Practices from July 1, 2002 to December, 2002

The initial notice to the enrollee, informs the enrollees that he or she must apply

through the local TDHS office for a rede-termination of his or her coverage eligibility. This notice and its attachments are written at a 4th to 6th grade reading level, and include a flyer, “Do You Need Special Help?”, listing free telephone numbers to call for assistance. (Docket Entry No. 1, Johnson Declaration, Attachment B at 6; Docket Entry No. 380, Johnson Testimony at 141-43). The initial step requires a signed application, two-page form with a legible name and address sent to TDHS by the end of the 89th day after the date of this notice. (Defendant’s Exhibit No. 1, Johnson Declaration ¶¶ 12-13; Docket Entry No. 381, Teasley Testimony at 82).

The initial notice of redetermination directs enrollees to bring with them to the TDHS interview those items of necessary information to establish their eligibility and income, (Defendant’s Exhibit No. 1, Johnson Declaration, Attachment B, unnumbered pages 9-10, (“What to Bring with You to the TDHS Office”)), including technical and financial eligibility requirements set forth in TennCare Standard Rule 1200-13-14-,02(2). (Plaintiffs’ Exhibit No. 51; Docket Entry No. 380, Johnson Testimony at 225). The notice also tells the enrollee:

IMPORTANT

TennCare has changed.

We must check to see if you are still eligible by <DATE>.

Read this letter carefully. Follow all the directions.

‡ # ‡ 5k

Follow the directions in this letter.

If you do not, you could lose you TennCare.

* %

Do the things in numbers 1 and 2 in the next k5 days or sooner if possible.

(Defendant’s Exhibit No. 1, Johnson Declaration, Attachment B at unnumbered page 1). In addition this notice states, “If we say you cannot keep your TennCare, you can appeal. Our letter will tell you how to appeal.”

Id.

at unnumbered page 2.

The first letter also stated that if an enrollee needs “Special Help”, including “learning or mental health problem” or “serious need for health care or medicine” to call one of several telephone numbers.

Id.

at unnumbered page 6. This form letter and attachments have a Spanish language version. (Defendant’s Exhibit No. 1, Johnson Declaration, Attachment B). In

*772

addition, limited instructions are given on other languages.

If a response is not received within 30 days of the initial notice, then a reminder notice is sent and that reminder notice contains, in pertinent part, with the following language:

IMPORTANT

TennCare has changed.

We must check to see if you are still eligible

You only have until <date of 90th day> to get you application to [T]DHS.

Your coverage will end on that date if you do not get your application to [T]DHS.

sjs >}:

‡

Read this letter carefully. Follow the directions as you could lose your TennCare.

:{: sfc ❖ Hs

2. Call the DHS office and make an appointment. DHS will try to find a time that works for you. If you do not call them to set a time, they will make an appointment for you when they get your application.

If you cannot come to the DHS office in person because of a medical problem or a disability, call DHS and tell them. They will help you make other arrangements.

If you have problems getting the help you need, call the TennCare Information Line. Their number is 1-800-758-1688. If you or someone in your home has a mental illness, you can get help from the TennCare Partners Advocacy Line.

Do Things in Numbers 1 and 2 in the next 45 days or sooner if possible

# H? sk # ^

6. Go to DHS for your appointment.

If you cannot go the, you need to call DHS to set another time.

Remember, you must complete the interview process and get all of the required information to DHS within 45 days of filing your application. If you do not do this, your TennCare will end. When you go to DHS, they will check to see if you can get TennCare Medicaid or TennCare Standard. There is more information about changes to TennCare. Read the paper called “TennCare is Changing” with this letter. You can call the TennCare Information Line if you have questions. Their number is 1-800-669-1851. This is a free call. In Nashville, call 741-4800.

After DHS decides if you are still eligible, you will get a letter. It will tell you if you can keep your TennCare. It will tell you if there is a change in how much you must pay for your TennCare. If we say you cannot keep your TennCare, you can appeal. Our letter will tell you how to appeal.

Id.,

Attachment C at 1-2. In addition, TDHS procedures require that each applicant be informed of their appeal rights during the interview process. (Defendants’ Exhibit 26, at unnumbered page 1).

Persons in the reverification process are notified to provide documentary proof of identity, age, citizenship or alien status, address, income, resources (including bank accounts, savings bonds, property and automobiles), cost of utilities, life insurance and health insurance. (Defendant’s Exhibit No. 1, Johnson Declaration, Attachment B, at unnumbered pages 9-10, (“What to Bring with You to the TDHS Office”)). If an enrollee lacks a particular piece of documentation, the TDHS case manager possesses the discretion to accept the enrollee’s self-declaration of income “as a last resort”. (Docket Entry No. 380,

*773

Johnson Testimony at 228-82; Docket Entry No. 381, Teasley Testimony at 87-88).

The same notices are sent to the entire TennCare population, regardless of disability, including those who are mentally disabled who must self-identity as disabled. (Defendant’s Exhibit No. 1, Johnson Declaration ¶ 11 and Attachment B; ¶ 12 and Attachment C; ¶ 13 and attachment D; ¶ 17 and Attachment F; ¶ 25 and Attachment H; ¶ 26 and Attachment I; ¶ 42 and Attachment N; ¶43 and Attachment 0; ¶ 44 and Attachment P).

The notices were adopted without participation by persons knowledgeable of the need to adapt the notices to the needs of the mentally impaired. (Plaintiffs’ Exhibit No. 50, Johnson Deposition at 108-09). There was not any field testing of the notices appropriateness for that population.

Id.

If an enrollee who receives a reverification notice does not call for an appointment, then within a few days, the TDHS caseworker schedules an appointment that the person can reschedule.

Id.

at 56-59 . If a person calls the designated state helpline, that employee will work with TDHS to secure necessary assistance.

Id.

at 61 .

The notice to these enrollees instructs them to provide medical records, without providing guidance as to the type or quantity required. (Defendant’s Exhibit No. 1, Johnson Declaration, Attachment B, at unnumbered page 10; Attachment O, Part A, TennCare Application for Determination of Health Insurance Status, at 2; Docket Entry No. 380, Blackburn Testimony at 43-44; Docket Entry No. 381, Westlake Testimony at 29-30).

As stated earlier, the eligibility interview was expected to last 1 hour, but the Court finds that estimate is unreasonable given the complexity of the Medicaid eligibility rules, the numbers of documents to be reviewed and the existence of substantial number of enrollees who have a mental disability.

If an application is not submitted by the eighty-ninth (89th) day after the first notice, then the enrollee’s TennCare coverage terminates on the 90th day with a right to reinstatement of continuous coverage upon filing an appeal within 30 days after the ninety-day termination date. (Defendant’s Exhibit No. 1, Johnson Declaration ¶ 13). If an application is submitted, there is a 45-day period to complete the application. (Defendant’s Exhibit No. 1, Johnson Declaration ¶ 15). This 45 day period begins on the date the signed application was received during which the en-rollee must have a redetermination interview with a TDHS worker.

Id.

Although TDHS caseworkers have the discretion to extend the 45-day deadline for good cause, the initial notices to current enrollees do not inform enrollees of the availability of such an extension to enable the enrollee to request an extension.

Id.,

¶ 16 and Attachment B. The termination of coverage notices to individuals for failing to complete the eligibility process in 45 days is silent on the good cause exception. (Defendant’s Exhibit No. 1, Johnson Declaration, Attachments F and N).

For the 45-day period after the signed application, there was a factual dispute between the Defendant’s expert and the TDHS Deputy Commissioner on the scope of TDHS’s eligibility review. Cyndy Johnson, the Defendant’s consultant, explained that “[i]f they don’t get us everything that the Bureau needs to make that decision, they will get a notice that tells them at the end of the 45 days, your application has been denied because its incomplete. And it will tell them that these are a number of good cause reasons why you may appeal and ask for more time. And it lists those reasons.” (Docket Entry No. 380, John

*774

son Testimony at 144). Johnson further testified that:

Q. The situation where the person simply fails to complete the Medicaid process, but it is documented that they are, in fact, eligible for Tenn-Care?

A. Well, the waiver documentation that I have seen all makes it clear that people will go through the Medicaid eligibility determination process first.

Q. I understand that. Is there anything in the waiver that indicates that if they show that they are TennCare waiver eligible but cannot finish the process, that they are to lose their TennCare coverage?

I believe that the requirement is they complete the Medicaid process. So if they do not, they would not be permitted to enroll under the waiver program. That’s my understanding.

Q. And if they fail to complete the Medicaid process, even though they show that they meet those technical requirements, they will still be denied; is that correct?

If they do not complete the Medicaid process, yes, they will be denied.

* * * * * *

Q. A person who wants to be considered for all sources of eligibility, including possible medical eligibility, will have to apply twice; will they not?

A. They will apply first through Medicaid to determine if they meet those requirements. And then, if they do, if their income is a certain level— I’m talking about redetermination folks right now. If their income is above certain levels. But then they also have to prove that they are medically eligible. So it is a two step process.

Q. And similarly, they will have to appeal twice, will they not, if they want all sources of eligibility to be considered on appeal?

A. Yes. If they have to appeal their Medicaid denial, and then also, if they want to, to appeal their Tenn-Care standard denial.

(Docket Entry No. 380, Johnson Testimony at 233, 235, 236)(emphasis added).

Moreover, during the Medicaid eligibility screening, if the enrollee is determined ineligible for Medicaid, but satisfies the “technical eligibility requirements of Tenn-Care Standard; is uninsured; lacks access to health insurance; and has income at or below 100% of the federal poverty level [the enrollee] may qualify for TennCare Standard” as medically eligible. (Defendant’s Exhibit No. 1, Johnson Declaration ¶ 43). Johnson testified that the TDHS worker “will flag the system, prompting the TennCare Bureau to send the applicant a Medical Eligibility Determination packet.”

Id.

Yet, according to Michael Dedmon, TDHS’s Deputy Commissioner, if, during the Medicaid eligibility process, the enroll-ee is denied Medicaid eligibility, the enroll-ee would still be evaluated for TennCare Standard.

Q. A question was raised to Ms. Cyndy Johnson that I wanted to follow up with you about. At the end of an applicant’s time to complete their application, if the application remains incomplete at that time, what happens to that person’s eligibility for Medicaid?

A. If the application is incomplete for Medicaid because the Department does not have information on resources, on assets, then that appli

*775

cation goes on and is tested for [Standard eligibility.

Q. And so they are not automatically denied in terms of TennCare [Standard if the rest of their application is complete in terms of that program; is that correct?

A. No, they are not.

Q. If Cyndy Johnson testified different than you have just stated, do you have an explanation for that?

A. There was differing understandings between the Department of Human Services and the Bureau of Tenn-Care as to how the situation you described would be handled. DHS was under the impression that TennCare wanted the incomplete medication — the incomplete Medicaid application denied at that point, and that would be the end of the process. The TennCare Bureau wanted the application to go forward and be tested for standard.

Q. And which one of those two are you to follow?

A. What the Bureau wanted the Department to do.

Q. So the TennCare [Standard review will go ahead even if the denial takes place?

A. That’s correct.

(Docket Entry No. 381, Dedmon Testimony at 242-44).

The Court finds that this dispute between Johnson and Dedmon, in all probability, reflects the Defendants’ modification of the TennCare rule in response to Plaintiffs conclusion that Medicaid regulations require consideration of all basis of eligibility.

In any event, there is a standard notice form that advises an enrollee whether he or she qualified for “uninsured”, and then enrollees are informed of a ME determination at the separate phase of the eligibility process, for which there is a second 45-day deadline. (Defendant’s Exhibit No. 1, Johnson Declaration, Attachment 0, at 1). With exceptions discussed

infra,

an enroll-ee must file a separate application for “medical eligible” or ME reverification.

The TennCare Bureau, sends the enroll-ee a ME packet, with instructions and necessary forms for establishing medical eligibility criteria.

Id.

at ¶ 23 and Attachment G. The ME packet explains three ways to establish eligibility, by submission of: (1) a current letter from an insurance company denying health insurance; (2) a signed physician letter attesting that the individual has a qualifying medical condition on the TennCare Medical Condition List; or (3) an updated CRG/TPG assessment performed by a CMHC, reflecting the enrollee’s SPMI/SED status.

Id.

An enrollee’s TennCare coverage usually continues throughout the ME application and reverification process.

Id.

¶ 24 .

Enrollees who submit ME packets are informed of the good cause extension, but only after TennCare has denied them for failure to complete the ME process within the 45 day ME packet deadline.

Id.,

Attachment P, at 3 and unnumbered page 6. As to the 45-day extension for good cause, “TDHS

may

grant [the good cause extension] ... in accordance with Bureau/DHS policies.” Docket Entry No. 437, Exhibit E at Rule 1200-13-14.02(8)(h). The good cause extension of the 45-day limit is intended for “rare” circumstances. (Plaintiffs Exhibit No. 50, Johnson Deposition at 74; Defendant’s Exhibit No. 1, Johnson Declaration ¶ 16). Other extensions are permitted to enable individuals to obtain an outstanding item of information or proof of eligibility. (Defendant’s Exhibit No. 1, Johnson Declaration ¶ 16). For example, if there is an item of information missing on the 44th day, and at 5:00 p.m., the applicant is hospitalized as a result of a

*776

car accident; such circumstances could justify an extension beyond the 45 days. (Plaintiffs’ Exhibit No. 50, Johnson Deposition, at 74; Defendant’s Exhibit No. 1, Johnson Declaration, Attachment E at 2). This “good cause” exception for failing to meet the 45-day time limit does not address the inability of the SPMI or SED enrollee to complete the eligibility process without extensive accommodation.

A separate application is not required in some instances. (Defendant’s Exhibit No. 1, Johnson Deposition ¶ 35). For example, an enrollee who has income in excess of the criteria for TennCare Standard as an uninsured person, but has a current qualifying CRG/ TPG assessment in the TennCare/TDHS databases, will be “deemed” to qualify for TennCare Standard as a medically eligible person. (Defendant’s Exhibit No. 1, Johnson Declaration ¶ 22). Moreover, if the applicant were treated for a medical condition that is on the TennCare Medical Condition List, that fact will be noted on the TDHS database.

Id.

¶ 35 . According to the Johnson, the TDHS eligibility caseworker is aware of this fact. Further, if the en-rollee satisfies the technical eligibility requirements for TennCare Standard, and asks to be considered for coverage as a medically eligible person, a qualifying medical condition satisfies the ME requirement. In such an instance, the second application also is unnecessary for the Medicaid eligibility process.

Id.

If, however, the enrollee does not qualify with a condition on the TennCare Medical Condition List, TDHS concludes the re-verification process and terminates the individual’s TennCare coverage,

id.,

without determining if the person would still qualify as a “medical eligible.”

Yet, for the enrollees who fail to complete the Medicaid application process, even if the enrollee could be flagged as having a qualifying condition, the enrollee is nonetheless terminated, despite the State’s documentation of the enrollee’s medical eligibility condition for TennCare Standard. (Plaintiffs’ Exhibit No. 50, Johnson Deposition at 48). Johnson conceded that “federal policy” requires the state “to explore all avenues” of eligibility. (Docket Entry No. 380, Johnson Testimony at 190). Without a “deeming” of medical eligibility, a second application starts the second 45-day time limit, within which the enrollee must complete the nonMedi-caid eligibility phase of the reverification process.

3. Pacific Health’s Monitoring of TDHS’s Administration

The Defendant hired the Pacific Health Group to monitor its compliance with the Agreed Order, Settlement Agreement and the Court’s other Orders in this action. (Docket Entry No. 170, Settlement Agreement, Section I at 2, Section I; Plaintiffs’ Exhibit No. 50, Johnson Deposition at 5, 34). The State also retained Pacific Health to conduct a federally mandated readiness review of new managed care contractors before the contractors were permitted to participate in the TennCare program. (Plaintiffs’ Exhibit No. 1, Reynolds Deposition at 31-32; Docket Entry No. 380, Johnson Testimony at 239-40).

The Pacific Health consultants only monitor those areas that the TennCare Bureau directs them to monitor. (Plaintiffs’ Exhibit No. 50, Johnson Deposition at 64-65). Pacific Health proposed a similar monitoring plan for TDHS, but the Defendant rejected it. (Docket Entry No. 380, Johnson Testimony at 240). Pacific Health again proposed to evaluate TDHS’s readiness for its new duties, but the Defendant again declined the request.

Id.

at 240-41 . For that reason, Pacific Health did not assess fully TDHS’s readiness to implement the new procedures to comply with the Agreed Order and Settlement

*777

Agreement. (Docket Entry No. 380, Johnson Testimony at 249).

Pacific Health did not assess the adequacy of State’s computer systems to implement the new TennCare policies and procedures. (Plaintiffs’ Exhibit No. 50, Johnson Deposition, at 47-48). Pacific Health consultants did not test the TDHS system to insure that individuals in the TennCare computer system actually had their data transferred to the TDHS computer system. (Docket Entry No. 380, Johnson Testimony at 245). Johnson acknowledged data entry errors in the Defendant’s computers that could impact the parties’ settlement agreement.

Id.

at 248 . The TennCare computer system has also had difficulties in complying with the Orders in this case, but improvements have been made to correct these deficiencies.

Id.

at 245-49 . Deficiencies in the computer system are critical, given the fact that the Defendant’s new policies require the denial or termination of TennCare coverage, if the reverification process is not completed within 45 days. (Plaintiffs’ Exhibit No. 51, TennCare Standard Rules, Rule 1200-13-14-.02(7)(e),(f) and (m); Rule 1200-13-14-.02(8)(c) and (g)).

Pacific Health also has never evaluated TDHS computer and information systems, (Docket Entry No. 380, Johnson Testimony at 239), the TDHS appeal process,

id.

at 236-37 , the adequacy of TDHS staffing,

id.

at 250 , TDHS’s training.

Id.

To be sure, Pacific Health examined the written training materials, but did not attend any of the training sessions.

Id.

at 241-242 ; Plaintiffs’ Exhibit No. 50, Johnson Deposition at 13.

Pacific Health, however, has done limited monitoring of TDHS’s actual performance of the reverification. Although Pacific Health did not assess the adequacy of the notice for purposes of informing people with mental impairments, Pacific Health surveyed a group of randomly selected TennCare enrollees who received the notices and found that roughly 19%, or 8 of 43 respondents who recalled receiving the notices, found the notice difficult to understand. Six persons “were unaware after reading the letter that they were required to contact TDHS,” to keep their TennCare coverage. (Plaintiffs’ Exhibit No. 81, Pacific Health Policy Group August 2002 Report, at 7). Five of six persons were elderly.

Id.

Sixty-four (64) percent of the respondents were elderly, i.e., age 64 or older.

Id.

Pacific Health also made test calls to the TDHS County office shortly before the last preliminary injunction hearing and half of the calls had not been returned a week later. (Docket Entry No. 380, Johnson Testimony at 243-44). Pacific Health’s report found that over half of calls to Davidson County TDHS workers were simply never returned. (Plaintiffs’ Exhibit No. 81, Pacific Health Policy Group August 2002 Report at 6). A fourth of Pacific Health’s telephone calls to other TDHS offices produced similar results.

Id.

According to Cyndy Johnson, because of the State’s 45 day deadline for enrollees to complete the application process, such delays can result in the loss of an enroll-ee’s health coverage. (Docket Entry No. 380, Johnson Testimony at 243^15).

Further, Pacific Health’s test of select counties revealed that nearly a quarter of TDHS’s county offices lacked basic information about the new process when requested during telephone calls (Plaintiffs’ Exhibit No. 54, Pacific Health Policy Group report “DHS Undercover Calls” (7-2-02)). Seven (7) of the ten (10) TDHS county offices could not process a telephone call from a Spanish speaker. (Plaintiffs’ Exhibit No. 55, Pacific Health Policy Group report “Spanish Monitoring Calls” (7-10-02); Docket Entry No. 380, Johnson Testimony at 157-58; Plaintiffs’

*778

Exhibit No. 50, Johnson Deposition, at 28-29).

Moreover, Pacific Health’s testing revealed that 50% of those who requested an appointment with TDHS did not secure an interview.

Id.

Although 40% reported TDHS to be “very helpful” and 10% “somewhat helpful”, 50% described TDHS as “not helpful.”

Id.

at 7B, at 3. For the two people who had an appointment, one person found TDHS “very helpful” and the other person “somewhat helpful.” Acknowledging the limitation of the group size of its survey, Pacific Health concluded that “the results do suggests that the noticing process, while not perfect, worked as intended for most of the 50 respondents.”

Id.

at 7 . Yet, of the five persons who secured an appointment, only 2 persons had been interviewed.

Id.

at 7B, at 2, 3. For the subsequent, 555,253 mailings of notices of reverification, 190,278 have completed interviews and received decisions on their terminations. (Docket Entry No. 448).

As to the TennCare information line, after the first mailing to 11,712 enrollees went out on July 1, the Pacific Health’s test calls to the Information Line encountered average waiting times of 28 minutes for calls made after the noon hour. (Plaintiffs’ Exhibit No. 81, Pacific Health Policy Group August 2002 Report at 7-8 and Attachment 8). In its latest report summarizing the results of its test calls to the Information Line, Pacific Health stated: “In general, the operators seemed uninformed about the recent changes to the TennCare program.” (Plaintiffs’ Exhibit No. 81, Pacific Health Policy Group August 2002 Report at 9).

4. Appeal Process

If an enrollee submitted a complete application and is denied Medicaid coverage, a notice of the proposed termination of TennCare coverage is mailed with a statement of appeal rights and the availability of continued coverage pending appeal. (Defendant’s Exhibit No. 1, Johnson Declaration ¶ 17). For denials of applications, the Defendant’s denial form provides a checklist of reasons for a denial, including lack of U.S. citizenship or legal residency, access to private health insurance and Medicare eligibility as well as other reasons. (Docket Entry No. 380, Johnson Testimony at 146). Yet, in some denial forms, the notice of the enrollee’s ineligibility for TennCare Standard lacks specificity to inform the applicant or enrollee of the reasons for termination of coverage.

The Defendant informs some enrollees who are denied coverage: “You did not finish the application process for Tenn-Care”, but does not identify the specific deficiency or how the enrollee can remedy it. (Plaintiffs’ Exhibit No. 79, Robertson Declaration ¶4; Defendant’s Exhibit No. 1, Johnson Declaration, Attachment F, at unnumbered pages 6-8; Attachment K, at 6-7; Attachment N, at unnumbered pages 3-5; Docket Entry No. 380, Johnson Testimony at 212-15). Plaintiffs contend that this generic statement could cover a wide range of alleged deficiencies in the person’s application, and does not provide an adequate explanation to prepare an appeal on whether the State’s termination was correct, or how they might remedy the problem. (Plaintiffs’ Exhibit No. 79, Robertson Declaration ¶ 4; Defendant’s Exhibit No. 1, Johnson Declaration, Attachment F, at unnumbered pages 6-8; Attachment K, at 4; Attachment N, at 3-unnumbered page 5; Docket Entry No. 380, Johnson Testimony at 212-15).

If there is an incomplete application in the reverification process for continued eligibility for Medicaid, such as a failure or inability to verify assets/resources, Tenn-Care coverage is terminated but is given notice to file an appeal within 30 days that will also reinstate TennCare coverage.

*779

(Defendant’s Exhibit No. 1, Johnson Declaration at Attachment D). Yet, this denial notice does not refer to the good cause extension rule.

Notice of denials of medical eligibility, however, reflect that a person can appeal if good cause were shown for not completing the application in time, (Defendant’s Exhibit No. 1, Johnson Declaration, Attachment I, at 3).

The new TennCare process establishes separate appeals to two different agencies to obtain review of the different bases of eligibility. Adverse Medicaid eligibility determinations must be appealed to TDHS, but decisions on TennCare Standard eligibility must be appealed to the TennCare Bureau Appeals Unit. (Plaintiffs’ Exhibit No. 50, Johnson Deposition at 81-82, 106-07; Docket Entry No. 380, Johnson Testimony at 151, 236). To ensure consideration for entitlement to Tenn-Care coverage under all possible eligibility criteria, the enrollee would be wise to appeal to both forums. (Plaintiffs’ Exhibit No. 50, Johnson Deposition at 105-06).

The notices, however, do not inform plaintiff class members of this dual appeal requirement. (Docket Entry No. 380, Johnson Testimony at 236). A denial for an incomplete application does not include an appeal form. (Defendant’s Exhibit No. 1, Johnson Declaration at Attachment D). There is an appeal form for denials of enrollees who sought Medicaid Eligibility coverage. (Defendant’s Exhibit No. 1, Johnson Declaration at Attachment I), and a separate notice for denial of ME coverage for “New Applicants.”

Id.

at Attachment P. There are also separate forms for denials for “Technical/Insurance Reasons,”

id.

at Attachments F and N, and “because their income is too high.”

Id.

at Attachment G. These notices have separate appeal forms. Once an appeal is filed on a reverification denial, TennCare coverage continues. (Docket Entry No. 380, Johnson Testimony at 155-56).

The TennCare Information Line is available for class members who need assistance in the appeal process. (Defendant’s Exhibit No. 1, Johnson Declaration, Attachment B, unnumbered page 6 (“Do You Need Special Help?”), Attachment K at 2; Docket Entry No. 381, Teasley Testimony at 142-43).

On September 20, 2002, TDHS discovered that the yellow appeals information sheet entitled “Want to change what’s happening to the help you get from us? Here is what you can do,” was not enclosed with DHS notices of disposition sent to individuals between August 15, 2002 and September 16, 2002. (Docket Entry No. 430, Rudolph Fifth Declaration ¶ 3). In total, the notices were not inserted into 425,783 ACCENT generated notices of disposition sent to all Family Assistance programs (Families First, Food Stamps and Medicaid).

Id.

The Department of General Services that stuffs and mails all notices exhausted its existing supply of yellow appeals sheets. Although additional supplies had been ordered, no one from General Services notified TDHS when the supply was exhausted on August 15, 2002.

Id.

General Services received a new supply of forms on September 16, 2002 and began using the new supply at that time.

Id.

To remedy this error, TDHS issued a special mailing to Family Assistance program individuals who should have, but did not receive the yellow appeals information sheet. This special mailing began October 1, 200 and was completed October 5, 2002.

Id.

Additional time will be afforded to those individuals. Specifically, they will have until December 31, 2002 to appeal the negative action (for a new 90 day time frame). Individuals wanting to continue

*780

their existing benefits may do so by appealing by October 31, 2002. Although this period is normally 10 days after notice, [T]DHS is providing this extended periods to ensure that these individuals are afforded ample opportunity to appeal and continue their benefits during the appeal.

Id.

The TennCare Bureau appeals unit has a history of backlog an excessive delay in the processing of administrative appeals. A study of this backlog resulted in a restructuring of the agency.

See

Plaintiffs Exhibit No. 81. At the time of the new TennCare waiver, this appeals unit was not current with the existing volume of appeals.

Id.

Johnson, however, described the appeals unit as making significant progress. (Docket Entry No. 380, Johnson Testimony at 237). As of November 25, 2002, the reverification process had added 11,560 appeals.

See

Docket Entry No. 448 at unnumbered page 2.

5. Accommodations for Enrollees with Severe and Persistent Mental Illness (“SPMI”) and Seriously Emotionally Disturbed Children (“SEDC”)

Plaintiffs assert that the Defendant has failed to develop policies and procedures to identify enrollees who are SPMI or SED and to accommodate those enrollees in the reverification process. Accommodations for enrollees and their special needs are critical to determine their eligibility under newly implemented Medicaid policies to retain their TennCare coverage.

As noted earlier, TennCare rules provide that “Reasonable accommodation will be made for persons with disabilities who require assistance in responding to a renewal request.” (Docket Entry No. 234; Plaintiffs’ Exhibit No. 27, TennCare Rule 1200-13-14.02(6)(a)). According to Johnson, federal Medicaid policy also requires equal treatment and accommodations for applicants and enrollees. (Docket Entry No. 380, Johnson Testimony at 255). In the initial reverification process, the Defendant has “Redetermination/Medicaid Rollover process for SPMI/SED Enroll-ees.” (Defendant’s Exhibit No. 1, Johnson Declaration at Attachment K).

As to persons with disabilities, Tenn-Care rules define the SPMI as adults with a diagnosable mental, behavioral or emotional disorder resulting in functional impairment which substantially interferes with or limits major life activities including basic living skills (e.g., eating, bathing, dressing); instrumental living skills (maintaining household, managing money, getting around in the community, taking prescribed medication); and functioning in social, family and vocational/educational context. (Docket Entry No. 437, Exhibit E, Rule 1200-13-14-.01(93)(a)3). The rules identify the SPMI and SED as individuals who suffer from disorders with episodic, recurrent or persistent features.

Id.

at Rule 1200-13-14-.01(92)(b) and (93)(a)2.

To qualify as medically eligible on the basis of SPMI or SED status, a current enrollee or new applicant must have received a CRG/TPG classification within the past 12 months (Docket Entry No. 437, Exhibit E, Rule 1200-13-14-.01(92)(b) and (93)(a)2). SPMI adults and SED children are identified through clinical and functional assessments, known by the acronyms CRG or TPG. CRG/TPG assessments are performed primarily by the community mental health centers, then processed by

*781

the Department of Mental Health and Developmental Disabilities (“DMHDD”). (Plaintiffs’ Exhibit No. 50, Johnson Deposition at 8-9; Defendant’s Exhibit No. 1, Johnson Declaration ¶ 49).

The SPMI individuals are classified in one of three clinically related groups, designated as CRG 1, CRG 2, and CRG 3, with CRG 1 being the most severely impaired. (Docket Entry No. 381, Blackburn Testimony at 24-31). Plaintiff class members in CRG 1 are known to the State to require constant assistance or supervision with daily living activities and to display,an inability to relate to others. (Docket Entry No. 437, Exhibit E, Rule 1200-13-14-.01(93)(b)l). The latter limitation interferes with these enrollees’ ability to work and their family relationships and usually results in social isolation in the community.

Id.

Changes in the environment are stressful and may result in further withdrawal or dysfunction in other areas.

Id.

Support is needed to insure the person’s safety and survival.

Id.

Plaintiff class members who are rated as CRG 2 are known to have extensive problems with performing daily routine activities and to require frequent assistance. These enrollees have substantial impairments in their ability to take part in social activities or relationships that often results in social isolation in the community.

Id.

Such a person has extensive difficulty in adjusting to change.

Id.

Assistance with activities of daily living is necessary to survival in the community.

Id.

Such individuals are known to the State to have difficulty completing simple tasks.

Id.

at Rule 1200-13-14-.01(93)(b).

Even those SPMI enrollees who are the least impaired, and who are therefore classified as belonging to CRG 3, are known to the State to “generally need[] long term continued support.”

Id.

at Rule 1200-13-14-.01(93)(b)3. Characteristics of this population may include regular or frequent problems performing daily routine activities. A person in this subset of the SPMI population “may require some supervision although [the person] can survive without it... There is sometimes noticeable difficulty in accepting and adjusting to change and the person may require some interventions.”

Id. .

A child who is SED is likewise defined as having a diagnosable mental, behavioral or emotional disorder with episodic, recurrent or persistent features, which substantially interferes with or limits the child’s role or functioning in family, school, and community activities as well as their ability to maintain appropriate social, behavioral, cognitive, ' communicative, or adaptive skills.

Id.,

at Rule 1200-13-14-.01(92). The families of such children have difficulty coping with the types of administrative requirements imposed by the new Tenn-Care eligibility rules. (Docket Entry No. 380, Bryson Testimony at 104-05). Such difficulties require accommodation to permit the families to complete successfully their children’s re-applications for Tenn-Care coverage.

Id.

As a practical matter, for these groups, these disabling conditions do not go away, and the person does not “get well”. (Docket Entry No. 380, Blackburn Testimony at 29-30; Bryson Testimony at 105-06; Docket Entry No. 381, Westlake Testimony at 30). Given the persistent and chronic nature of the SPMI/SED condition, once a person receives a CRG/TPG assessment that he or she is SPMI or SED, in all likelihood, the person continues to suffer these serious impairments despite the lack of a current CRG/TPG in his or her medical record (Docket Entry No. 380, Blackburn Testimony at 29-30; Bryson Testimony at 105-06).

Since 1996, TennCare has classified approximately 190,000 enrollees as SPMI or SED. (Plaintiffs’ Exhibit No. 64, Progress

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Report on TennCare Partners Program (March 2002) at 7). Enrollees assessed as SPMI or SED are identified as such in the TennCare management information system. (Docket Entry No. 380, Johnson Testimony at 257-58).

Although TennCare’s management information system has a data field for “disabled”, effective July 1, 2002 the Defendant started a new TDHS application that deletes the data field for identifying the applicant as having a disability. Defendant’s Exhibit No. 1, Johnson Declaration, Attachment B at unnumbered page 4; “Tennessee Department of Human Services Application or Review of Eligibility for Families First, Food Stamps, Medie-aid/TennCare”; (Docket Entry No. 381, Teasley Testimony at 164). The Defendant could have used this data field, but did not. (Docket Entry No. 380, Johnson Testimony at 259). The Defendant could have also worked around the limitations of the management information system, for example, through the use of a PC-based system, but did not. (Docket Entry No. 380, Johnson Testimony at 258-59).

TennCare and TDHS have separate computer data systems. (Plaintiffs Exhibit No. 50, Johnson Deposition at 46-47). Although TennCare still retains in its computer system where the enrollee self-identifies as disabled, at one time this data was not accessible to the TDHS caseworkers who are relied upon to identify and accommodate the needs of people with disabilities.

Id.

at 12-13 . The TennCare Bureau’s management information system had a data field for “disabled” that includes two types of disabilities, physically disabled and seriously emotionally disabled. (Plaintiffs’ Exhibit No. 50, Johnson Deposition at 8). Based upon its assessments at the local mental health centers provided to Defendant, the TennCare Bureau’s computer data bases includes those persons with serious mental illnesses, i.e., SPMI and SED individuals. (Docket Entry No. 50, Johnson Deposition at 8-9). Yet, the TDHS application form deleted all references to disability. (Docket Entry No. 380, Johnson Deposition at 202).

The TennCare Bureau’s computer, however, has encounters data that reflects clinical encounters between enrollees and health care providers and contains information showing that the persons received treatment for a condition that is on the TennCare Medical Condition List, a fact reflected in the TDHS database. In these situations, TennCare will transmit this information to the relevant TDHS computer database, accessible to TDHS caseworkers for a determination of eligibility. (Defendant’s Exhibit No. 1, Johnson Declaration 11 22). Yet, TennCare transmits that information to TDHS only if an SPMI or SED enrollee has a current CRG/TPG and it will be flagged in the TDHS computer record, so that the case manager assigned to the case will know that the person has been so designated.

The Defendant mails initial notice of re-verification only to those enrollees with current CRG/TPG assessments. Individuals who have a current CRG/TPG assessment, and meet the TennCare regulatory definition of SPMI or SED, are the subjects of additional notification efforts. (Defendant’s Exhibit No. 1, Johnson Declaration ¶ 33 and Attachment K at 3). According to Johnson, the current implementation plan is to issue mailings to all persons to be followed by telephone calls to those persons with disabilities requesting special assistance. (Plaintiffs Exhibit No. 50, Johnson Deposition at 36).

When the first 45-day period commences, TDHS asserts that it will accommodate individuals with special needs. (Docket Entry No. 380, Johnson Testimony at 166, 173; Docket Entry No. 381, Teasley Testimony at 87-94, 97-99, 104,

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165; Smith Testimony at 270, 297-99). TDHS eligibility caseworkers are to provide assistance to other persons encountering difficulty completing the application process, including obtaining verification of requested information for the individual. (Docket Entry No. 381, Teasley Testimony at 82-83).

If necessary to accommodate an enroll-ee’s special needs, alternative arrangements include a telephone or in-home interview, completion of the interview by an authorized representative of the enrollee, or an interview conducted at alternative sites, such as a CMHC. (Docket Entry No. 381, Teasley Testimony at 104).

With the policy requiring a current CRG/TPG, the Defendant excluded the majority of enrollees who have been previously identified as SPMI or SED.

See

Docket Entry No. 380, Blackburn Testimony at 28-30. If the enrollee lacks a current CRG/TPG or an encounter data entry showing that the applicant has a qualifying medical condition, the applicant must obtain a new CRG/TPG and submit it with a fully completed medical eligibility application packet. (Defendant’s Exhibit No. 1, Johnson Declaration, Attachment A at 3-5). The applicant must complete his/her portion of the form and sign it.

Id,

and Attachment K at 5-6. Failure to do so will result in rejection of the packet and termination of coverage.

Id.

Attachment A at 4.

Yet, even if an enrollee lacks a current CRG/TPG, the enrollee may still be deemed to be medically eligible by virtue of having a qualifying mental health condition (that is, a condition on the TennCare Medical Condition List developed for the medical eligibility process), as evidenced by the presence of the qualifying diagnosis on the claim/ encounter record in Tenn-Care’s database for calendar year 1999 to the present.

Id.

¶ 22 and Attachment K at 5-6; Attachment G (including TennCare Medical Condition List).

If an SPMI or SED enrollee completes the Medicaid eligibility process, satisfies the technical eligibility requirements for TennCare Standard, and asks to be considered for coverage as a medically eligible person, the database notation of either a current CRG/TPG or a qualifying diagnosis will satisfy the ME requirement, and the person need not submit the separate application required of other enrollees.

Id.

¶ 35 .

Without a “deeming,” a medical eligibility packet is mailed to the enrollee. The packet must be completed and submitted within 45 days from mailing by the Tenn-Care Bureau. (Plaintiffs’ Exhibit No. 51, TennCare Standard Rules at Rule 1200-13-14.02(7)(n)). The enrollee must obtain a new CRG/TPG and submit it with a fully completed medical eligibility form or must submit a fee and undergo an underwriting review by the State’s contractor. (Defendant’s Exhibit No. 1, Johnson Declaration, Attachment M at 4). In either event, the SPMI/SED applicant must complete the appropriate Medical Eligibility form and sign it.

Id.

Failure to do so within the 45 day limit will result in rejection of the packet and denial of coverage.

Id.

at 2-3 .

During the indispensable first phase of the process, to complete a Medicaid application, this enrollee must still submit supporting documentation. If the first phase is not completed, the enrollee will not be considered for TennCare Standard or ME coverage. (Docket Entry No. 380, Johnson Testimony at 232). Even enrollees who are flagged as having a current CRG/ TPG will be terminated, if they fail to complete the Medicaid application process. Termination of coverage occurs even if they meet the technical requirements for TennCare Standard.

Id.

In such instances, the Defendant’s record reflects that the enrollees are medically eligible for Tenn-Care Standard (because they meet the

*784

technical eligibility requirements and have current CRG/TPGs), but will nonetheless deny them for failure to complete the Medicaid process. (Plaintiffs’ Exhibit No. 50, Johnson Deposition at 48; Defendant’s Exhibit No. 1, Johnson Declaration ¶ 16).

To be eligible as an SPMI/SED enrollee, a current CRG/TPG assessment, i.e., within the preceding 12 months, is required for reverification, but many SPMI/SED enroll-ees do not have current CRG/TPG assessments. Only about one fourth (46,104 in fiscal year 2000-2001) of TennCare enroll-ees identified since 1996 as SPMI/SED have a current CRG/TPG assessment. (Plaintiffs’ Exhibit No. 15, Blackburn Declaration, ¶ 3;

See also

Defendant’s Exhibit No. 1, Johnson Declaration, Attachment H, “We are returning your ‘Medical Eligibility’ Application” (“You must send your medical records to support your application.”) and Attachment O, 7th unnumbered page, Part A — TennCare Application, at 1 (“Send all of your forms, $25.00 and medical records in one package. If you do not send it together, it will be denied as incomplete.”);

cf.

Docket Entry No. 380, Blackburn Testimony at 43-44, 67-68). If the medical records are submitted separately by a health care provider, the application will also be returned because the enrollee’s medical eligibility packet is deemed incomplete.

Id.;

Plaintiffs’ Exhibit No. 51, TennCare Standard Rules, Rule 1200-13-14 — .02(8)(g), at 21.

For the SPMI or SED enrollees, acquiring a necessary letter of declination from an insurance company within the 45 day limitation likewise is difficult. (Plaintiffs’ Exhibit No. 51, TennCare Standard Rules, Rule 1200-13-14-.02(7)(m)(l), at 19; Docket Entry No. 380, Blackburn Testimony at 60-61; Docket Entry No. 380, Bryson Testimony at 120; Docket Entry No. 381, Westlake Testimony at 33). The requirement of a declination letter seems unneces

*785

sary to determine that the current enrollee lacks access to private insurance, because enrollees who have been designated in the past as SPMI or SED, usually lack access to private insurance.

Id.

Otherwise, the current enrollee would not be on Tenn-Care.

Many of the SPMI individuals and many of the families of SED children need direct one-on-one personal help, and cannot satisfactorily cope with the telephone or written notice. (Docket Entry No. 380, McCormick Testimony at 14-17; Docket Entry No. 380, Bryson Testimony at 116— 17).

TennCare has amended its contract with the Mental Health Association of Middle Tennessee, to advocate on behalf of SPMI/ SED individuals. TennCare also retained the TennCare Partners Advocacy Line (“TPAL”), to expand assistance to be provided to SPMI/SED enrollees during the redetermination process. (Docket Entry No. 381, Smith Testimony at 270-71; McLean Declaration ¶ 17).

TPAL, a state contractor, also offers assistance to enrollees who fail to respond to the initial redetermination notice. TPAL’s efforts consist of telephone contacts and mailed notices within 30 days of the initial redetermination notice. (Docket Entry No. 381, Smith Testimony at 271). TPAL is to contact the last known provider or case worker of the SPMI/SED en-rollee and will utilize a variety of ways to offer assistance and information. TPAL’s role is to ensure that each SPMI/SED enrollee who has failed to respond to the initial notice has a current provider or mental health case manager at a CMHC or other person, who will assist them in navigating the reverification process. (Docket Entry No. 381, Smith Testimony at 272, 284). TPAL’s assistance, however, is limited to persons with recent CRG/TPG designations, and does not extend to either the mentally ill who lack recent CRG/ TPGs, or to the physically disabled. (Plaintiffs’ Exhibit No. 50, Johnson Deposition at 54-55).

In any event, telephone contact is considered by several mental health workers to be insufficient to accommodate the mentally ill population that needs in-person assistance as provided by mental health case managers at the CMHCs. (Docket Entry No. 381, Smith Testimony at 283; Docket Entry No. 380, Blackburn Testimony at 33-35; Docket Entry No. 380, Bry-son Testimony at 115-16; Docket Entry No. 380, Womack Testimony at 265-66; Docket Entry No. 381, Westlake Testimony at 21-26). A pilot project undertaken by the State involving similar assistance from TPAL convinced the State to exempt the SPMI/SED from the reverification process in place prior to July 1, 2002, pending the development of more appropriate eligibility determination procedures for that population. (Plaintiffs’ Exhibit No. 57, Reverification Pilot Project Outcomes; Docket Entry No. 380, Blackburn Testimony at 54-55; Plaintiffs’ Exhibit No. 50, Johnson Deposition at 9, 64, 99-100).

The Defendant asserts that it has now established a helping role for the local Community Health Centers to assist mentally disabled enrollees.

(Docket Entry No. 215). At the Court’s direction, a September 2001 protocol with CMHC’s was established for processing eligibility for the SPMI/SED. (Docket Entry No. 201). The CMHCs are intended to be the “front line” in serving this vulnerable population. (Plaintiffs’ Exhibit No. 50, Johnson Depo

*786

sition at 17-18, 38). Under the protocol, the CMHC providers were assigned the crucial role of actually submitting Tenn-Care applications and supporting documentation for individuals who qualify as SPMI/SED. (Docket Entry No. 215, TMHDD Procedures, Initial Steps for Categories 1 & 2). From October 1, 2001 to June 30, 2002, CMHCs processed 2,300 applications. (Docket Entry No. 380, Johnson Testimony at 160).

CMHC’s that have sent mentally ill individuals to TDHS to apply for TennCare report that their patients are told that they are not Medicaid eligible, and that TennCare Standard enrollment for ME coverage is closed. (Plaintiffs’ Exhibit No. 80, Blackburn Second Declaration ¶ 3; Plaintiffs’ Exhibit No. 73, Letter to whom it may concern from TDHS worker Sandra Sorrells, 7-18-02; Docket Entry No. 381, Womack Testimony at 268-71).

According to the Executive Director of the Tennessee Association of Mental Health Organizations (“TAMHO”), the CMHCs are concerned about their reimbursement for the costs of performing a CRG/TPG assessment for a new applicant not yet covered by TennCare. (Docket Entry No. 380, Blackburn Testimony at 65; Docket Entry No. 381, Smith Testimony, at 279). In July, 2002, the TennCare Bureau placed those individuals to be processed by CMHCs into a state-funded program while their TennCare applications are pending. (Docket Entry No. 381, Smith Testimony at 280). In this program, the State pays the CMHCs, with state monies, for the costs of the CRG/ TPG assessments that are necessary for the applicant to obtain TennCare coverage as medically eligible.

Id.

The State sent the instructions and protocols for these placements to the CMHCs on July 18, 2002 for review and comment, and immediate implementation.

Id.

at 281-282 .

The TDHS Family Assistance Line is also cited by the State as an important resource for assisting people with special needs, including the SPMI, through the eligibility process. Yet, the Defendant’s notices that instruct current enrollees regarding the re-application process do not provide information about that resource, nor how to use it. (Plaintiffs’ Exhibit No. 79, Robertson Declaration ¶ 7; Defendant’s Exhibit No. 6, Teasley Declaration, at 15-16, ¶ F;

cf.

Defendant’s Exhibit No. 1, Johnson Declaration, Attachment B; Docket Entry No. 380, Johnson Testimony at 253; Docket Entry No. 381, Teasley Testimony at 101-11, 116-17, 142-44). Finally, Plaintiffs note that these contacts by TDHS and TPAL workers are directed to the enrollee (Plaintiffs’ Exhibit No. 35, 2nd-3th unnumbered pages; Plaintiffs’ Exhibit No. 50, Johnson Deposition at 54-55; Docket Entry No. 381, Smith Testimony at 283-84) and do not reasonably accommodate the needs of this population who need personal assistance to communicate effectively.

TDHS has offered to outstation case managers at CMHCs, but only if the CMHCs provide space and telephones to accommodate them, and if the CMHCs have sufficient TennCare SPMI/SED application caseloads to justify these case workers. (Docket Entry No. 381, Dedmon Testimony at 221; Docket Entry No. 380, Blackburn Testimony at 51-53, 57-60).

TDHS eligibility caseworkers can be assigned to a CMHCs that serves the SPMI/ SED population, to TennCare applications or redetermination processes at that location. (Docket Entry No. 381, Dedmon Testimony, at 222). Every CMHC that requested an outstationed TDHS eligibility caseworker and has sufficient caseload to occupy that worker, has received one.

Id.

TDHS has worked with the CMHCs to finalize agreements to assign full-time

*787

TDHS staff at five locations, effective August 1, 2002.

Id.,

Williams Testimony, at 301-02. West Tennessee, TDHS, has agreements with the three primary CMHCs in that area to assign staff at 10 sites.

Id.,

Davis Testimony, at 320-22. The CMHCs decided the sites for the TDHS outstationed workers, and TDHS has offered placements at additional CMHC sites.

Id.

A minority of CMHC clinical sites is expected to have part-time TDHS workers, but the details of how they will work, or how the CMHCs will participate in their process of accommodation of the SPMI/ SED enrollees remain to be defined and that process likely will take a minimum of 90 days. (Docket Entry No. 380, Blackburn Testimony at 59; Womack Testimony at 265-66). For the present, TDHS county offices lack sufficient information to be able to answer basic questions from the CMHCs.

Id.,

Blackburn Testimony, at 82-83.

The Court finds that this use of TDHS caseworkers shifts the costs associated with providing space and support for such TDHS staff to the CMHCs for obligations that the Court imposed on the Defendant; and the Defendant agreed to provide.

As to the evidence of the SPMI or SED individuals’ abilities to navigate the Medicaid eligibility process or similar processes through TDHS, Defendant cites statistics that, as of September 15, 2001, of the persons on TennCare as Medicaid eligible, 112,494 were SPMI/SED individuals. (Docket Entry No. 381, Smith Testimony at 277). Of that number, 67,850 came to Medicaid through the TDHS eligibility process (as opposed to qualifying for Medicaid by virtue of SSI eligibility having been established through the Social Security Administration).

Id.

at 277, 285 . As of September 15, 2001, there were 67,449 SPMI/SED waiver enrollees in TennCare. Of those enrollees, 19,783 were Medicaid rollovers who originally came on the Tenn-Care program through the TDHS eligibility process. In sum, as of September 15, 2001, approximately 108,000 people who were enrolled in TennCare were in the SPMI/SED category and, of that 108,000, approximately 88,000 entered the Tenn-Care program through the TDHS eligibility process. (Docket Entry No. 381, Smith Testimony at 277-78, 285).

Defendant also refers to the majority of families of SED children on the TennCare program as recipients of other benefits such as food stamps or cash assistance, for which they were qualified through a TDHS eligibility process that is substantially similar to the Medicaid process. (Docket Entry No. 380, Bryson Testimony, at 121— 122). To maintain these benefits, these families also must periodically re-established their eligibility.

Id.

at 123 . The Defendant also notes that individuals with mental retardation, autism, and learning disabilities satisfactorily navigated the SSI/ SSA process administered by TDHS that also required periodic eligibility rede-terminations.

Yet, under SSA processes, particularly for persons with mental impairments, including children, the SSA actually collects the necessary data to determine eligibility, such as from physicians and health care providers and also contracts with health consultants to perform evaluations.

See e.g.,

20 C.F.R. § 404.1503 (e). In contrast, the new TennCare reverification procedure shifts that burden to enrollees who have serious mental disabilities. The 45-day time limit for a complete application also does not apply in the social security application process.

Carol Westlake, director of the Tennessee Disability Coalition, who has a masters in education, referred to the Social Security eligibility determination as a “fairly

*788

challenging process.”

(Docket Entry-No. 381, Westlake Testimony at 46-47). Westlake cited a Kaiser Family Foundation survey finding that only 67% of eligible families apply for Medicaid and described the process as “confusing.”

Id.

at 28 . Of those surveyed, seventy-two percent (72%) described Medicaid’s data collection requirements to be “nearly impossible for them to do.”

Id.

at 28-29 . The State’s notice and application that requested self identification as disabled, in West-lake opinion, is also “difficult” for members of this group.

Id.

at 25 . Westlake’s awareness of disabled persons who apply for benefits through TDHS has included good and bad experiences.

Id.

at 37-38 .

As to reassessments of SPMI and SED individuals, Westlake described a SPMI or SED as “a fairly permanent condition,”

id.

at 30 , and the Defendant’s requirement that these persons obtain a mental health assessment in 45 days, “is going to be a challenge.”

Id.

at 31 . Moreover, for any person with a disability to obtain a rejection letter from an insurance company, particularly with the 45-day time limit, is “risky.”

Id.

at 33 .

There are persons who are not SPMI and SED, but have mental limitations that require assistance in the reverification process.

Id.

at 18, 21 . These person include persons who are mentally retarded or have acquired brain injuries due to some external trauma. (Docket Entry No. 381, West-lake Testimony at 21-22). As it were with SPMI and SED individuals, these persons need assistance in understanding notices and acquiring the necessary information for the reverification process.

Id.

at 23, 24 .

It is “fairly complicated” to expect TDHS interviewers to assess from a telephone conversation or actual site visit, whether an applicant has a disability. (Docket Entry No. 381, Westlake Testimony at 34). The 45-day time limit on rever-ification makes accommodations prior to reverification especially important for this group of citizens.

Id.

at 25 . In a “Reveri-fication Pilot Project Outcomes” for SPMI and SED enrollees, TPAL, identified 1021 SPMI and SED individuals to survey during the reverification process, but actually contacted only 735 before terminating its study. (Plaintiffs’ Exhibit No. 57). Of the 735 SPMI and SED individuals, 317 could not be located.

Id.

Of the remaining persons in this group, only 159 or 21.6% actually completed the reverification process successfully.

Id.

As to evidence of the effectiveness of the Defendant’s procedures for SPMI/SED en-rollees, when the State conducted a pilot reverification process involving the SPMI enrollees in 2000, the response to mail notices, with telephone follow-up by TPAL, was so poor that the report convinced State officials to defer reverification of this group altogether. (Docket Entry No. 380, Blackburn Testimony at 54-57, 90-91; Plaintiffs’ Exhibit No. 57, Reverification Pilot Project Outcomes; Plaintiffs’ Exhibit No. 50, Johnson Testimony at 9, 64).

A compliance review conducted by the Pacific Health revealed that, in May of 2002, eight of the ten CMHCs contacted stated they were assisting their clients in accordance with the protocol. The other two CMHCs respondents were unfamiliar with the protocol, but had processed CRG/ TPG assessments and forwarded Tenn-Care applications during the period from October 1, 2001 through June 30, 2002. As of the day before the hearing, senior

*789

TennCare management were distributing to mental health providers, advocates and community groups basic information about the new eligibility process and criteria that was erroneous. (Plaintiffs’ Exhibit No. 72, TennCare Flow Chart; Docket Entry No. 380, Bryson Testimony at 128-29; Docket Entry No. 381, Miller Testimony at 6-14; Docket Entry No. 381, Smith Testimony at 274-76)

Yet, in a more recent survey of the new TennCare program, Johnson testified that TennCare has failed to provide full information to 20 of the CMHCs in Tennessee’s 95 Counties. (Docket Entry No. 380, Johnson Testimony at 160-63; Plaintiffs’ Exhibit No. 15, Blackburn Declaration ¶ 4; Docket Entry No. 380, Blackburn Testimony at 35-36, 77-81, 92-93 and Johnson Testimony at 160-63; Plaintiffs’ Exhibit No. 50, Johnson Deposition, at 17-18). Some providers helped SPMI/SED applicants through the process, despite the lack of guidance from the State and the defendant’s failure to implement the protocol. (Defendant’s Exhibit No. 23, Community Mental Health Center Report; Docket Entry No. 380, Johnson Testimony at 160). The Mental Health Cooperative that has 4,500 clients processed 553 applicants through the TennCare process before July 1, 2002. (Docket Entry No. 38, Womack Testimony at 261-64). Yet, at the time of the evidentiary hearing, this agency did not have a contract to complete the reveri-fication process for its clients.

Id.

at 266-67 . Since July 1, such voluntary

ad hoe

efforts have ended.

In its earlier directive on the CMHC protocol (Docket Entry No. 201), the Court found that effective accommodation of this vulnerable population required the active and informal involvement of the CMHCs who treat them and are familiar with these class members. The Testimony at the hearing was in accord. (Docket Entry No. 380, Blackburn Testimony at 33-38;

Id.,

Bryson Testimony at 104, 117;

Id.,

Wom-ack Testimony at 262, 264, 267). The new eligibility process is significantly more demanding for the SPMI/SED enrollees than the former process, especially without the support of the CMHCs that the Court directed under last September’s protocol. (Docket Entry No. 201).

The Court finds that the Defendant has not established a clear role nor provided adequate support for the CMHCs that are at “the heart” of the September 2001 protocol for processing eligibility for the SPMI/SED enrollees. (Docket Entry No. 201). Defendant’s consultants concede that CMHCs are on the “front line” in serving this vulnerable population. ( Plaintiffs’ Exhibit No. 50, Johnson Deposition at 17-18, 38; Docket Entry No. 215). The Court also finds that in the current system, the redetermination process lacks sufficient assistance and guidance for a substantial number of enrollees with mental impairments. (Docket Entry No. 380, McCormick Testimony at 14-16; Docket Entry No. 380, Blackburn Testimony at 41-45; Docket Entry No. 380, Bryson Testimony at 112; Docket Entry No. 381, Westlake Testimony at 25-26, 29-30; Docket Entry No. 380, Womack Testimony at 264).

The Court finds that these enrollees cannot handle the burdens imposed by the Defendant’s new reverification process and the Defendant’s efforts to assist them are inadequate. The Court also finds that the current procedures for accommodating the SPMI/SED do not provide consistent, necessary assistance from the CMHCs to enable all class members to compile and submit their applications for timely reveri-fication.

6. Accommodations for Enrollees with Limited English Proficiency (“LEP”)

In March 2001, Johnson examined the state computer data base to identify per

*790

sons with LEP. (Docket Entry No. 380, Johnson Testimony at 171-72). Johnson conceded that paragraph (1)(A)(7) of the Settlement Agreement required the Defendant to provide accommodations for persons with LEP.

Id.

at 172 .

The TennCare Bureau never collected information on LEP from either applicants or current enrollees. (Plaintiffs’ Exhibit No. 50, Johnson Deposition at 7, 9-10; (Docket Entry No. 381, Sharp Testimony at 216). The new TDHS applications do not capture this information (Defendant’s Exhibit No. 1, Johnson Declaration, Attachment B, 4th unnumbered page; Docket Entry No. 381, Teasley Testimony at 164), but TDHS intends to start collecting such information in August, 2002 for giving individuals notice, but these notices will not be sent until May, 2003.

Id.,

Teasley Testimony at 164-165).

Such TennCare Bureau notices, however, are translated into Spanish. (Defendant’s Exhibit No. 1, Johnson Affidavit at Attachment B), as well as other languages: Kurdish-Badinani, Kurdish-Sorani, Arabic, Somali, Bosnian.

Id.

In addition, a toll free telephone line is available for language assistance.

Id.

Two of the Plaintiffs in the Supplemental complaints are of Vietnamese descent, but Vietnamese is not included in these translated language forms.

TDHS notices, however, including those informing enrollees of appointments or explaining why they have been denied Medicaid and how to appeal, are provided only in English, even if TDHS is aware of the person’s limited English proficiency. This policy will continue for Spanish-speaking class members until translation of the notices is complete in May 2003. In addition, TDHS officers cannot always accommodate Spanish speakers when they contact the agency about the notices sent to them. (Plaintiffs’ Exhibit No. 50, Johnson Deposition at 28-29; Plaintiffs’ Exhibit No. 55, Pacific Health Policy Group report, “DHS Spanish Monitoring Calls”).

Pacific Health’s test calls to TDHS offices found that seven of the ten offices contacted were unable or unwilling to accommodate a caller speaking Spanish.

Id.

Pacific Health’s testing of TDHS capacity after July 1, 2002 revealed serious lack of understanding of how to accommodate people with LEP. (Plaintiffs’ Exhibit No. 53, Plaintiffs’ Exhibit No. 54, Plaintiffs’ Exhibit No. 55; Docket Entry No. 380, Johnson Testimony, at 157-158). Private agencies that serve the Spanish population report similar experiences when they contact TDHS offices. (Plaintiffs’ Exhibit No. 6, McClellan Declaration ¶ 4; Plaintiffs’ Exhibit No. 43, Hough Declaration ¶ 2).

7. The Effects of Multiple Eligibility Reverification

Plaintiffs contend that by virtue of the two reverification processes and appeals processes, the Defendant will terminate coverage to some members of the plaintiff class whom the State knows, based upon its records, nonetheless meet the technical eligibility and/or medically eligibility criteria requirements.

The Defendant expected that 75,000 of the current waiver eligible population of approximately 625,000 will lose their coverage as a result of the reverification or redetermination process. (Plaintiffs’ Exhibit No. 1, Reynolds Deposition, at 46-47). The Defendant estimated that 25% of current TennCare enrollees will “choose” not to re-apply, and will lose coverage. Experienced mental health workers estimate that many of those persons who fail to complete the new process will be persons •with mental impairments. (Docket Entry No. 380, Bryson Testimony at 110, 114, 115; Blackburn Testimony at 33, 41-44, 62-63; Womack Testimony at 268). For such individuals, the failure to re-apply and complete the process will not be a “choice,” but a result of their disabilities,

*791

and difficulty in completing the process without adequate accommodation. (Docket Entry No. 257, Reynolds Testimony at 58-59).

By stipulation, the most recent statistics on the reverification reveal that on July 31, 2002, the State mailed eligibility notices to 221,923 individuals. (Docket Entry No. 448). As of November 19, 2002, the rede-termination process was complete for 89,-359 individuals, or 40% of the total number of individuals who were sent the notice, and 66,801 individuals, or 30%, are still being processed.

Id.

Of those whose process was complete, 91% were determined to be eligible and 7,277, or 3% of the total number of individuals sent notices, were found ineligible.

Id.

There were 77,323 individuals, or 35%, who did not submit a redetermination application.

Id.

Of those 77,323 individuals, 65,763, or 30% of the total number of individuals sent notices for redetermination, made no contact during the 90 day period and have been terminated.

Id.

Coverage continues for the other 11,560 because of timely appeals.

Id.

On August 30, 2002, the State mailed eligibility notices to 177,208 individuals of which 78,378, or 44%, have responded.

Id.

On September 30, 2002, the State mailed eligibility notices to 113,061 individuals of which approximately 33% have responded.

Id.

On October 3, 2002 the State made an additional mailing to 43,061 individuals who are Medicaid eligible but, may be eligible for continued TennCare coverage under the “grandfather” statute and approximately half have responded.

Id.

The graphic display of these members and their effects on the new process are as follows:

a. WAIVER ELIGIBLE REDETERMINATION PROCESS

[[Image here]]

Plaintiffs attribute any decline in enrollment to the complex reverification process that will result in many enrollees who will be unable to complete the process within the 45-day time limits. (Plaintiffs’ Exhibit No. 2, Cummings Declaration ¶¶ 2-3; Plaintiffs’ Exhibit No. 11, McCormick Declaration, ¶¶ 2-8; Plaintiffs’ Exhibit No. 12, Marshall Declaration, ¶¶ 3-7; Plaintiffs’ Exhibit No. 13, Judge Declaration, at 2; Plaintiffs’ Exhibit No. 14, Evans Declaration, ¶¶4-9; Plaintiffs’ Exhibit No. 15, Blaekburn Declaration ¶ 8; Plaintiffs’ Ex-

*792

Mbit No. 20, Powers Declaration ¶ 8; Plaintiffs’ Exhibit No. 23, Smith Declaration ¶¶ 13-15).

8. The Medical Care Advisory Committee (“MCAC”)

Plaintiffs again charge that prior to adopting the new TennCare policies and procedures at issue, the Defendant failed to consult a duly constituted MCAC regarding the eligibility determination policies and procedures. The former Tenn-Care Director, Mark Reynolds, testified by deposition that the policies and procedures now at issue have not been reviewed by a MCAC. (Plaintiffs’ Exhibit No. 1, Reynolds Deposition at 39-40).

The Defendant has offered the declaration of Dr. Conrad Shackleford, who asserts that as of February, 2002, the Defendant has a duly constituted MCAC that satisfies the requirements of the federal regulations. (Defendant’s Exhibit No. 3). Yet, from Dr. Shackleford’s declaration none of the committee members is a Medicaid recipient, as required by Medicaid regulations. Moreover, Dr. Shackleford does not contradict TennCare’s former Director’s Testimony that this committee never reviewed the TennCare policies and procedures now before the Court, prior to the submission of the proposed waiver amendment to CMS in October, 2001. At best, Dr. Shackleford’s declaration shows that this committee was established in February, 2002 and met on June 14, 2002 for the first time to review the new Tenn-Care waiver. Dr. Shackleford does not state that the committee had an opportunity for participation in policy development and program administration before its submission to CMS. Dr. Shackleford’s committee’s June 14th meeting was after CMS’s May 30th letter of approval. Id attached thereto.

There is also evidence that key state legislative committees previewed the proposed amendments to the TennCare waiver action plan prior to its submission to CMS and approved them. The Court finds that the Defendant did not consult with a duly constituted MCAC prior to its submission of the amended TennCare waiver to CMS.

The Defendant notes that after the entry of the Agreed Order, the TennCare Bureau met with the advocacy community groups to share information and to receive comments. (Docket Entry No. 384, Declaration of Nancy McLeon). Yet, according to the proof, there are substantial differences of opinion on the exchanges of information with advocacy groups.

Compare

Docket Entry No. 405, Defendant’s Exhibit No. 41, Kilgas Declaration ¶ 3; Defendant’s Exhibit 42, Bates Declaration ¶ 3

with

Plaintiffs’ Exhibit No. 118, Garr Declaration ¶ 1. The Court does not deem it necessary to resolve these disputes other than to highlight the differences of opinions on the efficacy of the Defendant’s dialogue with local community groups.

E. Individual Plaintiffs

1. Michael Rosen

Michael Rosen is a 34 year old resident of Davidson County, Tennessee, and self-employed in the recording industry. (Docket Entry No. 1, Complaint ¶ 35). On May 30, 2001, Michael Rosen gave written notice that he wished to cancel his Tenn-Care coverage; he has since been terminated from the program. (Docket Entry No. 223, Sharp Declaration, Attachment A). There is no proof introduced by Plaintiff that Mr. Rosen will imminently suffer from the waiver changes.

2. Barbara Huskey

Ms. Huskey is a 51 year old housewife and a resident of Sevier County, Tennessee. Ms. Huskey suffers from mitral valve prolapse and osteoarthritis. Mitral valve prolapse requires the use of medications each day to regulate blood flow around the

*793

heart. Ms. Huskey is currently enrolled in TennCare as a waiver eligible. (Docket Entry No. 1, Complaint ¶ 58; Docket Entry No. 233, Sharp Declaration ¶ 2). Ms. Huskey depends upon her TennCare coverage to pay for medication for her arthritis and for treatment of her mitral valve prolapse. The Defendant is requiring Ms. Huskey, like all waiver eligibles, to participate in the new reverification process for TennCare coverage through TDHS. (Plaintiffs’ Exhibit 51, TennCare Standard Rules, Rule 1200-13-14-.02(7), at 17).

3. Emanuel Martin By Next Friend Cheryl Martin

Emanuel Martin is a resident of Maury County, Tennessee, with his parents, Emanuel was born on March 21, 1996, with a prolapsed umbilical cord that caused permanent brain damage and that has resulted in developmental delays. (Docket Entry No. 1, Complaint ¶ 59). Martin cannot sit on his own, crawl or walk.

Id.

He cannot swallow and is fed through a G-tube.

Id.

Martin needs extensive home nursing and therapy services. Emanuel Martin is currently enrolled in TennCare as a waiver eligible. (Docket Entry No. 233, Sharp Declaration ¶2). The Defendant is requiring Emanuel Martin, like all waiver eligibles, to participate in the new reverifieation process for TennCare coverage through TDHS. (Plaintiffs’ Exhibit 51, TennCare Standard Rules, Rule 1200-13-14-.02(7), at 17).

4. Wanda Campbell

Wanda Campbell is a resident of Hawkins County, Tennessee. She is a 32 year old housewife suffering from dystonia, depression and chronic pain syndrome. (Docket Entry No. 1, Complaint ¶ 79). Campbell’s symptoms include severe muscle spasms in her face, neck, back and throat, with intermittent difficulty speaking and breathing.

Id.

Wanda Campbell is currently enrolled in TennCare as a waiver eligible. (Docket Entry No. 233, Sharp Declaration ¶ 2). The Defendant is requiring Wanda Campbell, like all waiver eligi-bles, to participate in the new reverification process for TennCare coverage through TDHS. (Plaintiffs’ Exhibit 51, TennCare Standard Rules, Rule 1200-13-14-.02(7), at 17).

5. Connie Hoilman

Connie Hoilman is a resident of Washington County, Tennessee. She is a 43 year old housewife who suffers from Multiple Sclerosis. (Docket Entry No. 1, Complaint ¶ 84). Connie Hoilman is currently enrolled in TennCare as a waiver eligible. (Docket Entry No. 233, Sharp Declaration ¶ 2). The Defendant is requiring Ms. Hoil-man, like all waiver eligibles, to participate in the new reverification process for Tenn-Care coverage through TDHS. (Plaintiffs’ Exhibit 51, TennCare Standard Rules, Rule 1200-13-14-.02(7), at 17).

6. Mark Hughes

Mark Hughes is a resident of Greene County and is currently enrolled in Tenn-Care as a waiver eligible. (Docket Entry No. 233, Sharp Declaration ¶ 2). The Defendant is requiring Mark Hughes, like all waiver eligibles, to participate in the new reverification process for TennCare coverage through TDHS. (Plaintiffs’ Exhibit 51, TennCare Standard Rules, Rule 1200-13-14-.02(7), at 17).

7. Jacob B. By Next Friend Martin B.

Jacob B. is a severely emotionally disturbed 14 year old patient at Hermitage Hall, a residential mental health facility in Nashville, Tennessee. (Docket Entry No. 1, Complaint ¶ 94). Jacob B. is not currently enrolled in TennCare. (Docket Entry No. 233, Sharp Declaration ¶2). There is no proof introduced by Plaintiff

*794

that Jacob B. will imminently suffer from the waiver changes.

8. Jackie Baggett

Jackie Baggett is 48 years old resident of Haywood County, Tennessee, and a high risk diabetic. (Docket Entry No. 1, Complaint ¶98). Jackie Baggett is currently enrolled in TennCare as a waiver eligible. (Docket Entry No. 238, Sharp Declaration ¶ 2). The Defendant is requiring Jackie Baggett, like all waiver eligibles, to participate in the new reverification process for TennCare coverage through TDHS. (Plaintiffs’ Exhibit 51, TennCare Standard Rules, Rule 1200-18-14-.02(7), at 17).

9. Brenda Clabo

Brenda Clabo is a resident of Sevier County, Tennessee. She is a 45 year old housewife who manages two apartments during the day. (Docket Entry No. 1, Complaint ¶ 103). She suffers from rheumatoid arthritis and asthma.

Id.

Ms. Cla-bo is not currently enrolled in TennCare. (Docket Entry No. 233, Sharp Declaration ¶ 2). There is no proof introduced by Plaintiff that Ms. Clabo will imminently suffer from the waiver changes.

10. Pradie Tibbs

Pradie Tibbs is a 54 year old construction worker who has undergone multiple surgeries for colon obstruction and has a permanent colostomy. (Docket Entry No. 1, Complaint, ¶ 108,112). Tibbs also suffers from high blood pressure that requires daily medications.

Id.

¶ 113 . Pra-die Tibbs is currently enrolled in Tenn-Care as a waiver eligible. (Docket Entry No. 233, Sharp Declaration ¶ 2). The Defendant is requiring Pradie Tibbs, like all waiver eligibles, to participate in the new reverification process for TennCare coverage through TDHS. (Plaintiffs’ Exhibit 51, TennCare Standard Rules, Rule 1200-13-14-02(7), at 17).

11. Gayle Cummings

Gayle Cummings currently receives TennCare benefits as an uninsurable person. (Docket Entry No. 343, Plaintiff’s Exhibit 2: Cummings Declaration ¶ 1). Ms. Cummings suffers from memory deficit and impairments to her attention skills, new learning skills, reading and auditory skills.

Id.

Ms. Cummings has a hard time understanding what she reads and has difficulty filling out forms.

Id.

¶2 . Noise and crowds give Ms. Cummings panic attacks and she does not leave her house unless going to the grocery store or doctors office.

Id.

¶¶ 2, 3 . The Defendant is requiring Ms. Cummings, like all waiver eligibles, to participate in the new reverifi-eation process for TennCare coverage through TDHS. (Plaintiffs’ Exhibit 51, TennCare Standard Rules, Rule 1200-13-14-.02(7), at 17).

12. Bach Thuy Nguyen

Bach Thuy Nguyen is a resident of Brentwood, Tennessee and is currently enrolled as a TennCare uninsurable. (Plaintiffs Exhibit 41: Bach Thuy Nguyen Declaration ¶ 2). Ms. Bach Thuy Nguyen is a monolingual Vietnamese speaker who cannot communicate in English.

Id.

¶ 3 . Ms. Nguyen suffers from high blood pressure, high cholesterol, and hypertension.

Id.

¶ 2 . Additionally, she suffers from swollen limbs and joint pain.

Id.

Bach Thuy Nguyen is dependant upon TennCare for prescriptions and doctors visits. Id. ¶ 4 . The Defendant is requiring Bach Thuy Nguyen, like all waiver eligibles, to participate in the new reverification process for Tenn-Care coverage through TDHS. (Plaintiffs’ Exhibit 51, TennCare Standard Rules, Rule 1200-13-14- 02(7), at 17).

13. Di Nguyen

Di Nguyen lives in Davidson County, Tennessee and is currently enrolled as a

*795

TennCare uninsurable. (Plaintiffs Exhibit 42: Di Nguyen Declaration ¶ 2). Di Nguyen is a monolingual Vietnamese speaker who cannot communicate in English.

Id.

¶ 3 . Di Nguyen has problems with arthritis, migraine headaches, and her shoulder frequently becomes dislocated.

Id.

¶2 . Additionally, a lump has been found in her breast.

Id.

¶ 2 . She is seeking treatment and needs mammograms to monitor the lump.

Id.

¶ 4 . Di Nguyen is dependant on TennCare for her medicine, doctor visits, and mammograms.

Id.

¶ 4 . The Defendant is requiring Di Nguyen, like all waiver eligibles, to participate in the new re-verification process for TennCare coverage through TDHS. (Plaintiffs’ Exhibit 51, TennCare Standard Rules, Rule 1200-13-14-.02(7), at 17).

14. Sherry Justice

Sherry Justice fives in Chapmansboro, Tennessee. (Docket Entry No. 409, Plaintiffs’ Exhibit No. 94, Justice Declaration ¶ 1). Ms. Justice stopped working in January of this year due to poor health. (Docket Entry No. 383, Justice Declaration ¶ 1). She has had three digestive tract surgeries, which attempted to repair damage to her stomach fining and esophagus; she has a spot on her lung; and she is currently suffering from unexplained rectal bleeding.

Id.

¶¶ 3-1 . Ms. Justice has no income, no access to health insurance, and has been refused coverage by BlueCross/BlueShield.

Id.

¶¶2-3, 5 . She is dependent on TennCare for medical treatment.

Id.

¶ 4 .

In order to apply for TennCare coverage, Ms. Justice filed an application at TDHS for Medicaid eligibility. (Plaintiffs’ Exhibit 51, TennCare Standard Rules, Rule 1200-13-14-.08, at 20-21). Subsequently, Ms. Justice filed an application for TennCare coverage at her local TDHS office on July 15, 2002.

Id.

¶6 . TDHS denied her application that same day, and told her she would receive a ME packet from TennCare.

Id.

Ms. Justice’s packet was not received when promised but, after subsequent inquiries, she received a Tenn-Care ME packet on September 9, 2002. (Docket Entry No. 409, Plaintiffs Exhibit 94, Justice Declaration ¶ 4). The packet was required to be completed by September 19, 2002.

Id.

at ¶ 7 . After sending in the Part B requirements of the ME packet, Ms. Justice was informed on September 19, 2002 that her application was incomplete and that she filled out the portion of the form reserved for SPMI individuals.

Id.

The Tennessee Justice Center contacted the TennCare lawyers and arranged for Ms. Justice to re-submit her application although the September 19, 2002 deadline had passed. (Docket Entry No. 419, Plaintiffs Exhibit No. 110, Justice Declaration ¶¶ 3-4). Ms. Justice has re-submitted her application and is awaiting the TennCare Bureau’s decision.

Id.

¶ 4 .

Mary Anne Rudolph, the director of the Medicaid/TennCare Policy Unit of TDHS responds to Justice’s declaration by stating that the case worker inadvertently did not indicate that an ME packet should be sent to Justice. (Docket Entry 430, Rudolph Declaration ¶ 11). This has been corrected, but contrary to Justice’s declaration, she has not provided her necessary medical records information.

Id.

Justice’s TDHS Medicaid-Disability application is still pending with DDS.

Id.

No decision can be made on TDHS Medicaid application until her application with DDS is completed.

Id.

15. Lorri Griffin

Lorri Griffin is a resident of Morris-town, Tennessee, and has been enrolled in TennCare since 1994 when TennCare began. In late August 2002, Ms. Griffin completed the redetermination process and continues to be waiver eligible for Tenn-

*796

Care Standard through August 2003. (Plaintiffs’ Exhibit 51, TennCare Standard Rules, Rule 1200-13-14-.02(7), at 17). Lorri Griffin is diagnosed with low blood sugar, gastro-esophageal reflux disease, colon polyps, peripheral vascular disease and arthritis. (Docket Entry No. 440, Third Supplemental Complaint ¶ 6). Additionally, Ms. Griffin suffers from an as yet undiagnosed heart condition, that causes chest wall pain.

Id.

16. Melanie Jackson & Wilson Dale Jackson

Melanie Jackson and her husband, Wilson Dale Jackson, live in Franklin, Tennessee and have been enrolled in TennCare since 1994. (Plaintiffs Exhibit 109, Jackson Declaration ¶ 1). They are both waiver eligible. Mr. and Mrs. Jackson are currently participating in the reverification process through TDHS.

Id.

¶ 4 . Mr. Jackson suffers from Idiopathic Thrombocy-topenia Purpura (“ITP”), an auto-immune disease that causes him to have a very low platelet count that can cause spontaneous hemorrhaging.

Id.

¶ 2 . Mrs. Jackson suffers from sensory neuropathy and must take medications to manage pain.

Id.

¶ 3 . The Jacksons, like all waiver eligibles, are required to participate in the new reverifi-cation process for TennCare coverage through TDHS. (Plaintiffs’ Exhibit 51, TennCare Standard Rules, Rule 1200-13-14-.02(7), at 17).

In August 2002, both individuals received letters stating that they needed to make appointments at the local TDHS office to be recertified for TennCare.

Id.

¶ 4 . On September 4, 2002, after meeting with a TDHS case worker, both individuals received letters stating that their coverage would end on September 8, 2002.

Id.

¶ 5 . Noting that they had ten (10) days to appeal, the Jacksons sent in a letter on September 7, 2002 appealing the denial of coverage.

Id.

¶ 6 . Mrs. Jackson stated that she did not have time to gather medical records for the appeal.

Id.

Subsequently, Ms. Jackson learned from TennCare advocates that they could apply through the ME application.

Id.

¶ 7 . “No one at [T]DHS had mentioned the medical eligibility option to [them]. If [Mrs. Jackson] had not spoken to a TennCare advocate, [she] would never have known the option existed.”

Id.

On September 11, 2002, Ms. Jackson called their local TDHS office to request a ME packet.

Id.

¶ 8 . She spoke to several people who did not know how to address the situation before she was able to speak to personnel who understood her request.

Id.

On September 16, 2002, Mrs. Jackson called the TennCare Bureau to check on the status of her appeal and to find out whether the ME packet had been sent. “[She] was told they could not check the status of [her] appeal, and that [T]DHS had not indicated to them that a medical eligibility packet should be sent to [her].”

Id.

¶ 9 . She again called the TDHS office. The TDHS worker apologized for the mistake and assured her that a ME package would be sent.

Id.

In mid September 2002, Mrs. Jackson checked on the status of their TennCare coverage. Mrs. Jackson’s coverage had been terminated as of September 8, 2002 but, it is unknown why her husband’s coverage was not terminated.

Id.

¶ 10 .

Mrs. Jackson received a ME packet dated September 18, 2002 which stated that it must be completed and returned by November 2, 2002. (Plaintiffs Exhibit 113, Jackson Declaration, ¶ 2). Mr. Jackson did not receive the medical eligibility packet although TennCare stated that both were mailed on the same day.

Id.

Mrs. Jackson is required to apply through Part B of the medical eligibility application because sensory neuropathy is not on the TennCare Medical Condition List and she

*797

has no mental illness, therefore, she must acquire a letter from an insurance company stating that she is uninsurable.

Id.

¶ 4 . Mrs. Jackson has applied for insurance from Farm Bureau, but has been told the process will take 3-4 weeks although, they have verbally informed her that she is uninsurable.

Id.

On September 25, 2002, the Jacksons received a bill for their October premium which covers both indivi

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