2012-0724, Gary Dube & a. v. New Hampshire Department of Health and Human Services & a.

brie f and orally), for the defendan t s. Joseph A. Foster, attorney general (Jeanne P. Herrick, attorney, on the

Homes, Inc. Donald L. Smith on the brief, and Mr. Quarles orally), for plaintiff Harbor Devine, Millimet & Branch, P A, of Manchester (Thomas Quarles, Jr. and

Furber. for plaintiffs Gary Dube, Thomas Taylor, Cynthia Washington, and Arthur Rebecca G. Whitley, and Amy B. Messer on the brief, and Ms. Mallinson orally), Disabilities Rights Center, Inc., of Concord (C. Adrienne Mallinson,

NEW HAMPSHIRE DEPART MENT OF HEALTH AND H UMAN SERVICES & a.

No. 2012 - 724 Merrimack

page is: http://www.courts.state.nh.us/supreme. a.m. on the morning of their release. The direct address of the court's home reporter@courts.state.nh. us. Opinions are available on the Internet by 9:00 to press. Errors may be reported by E - mail at the following address: editorial errors in order that corrections may be made before the opinion goes Hampshire, One Charles Doe Drive, Concor d, New Hampshire 03301, of any Readers are requested to notify the Reporter, Supreme Court of New well as formal revision before publication in the New Hampshire Reports. NOTICE: This opinion is subject to motions for rehearing under Rule p. 2 22 as 2

1 p. 2 263 (D.C. 1975) (explaining that states are given “considerable discretion and see also Dist. of Col. Pod. Soc. v. District of Columbia, 407 F. Supp. 1259, 960, 963 (9 th Cir. 2013) (quotation o mitted) (Planned Parenthood of Arizona); limitations on coverage.” Planned Parenthood Arizona Inc. v. Betlach, 727 F.3d program, with discretion as to the proper mix of amount, scope, and duration “Each state designs, implements, and manages its own Medicaid

p. 2 297, 301 (1980). must comply with the requirements of Title XIX.” Harris v. McRae, 448 U.S. the Medicaid progra m is entirely optional, once a S tate elects to part icipate, it Human Serv s., 158 N.H. 104, 105, 108 (2008). Although s tate “participation in medical costs (Medicaid program). See Bel Air Assoc s. v. N.H. Dep ’t of Health & healthcare services to certain individuals who canno t afford t o pay their own program in which the federal government offers funding to states that provide Act, 42 U.S.C. § § 1396 et seq. (Medicaid Act), is a cooperative federal - state The Medicaid program, established by Title XIX of the Social Security

1. Medicaid

A. Statutory and Regulatory Framework

154 N.H. p. 2 228, 229 (2006). in New Hampshire. Bel Air Assoc s. v. N. H. Dep ’t of Health & Human Servs., DHHS is the state agency responsible for administering the Medi caid program plaintiffs received Medicaid - funded rehabilitative services from H arbor Homes. to Medicaid - eligible individuals with serious mental illness. T he individual that provide s independent living and support services (rehabilitative services) Harbor Homes is a non - profit New Hampshire corporation in Nashu a

I. Background

federal Medicaid Act and remand. New Hampshire Administrative Rule s, He - M 4 p. 2 26.04 (a)(2) does not violate the two counts in t he plaintiffs’ petition. We reverse the trial court’s ruling that motions and granting the defendants’ cross - motions for summary judgment on Court (McNamara, J. and Smukler, J.) denying their summary judgment chosen provider, Harbor Homes. The plaintiffs appeal rulings of the Superior individ ual plaintiffs the right to obtain Medicaid - funded services from their (collectively, the defendants) seeking, in part, to enjoin DHHS from denying the Commissi oner of DHHS, and Administrator of the Bureau of Behavioral Health Human Services (DHHS), Commissioner of DHHS (commission er), Associate (collectively, the plaintiffs) against New Hampshire Department of Health and Taylor, Cynthia Washington, and Arthur Furber (the individual plaintiffs) relief brought by Ha rbor Homes, Inc. (Harbor Homes) and Gary Dube, Thomas CONBOY, J. This case involves a petition for injunctive and declaratory p. 3 3

440.1 p. 3 30(d) (2013). He - C 6420.04(d)(7); 42 U.S.C. §§ 1396a(a)(10)(A)(ii), 1396d(a) (13); 4 2 C.F.R. § those provided to the individual plaintiffs in this case. See N.H. Admin. Rules, Hampshire’s Medicaid program provides optional rehabilitative services such as U.S.C. § § 1396a(a)(5), (6) (2012); 42 C. F.R. § § 431.10, .16 (2013). New with all of the provisions of the Medicaid Act. See RSA 125:15 (2005); 42 program, is responsible for receiving federal funding and ensuring compliance DHHS, as the administering agency for New Hampshire’s Medicaid

2. RSA Chapter 1 p. 3 35 - C and Accompanying Regulations

provision. See Eder v. Beal, 609 F.2d 695, 702 ( p. 3 3d Cir. 1979). Medicaid requirements and regulations, including the free - choic e - of - provider (2012). When a state provides optional service s, it must do so consistent with m ight not otherwise be covered. 42 U.S.C. § § 1396a(a)(10)(A)(ii), 1396d(a) certain optional services or may extend services to certain populations that In formulating its Medicaid p rogram, each state may elect to provide

qualifications of providers.” 42 C.F.R. § 4 p. 3 31.51(c)(2) (2013). 1991). States may establish “reasonable standards relating to the receive treatment.” King by King v. Sullivan, 776 F. Supp. 645, 655 (D.R.I. a service exist, the state may not dictate where a Medicaid recipient is to C enter, 447 U.S. 773, 785 (1980). Thus, “[w]hen several qualified providers of providers, without government interference.” O’Bannon v. Town Court Nursing Medicaid beneficiaries “the right to choose among a range of qualified 969 (7 th Cir. 2012) (Planned Parenthood of Indiana). This provision affords provision. See Planned Par enthood v. Com ’r of Dept. Health, 699 F.3d 962, § 1396a(a)(23)(A) (2012). This is known as the free - choice - of - provider qualified to perform the service or services required.” 42 U.S.C. assistance from any institution, agency, community pharmacy, or person, must allow “any individual eligible for medical assistance” to “obtain such One of the Medicaid Act’s require ments is that s tate Medicaid p rograms

Arizona, 727 F. p. 3 3d at 963. recipients must be afforded in selecting their doctors.” Planned Parenthood of reimbursement is to be determined, and what range of choice Medicaid matters, who is eligible for care, what services must be provided, how funding, states must comply with federal criteria governing, among other de signing its Medicaid program, however, has limits: “To receive Medicaid 637 F.3d 1220, 1238 (11 th Cir. 2011). The discretion afforded to each state in operating the Medicaid program in that state.” Moore ex rel. Moore v. Reese, each state “must create its own administrative rules and regulations for latitude in devising their Medicaid Plans”). In designing its Medicaid program, p. 4 4

duplication, and the provision of twenty - four hour emergency services. See continuity of care between Harbor Homes and GNMHC, with minimal resource pur pose of the IAA was to ensure collaborative service planning and delivery, certain Medicaid - funded rehabilitative services to GN M H C patients. The authorized Harbor Homes, as a community mental health provider, to provide now known as Greater Nashua Mental Health Center (GNMHC), which with a community mental health program, Community Council of Nashua, NH, June 23, 2008, Harbor Homes ente red into an interagency agreement (IAA) Medicaid program pursuant to a Medicaid Provider Enrollment Agreement. On Since 1991, Harbor Homes has participated in New Hampshire’s

B. Procedural History

N.H. Admin. Rules, He - M p. 4 426.04(a) (emphasis added) (IAA requirement). mental health program]. . . and (3) Mai ntains a quality assurance plan. . . .” rules; (2) Maintains an interagency agreement with the regional [community provider status as long as the provider: (1) Is in complian ce with applicable provide m edicaid funded mental health services until the date of expiration of provider [] approved prior to August 22, 1997 shall be aut horized to continue to 426.” N.H. Admin. Rules, He - M 426.02(g). A “[c] ommunity mental health commissioner to provide specific mental health services pursuant to He - M community mental health services that has been previously approved by the A “[c]ommunity mental health provider” is “a m edicaid provider of

N.H. Admin. Rules, He - M p. 4 426.04(b). medicaid funded community mental health services described in the[] rules.” health programs] or their subcontractors shall be authorized to provide the He - M 426.02(f); see also RSA 135 - C:2, IV (2005). “Only [community mental pursuant to He - M 403 and as defined in RSA 135 - C:2, IV.” N.H. Admin. Rules, and administering an array of community - based, mental health services New Hampshire nonprofit corporation for the purpose of planning, establishing, program operated by the state, city, town, or county, or a community based Admin. Rules, He - M 426.01. A “[c]ommunity mental health program” is “a health providers” that are reimbursable under the Medicaid program. See N. H. provided by “community mental health programs” and “community mental New Hampshire Administrative Rules, Part He - M 426 describe services

assurance procedures.” RSA 13 p. 5 5 - C:5, I (c) (2005). limited to, “[q]uality standards for services and treatment provided a nd quality services within the state mental health services system,” including, but not may adopt rules, pursuant to RSA 5 p. 4 41 - A, relative to the requirements for mental illness.” RSA 135 - C:1, I(a) (20 05). To that end, “[t] he commissioner “a comprehensive, effective, and efficient system of services for persons with DHHS is also responsible for establishing, maintaining, and coordinating 5

exists, we determine whether the moving party is entitled to judgment as a its capacity as the nonmoving party and, if no genuine issue of material fact judgment, “we consider the evidence in the light most favorable to each party in In reviewing the trial court’s rulings on cross - motions for summary

II. Standard of Review

nonsuit without prejudice, and this appeal followed. The remaining issues were later disposed of by order or voluntary

Medicaid Act” and is, therefore, a valid requirement. the s tate [Medicaid] plan and qualifications of provide rs pursuant to the as a matter of law because “[t] he IAA requirement re la tes to administration of ruling that th e plaintiffs’ facial challenge to the validity of the regulation failed court granted the defendants’ motion, in part, and denied the plaintiffs’ motion, the requirement is invalid both on its face and as applied in this case. The trial Harbor Ho mes’ s status a s a qualified Medicaid provider was improper because claim that DHHS’s reliance upon the IAA requirement as a reason to terminate Thereafter, all parties moved for partial summary judgment on the plaintiffs’ hearings, the court denied the plaintiffs’ request for a preliminary injunction. services from Harbor Homes, the provider of their choice. Foll owing two the State to allow the individual plaintiffs to obtain community mental health limiting Harbor Home s’ status as a qualified Medicaid provider” and directing declaratory relief, seeking a court order enjoining DHHS from “termin ating or On June 28, 2011, the plaintiffs filed a petition for injunctive and

Admin. Rules, He - M 426.04(a)(2). forty of its clients, including the individual plaintiffs in this case. See N.H. Medicaid funded mental health services to appro ximately one hundred and community mental health provider, it w ould no longer be permitted to provide because, as of July 1, 2011, Harbor Homes would no longer ha ve an IAA with a Homes would be transitioned to GNMHC. Under Rule He - M 426.04(a)(2), renew the IAA and that the Medicaid reimbursable services provided by Harbor In February 2011, Harbor Homes learned that GNMHC did not intend to

Homes. level of service needed for the individuals receiving services from Harbor preparing and approving individual treatment plans that pr escribe the type and case management for the individuals served by Harbor Homes as well as individual plaintiffs in this case. GNMHC is responsible for psychiatry and hundred and sixty individuals with serious mental illness, including the Under the IAA, Harbor Homes provided services to approximately one

the period beginning July 1, 2008 and ending on June 30, 2011.” N.H. Admin. Rules, He - M 42 p. 6 6.0 4(a)(2). By its terms, the IAA was “effective for 6

to provide the care.” We agree. of - provider] provision because” it does not “relate to the ability of the provider qualified provider of Medicaid mental hea lth services violates [the free - choice - The plaintiffs argue that the “requirement of maintaining an IAA to be a

Ass’n, 1 p. 6 65 N.H. at 125 (construing state statute). Parenthood of Arizona, 727 F.3d at 970; cf. Appeal of Lake Sunapee Prot ective might have said, nor add words that it did not see fit to include. S ee Planned Ass ’n, 165 N.H. 119, 125 (2013). We will neither consider what Congress its meaning is not subject to modification. Ap peal of Lake Sunapee Protective Pelkey, 163 N.H. at 487. When the language of the statute is clear on its face, construe that language according to its plain and ordinary meaning. See a statute, we begin with the language of the statute itself, and, if possible, federal policy and precedent), aff’d, 133 S. Ct. 1769 (2013). When interpreting 487 (2012) (i nterpreting 49 U.S.C. § 14501(c)(1) (2006) in accordance with Arizona, 727 F.3d at 968 - 71; Pelkey v. Dan’s City Used Cars, 163 N.H. 483, accordance with federal policy and precedent. Cf. Planned Parenthood of 42 U.S.C. § 1396a(a)(23) (A), is a question of federal law, we interpret it in 10, 15 (2007). Because the meaning of the free - choice - of - provider provision, Assoc. of Counties v. Comm ’ r., N.H. Dep’t of Health & Human Servs., 156 N.H. interpretation of a statute is a question of law, which we review de novo. N.H. implementing that fr amework in the context of the mental health system. The statutory and regulatory framework, as well as New Hampshire law Our review of this issue requires an examination of the pertinent federal

the free - choice - of - provider provision. relating to the qualificati ons of providers and, therefore, does not run afoul of 431.51(c)(2). The y maintain that the IAA requirement is a reasonable standard standards relating to the qualifications of providers. See 42 C.F.R. § The defendants counter that the Medicaid Act permits states to set reasonable perform service s and, therefore, violates the free - choice - of - p rovider provision. that the IAA requirement does not relate to a provider’ s qualification s to free - choice - of - provider provision of the Medicaid Act. The plaintiffs contend disqualify Harbor Homes as a community mental he alth pr ovider violates the consider only one: whether DHHS’s reliance upon the IAA requirement to Although the plaintiffs advance four arguments on appeal, we need

III. Analysis

(quotation omitted). a matter of law, then we will affirm the grant of s ummary judgment.” Id. genuine issue of material fact and if the moving party is entitled to judgment as 2 82 (2013) (quotation omitted). “If our review of that evidence discloses no matter of law.” Granite State Mg mt. & Res. v. City of Concord, 1 p. 6 65 N.H. 2 p. 7 77, 7

Medicaid - specific criteria (whether imposed by the federal government or the omitted). “The provision thus indexes the relevant ‘qualifications’ not to any medical serv ice’ that a given Medicaid recipient requires.” Id. (brackets but to denote the capability to carry out a particular activity — ‘performing the meant for that adjective not to refer to a Medicaid Act - specific authorization, or services required’ modify the adjective ‘qualified,’ telling us that Congress 42 U.S.C. § 1396a (a) (23)(A)). It reasoned that “th e words ‘to perform the service specification ‘qualified t o perform the servi ce or services required. ’” Id. (quot ing ‘qualified’ in” the free - choice - of - provider provision when it added “the further so, i t found that Congress removed “any doubt as to how [to] read the word in terpretation. See Pla nned Parenthood of Arizona, p. 7 727 F.3d at 969. In doing Subsequently, the Ninth Circuit agreed with the Seventh Circuit’s

professionally competent, safe, legal, and ethical manner.” Id. relevant sense is to be capable of performing the needed medical services in a the patient requires.” Id. Accordingly, it held that “[t]o be ‘qualified’ in the unambiguously relates to a provider’s fitness to perform the medical services reasoned that, “[r]ead in context, the term ‘qualified’ as used in § 1396a(a)(23) ‘qualified’ in this particular context.” Id. (quot ation omitted). The court to the permissible variations in the ordinary concept of what it means to be suggests, a state’s authority to determine provider qualifications must be keyed Id. (quotation s omitted). “As the limiting term ‘reasonable’ in the regulation including a meaning entirely strange to those familiar with its ordinary usage.” that states are free to ascribe any meaning to the statutory term ‘qualified’ — 42 C.F.R. § 431.5 1(c)(2)). Nonetheless, “[t]his au thority. . . does not suggest ‘reasonable standards relating to the qualifications of providers.’” Id. (quoting explained that “Medicaid regulations provide that the states may establish for a provider to be ‘qualified,’ and the term is not self - defining.” Id. It T he Seventh Circuit noted that “[t]he Act does not define what it mean s

regulations.” Id. at 9 p. 7 7 p. 8 8. § 1396a(a)(23) and finds no support in related Medicaid statutes and ruling that Indiana’s argument “conflicts with the unambiguous language of that effectively limit that right.” Id. at 97 7 - 7 8. The Seventh Circuit disagreed, range of qualified providers, “the states may establish provider qualifications the provision conferred on Medicaid recipients the right to choose among a free - choice - of - provider provision. Id. at 967 - 68. Indiana argued that, even if Parenthood of Indiana challenged an Indiana defu nding law as violating the See Planned Parenthood of Indiana, 699 F.3d at 97 7 - 80. In that case, Planned Appeals recently interpreted t his provision in Planned Parenthood of Indiana. U.S.C. § 1396a(a)(23) (A) (emphasis added). T he Seventh Circuit Court of pharmacy, or person q ualified to perform the service or services required.” 42 may obtain such assistance from any institution, agency, community “must . . . provide that. . . any individual eligible for medical assistance. . . The free - choice - of - provider provision r equires that s tate Medicaid plans 8

United States District Court for the Middle District of Alabama concluded that, Ala. 19 p. 8 89) and District of Columbia Podiatry Society is misplaced. In Warr, the The defendants ’ reliance upon Warr v. Horsley, 705 F. Supp. 540 (M.D.

service or services required.’” Id. This we will not do. See id. ‘qualified’ from the phrase in which it is embedded; ‘qualified to perform the we to adopt the defendants’ interpretation, we would detach “the word purposes of its own Medicaid prog ram however it sees fit.” Id. Moreover, w ere ‘qualified,’ much less indicated that each state is free to define this term for “N owhere in the Medicaid Act has Congress given a special definition to

727 F.3d at 970. requisite medical services wit hin the state.” Planned Parenthood of Arizona, otherwise legally qualified, through training and licensure, to provide the a provider is not qualified for Medicaid purposes, even if the provider is inte rpretation, however, would permit states to “determine for any reason that practice and did not violate free - choice - of - provider provision). The defendants’ appropriate intermediate care facilities and group homes was necessary practice of matching applicants for private intermediate care facilities to efficiently.” King by King, 776 F. Supp. at 656 (concludi ng that Rhode Island’s necessary for allocating and delivering its limited medical assistance funds “cannot prevent the State from adopting administrative processes that are also 42 C.F.R. § 431.51(c)(2). Further, the free - choice - of - prov ider provision Medicaid regulations.” Planned Parenthood of Indiana, 699 F.3d at 9 p. 8 80; see federalism model of the Medicaid program and expressly recognized in the providers,” and that “this residual power is inherent in the cooperative establish licensing standards and other related practice qualifications for providers.” There is no dispute “that the states retain considerable authority to the States to set reasonable standards relating to the qualifications of not controlled by the Medicaid Act; rather, the federal go vernment has left it to T he defendants argue that “[w]hat it means to be a qualified provider is

patients.” Planned Parenthood of Arizona, 727 F.3d at 969. the serv ice in question, whether for Medicaid patients or for any other whether the provider is qualified in a general sense to perform, i.e., carry out, the provider is qualified in some sense specific to Medicaid patients, but simply verb ‘perform’ here is key: It confirms that the relevant question is not whether Parenthood of Arizona, 727 F.3d at 969. As t he Ninth Circuit explained, “T he requires.” Planned Parenthood of Indiana, 699 F.3d at 97 p. 8 8; see also Planned relates to a provider’s fitness to perform the medical services the patient in context, “the term ‘qualified’ as used in § 1396a(a)(23) unambiguou sly We agree with both the Seventh and the Ninth Circuit s that, when read

competency and professional standing as a medical provider generally.” Id. states), but to factors external to the Medicaid program; the provider’s p. 9 9

Indiana, 6 p. 9 99 F.3d at 980. fitness to rende r the medical services required,” Planned Parenthood of of the provider to perform the Medicaid services in question, i.e., “the provider’s providers,” 42 C.F.R. § 431.51(c)(2), these standards must relate to the ability authority to adopt “reasonable standards relating to the qualifications of provider provision. See Eder, 609 F.2d at 702. Although states have the Eder, 609 F.2d at 702. This i ncludes complying with the free - choice - of offer “physical therapy and related services”); see also Harris, 448 U.S. at 301; exclude electronic speech devices from coverage under its plan once it chose to Reagan, 776 F.2d 241, 243 - 44 (8 th Cir. 1985) (concluding that Iowa could not regulations in the implementation of those services.” Meyers by Walden v. itself to act in compliance with [the Medicaid Act] and the applicable Since New Hampshire has elected to provide rehabilitative services, “it bound limited or in any way not covered under New Hampshire’s Medicaid Program. C.F.R. § 440.1 30 (d), a nd the defendants do not contend that these services are Rules, He - C 6420.04(d)(7); 42 U.S.C. § § 1396a(a)(10)(A) (ii), 1396d(a)(13); 42 rehabilitative services such as those at issue in this case, see N.H. Admin. New Hampshire’s Medicaid plan, however, includes optional

in their Medicaid plans. Medicaid because the respective states had chosen not to include such services Thus, these cases addressed services that were not reimbursable under reci pient to obtain assistance from a podiatrist for those services. See id. podiatrist, the free - choice - of - provider provision did not entitle a Medicaid compensable under the District of Columbia’s Plan when performed by a podiatry services for which the plaintiffs sought reimbursement were not service is one compensable under the State Plan.” Id. at 1266 n. 32. Since the choice - of - provider provision as meaning “that a provider is ‘ qualified ’ if the court interpreted the phrase “qualified to perform the service” in the free every procedure or serv ice they may legally perform.” Id. at 1264 - 65. The require that podiatrists or any other medical care provider be compensated for based, in part, upon “the [federal] Medicaid regulations . . . [which do] not Col. Pod. Soc., 407 F. Supp. at 1263 - 66. The cour t reached this conclusion to fund all services that a licensed podiatrist could legally perform. Dist. of podiatric care services it offered under its Medicaid plan and was not required Columbia had the discretion to impose limitations on the scope of the optional District Court for the District of Columbia determined that the District of Similarly, i n District of Columbia Podiatry Society, the United States

its plan as an optional service.” Warr, 705 F. Supp. at 544. Medicaid for their services unless the state [chose] to include podiatric care in provision and were, therefore, “not entitled to receive reimbursement under podiatrists were excluded from the terms of the free - choice - of - provider since “Alabama ha s not chosen to include podiatric care in its [Medicaid] plan,” p. 10 10

HICKS and BASSETT, JJ. , concurred.

further proceedings consistent with this opinion. violate the Medicaid Act’s free - ch oice - of - provider provision, and remand for conclude that the trial court erred in ruling that the IAA requirement does not reason unrelated to its fitness to provide the requisite services. Accordingly, we Here, the IAA requirement e xcludes Harbor Homes from Medicaid for a

of Indiana, 699 F. 3d at 978. professionally competent, safe, legal, and ethical manner,” Planned Parenthood up on its “capab [ility] of performing the needed medical services in a whether it has an IAA with a community menta l health program, rather than provider to provide Medicaid - funded mental health services dependent upon Rule He - M 426.04(a)(2) makes t he ability of a community mental health Parenthood of Indiana, 699 F.3d at 978. Currently, the IAA requirement in professionally competent, safe, legal, and ethical manner.” Planned relevant sense is to be capable of performing the needed medical services in a free - choice - of - provider provision). As explained above, “[t]o be ‘qualified’ in the have contract with c ounty did not mea n it was not “qualified provider” under regulatory framework, fact that assisted - living and memory care facility did not 161, 16 4 - 6 9 (Min n. Ct. App. 2011) (concluding that, under applicable services re quired.” Id. (emphasis added); cf. Young v. Jesson, 796 N.W.2d 158, IAA requirement directly relates to “the provider’s fitness to render the medical providing those services. But the defendants’ argument fails to explain how the assures quality of s ervices to its recipients and collaboration of care in W e do not doubt the importance of having a ment al health syste m that

a rational basis and is a reasonable standard relating to the quality of care. interests of the clients to whom services are provided,” the IAA requirement has because the collaboration provided by an IAA is necessary to “serve [] the best needs and current level of functioning.” Thus, according to the defendants, based upon the full complement of information about the individual’s clinical development of an individuali zed service plan, and the provision [of] services is sharing of information required by the [IAA] ensures that the diagnosis, care in a manner that is efficient and effective.” They contend that “[t]he it “ensures collaborative service planning and delivery to provide continuity of The defendants contend t hat the IAA req uirement is reasonable because