Federal Courts Exam Spring 2011

By Mike Dorf

Continuing a tradition I started last year, I'm posting my Federal Courts exam.  There are four questions of equal weight. This was a particularly challenging exam.  It was an open-book take-home for which the students had eight hours.

The following facts pertain to all questions:

Section 10320 of the Patient Protection and Affordable Care Act (PPACA) amended Section 1899A of the Social Security Act to strengthen a body now called the “Independent Medicare Advisory Board.”  You can read a version of the Act as it now stands at 42 U.S.C. § 1395kkk.  However, to use your time on this question effectively, you would be well advised to accept the following summary, which borrows liberally from the summary posted on the White House website:

* The Board consists of fifteen members, including medical professionals and others, who are nominated by the President and confirmed by the Senate.  Except for the initial terms, which are staggered to create three “classes” (like in the Senate), board members serve for six-year terms.  Thus far, the President has not nominated anyone to the Board.

* The Board is tasked with proposing policies to improve care and lower costs for Medicare.  However, the Board is prohibited from recommending any policies that ration care, raise taxes, increase premiums or cost-sharing, restrict benefits or modify who is eligible for Medicare.

* The Act puts in place various fast-track procedures for Congress to reject or modify Board proposals.  The overall procedure is similar to the protocol under the Rules Enabling Act: If Congress does nothing, the Board’s proposals become effective.

* The Act provides that there shall “be no administrative or judicial review under” pre-existing provisions of the Social Security Code “or otherwise of the implementation by the Secretary under” the relevant provisions of the Act “of the recommendations contained in a proposal.”

(The foregoing is all true.  The balance of this exam is based on the following additional, made-up facts.)

As one condition of securing majority support for a measure to raise the debt ceiling, Speaker Boehner secures President Obama’s and Majority Leader Reid’s agreement to the enactment of an amendment to the foregoing measures, which passes as part of the Restoring American Fiscal Responsibility Act  (RAFRA) of 2011.  Here is a summary of the key provisions of RAFRA as they relate to Medicare reimbursements:
A) Medicare reimbursements shall continue to be made in accordance with the rules adopted under the procedures establishing the Independent Medicare Advisory Board, except that those rules shall have no force or effect in any State that creates a “State Independent Medicare Advisory Board (SIMAB).”  The new legislation sets forth requirements for SIMABs, which are modeled on the existing federal Board, but allow some greater flexibility with respect to the number of members and terms of office.  RAFRA further states that no provision adopted by a SIMAB or state legislature shall take effect until 30 days after it has been transmitted to Congress, and Congress has passed no law disavowing it.  If Congress takes no action, the provision adopted by a SIMAB takes effect in that state. 
B) Any State that creates a SIMAB receives a block grant to pay for Medicare reimbursements, with the size of the grant to be determined by a formula set forth in RAFRA that takes account of prior year spending under the federally administered Medicare program and population changes.  Responsibility for all Medicare reimbursements in States that create SIMABs and receive block grants is transferred from the federal government to the State.  RAFRA further provides that the State may use any unused portion of the RAFRA block grant for its Medicaid program, with 50% of the unused federal Medicare funds thus diverted counting as part of the State’s contribution to Medicaid and the other 50% counting as federal matching funds. 
C) RAFRA contains the following provision: “Section 401: A State’s creation of a SIMAB and acceptance of a Medicare block grant shall be deemed an unconditional waiver of its sovereign immunity to all private lawsuits seeking relief under this Act or under any provision adopted pursuant to this Act.  This Act shall, in the alternative, also be understood as an exercise of Congressional power to enforce the Fourteenth Amendment, insofar as the elderly are a discrete and insular minority, health care is a right, and/or future generations who will be saddled with our debt necessarily lack current political power; accordingly, and in the alternative, this Act hereby abrogates state sovereign immunity.” 
D) RAFRA contains the following provision: “Notwithstanding 28 U.S.C. §§ 1257, 1291, 1292, or any other provision of law, neither any federal appeals court nor the Supreme Court of the United States shall have jurisdiction, either by appeal or as an original action, over any case in which reimbursement is sought for expenses allegedly incurred in conformity with rules established by a SIMAB.  However, the losing party to a suit that is properly brought in federal district court shall have the right to appeal to a state intermediate appellate court, and thence to the state’s highest court, to the extent that, and on equal footing with, appeals that would be available from a state trial court sitting where the federal district court sits.”
Following the enactment of RAFRA, the State of Hughes creates and staffs a SIMAB.  During its first year, the Hughes SIMAB proposes dozens of rules, which it sends as a package to the Hughes legislature.  The legislature does not disapprove them, and thus they go into effect thirty days after they are transmitted to Congress, which also does not disapprove them.  One of the rules was adopted in response to evidence that a substantial number of home health aides in Hughes are not proficient in English, and thus have difficulty reading prescriptions and communicating with Medicare patients.  The Rule provides as follows:
Rule 28: No person or entity providing otherwise reimbursable home health care services in Hughes shall receive reimbursement for such services provided by any person who is not proficient in speaking, reading, and writing English.
Immediately following the completion of the thirty-day Congressional review period, Helping Hands, Inc., a Hughes corporation with its principal place of business in Hughes, sues Deena Darling, a Hughes citizen and the Secretary of Health for the State of Hughes.  As Secretary of Health, Darling heads the state agency charged with making Medicare reimbursement eligibility decisions.

In the year immediately prior to its lawsuit, Helping Hands received over $10 million in Medicare reimbursements for home health aides it employed in the State of Hughes.  Roughly half of its employees are not native English speakers.  Helping Hands provides an in-house 2-week intensive English immersion course for non-native speakers whom it hires as home health aides.  It seeks a declaratory judgment that employees who successfully complete the course are “proficient” under Rule 28.  Helping Hands also seeks an injunction directing Darling not to withhold Medicare reimbursements from it on the ground of failure to comply with Rule 28.

The lawsuit by Helping Hands is filed in the Federal District Court for the District of Hughes, in Hughes City.  The complaint invokes the federal Declaratory Judgment Act, the Hughes Declaratory Judgment Act, Ex Parte Young, the Hughes All Writs Act (which, among other things, provides a state cause of action for injunctive relief against a state official charged with violating state law but expressly states that it is not a waiver of state sovereign immunity), and, as the basis for federal subject matter jurisdiction, 28 U.S.C. § 1331.

You are an attorney for the Hughes Department of Health.  Secretary Darling asks you to write an objective memorandum addressing the following questions:

Question 1:  Does the federal district court have subject matter jurisdiction, and if so, should it nonetheless decline to exercise that jurisdiction on the basis of an abstention doctrine?

Question 2: If the court finds that there is subject matter jurisdiction and no ground for abstention, can Darling successfully invoke sovereign immunity to block relief?

(The following additional facts pertain to Questions 3 and 4:)

Despite your best efforts, the district court rules that it has jurisdiction, that there are no grounds for abstention, and that sovereign immunity does not bar relief.  On the merits, it finds that the intensive course satisfies Rule 28 and grants declaratory and injunctive relief.  On behalf of the Department, you file an appeal with the Hughes Appellate Division, an intermediate appellate court in the State.  Helping Hands moves to dismiss the appeal on the ground that there is no jurisdiction.  Now write an objective memorandum addressing the following question:

Question 3: Does the Hughes Appellate Division have jurisdiction?

(The following additional facts pertain to Question 4:)

The Hughes Appellate Division rules that it has jurisdiction.  On the merits, it reverses the federal district court.  In the course of its opinion, the Appellate Division states “the clear purpose of Rule 28 is to ensure that real Americans who can speak and understand English take care of our seniors.  That’s a legitimate purpose.  A two-week English course doesn’t turn a foreigner into an English-speaking American.”

Helping Hands seeks discretionary review in the Hughes Supreme Court.  The petition argues that the Hughes Appellate Division’s opinion misinterpreted Rule 28 and insofar as it did not, that Rule 28 as construed by the Appellate Division is unconstitutional on equal protection and federalism grounds in light of Plyler v. Doe, 457 U.S. 202 (1982).  Accordingly, Helping Hands alleges that the Appellate Division opinion violated Rule 28 and the federal Constitution.  The Hughes Supreme Court denies discretionary review without opinion.

Helping Hands next files a petition for a writ of certiorari with the U.S. Supreme Court, renewing both its argument that the Hughes Appellate Division misinterpreted Rule 28 and its federal constitutional objection.  Write an objective memorandum addressing the following question:

Question 4: Does the petition properly fall within the jurisdiction of the U.S. Supreme Court?


Feel free to write up answers in the comments.  However, having spent a good portion of the last week and a half grading, I won't comment.