More than 5,000 Minnesotans with disabilities have been deprived of plus-$1 billion in services for more than two decades under a federal Medicaid program managed by the Minnesota Department of Human Services (DHS). That’s the claim outlined in a lawsuit filed August 29 in U.S. District Court in St. Paul.

The lawsuit states that people have waited for years for services needed so that they can live in the community. But some Minnesota counties don’t spend Medicaid funds as quickly as they should. The lawsuit is brought against the state and DHS Commissioner Lucinda Jesson. The lawsuit contends that for more than two decades DHS mismanaged monies appropriated by the Minnesota Legislature for the Home and Community Based Waiver Services program.

“We have been waiting for these services for over 14 years,” said Jeff Pearson. His daughter Abigail, age move out of her parents’ home into a setting where she could live with support. “No one has ever told us when our daughter would get off the list, or be provided the services for which she has been eligible.”

“Our son would be much more independent if he received the services he qualified for over five years ago,” said Keith Guggenberg, father of Kyle. “We are hopeful that DHS will recognize its
commitment to our son and others on the wait list and act to help them.”

Medicaid is a joint federal and state program that helps with medical costs and services for people with disabilities and others with limited income. The benefits at issue, called waivers, fund a wide range of community-based services for people with disabilities and are the largest single source of social services for people with disabilities in Minnesota. Qualifying for waivers can be one thing. Waiting for waiver services can be another.

More than 5,000 people with disabilities have placed on waiting lists, deprived of the waiver services for which they are eligible, and not told that money was available for them. One goal of the lawsuit is to seek a class action certification on behalf of all who never received services.

Waivers have long been a source of frustration for people with disabilities and their advocacy groups. Some point fingers at DHS and call for better program management as well as action against counties that only spend a small portion of their waiver dollars. Spending varies widely by county. But counties that overspend must reimburse the funds, so that often leads to caution.

“Our state government has mismanaged a critical federal program directly violating the civil rights of people with disabilities, forcing them onto waiting lists for years and never bothering to tell them that millions of dollars had been available for their needs,” said Shamus O’Meara, lead counsel for the families and managing shareholder with the Minneapolis law firm of O’Meara Leer Wagner & Kohl. “We absolutely cannot treat people like this. Justice requires that DHS be ordered to immediately address this important issue and provide these services without further delay.”

The plaintiffs contend that DHS has reports showing unspent funds dating back to 1995 through 2011 for the development disability, brain injury, Community Alternative Care and Community Alternatives for Disabled Individuals or CADI waivers.

“By letting millions of dollars that were intended to fund the waiver programs go unspent year after year, DHS unnecessarily placed eligible individual with disabilities on waiting lists that blocked them from gaining access to the services and supports they need to live and work in their communities,” said Pamela Hoopes, Legal Director of Mid-Minnesota Legal Aid’s Minnesota Disability Law Center. Hoopes is cocounsel in the lawsuit. “Our clients want DHS and the state to manage the waiver programs in compliance with the law, so that eligible people with disabilities get the services they need.”

Jesson stated that reducing and ultimately eliminating the waiting lists is a goal of the state’s Olmstead Plan. The plan calls for eliminating waivers, with the CADI waiver list gone by October 2016. As of Access Press deadline, DHS hadn’t filed a formal response to the lawsuit.

The lawsuit asks that the court order that waiver services be provided to the plaintiffs and also protect existing monies appropriated for those who are eligible for the program and placed on waiting lists. Specifically, the lawsuit requests that the court declare that DHS has violated the plaintiffs’ rights under the Medicaid Act, Americans with Disabilities Act, The Rehabilitation Act, and the Due Process Clause of the Fourteenth Amendment to the United States Constitution. This is due to failure to provide waiver services, failure to provide waiver services in the most integrated setting appropriate to individual needs and preferences, failure to provide plaintiffs with proper notice of initial and ongoing decisions and not to provide waiver services or an opportunity to challenge those decisions in a hearing on the merits; and failure to provide waiver services in the most integrated setting appropriate to individual needs and preferences. It also seeks to require that defendants provide plaintiffs and others with services in the most integrated setting appropriate to their individual needs and preferences consistent with applicable law.