Amicus Curiae Brief — Wilder v. Virginia Hospital Assn.

in the Supreme Court

of the United States

OCTOBER TERM, 1988

GERALD L. BALILES, et al.

Petitioners,

THE VIRGINIA HOSPITAL ASSOCIATION,

Respondent.

ON PETITION FOR WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

Brief Amici Curiae of the States of

Alaska, Arizona, Colorado, Connecticut, Delaware,

Florida, Georgia, Hawaii, Idaho, Illinois, Indiana,

lowa, Kansas, Kentucky, Louisiana, Michigan,

Minnesota, Mississippi, Missouri, Montana, Nebraska,

Nevada, New Hampshire, New Jersey, North Dakota,

Oklahoma, Oregon, Pennsy!vania, Rhode Island,

South Carolina, South Dakota, Tennessee, Utah,

Vermont, Washington, West Virginia and Wyoming

DAVE FROHNMAYER

Attorney General of Oregon

JAMES E. MOUNTAIN, JR.

Deputy Attorney General

*VIRGINIA L. LINDER

Solicitor General

ROBERT M. ATKINSON

Assistant Attorney Genera!

400 Justice Building

Salem, Oregon 97310

Phone: (503) 378-4402

Council for Amici Curiae

BEST AVAILABLE COPY ©

(ie., hospitals and nursing care homes) a private right of

action enforceable through 42 U.S.C. § 1983 (1982) to chal-

lenge state reimbursement decisions in federal court.

INTEREST OF AMICI CURIAE

The State of Oregon et al. submit this brief as amici curiae

in support of the petition for writ of certiorari filed by the

Commonwealth of Virginia. Virginia seeks review of the deci-

sion of the United States Court of Appeals for the Fourth

Circuit in Virginia Hospital Association v. Baliles, 868 F.2d 653

(4th Cir. 1989). In urging the Court to grant certiorari, the

State of Oregon is joined by 36 additional states.' The amici

states, individually and collectively, have a strong interest in

the issues presented by the Commonwealth of Virginia in its

petition. In particular, they have an overriding interest in the

first question presented: whether health care service pro-

viders have a right enforceable through section 1983 to sue in

federal court for a particular level of Medicaid reimbursement.

Medicaid is a voluntary, cooperative federal-state program

that provides funds to reimburse certain costs of medical

treatment for the needy. Each of the amici states participates

in the Medicaid program, except Arizona. See footnote 1. As

required by federal law, a participating state’s Medicaid pro-

gram must fund institutional medical care, including care in

inpatient hosptials, nursing facilities, and intermediate care

facilities (collectively referred to as “providers”). The amount

of federal-state dollars directed to needy persons through

private, for-profit providers is a major portion of the overall

Medicaid program.

The amici states have a substantial financial stake in the

outcome of this case and a significant legal interest in its

'This brief of amici curiae is filed pursuant to Rule 36.4 of the Rules of

the Supreme Court. The amici states are listed in Appendix A to this

brief. Amicus State of Arizona does not participate in the Medicaid program

directly. However, it participates in a cooperative state-federal program

under a special grant that provides funds for indigent health care. Because of

the similarities between this special grant program and the Medicaid

program, Arizona has an interest in the issues presented in the petition for

writ of certiorari. ,

ili

resolution. The decision below holds that a health care pro-

vider may bring an action under section 1983 to challenge the _

provider reimbursement rate set by a state and approved by

the federal government. Providers are thus free to attack, on

a year-by-year and provider-by-provider basis, the “reason-

ableness” of each state’s reimbursement rates. Every routine

rate challenge may be made a federal case.

Many of the amici states already are caught up in the

explosion of provider litigation based on alleged federal rights

to specific levels of reimbursement. Indeed, some amici states

are under siege by multiple lawsuits for different years,

different classes of providers and inconsistent claims as to the

rate allegedly guaranteed by federal law. Millions of state and

federal dollars are potentially at stake in each law-

suit. Collectively, hundreds of millions of dollars are

involved. The question of provider entitlement to bring these

federal lawsuits needs resolution at a national level. The

amici states therefore file this brief to urge the Court to grant

the Commonwealth of Virginia’s petition for writ of certiorari.

iv

TABLE OF CONTENTS

Page

EE Te hs cc acadgngeeed binteceedsesseetouens i

EL . «¢eccodedecesoecsegeessessecsese iii

ES ccccccoscescecccescsecesccososeeses 1

Argument

I. This case involves issues of substantial impor-

SD cncccnaececedidenccesteecencasceccececocs 2

II. Neither the history nor the language of section

1396 supports finding that providers have rights

_ enforceable through section 1983 ................ 3

Ill. The results in the circuits are inconsistent ....... ll

URES di decnbScebe weds cbSececdcccecdccecesoti 13

Appendix A

List of the Amici Curiae ..................005. App-1

Appendix B

PED caodoccvccosceseesoseesesses App-7

TABLE OF AUTHORITIES

Page

Cases Cited

Cannon v. University of Chicago, 441 U.S. 677 (1979) ......... 8

Case v. Weinberger, 523 F.2d 602 (2d Cir. 1975) ............. 11

Colorado Health Care Ass’n v. Colorado Dept. of Social

Services, 842 F.2d 1158 (10th Cir. 1986) .............. 11

Coos Bay Care Center v. Oregon, 803 F.2d 1060 (9th Cir.

1986), cert. granted, 481 U.S. 1036, judgment

vacated and remanded on issue of mootness,

U.S. —— , 108 S.Ct. 52 (1987) 2... ccc eens 2,11

Cort v. Ash 422 U.S. 66 (1975) .. 2.66.6 ccc cece eee 12

Edwards v. District of Columbia, 821 F.2d 651 (D.C. Cir.

i ie ch ie teesndgosedecceococcces 4

Green v. Cashman, 605 F.2d 945 (6th Cir. 1979) .......... 11-12

Maine v. Thiboutot, 448 U.S. 1 (1980) ...........6..06 005 3,12

Middlesex County Sewerage Auth. v. Nat’l Sea Clam-

mers Ass’n, 453 U.S. 1 (1981) ... 2... 6. cece eee ewes 3,12

Minnesota Assoc. of Health Care Facilities v. MAHCF,

742 F.2d 442, 446 (8th Cir. 1984), cert. denied, 469

ST an dec cdancedeebeoesedbeccnccccecs 10

Mississippi Hosp. Ass’n., Inc. v. Heckler, 701 F.2d 511

ink co dinregbbeeteeseedsedeccccccocce 5

Nebraska Health Care Ass’n v. Dunning, 778 F.2d 1291

i ctancd cgeawebesoedsdbedséeocecccccece 7

Pennhurst State School and Hospital v. Halderman, 451

Rabe dudbedesbbcdeetercstesooccces passim

Virginia Hosp. Ass’n v. Baliles, 868 F.2d 653 (4th Cir.

BED edebedddeeesesssedcocoessccccccoevecccces passim

Volk, et al. v. State, et al A5O0092 . 2... cece

Wisconsin Hospital Ass’n v. Reivitz, 733 F.2d 1226 (7th

i ie ee cepa eeeeedes se cceeccess 5

Wright v. City of Roanoke Redevelopment & Housing

Auth., 479 U.S. 418 (1987) ... 2.2... 3,10

vu

TABLE OF AUTHORITIES—Continued

Page

United States Constitution, Article I, section 8, clause 1 ........ 9

Statutory Provisions

42 U.S.C. § 1396a(a)(13)(A) (1986) ..............00005. passim

Ge) SET bab cnbctccccccesocceevesosses passim

Administrative Regulations

SOG ee O GRD Fei ok ob dedeccccccccdscccccncs 10

GeO SUP ED oc cccccccctvccccccccceccccces 10

EE 7

ny <i. cccnpeecgereseeesssuesdeebees 10

a ss ns cencuceneebecncnesestoues 10

Se ED vcccnnssdodeteccocccccesctb<cees 3

Other Authorities

S. Rep. 96-471, 96th Cong., Ist Sess. ..............000055. 4-5,6

126 Cong. Rec. 17,885-86 (1980) ... 2.2.2.0... ee eee eee ee 5

HEALTH CARE FINANCING ADMIN., Dep’t of HEALTH

AND HUMAN Services, Mepicaip FINANCIAL

SUUPGUIST PUBOAE, WEN TEE occ ccc ccccccccccccccccccs 3

Vill

1

SUMMARY OF ARGUMENT

Congressional intent, as revealed by the language and his-

tory of the 1980 amendments to the Medicaid statutes, refutes

the lower court’s conclusion that providers have a right to sue

states over reimbursement rates under the aegis of section

1983. The amended version of the statute provides only that

states must provide “assurances” to the Secretary of Health

and Human Services that rates are reasonable and ade-

quate. There is no language in the amended statute suggest-

ing enforceable rights. The history of the amendments

confirms Congress intended to decrease federal oversight of

state rate-making. Layering judicial scrutiny on top of

administrative review runs directly counter to that

intent. Rather than reducing federal oversight of the state

responsibility for those rates, as Congress intended, the result

setting authority to the federal courts. That transfer of

authority threatens to spill over to permit private rights of

action pursuant to other statutory systems under the lower

court’s misapplication of the “enforceable rights” doctrine.

The lack of support for provider enforceable rights in the

language and history of the statutes has caused those circuits

that have found such a right to employ inconsistent and often

contradictory analyses. The courts disagree about the

applicability of this Court’s cases to this issue. Some courts

find providers to be “intended beneficiaries” of the Medicaid

found a coherent approach consistent with this Court’s juris-

prudence of enforceable rights under section 1983. Because of

the uncertainty among lower courts in their analyses and the

importance of the issue, this case merits this Court’s review.

2

ARGUMENT

I. This case involves issues of substantial importance.

This case presents the same issue on which this Court

granted certiorari in Coos Bay Care Center v. Oregon, 803 F.2d

1060 (9th Cir. 1986), cert. granted, 481 U.S. 1036, judgment

vacated and remanded on issue of mootness, __. U.S. ___., 108

S.Ct. 52 (1987) (Coos Bay). Did Congress intend to permit

providers of health care services under 42 U.S.C.

§ 1396a(a)(13)(A) (1986) to bring suit against the states under

42 U.S.C. § 1983 (1982) when it amended the Medicaid stat-

utes in 1980? The issue is no less important today than it was

in 1987 when a majority of the states, several organizations

representing local governments, and the United States Solic-

itor General all joined Oregon in requesting this Court to

reverse the decision of the Ninth Circuit Court of Appeals

allowing providers to sue. Indeed, the rapid growth of litiga-

tion in the area and the enormous amounts of money at stake

bear stark witness to the Court’s prudence in agreeing to hear

that case.

The number of challenges to state reimbursement systems

by providers of inpatient hospital and long-term care services

to Medicaid recipients has been substantial in recent

years.? Each of these challenges has the potential to involve

very large amounts of money drawn from both state and

federal treasuries.’ Because the total number of state and

grams is truly staggering, the burgeoning number of cases has

the potential to subject federal and state governments to lia-

* See Appendix B for a list of some currently pending section 1983

challenges to Medicaid reumbursement rates.

‘For example, Volk, et al vu. Oregon, et al, cited in Appendix B,

although involving only one year’s reimbursement schedule and involving

the nursing home industry but not hospitais, has over $5 million at stake.

more than $3 milhon of which is federal money. The several Pennsylvania

cases may entail liability of $80 million.

3

bility running easily into the hundreds of millions of dollars.‘

Il. Neither the history nor the language of section

1396 supports finding that providers have rights

enforceable through section 1983.

In Maine v. Thiboutot, 448 U.S. 1 (1980), this Court held

that the phrase “and laws” in 42 /.S.C. § 1983 (1982)° must be

read literally, so as to create under that section a private cause

of action against state officials for violations of rights confer-

red by federal statutes. One year after Thiboutot, the Court

“recognized two exceptions to the application of § 1983 to

statutory violations.” Middlesex County Sewerage Auth. v.

Nat'l Sea Clammers Ass'n, 453 U.S. 1, 19 (1981) (Sea Clam-

mers), citing Pennhurst State School and Hospital v. Halder-

man, 451 U.S. 1 (1981) (Pennhurst). The Court held that a

section 1983 action will not lie where (1) Congress has fore-

closed private enforcement of the federal statute in the statute

itself, or (2) the statute does not create “enforceable rights”

under section 1983. Sea Clammers, 453 U.S. at 19; Pennhurst,

451 U.S. at 28; see also Wright v. City of Roanoke Redevelop-

ment & Housing Auth., 479 U.S. 418, 423-24 (1987)

“ As the United States Solicitor General noted in his brief in support of

the State of Oregon in Coos Bay, the federal contribution to the Medicaid

program for medical assistance totalled $23.4 billion in 1986. Brief For The

United States As Amicus Curiae Supporting Petitioners, at 2, citing

HeactuH Care Financine Apmin., Dep't or HEALTH AND HUMAN Serv-

ices, Mepicam Frnanciat Report: Fisca Year 1986. Federal funds

comprised at least 50 and in some cases more than 70 percent of each state's

medical assistance program in 1986. 49 Fed. Reg. 46,957 (1984). The

average figure was approximately 58 percent. Thus, treating 1986 as a

representative year, and including the states’ contribution, the total medica!

assistance budget is over $40 billion per year.

* 42 U.S.C. § 1983 (1982) provides, in pertinent part:

Every person who, under color of any statute, ordinance, reg-

4

(Roanoke). This case falls within the second excep-

tion: Congress did not intend to afford enforceable rights to

providers of health care services when it amended the Medic-

aid statutes in 1980.

In Pennhurst the Court concluded that whether Congress

intended to create rights enforceable under the aegis of section

1983, when it does not expressly provide for such actions in a

given enactment, must be determined from the language and

history of the act. In this case, the history, which demon-

strates that Congress intended to increase state autonomy and

decrease federal oversight in the Medicaid reimbursement

rate-setting process, illuminates the language, which is not the

right- or duty-creating language a court must find to support a

claim of rights enforceable under section 1983.

A. The history of section 1396 supports a result

directly contrary to that reached in the lower

court.

By the earlier reference to the increasing numbers of suits

challenging state reimbursement rates, amici do not merely

suggest the federal courts wil] be met with a flood of litigation,

although those waters are unquestionably rising. The point,

rather, is that year-by-year, provider-by-provider litigation

over each aspect of each state’s plan is becoming the rule, a

reality manifestly inconsistent with Congress’ unmistakable

intent to reduce rather than increase federal oversight of the

rate-making process. That intent is conspicuous in the legis-

lative history surrounding the enactment of the 1980 amend-

ments to the Medicaid statutes.

In 1980, in response to the “inherently inflationary”

nature of the former “reasonable cost” standard, Congress

enacted the Boren Amendment to the Medicaid statutes.® S.

* Now embodied in 42 U.S.C. § 1396a(a)(13)(A) (1986).

SS ee ee ee

Rep. 96-471, 96th Cong., Ist Sess. 28-29.’ The amendment

“represented a significant change in the federal {reimburs-

ement] standard,” offering the states an opportunity to effect

“more stringent cost containment” while freeing them from

excessive “federal oversight of (their] reimbursement meth-

odologies.” Wisconsin Hospital Ass'n v. Reivitz, 733 F.2d 1226,

1228 (7th Cir. 1984). Congress chose to “give{] the States

and standards of payment.” S. Rep. 96-471, at 28. By the

same token, Congress intended “to reduce federal oversight of

state reimbursement.” Mississippi Hosp. Ass'n., Inc. v.

Heckler, 701 F.2d 511, 521 (5th Cir. 1983). While pointing out

that the Secretary would continue to insist on “assurances

. . . that the payment rates. . . are reasonable and adequate,”

Congress “expectied} that the Secretary will keep regulatory

and other requirements to that minimum necessary to assure

proper accountability, and not overburden the States and

facilities with marginal but massive paperwork require-

ments.” S. Rep. 96-471, at 29. It is distinctly ironic that a

however, is largely limited to statements that merely reiterate

the statutory references to “reasonable and adequate”

rates. See 868 F.2d at 658-59. The court acknowledged that

the purpose behind the Omnibus Budget Reconciliation Act

(OBRA), of which the Boren Amendment was a part, was to

reduce the federal budget. The court ignored, however, the

paralle! and equally important intent of the Boren Amend-

ment to reduce federal oversight of state programs. Refusal to

acknowledge this central goal of the Boren Amendment

spared the court the unenviable task of reconciling the inev-

itably more intrusive effects of piecemeal litigation with Con-

Based on its conclusion that Congress “intended no close

7

whatever rates the states might conjure up is inconsistent not

only with these expressions of Congressional intent, but also

with the Secretary's view reflected in the regulations issued to

implement the Boren Amendment,’ and the Secretary's

actions in reviewing state plans. See, e.g, Nebraska Health

Care Ass'n v. Dunning, 778 F.2d 1291 (8th Cir. 1985) (discuss-

ing Secretary's disapproval of part of Nebraska's plan for

1983-84).

Congress intended to decrease, not increase, federal over-

B. The language of section 1396 is not rights-creat-

ing language.

The act under consideration in Pennhurst referred to

“rights” accorded to the intended beneficiaries of the act and

* See, e.g . Preamble to Interim Final Rule, Medicaid Program, Payment

for Long-Term Care Facility Services and Inpatient Hospital Services. 46

Fed. Reg. 47,964, 47,966 (1981). The regulations, as revised to meet the

requirements of the 1980 amendments. require states to submit assurances at

mation a State submits with respect to these items to determine whether it 1s

reasonable to justify acceptance of the State's assurances ~ /bid

“obligations” on the part of the states. Despite that language.

this Court concluded Congress had not intended to create

enforceable nghts against the states. Rather, the Court deter-

mined, the language in question was merely precatory, a

“nudge” in Congress’ preferred direction. 451 U.S. at 19.

The language of section 1396a(a)(13)(A) is far less likely

to be employed by a Congress desirous of creating enforceable

rights than is the language at issue in Pennhurst. Section

1396a(a)(13)(A) does not contain a specific grant of a private

right of action. Nor does it read like a statute designed to

“dictate specifically what the relevant government officials

may and may not do.” Edwards v. District of Columbia, 821

F.2d 651, 656 (D.C. Cir. 1987). Far from containing “right- or

duty -creating language,” Cannon v. University of Chicago, 441

U.S. 677, 690 n. 13 (1979), section 1396a(a)(13)(A) permits

participating states to devise reimbursement rates “which the

State finds, and makes assurances satisfactory to the Secre-

tary, are reasonable and adequate to meet the costs which

must be incurred by efficiently and economically operated

facilities. . . .” The statute also provides that these rates are

to be set “in accordance with methods and standards devel-

oped by the State.” By its terms, therefore, section

1396a(a)(13)(A) vests rate-making discretion in the state,

subject to the condition that it makes “assurances satisfactory

to the Secretary.” As the Pennhurst Court noted in the con-

vext of the statute at issue in that case, “[i}t is at least an open

question whether an individual's interest in having a State

provide. . . ‘assurances’ [to the Secretary] is a ‘right secured’

by the laws of the United States within the meaning of

§ 1983.” 451 U.S. at 28. Indeed, if the statutory requirement

of assurances by the states confers any right on providers, it is

only the nght to have those assurances provided to the Secre-

tary. The provision of the assurances then engages the

machinery of the Secretary's review. The Secretary examines

the assurances, the rates and the supporting data to determine

whether the rates meet the statutory standard. The providers’

“right,” if any, is the right to have the Secretary perform his or

her duty and conduct the required review to ensure proper

accountability, not the “right” to substitute themselves and

the courts for the state, under the scrutiny of the Secretary, as

rate-maker.

Thus, in Pennhurst, this Court did not find enforceable

rights despite language of right and obligation. Here, by con-

trast, the court of appeals found enforceable rights despite the

lack of right- or duty-creating language and in the face of the

much more limited language of “assurances,” language this

Court has previously questioned as the basis of “enforceable

rights.”

The lower court acknowledged that the statute at issue in

this case, like the statute in Pennhurst, was enacted under the

spending power of Article I, section 8, clause 1, of the United

States Constitution. 868 F.2d at 657, n. 3. Pennhurst’s insis-

tence on clear legislative direction in spending power cases

stemmed from the Court’s concern that states be informed of

their obligations in unambiguous terms when they enter into a

voluntary, federally supported program.

[Ljegislation enacted pursuant to the spending power

is much in the nature of a contract. . . . The legit-

imacy of Congress’ power to legislate under the spend-

ing power . . fests on whether the State voluntarily

and knowingly accepts the terms of the “contract”

. There can, of course, be no knowing acceptance

if a State is unaware of the conditions or is unable to

ascertain what is expected of it.

451 U.S. at 17 (citations omitted). The lower court believed

this concern is “allayfed]” in this case because the states

undoubtedly knew they were agreeing to pay reasonable and

adequate rates when they elected to participate in the pro-

10

gram. 868 F.2d at 659. It is one thing to say the states know-

ingly bound themselves to pay reasonable and adequate rates

under the supervision and control of the Secretary. However,

it is quite another to say they knowingly agreed to defend

expensive, time-consuming and disruptive litigation in state

and federal courts brought by each disgruntled provider over

every aspect of and change in their programs. To make a

simple analogy, even a consumer who felt she had no real

choice but to enter into a particular contract is entitled to

know it has an attorney fees provision in it.

Providers, like the states, are voluntary participants in the

Medicaid program. See 42 C.F.R. § 447.204 (1985); Minnesota

Assoc. of Health Care Facilities v. MAHCF, 742 F.2d 442, 446

(8th Cir. 1984), cert. denied, 469 U.S. 1215 (1985) (providers

are free to decline to participate in the Medicaid program if

they are dissatisfied with a state’s rates). Thus providers have

the ability to opt out of the Medicaid program any time a

state’s rates are such that they believe it is not economically

desirable to participate. Even so, as a condition to state

participation, the Secretary requires each state to have in

place an administrative appeals process through which pro-

viders may challenge reimbursement rates. 42 C.F.R.

§ 447.253(c) (1985). However, the Secretary, whose inter-

pretation is entitled to “some deference,” Roanoke, 479 U.S.

418, 427, expressly has rejected the call for private rights of

action in the regulations adopted to implement the Boren

Amendment on the ground that the statutes contained neither

mandate nor authority to provide judicial recourse for dissat-

isfied providers. 48 Fed. Reg. 56,052 (1983); see also Preamble

to Final Rule, Medicaid Program; Payment for Long-Term

Care Facilities and Inpatient Hosptial Services, 48 Fed. Reg.

56,046 at 56,050 (1983).

Oa oo a

ll

III. The results in the circuits are inconsistent.

Because of the proliferation of section 1983 actions

against the states based on statutes that do not expressly

provide for private rights of action, the states have a signifi-

cant stake in the development of the law of enforceable rights

under that section. Although the cases in the various federal

circuit courts of appeal cannot fairly be described as in direct

conflict, the courts have not found a consistent analysis. For

example, the Ninth Circuit concluded in Coos Bay Care Center

uv. Oregon that it was “not necessary to engage in a Pennhurst

analysis.” 803 F.2d at 1062. The lower court in this case, by

contrast, concluded that a Pennhurst analysis was indeed

required. 868 F.2d at 657 n. 3.

The Ninth and Tenth Circuits have concluded that pro-

viders have standing under section 1396a(a)(13)(A) based on

their view that providers are intended beneficiaries of the

Medicaid statutes with interests “parallel” to those of

patients. See Colorado Health Care Ass'n v. Colorado Dept. of

Social Services, 842 F.2d 1158, 1164, n. 5 (10th Cir. 1988); Coos

Bay, 803 F.2d at 1063.'° At least two other circuits have

rejected the conclusion that providers are intended benefici-

aries. Green v. Cashman, 605 F.2d 945 (6th Cir. 1979), and

Case v. Weinberger, 523 F.2d 602 (2d Cir. 1975). In Green, the

court stated:

12

We do not find in the statute authorizing Medicare

and Medicaid any legislative intention to provide

financial assistance to providers of care for their own

benefit. Rather, the statute is designed to aid the

patients and clients of such facilities.

605 F.2d at 946. Amici do not agree that “interest” analysis is

appropriate for determining enforceable rights under section

1983.'! Even so, those courts embarking on that approach are

at best in unsettled waters in concluding that section

1396a(a)(13)(A) provides standing to providers, as the dis-

agreement among the circuit courts of appeal demonstrates.

Thus, the circuits do not agree on the applicability of this

Court’s opinions and, assuming that the identity of the

intended beneficaries of the Medicaid statutes is a relevant

inquiry, they do not agree whether providers fall within that

class. In light of the enormous amounts of money at stake in

these cases, the importance to both the state and federal gov-

ernments of a clear application of the law of enforceable rights

under section 1983, and the ever-increasing amount of litiga-

tion by providers, this Court should determine whether pro-

viders have enforceable rights under section 1396a(a)(13)(A).

'' The Ninth Circuit “special beneficiary” test is “borrowed” from the

implied right of action test of Cort v. Ash 422 U.S. 66 (1975). See 803 F.2d at

1062-63. The Cort test is designed to determine whether Congress intended

to umply a right of action in a substantive statute itself, without reference to

section 1983. Thiboutot, Pennhurst, Sea Clammers, et al., by contrast, seek

to know if Congress intended to permit private enforcement via section

1983. The inquiries are distinct. See, Thiboutot, 448 U.S. at 6. The issue

under Cort is who can enforce a right provided by statute. The issue under

section 1983 is whether there is any secured right to enforce.

Indeed, this approach is demonstrably inconsistent with Pen-

nhurst. No one denied that the “bill of rights” provision of the act at issue in

Pennhurst was enacted for the benefit of the class of institutionalized per-

sons with mental retardation that included the plaintiffs in that case. That,

however, was not sufficient to support the conclusion Congress intended to

grant those intended benficiaries rights enforceable under section 1983.

13

CONCLUSION

For the reasons stated above, this Court should grant the

Commonwealth of Virginia’s petition for writ of certiorari.

Respectfully submitted,

DAVE FROHNMAYER

Attorney General of Oregon

JAMES E. MOUNTAIN, JR.

Deputy Attorney General

VIRGINIA L. LINDER

Solicitor General

ROBERT M. ATKINSON

Assistant Attorney General

Counsel for Amici Curiae

General of Colorado

Denver, Colorado 80203

Attorney General of Delaware

Wilmington, Delaware 19801

Attorney General of Illinois

100 West Randolph Street, 12th Floor

Chicago, Illinois 60601

State of Indiana

Linley E. Pearson

Attorney Genera! of Indiana

219 State House

Indianapolis, Indiana 46204

State of lowa

Thomas J. Miller

Attorney General of lowa

Hoover Building — Second Floor

Des Moines, lowa 50319

State of Kansas

Robert T. Stephan

Attorney General of Kansas

Judicial Center — Second Floor

Topeka, Kansas 66612

Commonwealth of Kentucky

Frederic J. Cowan

Attorney General of Kentucky

State Capitol, Room 116

Frankfort, Kentucky 40601

ns

Attorney Genera! of Missouri

Jefferson City, Missouri 65! (02

Attorney General of New Jersey

Trenton, New Jersey 08625

App-6

State of West Virginia

Charles G. Brown

General of West Virginia

26E, State

Charleston, West Virginia 25305

State of Wyoming

Joseph B. Meyer

Genera! of Wyoming

123 State Capitol

C—O

a

App-7

APPENDIX B

PENDING LITIGATION

COLORADO

Amisub (PSL), Inc. v. State of Colorado, Department of

Social Services, No. 88-2482— United States Court of

Appeals for the Tenth Circuit

The Medical Center of Delaware, Inc. v. Eichler, No.

89-MY-9-1-CA— (petition for removal to United

States District Court pending)

GEORGIA

Health Facility Investments, inc. dba Ansley Pavilion «

Johnson, No. 1:89CF844JOF — United States District

Court, Northern District of Georgia

HAWAII

Beverly Manor, Inc. v. Rubin, No. 85-0052 — United

States District Court, District of Hawaii

Idaho Health Care Association, et al. v. Bowen, No.

88-1425— United States District Court, District of

Idaho

Jeff D., et al. v. Andrus, No. 87-3586— United States

Court of Appeals for the Ninth Circuit

Pope v. Donovan, No. 67738— District Court of the

State of Idaho

ILLINOIS

Chicago Osteopathic Medical Center, et al v Suter, No.

88C 1174—United States District Court, Northern

District of Illinois

App-8

[lUlinois Health Care Association, et al. v. Suter, No. 89C

849— United States District Court, Northern District

of Ilhnois

MICHIGAN

Health Care Association of Michigan, et al v. Depart-

ment of Social Services, et al., No. 89-50063

CA— United States District Court, Western District

of Michigan

MINNESOTA

REM-Bemidji, Inc., et al v. Sandra S. Gardebring,

Commissioner of the Minnesota Department of Human

Services, et al, No. 4-88-Civil-562— United States

Distnet Court, District of Minnesota; dismissed with-

out prejudice December 2, 1988, to permit completion

of edmini ve chall

MISSISSIPPI

Mississippi Health Care Association v. J. Clinton

Smith, No. JA 6-0765(B)— United States District

(consohdated with case below)

Independent Nursing Home Association v J Clinton

Smith, No. JA 6-0731 (W)— (same court as above)

MISSOURI

A.G.1 -Bluff Manor, Inc. v. Michael Reagen, Director,

Missouri Department of Social Services, et al, No.

&5-4015-CV-CO5— United States District Court, Dis-

tnct of Missoun

NEVADA

Hillthaven, Inc, et al v. State of Nevada Department of

Human Resources, et al, No. CV 88-6222— District

Court of the State of Nevada, Washoe County

App-9

NORTH DAKOTA

North Dakota Hospital Association, et al. v. George A.

Sinner, et al, Civ. No. Al-87-126—United States

District Court, Southwestern District of North Dakota

The Ohio Academy of Nursing Homes, Inc. v. Barry, et

al., (88AP-826) —Court of Appeals of the State of Ohio

(opinion June 22, 1989, certification to Ohio Supreme

Court pending).

Oregon Association of Hospitals v. Department of

Human Resources, (CF 88-225-DA)— United States

District Court, District of Oregon -

Volk, et al. v. State, et al., No. A50092— Oregon Court

of Appeals

Francisco, et al. v. Department of Human Resources, et

al., No. 89-6244—United States District Court, Dis-

trict of Oregon

PENNSYLVANIA

West Virginia University Hospitals, Inc. v. Casey, 701

F.Supp. 496 (1988) under advisement on appeal to the

United States Court of Appeals for the Third Circuit

Temple University v. White, et al., Civ. No.

88-6646 — Eastern District of Pennsylvania

Albert Einstein Medical Center, et al. v. White, et al.,

Civ. No. 88-8831—same as above

Frankford Hospital v. Department of Public Welfare, et

al., Civ. No. 88-8927 —same court

Hahnemann University Hospital, et al. v. Department

of Public Welfare, et al., Civ. No. 88-9132—same court

App-10

Hospital Association of Pennsylvania, et al. v. White, et

al., Civ. No. 88-9849—same court

SOUTH CAROLINA

ANCO, Inc., et al. v. State Health and Human Services

Finance Commission, et al., No. —on appeal to

South Carolina Superior Court

WASHINGTON

Folden, et al. v. DSHS, No. C87-802TB— United

States District Court, Western District of Washington

Multicare Medical Center, et al. v. State of Washington,

et al., No. C88-421Z—same court

WISCONSIN

Beverly California Corporation v. Wisconsin Depart-

ment of Health & Social Services, et al., No. 89-

CV -2689— Dane County Circuit Court

St. Michael Hospital of Franciscan Sisters of Mil-

waukee, Inc. v. Thompson, et al., No. 89-

C-620C — United States District Court, Western Dis-

trict of Wisconsin