Supreme Court denies Health & Hospital Corp.'s effort to block civil rights lawsuits

The U.S. Supreme Court has decided that nursing home residents and the millions of Americans who rely on federal spending programs like Medicaid can sue to correct violations, bringing a major victory to a family that filed a lawsuit over allegations of poor treatment in a Marion County-owned nursing home.

In a 7-2 decision published Thursday, the court's justices found that the family of late Gorgi Talevski, a former patient with dementia at Valparaiso Care and Rehabilitation, can move forward with their lawsuit against the facility, its owner Health & Hospital Corp. of Marion County and facility manager American Senior Communities LLC because federal law and court precedent give nursing home residents a path to sue to enforce their rights.

More: Marion County agency wants SCOTUS to strip protections for millions of vulnerable Americans

But the decision has ramifications that reach far beyond that single lawsuit.

The justices also rejected Health & Hospital's argument that people can't rely on a Civil Rights-era law to sue government entities that violate the terms of federal spending programs like Medicaid — a blow to a highly controversial portion of the agency's Supreme Court petition that experts said threatened to significantly water down the public's ability to enforce.

"We reject both propositions," Justice Kentaji Brown Jackson wrote in the court's opinion, which was released Thursday. "'Laws' means 'laws,' no less today than in the 1870s."

"Today the Supreme Court came in on the side of ... the little guys," Susie Talevski, Gorgi Talevski's daughter, said during a press conference in downtown Indianapolis hours after the opinion was released.

"Many people across the country, many experts, attorneys, thought that we were going to lose this case because we have a conservative court," she said. "I was under immense pressure to extricate myself from this case, but I never at any point in time waivered."

"I decided I was going to fight the good fight on behalf of my father," Susie Talevski said," and on behalf of our nursing home patients here in Indiana."

Democrat-led health agency asks court to strip right to sue

Health & Hospital, which owns dozens of nursing homes across the state, has been fighting the lawsuit ever since it was filed in federal Northern District of Indiana court in 2019. The agency won a dismissal there, but after Talevski's family appealed the Seventh Circuit Court of Appeals found they did have the right to sue.

More: Secrecy concerns grow over Marion County health agency's handling of Supreme Court case

When it brought the case to the Supreme Court, the Democrat-led Health & Hospital asked the justices to go beyond this lawsuit and stop people from being able to sue to enforce federal spending programs. At issue was a Civil War-era law, known as Section 1983, that has long been used by people to sue over violations of federal law and the Constitution by government officials.

The agency’s few allies — one of whom is staunch conservative Indiana Attorney General Todd Rokita — argued in court briefs that Section 1983 lawsuits interfere with what is essentially a contract between states and the federal government. The federal government provides funds for spending programs like Medicaid while states administer them.

In his dissenting opinion, Justice Clarence Thomas aligned with that interpretation. "From the framing of the Constitution to well into the 20th century, it was virtually undisputed that Congress’ spending power was nothing more than a power to spend," he wrote. "It included no regulatory authority to bind parties, to secure rights or impose duties with the force of federal law, and no authority to directly regulate the states even with their consent."

But experts, beneficiaries and Democrats in Congress sounded the alarm. They said what Health & Hospital asked the Supreme Court to do could have jeopardized millions who rely on programs like Medicaid and Supplemental Nutrition Assistance Program, also known as food stamps, by cutting down their right to go to court if they're unjustly denied benefits.

More: Here's why Nancy Pelosi, Todd Rokita, Biden administration care about Indiana nursing home

“To take that right away would leave people very vulnerable and the government could do whatever they wanted that way,” Edna Chadwell, who has cerebral palsy and successfully sued Indiana after the state tried to reduce her Medicaid-funded care, previously told IndyStar. “I think a lot of people would get hurt or die from the lack of services.”

Health & Hospital says it pursued case because of 'fiduciary duty'

A public relations representative for Health & Hospital said its president and CEO, Paul Babcock, was not available for an interview. Instead, the public agency issued a statement saying it filed the case "because it has a fiduciary duty to focus its scarce public resources on the health care needs of historically underserved populations."

"HHC’s goal was to understand from the Supreme Court the status of the governing law on the availability of federal claims regarding its nursing home operations," the statement said. "With the Court’s definitive answer today that Medicaid-supported nursing home residents have both administrative and federal court remedies for alleged violations, HHC will continue to work to manage those operations safely and effectively and analyze the impact of the decision on those public resources.”

More: Indiana case before U.S. Supreme Court could help red states defund Planned Parenthood

Congressman promises legislation to codify SCOTUS decision

U.S. Rep. André Carson, a Democrat whose district includes Indianapolis, said in a statement he was "encouraged" by the decision, and "what it means for the countless Americans who rely on social safety net programs to survive."

"If families have been mistreated or denied services they were promised, they deserve the opportunity to defend their rights and to be treated appropriately without being subjected to unfair, burdensome, and bureaucratic hurdles," the statement read.

Carson said he plans to introduce to Congress a piece of legislation called the Safety Net Protection Act, which will "codify today’s outcome and ensure those who benefit from lifesaving programs like Medicare, SNAP, TANF, and other federal programs have the same rights as every other American."

Advocates praise decision, slam Health & Hospital for 'sad leadership'

Mike Oles, a Democratic activist who helped organize protests against the public health agency's decision to take the case to the Supreme Court, slammed what he called "sad leadership" at Health & Hospital.

"We thought this was about greed and protecting a dirty and dangerous nursing home funding scheme," he said. "Unfortunately, HHC's board and CEO ignored us, laughed at us and tried to marginalize us. Now they’ve wasted millions of dollars and the good name of HHC."

As of October, HHC said it had spent more than $707,400 on the case. IndyStar has requested an updated figure.

More: She sued to save her Medicaid benefits. Now an Indy agency wants SCOTUS to bar such cases.

The impact of the court's decision extends beyond just nursing homes, said Shira Wakschlag, general counsel for The Arc, a national advocacy organization for people with disabilities.

"It sets a crucial precedent that will have far-reaching implications for people with disabilities in our health care system, housing, nutrition, education, disability, and other safety net programs," she said.

Those with disabilities often face discrimination and rely on federal lawsuits to enforce their rights, she said.

"One in four adults in America has a disability, the majority of whom rely on Medicaid and other safety net programs to live meaningful lives," she said. "Because of today’s decision, they will continue to have legal recourse if they face mistreatment or abuse or their benefits are taken away or denied, which happens more often than you may think."

Justices Ketanji Brown Jackson, John Roberts, Sonia Sotomayor, Elena Kagan, Neil Gorsuch, Brett Kavanaugh and Amy Coney Barrett joined in the court's opinion. Justices Samuel Alito and Clarence Thomas dissented.

Contact the reporter at 317-273-3188.

This article originally appeared on Indianapolis Star: SCOTUS denies Health & Hospital's effort to block civil rights lawsuits