>From the web page
http://www.ilru.org/mgdcare/rrtcnewsletter.html

     "Legal Protections for People with Disabilities in
     Managed Care"


                Mary Anderlik and Wendy Wilkinson,
                          Investigators

            from the Spring 2000 Issue of the Managed
                        Care Chronicles

           supported by the RTC on Managed Health Care
                     and Disability and the
           Southwest Disability and Business Technical
                        Assistance Center


Table Of C ontents

I.        About the Research and Training Center on Managed
Health Care and Disability
II.        What Constitutes Discrimination  in Managed Care?
III.       Sources of Law for Managed Care 101
IV.       Title II Integration Mandate Interpreted by Supreme
Court
V.        In the Wake of Olmstead v. L.C. - How to Integrate
People with Disabilities into the
           Community
                     a. Exploring the Scope and Power of the
Title II Integration Mandate
VI.       Challenging HMO Contractual Arrangements Under Title
III
VII.      Applicability of Title III to  Health Insurance Plans
VIII.     Section 501(c) of the ADA
IX.       Associational Discrimination
X.        Using the Medicaid Act to Resolve Individual
Complaints and Achieve Systemic Change
XI.       Medicaid Managed Care and the Implications of the BBA
XII.      Health Care Financing Administration
XIII.     State Law Protections
XIV.     Individual Claims - Use Informal and Formal Processes
XV.      Medicaid and Medicare
XVI.     Technical Assistance Resources on the ADA-Regional
Disability and Business Technical
           Assistance Centers
XVII.   RTC on Managed Health Care and Disability
XVIII.  Resource Directory


  Permission is granted for duplication of any portion of this
    newsletter, providing the following credit is given to the
project: Developed as part of the RTC on Managed Health Care and
  Disability and the Southwest Disability and Business Technical
                 Assistance Center.  c 2000 ILRU


I.   About the Research and Training Center on Managed Health
Care and Disability

R20;Legal Protections for People with DisabilitiesR21; is one of
six research projects of the Research and Training Center on
Managed Care and Disability (RTC-MC&D). Partners in the RTC are
the National Rehabilitation Hospital Research Center (NRH-RC) in
Washington, D.C. and ILRU (Independent Living Research
Utilization) in Houston, TX.  The Center began operating in June
of 1997 and is funded by the National Institute on Disability
and Rehabilitation Research (NIDRR). The purpose of the Center
is to provide national leadership on the major health service
and health policy issues facing consumers with disabilities in
managed health care arrangements.  The Health Law and Policy
Institute, based at the University of Houston and ILRU are
collaborating on the R20;Legal ProtectionsR21; project.

Data is being elicited by: (1) tracking complaints and
grievances voiced through protection and advocacy and similar
legal service programs;  (2) analyzing nondiscrimination laws
and other legislation to ascertain their effect on the delivery
of health care to people with disabilities in managed care
arrangements; and (3) tracking litigation.  The research
findings will be used to: (1) generate training and educational
materials designed to enhance the ability of consumers and
advocates to address barriers in managed care arrangements on an
individual and systemic basis; and (2) develop materials for
policy makers that identify gaps in the system of protections.

II.   What Constitutes Discrimination in Managed Care?

People with disabilities, along with other individuals without
disabilities, may receive less than adequate medical care in
managed care arrangements. Both groups may experience problems
due to the complexity and lack of flexibility in some managed
care organizations (MCOs), but the stakes are often higher for
people with disabilities.  There are a number of federal and
state laws and regulations that affect the terms and conditions
of the delivery of health care to individuals in MCOs.  They can
be used in a number of different ways, depending on the type of
MCO and the practice being challenged. Federal and state
anti-discrimination laws may be used to challenge practices that
result in inferior treatment for individuals with disabilities;
other laws may be used to challenge practices that may not
constitute discrimination per se, but deny access to needed
health care.

Distinguishing what may be considered discrimination based on
disability in health care from generally poor administration or
treatment is a difficult exercise.  To date, a number of suits
have been brought against state agencies responsible for
Medicaid managed care programs and MCOs using the Americans with
Disabilities Act (ADA) and Section 504 of the Rehabilitation
Act. These challenges have met with varying degrees of success.
We will highlight some of these cases in this newsletter.  What
we have learned from these cases is that there is power in these
laws.

Many managed care arrangements, by virtue of their design and
purpose, tend to perpetuate discrimination against people that
are or are perceived to be higher users of health care services,
a group that arguably includes more individuals with
disabilities than non-disabled individuals:
  * Marketing efforts may be designed to discourage enrollment
    of individuals who are higher users of health care services
    or those who are perceived to be higher  users.
  * Capitated payment structures that are not risk-adjusted
    create tremendous incentives (a) to deny needed treatments,
    access to specialists, proper medication and other services
    to individuals with greater-than-average health care needs,
    and (b) to avoid enrolling or caring for these individuals.
  * Rating systems may be used to penalize physicians who treat
    individuals with greater-than-average health care needs.
  * Managed mental health care organizations may stop referrals
    to psychiatrists who tend to provide more comprehensive
    treatment.
  * Referral and R20;documentation of needR21; processes may
    interfere with established relationships with health care
    professionals that are essential to the well-being of
    individuals with behavioral health care needs.
  * Emphasis on primary care and limitations on access to
    specialty care may have a tremendous impact on individuals
    with disabilities because primary care physicians may lack
    the expertise, time, or inclination to care for people with
    disabilities.
  * Review of medical decisions of physicians through
    utilization studies may result in termination of physicians
    who are costly to an MCO because they prescribe more
    expensive treatments, medications and services.
  * R20;Medical necessityR21; criteria that call for
    R20;substantial improvementR21; or R20;restoration of
    functionR21; as conditions for authorization of treatment,
    medication or equipment may  discriminate against
    individuals with certain types of disabilities who cannot
    meet these standards because of their disability.
  * The complexity of referral procedures and complaint and
    grievance processes, and the materials that describe these
    aspects of managed care, may create tremendous barriers for
    individuals with cognitive or learning disabilities.

III.  Sources of Law for Managed Care 101

In this special issue we are focusing on the major federal
anti-discrimination laws and their applicability to managed care
arrangements.  We will also review a few of the other laws that
can be used to assure that states are arranging for appropriate
care, providing procedural due process protections, and
developing assessments of the services delivered under their
Medicaid managed care programs.

Major Federal Legislation
  * Employer-Provided Benefits, Public Services, and Public
    Accommodations: Americans with Disabilities Act of 1990
    (ADA)
  * Federally-funded Programs: 504 of the Rehabilitation Act
    of 1973 (Rehabilitation Act)
  * Medicaid and Medicare Programs: Balanced Budget Act of 1997
    (BBA)
  * Group Health Plans: Health Insurance Portability and
    Accountability Act of 1996 (HIPAA)

Implementing Regulations and Guidance Documents
  * ADA Title I: Equal Employment Opportunity Commission (EEOC)
  * ADA Titles II & III: Department of Justice (DOJ)
  * Rehabilitation Act: various agencies
  * BBA & HIPAA: Health Care Financing Administration (HCFA)

State Law
  * Managed care (R20;patient protectionR21;) laws
  * Civil rights laws
  * Insurance laws
  * Deceptive Trade Practices Acts and other consumer protection
    laws
  * Common (case) law

What Kinds of Legal Protections Exist?

Legal protections vary by type of coverage.  Consumers need to
know that the answers to some questions will depend upon whether
their health insurance is public (e.g., Medicaid or Medicare) or
private.  Protections may also vary depending upon the type of
health plan.  For example, health maintenance organizations
(HMOs) tend to be more heavily regulated than preferred provider
organizations.

Public Health Insurance

Federally funded programs are subject to the Rehabilitation Act,
and state and local public services are subject to Title II of
the ADA.  Basic requirements of both acts include
nondiscrimination, reasonable accommodation/modifications, and
community integration.  State civil rights laws may provide
additional protections.

The BBA provides that Medicaid beneficiaries in Medicaid managed
care retain their right to a state-level fair hearing and
imposes other requirements on Medicaid managed care, such as a
R20;prudent laypersonR21; standard for emergency treatment. HCFA
is preparing to issue final regulations for Medicaid managed
care programs, but as of the date of this newsletter they have
not been published.

Private Health Insurance

Employer-provided benefits are subject to Title I of the ADA,
and R20;public accommodationsR21; (this includes doctorsR17;
offices, clinics, and hospitals and may include insurance
policies) are subject to Title III of the ADA, which has its own
nondiscrimination, reasonable modification, and integration
mandates. HIPAA also contains anti-discrimination provisions
that apply to group health plans.  It prohibits discrimination
against individuals based on health status and regulates use of
pre-existing condition clauses, among other things.

For private health insurance, the availability of basic managed
care protections, such as the R20;prudent laypersonR21; standard
for emergency treatment, depends on state law.  State insurance
regulations apply to health insurance purchased by individuals
and group health plans purchased by employers.  State insurance
commissioners provide oversight and regulate the business
activities of insurance companies.  They generally regulate
insurance marketing practices, review whether policies and
premiums are reasonable, and assure that claims are paid in a
timely manner.

Employers that set aside funds and employee premiums to pay for
health coverage have self-funded plans. Self-funded plans are
not regulated by states but are governed by the Employee
Retirement Income Security Act (ERISA). If these plans are
offered by a private sector employer or a bona fide union, the
U.S. Department of LaborR17;s Pension and Welfare Benefits
Administration regulates them.

IV.   Title II Integration Mandate Interpreted by Supreme Court

The United States Supreme Court, in Olmstead v. L.C., found that
institutionalizing a person with a disability who can benefit
from living in the community and wishes to do so constitutes
discrimination because it severely diminishes the
individualR17;s ability to interact with family and friends,
work and make a life for him or herself.

The case was brought by two Georgia women with disabilities
(mental retardation and mental illness) who were placed in
state-run institutions in order to receive the services they
needed, although their physicians had said that they were able
to live and receive services in a community-based setting.  The
women argued that the stateR17;s failure to provide services in
a community-based setting violated a regulation implementing
Title II of the ADA, 28 CFR   35.130 (d) which requires that
public entities provide their services R20;in the most
integrated setting appropriate to the needs of qualified
individuals with disabilitiesR30;.R21;  [In a setting that
R20;enables individuals with disabilities to interact with
non-disabled persons to the fullest extent possible.R21;]  The
setting must be appropriate to the needs of an individual and
could include home and community-based arrangements.  As the
Court noted, the extent of the obligation to make a community
placement may be modified by Title IIR17;s R20;fundamental
alterationR21; defense. In applying it to this situation, the
Court said states may consider not only the cost of providing
community-based care to individuals, but also the range of
services provided to other individuals with disabilities and the
statesR17; obligation to mete out those services in an equitable
manner.

V.   In the Wake of Olmstead v. L.C. - How to Integrate People
with Disabilities into the Community

In Olmstead v. L.C. the Court laid out the R20;roadmapR21; that
states must use to develop their integration plans.  The Court
indicated that states may demonstrate compliance by showing that
they have comprehensive and effective plans for placing
qualified individuals with disabilities in less restrictive
settings and waiting lists that move at a reasonable pace not
influenced by a stateR17;s attempts to keep its institutions
fully populated.  The role of people with disabilities in this
process is key.

January 14: Letters and Preliminary Technical Guide Sent to
State Medicaid Directors

The OCR began consulting with State Medicaid Directors, members
of the long-term care technical advisory group, and with people
with disabilities to help states develop their R20;Olmstead
Community Integration Plans.R21;  The letter outlines what OCR
expects from the states and offers technical assistance and
support from the agency.  The accompanying technical guide
outlines the responsibilities of the states, including the
principles that should be addressed, and recommended practices,
to provide states with a foundation from which to start.  The
OCR does not recommend one model plan, noting that each state
may take a different approach.  What is clear is that persons
with disabilities must be included in all phases of the process.

States are required to consider the methods that should be
employed to R20;ensure constructive, on-going involvement and
dialogue and assess what partnerships are needed to ensure that
any plan is comprehensive and works effectively.R21;
Other principles include:
  * Taking steps to prevent or correct current and future
    unjustified institutionalization of individuals with
    disabilities.
  * Ensuring the availability of community-integrated services.

January 4: DHHS, OCR Sends Sample Olmstead Letter to Governors
with Copy of Document Sent to Medicaid Directors

R20;We encourage you to develop and implement such plans, and to
involve individuals with disabilities and other stakeholders in
the process of design and implementation. This department stands
ready to assist you in these efforts.R21;

The Role of Advocates in Developing State Plans

On March 9, 2000 the NCIL (National Council on Independent
Living) National Advocacy Training Project held a national
teleconference on R20;Making Olmstead Work in Your State.R21;
Nationally known advocates and experts on Olmstead interpreted
the decision from the standpoint of clarifying what states must
do, and recommended strategies for people with disabilities to
work with states to develop plans that comply with the letter
and spirit of this important decision.  They broke the decision
down into pieces to demonstrate how each component of the
decision should be interpreted and implemented, for example:

What if a state treating professional fails to determine that
the community is the most integrated setting appropriate to meet
an individuals needs, can the assessment of the stateR17;s
treating professional be challenged?

Yes, the decision leaves room for the stateR17;s treating
professionalR17;s assessment to be challenged.  When the Supreme
Court explained its two-part test it said that states may
R20;generally rely on the reasonable assessmentsR21; of their
own professionals as to whether an individual is appropriate for
community-based services.  Certainly, R20;generally rely onR21;
does not mean total deference to the treating professionals on
this matter.  While the state can probably not simply ignore the
assessments of the state professional, the Court seems to leave
room for an individual to ask for another assessment from an
independent evaluator or for the state professionalR17;s opinion
to be challenged.

Also the Court said the state treating professionalR17;s
assessment must be R20;reasonable.R21;  While the Court did not
define the elements of a R20;reasonableR21; assessment, a strong
case can be made that, to be reasonable, an assessment must be
made by a qualified professional who is familiar with relevant
professional standards and the capacities of community systems,
especially services that are now available to meet even the most
challenging of needs, for example, wrap-around, crisis and
respite services.

An assessment may also be challenged as unreasonable if it is
the product of a flawed process.  For example, it is common for
institutions to judge an individual R20;not readyR21; for the
community solely because there is no community placement
currently available for that individual.  Institutional staff
that determine individuals to be ready for discharge only if and
when services become available (i.e., a community R20;slotR21;
opens up) are not making R20;reasonableR21; assessments of
community readiness.  Such assessments should be based on the
capacities and needs of the individual with a disability, and on
whether appropriately crafted community services can meet those
needs.  Whether appropriately crafted services are currently
available in the community has no bearing on whether the
community is the most integrated setting appropriate for an
individual.

(Statement prepared by National Association of Protection &
Advocacy Systems, Inc.  See Resource Directory for information
on obtaining the tape of the teleconference and the resources
provided.)

Filing Individual Complaints

If someone encounters a barrier imposed by the state Medicaid
program, to get them, a family member, or a friend out of an
institution, they may file a complaint with the Office for Civil
Rights in the Department of Health and Human Services.

V. a.  Exploring the Scope and Power of the Title II
Integration Mandate

The integration mandate has been used by Protection and Advocacy
Agencies (P&As) in a number of cases to assure the provision of
the services, medication, and equipment necessary to enable
individuals with disabilities to continue living independently
in a community setting.

In Sanon v. Wing, the court overruled the decision of the State
Department of Health and city agencies to terminate home care
services and place three individuals with disabilities in
nursing care.  The court held that Title II of the ADA required
that individuals with disabilities have access to in-home care
and that allowing such would not cause a  R20;fundamental
alterationR21; of the State Medicaid program.

In Re J Curtis H (Cal. DHS, Sept. 4 1998), an individual with
multiple disabilities required wrap around services to maintain
him in the community.  His doctor verified that these services
were necessary. The Department of Human Services denied his
request stating that these services were not medically
necessary.  The Administrative Law Judge ruled for the
individual, finding that these services were necessary for the
individual to remain living in the community.

In Ivey v. State Dept. of Health Care Policy and Finance/Mental
Health Capitation Program (1998), the P&A challenged the
stateR17;s implementation of the assessment process which was
part of the new Medicaid mental health care program. The new
program required that all Medicaid recipients discontinue
treatment with their existing providers.  An exemption would
only be granted if it was proven to be in the R20;best clinical
interestsR21; of the recipient, which would be determined
through an assessment. In this case, the court found that the
state did not conduct an appropriate assessment.  In addition,
the court found that R20;overwhelming evidence was presented
that the individuals in question would end up in institutions if
they were unable to continue with their current providers.R21;

In Adam Cale v. Illinois Department of Public Aid, the Illinois
P&A is arguing that a threatened reduction in home health
services for an individual with a disability would violate the
Title II integration mandate because if the individual is not
allotted the necessary hours the individual may have to move
into an institution.

In Blackman v. Mississippi, the Mississippi P&A sued a state
hospital for violation of the Title II integration mandate
because the hospital did not provide all anti-psychotic
medications on the same basis. The state hospital used a voucher
system for provision of medication; a voucher was needed to
prescribe certain types of medication, including certain types
of anti-psychotic medications.  No vouchers were needed to
prescribe older types of anti-psychotic medications.  Statistics
were presented which showed that 30-70 percent of individuals
with schizophrenia who do not respond to older drugs do improve
after taking the newer ones.

The administration of the vouchers in this way inhibited the
ability of individuals to obtain the treatment they needed to
live in the community. (The suit was dropped after the state
provided assurances that a system was in place that provided
access to medications regardless of brand or expense.)

In Chris S. v. Geringer,  the Wyoming P&A brought a class action
suit against the state for violations of the Medicaid Act and
the ADA, alleging that the state failed to provide adequate
transitional services, including employment and health care,
while the plaintiff was in the state hospital.  Without such
services, the plaintiff was at risk for re-institutionalization.
 The dispute resulted in a settlement agreement that created the
R20;Partnership for Resolution of Mental Health Issues in
Wyoming,R21; a coalition of the P&A, the State Alliance for the
Mentally Ill, and representatives of the Wyoming Department of
Health.

VI.   Challenging HMO Contractual Arrangements Under Title III

HMOs and other MCOs may have contractual arrangements with
health care providers that create incentives for those providers
to avoid or undertreat individuals with disabilities.  Problems
can arise where an HMO pays a provider a set fee per patient
(capitation), ties bonuses and other incentive fees to rates of
usage of services (utilization goals), or imposes prescription
drug limitations or restrictions on certain types of treatment.

Innovative cases have been brought challenging contractual
arrangements that contain incentives for providers to delay or
deny care to individuals with disabilities.  The ultimate
outcome is still unclear, but at least one of these cases has
passed a significant legal hurdle.

In Zamora-Quezada v. HealthTexas Medical Group of San Antonio,
34 F.Supp.2d 433 (W.D. Tex. 1998), the plaintiffs are two
physicians and 13 patients who are alleging that their Medicare
HMO delayed or denied them full and equal enjoyment of medical
treatment and services in violation of Title III of the ADA and
the Rehabilitation Act.  In the complaint, the
patient-plaintiffs claim that they were forced to endure long
waits or medical care was delayed or denied them, while
nondisabled patients received better treatment, and that the
HMOR17;s financial arrangements make treating people with
disabilities more costly to providers.  The physician-plaintiffs
claim that they were terminated by the HMO because they
advocated for their disabled patients (i.e., they suffered
associational discrimination).  The HMO moved to dismiss the
case.  In an important ruling, the court denied the motion to
dismiss.

The HMO maintained that all of its decisions were based on
actuarial, statistical and empirical data, and so were protected
from scrutiny under the ADAR17;s insurance R20;safe harbor,R21;
501 (c).  The court noted that Medicare HMOs are prohibited
from discriminating in coverage on the basis of health history
or current health status, meaning they cannot engage in
traditional insurance risk rating.  Additionally, the court
pointed out that the plaintiffs alleged discrimination was based
on clinical evaluations, not ratings for insurance purposes.

The HMO also maintained that it was not covered by Title III.
The court noted that Title III of the ADA applies to entities
that have a right to control a public accommodation.  If the HMO
regulated health care decisions made by the medical group,
including referrals and admissions, and attempted to monitor and
influence physiciansR17; utilization patterns, it would be
covered by Title III.

The HMO also argued that the case was one of disparate impact
rather than intentional discrimination.  It argued that
utilizing cost-control measures will result in some denials of
requests for care, and if people with disabilities have more
requests, they will have more requests denied.  The court found
the plaintiffsR17; specific allegations that delays and denials
were disability-based were sufficient to raise genuine issues of
fact for trial.

VII.  Applicability of Title III to Health Insurance Plans

While it is clear that an insurance office is a public
accommodation covered by Title III, courts are divided over
whether Title III applies to (a) insurance policies that are not
purchased by a consumer entering an actual insurance office, and
(b) the contents (terms and conditions) of insurance policies.
Of the federal Court of Appeals (the highest courts to consider
the issue thus far, one level below the U.S. Supreme Court), the
First, Second, and Seventh Circuit Court of Appeals have
interpreted Title III to include insurance policies, while the
Third, Sixth, and Ninth Circuits have gone the other way, at
least where the policy was provided by an employer.

In Carparts Distribution Center v. Automotive WholesalerR17;s
Assn., 37 F.3d 12 (1st Cir. 1994), the health plan at issue was
purchased by the employer through a trade association.  The plan
imposed a special, lower lifetime cap for AIDS-related medical
expenses, allegedly after learning of plaintiffR17;s diagnosis
with HIV/AIDS.  In evaluating whether the health plan itself was
covered by the ADA, the Court scrutinized the definition of
public accommodations and found that public accommodations are
not limited to physical structures.  The court noted that by
including travel services among the list of services considered
R20;public accommodations,R21; Congress clearly intended to
cover providers of services that do not require a person to
physically enter an actual physical structure: R20;It would be
irrational to conclude that persons who enter an office to
purchase services are protected by the ADA, but persons who
purchase the same services over the telephone or by mail are
not. Congress could not have intended such an absurd result.R21;
  The court also referred to the legislative history of the ADA,
noting that there was no mention of placing physical boundaries
on public accommodations1.

See also: Pallozzi v. Allstate Life Ins. Co., 198 F.3d 28 (22
Cir. 1999) and Doe v. Mutual of Omaha Ins. Co., 179 F.3d 557
(7th Cir. 1999), cert.denied S.Ct. (2000) (broader
interpretation) versus Ford v. Schering-Plough Corporation, 145
F.3d 601 (3d Cir. 1998), cert. denied, 119 S.Ct. 850 (1999) and
Parker v. Metropolitan Life Ins. Co., 191 F.3d 1006 (6th Cir.
1997), cert. denied, 118 S.Ct. 871 (1998), Weyer v. Twentieth
Century Fox Film Corp., (narrow interpretation).

VIII.   Section 501(c) of the ADA

Title I of the ADA prohibits discrimination in all terms,
conditions and privileges of employment, including health
benefits.  Employers are also prohibited from contracting with
an insurer or other entity that discriminated against its
employees with disabilities.  Titles II and III also contain
nondiscrimination mandates that can be used to attack
discriminatory health care practices.

The nondiscrimination requirements in Title I provide that
employers cannot refuse to hire, terminate or treat an employee
with a disability differently because of concerns about health
benefit plan costs and coverage. Employers also cannot refuse to
hire qualified applicants who have dependents with disabilities
because of any concerns about the potential impact on health
care costs. Employees with disabilities must be given equal
access to any health benefits provided to other employees. Lower
levels of coverage for dependents are permissible.

Section 501(c), located in Title V of the ADA, addresses the
practices of insurers.  Section 501(c) states that Titles I
through IV should not be construed to prohibit or restrict (1)
an insurer or other entity that administers benefit plans from
underwriting risks, classifying risks, or administering such
risks in a manner based on or not inconsistent with State law;
(2) a person or organization from establishing, sponsoring,
observing or administering the terms of a bona fide benefit plan
based on underwriting risks, classifying risks, or administering
such risks in a manner based on or not inconsistent with State
law; or (3) a person or organization from establishing,
sponsoring, observing or administering the terms of a bona fide
benefit plan that is not subject to State laws that regulate
insurance (ERISA prevents the application of state insurance
regulations to employer-
sponsored self-funded health plans).  However, Section 501(c)
may not be used as a R20;subterfuge to evade the purposes of
Titles I and III.R21;

The EEOC, in 1993, issued Interim Enforcement Guidance on
Application of ADA to Disability Based Distinctions in Employer
Provided Health Insurance in order to explain its interpretation
of Section 501(c).  The EEOC takes the position that
distinctions in health insurance are only subject to scrutiny
under the ADA if they are R20;disability-based.R21;  A
distinction is disability-based if it singles out a particular
disability, a discrete group of disabilities, disability in
general or any treatments related to a particular type of
disability.  In giving meaning to the concept
R20;disability-based,R21; the EEOC, in effect, defines two
points on a continuum from non-disability-based to
disability-based.  At the non-disability-based end of the
continuum are broad distinctions that (a) apply to the treatment
of a multitude of dissimilar conditions and (b) constrain
individuals both with and without disabilities (although they
may have a greater impact on individuals with disabilities).
Examples offered by the EEOC are lesser benefits for eye care as
well as R20;mental/nervousR21; conditions, and limitations on
elective surgeries or experimental drugs.  At the
disability-based end of the continuum are distinctions that
single out a particular disability, discrete group of
disabilities, or disability in general.

The primary barrier to the recognition of the traditional
distinction between R20;mental/nervous conditionsR21; and
R20;physical conditionsR21; as disability-based, and therefore
subject to scrutiny under the ADA, has been the Rehabilitation
Act cases.  However, there are good reasons for this issue to be
reviewed anew under the ADA.  The introductory provisions of the
ADA issue a powerful challenge to the long-held but false
assumptions that perpetuate discrimination.  The archaic nature
of the mental/physical distinction is revealed in the coupling
of R20;nervousR21; with mental, and the assumption that mind and
body can be neatly separated.

According to the EEOC, if a distinction in insurance is
disability-based, it is illegal unless it can be justified by
R20;sound actuarial data.R21;  An insurer must use legitimate
insurance risk classifications and actuarial data to prove that
the distinctions are legal or that the distinction is necessary
to prevent drastic changes in the things the plan offers
(premiums, scope of coverage, etc.) that would significantly
affect the level and quality of benefits offered to others in
the plan.  In addressing the insurerR17;s burden of proof once a
showing of disability-based discrimination has been made, the
EEOC notes that data that are R20;seriously outdated and/or
inaccurate,R21; e.g., R20;based on myths, fears, or
stereotypesR21; or R20;false assumptions... or ...assumptions
that may once have been, but are no longer, true,R21; are not
legitimate.  The same considerations should apply in the stage
one analysis of whether a distinction is disability-based and
therefore subject to scrutiny under the ADA.

IX.  Associational Discrimination

Title III of the ADA prohibits discrimination based on
association. Public accommodations must not discriminate against
R20;an individual or entity because of the known disability of
an individual with whom the individual or entity is known to
have a relationshop or assocation2.  In the interpretive
analysis accompanying this section, the DOJ notes that the term
"entity" in this section was added to ensure that those entities
"such as health care providers, ...and others who provide
professional services to persons with disabilities are not
subjected to discrimination because of their professional
association with persons with disabilities."  This section could
be used to challenge physical credentialing and de-selection
practices intended to rid plans of physicians that treat high
cost patients.

X.   Using the Medicaid Act to Resolve Individual Complaints and
Achieve Systemic Change

The Medicaid Act has been used on its own and along with the ADA
and Section 504 to challenge health care decisions and practices
that harm people with disabilities.

Medicaid is a joint venture between the federal and state
governments to help states provide medical care to eligible
low-income individuals. The federal government establishes broad
national guidelines that the states must follow.  The approval
process for waivers of Medicaid requirements can be used to
assure that people with disabilities can obtain more meaningful
access to health care. States may choose the managed care
providers and structure their contracts.  Getting involved at
the planning level can significantly affect what level of
services eligible individuals with disabilities will receive.
This R20;great potential for significant changeR21; can be
exploited through influencing decisions regarding the:
  * Basic structure of the long-term care program;
  * Who will be guaranteed eligibility for services;
  * What services will be covered and how they will be defined;
  * Which state agency will oversee the program;
  * Procedures for ensuring consumer involvement and choice in
    service coverage decisions;
  * Procedures for ensuring consumer and family involvement in
    monitoring quality;
  * Establishment of grievance mechanisms;
  * Development of the provisions of the state's contract with
    MCOs; and
  * The criteria by which MCO performance will be judged.

Visit the Families USA 3 Web site at http://www.familiesusa.org/
for a detailed R20;roadmapR21; of how individuals can get
involved in the design and implementation of Medicaid managed
care networks in their state.  Visit the National Health Law
Program Web site at
http://www.nhelp.org/pubs/adwaiverrepeal.html to review
R20;Medicaid Waiver Repeal Implications for Post-waiver
AdvocacyR21; to understand the implications for advocates of the
Balanced Budget ActR17;s repeal of Medicaid managed care waiver
requirements.

XI.   Medicaid Managed Care and the Implications of the BBA

The Social Security Act authorizes freedom of choice waivers to
implement Medicaid managed care programs. The BBA permits states
to implement managed care on a mandatory enrollment basis for
most individuals with disabilities without applying for a
freedom-of-choice waiver.  With the relaxation of this
requirement, it is even more important for advocates to get
involved during the planning stages of these programs.  The BBA
does require that plans meet certain standards.  Section 4705 of
 the BBA states that contracts for Medicaid managed care under
Section 1903(m) of the Social Security Act must develop and
implement quality assessment and improvement strategies.

R20;At a minimum, these strategies must include access
standards, measures that examine other aspects of care and
services directly related to improving the quality of care
(e.g., grievance procedures and marketing standards), procedures
for monitoring and evaluating the quality and appropriateness of
care and services that Medicaid enrollees receive. . . .R21; (A
workgroup is currently developing a regulation that will
implement this provision of the law.)

As a result of the relaxation of the waiver requirement, more
and more states are moving toward placing Medicaid recipients
into managed care programs. Individuals in the public system
generally have more serious disabilities. They also face
additional barriers such as poverty and have less access to the
tools needed to negotiate through the complex health care maze
than the privately insured population.  Hastily developed
programs, implemented without proper protections and guarantees
could have tremendous impact on the delivery of health care to
the individuals with disabilities who have the greatest health
care needs.

XII.   Health Care Financing Administration

HCFA, an agency of HHS, has developed a number of guidance
documents designed to assist states in implementing and
administering Medicaid managed care programs.
  * Guidance on Coverage of Medical Equipment

This guidance was issued in response to the Second Circuit Court
of Appeals opinion in DeSario v. Thomas, in which the court
upheld a stateR17;s use of the R20;Medicaid population as a
whole testR21; in deciding whether to approve coverage of
medical equipment. This test required a recipient to demonstrate
that R20;absent coverage of the item requested, the needs of
most Medicaid recipients would not be met.R21;  The Medicaid
program at issue, the mandatory home health services benefit,
covers medical supplies and equipment for home use.  HCFA
responded to this decision by quickly issuing a guidance letter
to all state Medicaid directors.  The agency unequivocally
stated that this type of test may not be used.  The guidance
noted that states are allowed some discretion in setting the
standards for coverage of these items, subject to certain
criteria (i.e., medical
necessity) and may develop pre-approved lists as a matter of
administrative convenience.  However, if they choose to do so,
they must also have a procedure for requesting items not on the
pre-approved list.
  * Guidance for States Considering the Development of Medicaid
    Managed Care Programs for Persons With Special Health Care
    Needs

This guidance is intended for states to use in R20;designing and
implementing quality strategies for persons with special health
care needs.R21;  Among the items addressed in the guidance is
the provision of services to assist individuals with cognitive
disabilities in understanding the enrollment process.
  * Guidance on Disclosure of Physician Incentive Plan
    Information to Beneficiaries

This guidance requires MCOs to disclose their financial
reimbursement arrangements with providers to R20;current,
previous, and prospective enrollees upon request.R21;  The type
of information that may be requested includes information on the
types of physician incentive plans used and how they affect
referral services.

XIII.   State Law Protections

There may be additional state law protections you can draw upon
to assist you in addressing barriers encountered in managed care
arrangements. Look for provisions that:
  * Allow people with chronic or life-threatening illnesses to
    obtain standing referrals to specialists, select a
    specialist as a primary care provider, and stay with a
    familiar provider through a transitional period when various
    changes occur;
  * Require development of detailed access plans describing how
    managed care organizations will meet the needs of people
    with disabilities;
  * Prohibit discrimination based on health status or
    utilization of services;
  * Offer access to non-formulary drugs upon a showing of need;
    and
  * Offer prompt review by qualified personnel of grievances and
    denials of care (in many states, MCOs can be held to a
    specific timetable, and in some states, a failure to act
    within the specified timeframe is treated as an approval of
    care).

States may also prohibit certain practices, for example,
restricting providers from speaking freely with patients or
using R20;economic profilingR21; to avoid or get rid of
providers that treat a high-cost patient population.  State
anti-discrimination laws may provide protections that exceed
those in the ADA or allow remedies that are not provided under
the ADA. Where someone suffers an injury, state common law may
provide a remedy.  Cases have been brought against managed care
organizations for bad faith, negligence, breach of fiduciary
duty, breach of contract, negligent misrepresentation,
intentional infliction of emotional distress, and interference
with the physician-patient relationship.

XIV.   Individual Claims--Use Informal and Formal Processes

Step 1: Informal Process
  * Check the policy or employee handbook carefully to identify
    what language can be used to argue that the treatment,
    equipment or medication is covered.  Find out what role your
    provider may have to assume in this process.
  *     Do they submit the claim or request for authorization?
  * After you have provided all requested information your claim
    or request should be processed within a certain number of
    days.
  * If your claim or request is denied the reason for denial
    should be stated in the notice you receive.
  * Check your policy or employee handbook for the companyR17;s
    appeal procedures.
  * Generally appeals must be in writing.

Step 2: Formal Grievance/Administrative Complaint
  * File a formal grievance with the MCO.
  * File a complaint with the state insurance department (or the
    special managed care consumer assistance office, if your
    state has one).  State agency interventions often result in
    favorable decisions for the consumers.  These complaints
    generally require:

        Name, address, and phone number;
        Brief narrative of your case, giving full explanation of
the problem and what type of insurance is involved;
        The name of your insurance company, policy number, and
the name of the MCO contact involved; and
        Any documentation that supports your case including
phone notes and a record of all contacts and content of
        conversations with the MCO representative.
  * If the plan is self-funded (governed by ERISA) and offered
    by a private sector employer or bona fide union, complaints
    may be registered with the U.S. Department of Labor (DOL)
    Pension and Welfare Benefits Administration. The DOL is not
    charged with interpreting plans or mandating resolution but
    they may investigate the complaint.
  * For denials of services, request external or independent
    review of an adverse determination (if available).  Medicaid
    beneficiaries have the right to request a state fair
    hearing.  After one denial, requests under Medicare are
    automatically sent to an independent reviewer.
  * For ADA and Rehabilitation Act complaints involving Medicaid
    or Medicare, file an administrative complaint.

General Tips for Consumers
  * Statistics released by states indicate that plans reverse
    about 30-40 percent of denials upon internal review.
    (Independent review results in a decision for the consumer
    in about 40-60 percent of cases.)
  * Act quickly, if you wait, you may lose your right to file a
    grievance or appeal.

If help is available, use it
  * Use the planR17;s toll-free number for consumer assistance.
    At a minimum, get them to help you understand your rights
    and responsibilities (if the member handbook is unclear) and
    the reasons for any policies/decisions that affect you.
  * Contact an advocacy organization.
  * Contact state agencies--many have toll-free numbers and
    require that these numbers be included in member handbooks.

Document, document, document
  * Make a record of any problem you experience while it is
    still fresh in your mind.
  * For any contact, note the date, who you talked to, and what
    you were told.
  * The process can be intimidating, and people arenR17;t always
    as helpful as they should be.  ThatR17;s why it is important
    to be clear about your objective (why the effort is worth
    it), and to use whatever help is available.

XV.  Medicaid and Medicare

HHS, through the Office for Civil Rights (OCR) enforces the
Rehabilitation Act and the ADA in all Medicaid and Medicare
programs.

Filing an administrative complaint is an easy process.  The good
news is that it doesnR17;t cost you anything and, better yet,
you donR17;t need an attorney.  The OCR conducts investigations,
provides technical assistance, issues policy guidance, uses
voluntary dispute resolution, and its enforcement powers to
pursue discriminatory actions.

Complaints must be filed within 180 days from the date of the
alleged discrimination.  This period may be extended for good
cause.  You can either request a Discrimination Complaint Form
from OCR or write a letter that includes all of the following
information:

    Your name, address and telephone number.  If you are filing
on someoneR17;s behalf, include your name, address,
    telephone number, and a statement of your relationship to
that person;

    Name and address of the institution or agency you believe
discriminated against you;

    How, why and when you believe you were discriminated
against;

    Any other relevant information; and

    Your signature.

The complaint should be sent to your OCR regional office or to
the Washington, D.C. headquarters:

            U.S. Department of Health and Human Services
            Office for Civil Rights
           Washington, D.C  20201

Once your complaint is received, it is reviewed and if it raises
an issue under the Rehabilitation Act or the ADA it will be
investigated.  If discrimination is found, OCR will first try
negotiating a voluntary resolution to correct the
discrimination.  If negotiations are unsuccessful, enforcement
proceedings may be instituted to suspend Federal funding.  At
this point, you may also wish to consult with an attorney about
bringing a private lawsuit.  Once a complaint is filed with OCR,
the institution or agency named in the complaint is prohibited
from taking any kind of retaliatory action against you or any
person who provides information to OCR regarding the complaint.

If OCR finds that the complaint is not within their
jurisdiction, they may forward it to an appropriate agency that
may be able to help you.  OCR has a hotline for technical
assistance at:

1-800-368-1019 (Voice); 1-800-537-7697 (TTY)4 or visit the Web
site at http://www.hhs.gov/progorg/ocr/504/file.html

XVI.  Technical Assistance Resources on the ADA--Regional
Disability and Business Technical Assistance Centers

The Disability and Business Technical Assistance Centers
(DBTACs) on the Americans with Disabilities Act (ADA) are
leading national resources for information on the ADA in the
United States.  There are centers in each of the ten federal
regions that cover the United States.  They are authorized by
the National Institute on Disability and Rehabilitation Research
(NIDRR) to provide training, materials, and technical assistance
to individuals and entities that are protected or have
obligations under the Americans with Disabilities Act.  ADA
requirements and answers to technical questions on the
application of the ADA to health care and other ADA issues are
explained to anyone calling the national toll-free hotline at
1-800-949-4232.  All calls are confidential and automatically
routed to the DBTAC that serves the state where the call
originates.

XVII.   RTC on Managed Health Care and Disability at ILRU
Research and Training Projects

Research Projects
  * Evaluating the Impact of Managed Care on Individuals with
    Disabilities: Secondary Data Analysis
  * Evaluating the Impact of Managed Care on Individuals with
    Disabilities: A Consumer-based Longitudinal Survey
  * Evaluating State-sponsored Health Care Reform Initiatives in
    Managed Care for People with Disabilities
  * Evaluating Alternative Managed Care Delivery Approaches for
    People with Disabilities
  * Enhancing Consumer Choice Through the Development of Quality
    Indicators for People with Disabilities

Training Projects
  * Informed Consumer Choice
  * Managed Care and Disability Information Service
  * Fellowship in Health Policy Research and Disability
  * National Conferences on Managed Care and People with
    Disabilities

For further information, please contact Wendy Wilkinson at ILRU
(Independent Living Research Utilization), 2323 S. Shepherd,
Suite 1000, Houston, TX  77019, 713-520-0232 (Voice),
713-520-5785 (Fax), 713-520-5136 (TTY), or email wendy@ilru.org.


1 Other cases that reached the same conclusion regarding the
R20;fluidityR21; of the definition of public accommodation
include: Wai v. Allstate Ins. Co., 75 F.Supp. 2d1 (DDC 1999);
Attar v. Unum Life Insurance Co. of America, 1998 WL 574885
(N.D. Tex. 1998); Chabner v. United of Omaha Life Ins. Co., 994
F.Supp. 1185 (N.D. Cal. 1998) (Title III applies to insurance
underwriting practices).  See also: Cloutier v. Prudential Ins.
Co., 964 F.Supp. 299, 302 (N.D. Cal. 1997); Kotev v. First
Colony Life Ins. Co., 927 F.Supp. 1316 (C.D. Cal. 1996); Lewis
v. Aetna Life Ins. Co., 982 F.Supp. 1158 (E.D. Va. 1997) (Title
III prohibits insurer from discriminating on the basis of
disability, regardless of how policy is acquired); Doukas v.
Metropolitan Life Ins. Co., 950 F.Supp. 422 (D.N.H. 1996) (Title
III extends to the substance of an insurance policy including
underwriting practices).

2 42 USC Sec. 12182 (b) (1) (e).

3 R20;Families USA is a national nonprofit, non-partisan
organization dedicated to the achievement of high-quality,
affordable health and long-term care for all Americans. Working
at the national, state and community level . . ..R21;  See
R20;Resource DirectoryR21; for contact and additional
information.

4 Information excerpted from R20;Know Your Rights - Fact
SheetR21; about OCRR17;s responsibilities under the ADA and
Section 504.


XVIII. Resource Directory

Getting Started

Families USA Foundation has a number of guides that provide a
basic overview of a topic and then offer extensive information,
case studies, and best practices for advocates.  Two may be of
particular interest to people with disabilities and disability
advocates:

A Guide to Meeting the Needs of People with Chronic and
Disabling Conditions in Medicaid Managed Care (January 1998).

A Guide to Access to Providers in Medicaid Managed Care (April
1998).

These guides are free.  For more information, you can contact
Families USA by email at info@familiesusa.org, by telephone
202-628-3030, or visit their Web site at
http://www.familiesusa.org/.

Reviewing Managed Care Contracts

The National Health Law Program has created R20;An Advocacy
Checklist for People with DisabilitiesR21; to assist in review
of state Medicaid managed care contracts.  This document and
other valuable tools are available on the NHeLP Web site at
http://www.nhelp.org/.

Evaluating MCO and State Plans

In October 1998, the Health Care Financing Administration
published a document entitled R20;Key Approaches to the Use of
Managed Care Systems for Persons with Special Health Care
Needs.R21;  This guidance document is intended to aid states in
planning, but it can also be used to hold states and health
plans accountable.  (After all, if something is R20;key,R21; it
should be addressed at the state and plan levels.)  This
document is available on the Web site at
http://www.hcfa.gov/medicaid/smd-snpf.htm. The revised 1915(b)
waiver renewal application form requires states to report on
their efforts to comply with ADA requirements, among other
things.  See R20;Section F: Special PopulationsR21; and
R20;Addendum to Section F: Draft Interim Review Criteria for
Children with Special Needs.R21;  In states that are
implementing mandatory managed care for Medicaid beneficiaries
with special needs, advocates should review this information and
monitor program and plan performance.

Managed Mental Health Care

The National Alliance for the Mentally Ill has created a report
card that can be used to evaluate mental health services.  To
see how it works, request a copy of Stand and Deliver: Action
Call to a Failing Industry by calling 1-800/950-NAMI, or read a
summary on the Web site at
http://www.nami.org/update/reportcard.htm.

The Substance Abuse and Mental Health Services Administration
has a Managed Care Technical Assistance Series that includes
titles such as Partners in Planning: ConsumersR17; Role in
Contracting for Public-Sector Managed Mental Health and
Addiction Services.  Like the other materials referenced in this
resource list, this helpful guidebook should be available
free-of-charge.  You can get more information from the SAMHSA
managed care initiative Web site at http://www.samhsa.gov/mc.

Implementing Olmstead

Tapes of the teleconference on Implementing Olmstead may be
obtained from NCIL (National Council on Independent Living),
1916 Wilson Blvd., Suite 209, Arlington, VA 22202 (Attn. Kristy
Langbehn), at 703-525-3406 (Voice), 703-525-3409 (Fax),
703-525-4153 (TTY), Web site at http://www.ncil.org/, or email
at ncil@ncil.org.  Speakers and organizations submitting
comments included: Bob Kafka, ADAPT, 1339 Lamar Square Drive
#101, Austin, TX  78704, Web site at http://www.adapt.org/; Mike
Oxford, Topeka Independent Living Resource Center, 501 SW
Jackson, Suite 100, Topeka, KS  66603, Web site at
http://www.tilrc.org/; Steve Gold, (215) 627-7300; ATTAC
(Advocacy Training/Technical Assistance Center) for Protection
and Advocacy Systems and Client Assistance Programs,
303-733-9324 (Voice), Web site at
http://www.protectionandadvocacy.com/attac12.htm; and the
National Association of Protection & Advocacy Systems, Inc., 900
Second Street, NE, Suite 211, Washington, DC 20002-3557 at
202-408-9514 (Voice), 202-408-9520 (Fax), 202-408-9521 (TTY),
Web site at http://www.protectionandadvocacy.com/, or email
eugenia@napas.org.


The RTC on Managed Health Care and DisabilityR17;s primary
purpose is to provide national leadership on the major health
service and health policy issues facing consumers with
disabilities in managed health care arrangements. The Center
conducts research; prepares special policy analyses; hosts
forums for discussion; presents expert testimony to Congress and
governmental agencies; publishes in the health policy, consumer,
and trade literature; trains graduate students with disabilities
in health service research; and disseminates findings to the
diverse consumer, provider, payer, academic, and policy making
audiences. The Center seeks to serve as a catalyst in the
nationR17;s capital and at the state level for the development
of new ideas that will make managed care and the larger health
care system more responsive to the needs of people with
disabilities. You can get more information at the Web site,
http://www.ilru.org/mgdcare. (Grant #H133B70003)

The Health Law and Policy Institute at the University of Houston
was established in 1978.  In March 1999, it was ranked as the
number one health law program in the country.  You can get more
information at the Web site, http://www.law.uh.edu/healthlaw.

Since 1977, ILRU (Independent Living Research Utilization has
served as a national center for information, training, technical
assistance, and research on independent living.  ILRU is
affiliated with TIRR Systems, a corporation providing a
continuum of services to people with disabilities.  You can get
more information at the Web site, http://www.ilru.org/.

The Southwest DBTAC (Disability and Business Technical
Assistance Center) for Federal Region VI is one of ten regional
centers in the United States.  The Southwest DBTAC is based at
ILRU, a program of TIRR located in Houston, Texas. It is funded
by the National Institute on Disability and Rehabilitation
Research (NIDRR), an agency of the Department of Education.
You can get more information at the Web site,
http://www.ilru.org/dbtac or if you are located in Arkansas,
Louisiana, New Mexico, Oklahoma, or Texas you can contact us at
1-800-949-4232.  All other states can contact us at
713-520-0232.(Grant #H133D60012)


Staff
Mary Anderlik
Wendy Wilkinson
Investigators
Sharon Finney
Editor


            c1999 ILRU Program.  All rights reserved
                     Last Updated:  04/17/00



