A Publication of the North Carolina Justice and Community Development Center
SPECIAL UPDATE EDITION • Spring 2001
The N.C. Poverty Law Monitor is a free, electronic newsletter that is designed to assist Legal Services advocates and other providing legal assistance to low-income North Carolinians. To receive a free e-mail subscription, to unsubscribe, or if you have suggestions or comments to offer or articles or announcements to submit, contact Rob Schofield, editor and chief writer at: rob@ncjustice.org or 919-856-2153
To obtain
more information on the North Carolina Justice and Community Development Center,
check out our web site at: www.ncjustice.org or contact
us at: NCJCDC, P.O. Box 28068, Raleigh, NC 27611
Contributors to this issue include: Greg Malhoit, Carlene McNulty, Yvonne Perry, Bill Rowe, Sorien Schmidt and Adam Searing.
In this issue news from the fields of:
Civil Rights - U.S. Supreme Court Further Limits Civil Rights Enforcement
Public
Benefits - State Supreme Court
Declines to Invalidate Two-Year Time Limit
........................ - U.S.
Supreme Court Strikes Down LSC Restriction on Welfare Reform Challenges
.........................-
Work First Update
Education
- Leandro to
be Appealed After All
................
- Court of Appeals Upholds Residency
Restriction
................
- Education and Law Project Pushes
Testing Reform; Attacks the Achievement Gap
Housing
- Hurricane Floyd Relief Process to be Improved; Money Removed from the Budget
Knife
..............-
Ninth Circuit Strikes Down HUD's "One-Strike" Regulations; Agency Issues Interpretation
..............-
Section 8 Homeownership
Rules
Consumer
- General Assembly
Wrestles with Payday Loans, Consumer Finance
.................-
Court of Appeals Hears Dispute on N.C. Class Action Rules
.................-
Utilities Commission Considers Public Benefits Fund; Looks at High Gas Prices
.................-
Don't Forget about Lifeline/Link-Up
Family
Law - Marriage
Statutes Amended
...............>..-
Child Support Legislation Advances
...............>..-
Family Law Case Updates
Health
and Employment Law - Parents
Win First Round in Suit Over Inadequate Dental Care
............................................>.-
Report on Medicaid: Structural Changes Save More than Benefit Reductions
............................................>
- including news from the North Carolina General Assembly
Education
- U.S. Supreme
Court Limits State Employees
..............>.-
National Employment Law Project Issues U.I. Study
U.S. Supreme Court Further Limits Civil Rights Enforcement
On April 24, the U.S. Supreme Court issued an opinion that appears to take away one of the most effective tools for fighting race discrimination, ruling that persons suing under Title VI of the civil rights act cannot prevail by showing "disparate impact" but must prove intentional discrimination.
The ruling in Alexander v. Sandoval effectively leaves recipients of federal funding free to engage in a wide range of discriminatory practices that have been forbidden for over thirty years. While the Court's decision left federal agencies free to enforce the "disparate impact" provisions of regulations passed to enforce Title VI, it barred private enforcement. Enforcement by agencies has, until now, been secondary to enforcement by private suit.
The 5-4 decision (with justices divided along the usual lines) involved a challenge to Alabama's decision to administer its driver's license examination in English only. Both the Federal District Court and the Eleventh Circuit Court of Appeals ruled that the policy must be enjoined as discriminatory against non-English speakers. In overturning the lower courts, Justice Scalia said it would amount to "judicial activism" for the Court to find a private right of action in disparate impact cases.
Despite the apparent defeat for civil rights enforcement contained in the Sandoval decision, a Federal District Judge in New Jersey has already issued an opinion in a disparate impact case that reads the Scalia's opinion in a very limited fashion. The lengthy (99 page) opinion in South Camden Citizens in Action v. New Jersey Department of Environmental Protection (Civil Action No. 01-702) was issued on May 10 by Judge Stephen Orlofsky. Judge Orlofsky concludes that his ruling in favor of plaintiffs that was issued five days before the Sandoval opinion is not affected. For a copy, go to http://lawlibrary.rutgers.edu/fed/html/ca01-702-3.html.
State Supreme Court Declines to Invalidate Two-Year Time Limit
In a decision that disappointed poverty law advocates and that could have significant impact upon state administrative law, the North Carolina Supreme Court has ruled against a challenge to the state's two-year time limit on Work First benefits. The decision in Arrowood v. DHHS, No.489A00, which was issued on April 6, reversed a 2-1 Court of Appeals ruling that had invalidated the time limits because of the state's failure to comply with the state Administrative Procedures Act (APA) in establishing the rule. As was reported in a previous edition of the Monitor, the Court of Appeals had ruled that the time limit provision was invalid because it had not been enacted as a statute by the General Assembly or promulgated as a rule by the state Department of Health and Human Services. Instead, DHHS simply announced the policy and implemented it after receiving a waiver from federal HHS in 1996.
In oral arguments held in March, it appeared from questions asked that members of the court were mistakenly concerned that if they struck down the two-year time limit, they might invalidate the entire Work First program. The Assistant Attorney General arguing the case went so far as to suggest that moneys could be owed to the federal government if that occurred. This argument had never been raised before in the case, and seems highly implausible given that federal AFDC and TANF law (which created a cash assistance program and under which Work First was implemented) was in place.
In issuing a per curiam reversal of the Court of Appeals, the Supreme Court offered no opinion of its own but simply adopted the reasoning of Judge Walker who dissented in the Court of Appeals decision. That opinion adopted the state's reasoning that the time limit limitation was properly adopted by virtue of the federal waiver/approval process. It can be found at: http://www.aoc.state.nc.us/www/public/coa/opinions/2000/990940-1.htm.
In addition to the setback this decision gives to the state's low-income community, it also appears to be a significant defeat for advocates who favor public input into the state rulemaking process.
U.S. Supreme Court Strikes Down LSC Restriction on Welfare Reform Challenges
As most advocates are hopefully aware by now, the U.S Supreme Court has struck down a 1996 Congressional prohibition on participation in specified types of welfare reform litigation by LSC recipients. The February 28 decision in Velazquez v. LSC, sustained the Second Circuit's invalidation of the provision which limits representation to "an individual client who is seeking specific relief from a welfare agency if such relief does not involve an effort to amend or otherwise challenge existing law in effect on the date of the initiation of the representation." The 5-4 ruling was authored by Justice Kennedy and was premised on the finding that the provision violated the First Amendment guarantee of free speech for the LSC funded attorneys and their clients. Neither the Supreme Court or the Second Circuit saw fit to strike down other LSC restrictions challenged in Velazquez -- such as the broader prohibitions on welfare reform lobbying, rulemaking and class based litigation. The decision does make clear, however, that LSC funded attorney are free to bring challenges to the legality or constitutionality of welfare laws or regulations when they are brought in the context of an individual's case against a welfare agency.
Work First Update
Work First (North Carolina's primary cash assistance program for low-income families) continues to labor under significant budgetary and policy restraints that limit its capacity to help those in need. The Work First caseload as of March 2001 is 43,309 cases, 22,419 child-only and 20,890 all other families. Average monthly cash payment in July, 2000 was $217 per month, down from $230 per month in 1991. According to legislative staff, a private evaluation of the program found that families stay on the Work First rolls an average of 9 months, compared to 12 months average stay on AFDC -- Work First's predecessor. Unfortunately, there is little difference found in families’ employment and earnings. The assessment also found that in May, 1999 family earnings after being off of Work First for 12 months are as follows:
The 1999 federal poverty guideline for a family of three was $13,880 and for a family of four was $16,700. Consequently, sixty-four percent (64%) of the families that left Work First earned two-thirds or less of the federal poverty level in their first year off the program. While many claim that Work First is a success because the rolls have decreased over 60%, clearly there has been no abatement of poverty and need. In fact, it appears that a significant portion of the families who left Work First are still financially eligible to get the cash assistance. Unfortunately, in light of the ongoing crisis in the state budget, advocates hold out little hope of obtaining necessary funding increases and will be doing their best to protect programs from further cuts in the weeks ahead.
There is also news regarding the Work First Electing and Standard county systems. The Standard counties follow state-set eligibility rules and standards regarding who qualifies for Work First cash assistance, program requirements, sanctions, time limits etc. The Electing counties can set their own eligibility and program standards for cash assistance. Electing counties receive a block grant of money to run their entire program. This means that if fewer people apply for benefits the Electing county keeps any savings to use as they wish on a wide variety of social services. However, if caseloads increase, Electing Counties are limited to the money in their block grant to fund cash assistance and services. Currently, there are 21 Electing Counties. Of these, three overspent for the current fiscal year and were facing the possibility of having to cut off services and/or deny families cash assistance. The state Division of Social Services has done its best to help prevent families from being hurt in those counties; however, this has been a graphic display of the limitations of a block grant system.
As a result of this experience, ten counties that had initially applied to be Electing in 2001-2003 have now withdrawn their Electing plan and have changed to Standard (Alamance, Cabarrus, Catawba, Cherokee, Durham, New Hanover, Polk, Rutherford, Stokes and Transylvania). Thirteen counties continue to apply for Electing County status for 2001-2003: Caldwell, Caswell, Davie, Henderson, Iredell, Lenoir, Lincoln, Macon, McDowell, Randolph, Sampson, Surry, and Wilkes.
Education
Leandro to be Appealed After All
Education advocates were surprised and disappointed at the recent decision of by state education officials and Gov. Easley to appeal Judge Howard Manning’s ruling in the Leandro, low-wealth schools lawsuit. Judge Manning had issued a series of lengthy opinions in the case spelling out his finding that the state is failing to fulfill its constitutional obligation to provide all students with a sound basic education.
In the first installment of Judge Manning's decision he ruled that the State has provided a constitutional framework for children to receive a sound basic education along with clear goals for achievement. In the second installment of his decision the Judge ruled that early childhood pre-kindergarten is constitutionally required for "at-risk students" for them to be afforded an equal opportunity to obtain a sound basic education. According to the Court this means that "at-risk students," presumably including LEP students, have a right to be provided the opportunity to attend a quality pre-kindergarten educational-based program.
In the third installment of Judge Manning's decision, the Court held for Plaintiffs in finding that at-risk students in Hoke County are not receiving the opportunity for a sound basic education required under the State Constitution. In addition, the Court found across the State, there are significant numbers of children who are at-risk of academic failure, and that the needs of these students are not being adequately addressed. The Court stated that educating these at-risk children requires more time and effort and is more expensive than educating children from middle class backgrounds. However, Judge Manning said that plaintiffs had "not yet proved" that the failure of at-risk children to receive a sound basic education is the result of lack of sufficient funding from the State. As a result, Judge Manning directed that the State and the plaintiffs "conduct self-examinations of the present allocation of resources and . . .produce a rational, comprehensive plan . . . towards meeting the needs of all children. . . ." The Court directed that this be done within twelve months.
Advocates had hoped that state leaders might welcome Manning’s ruling as an opportunity to finally address the needs of at-risk children in North Carolina public schools. Manning did not attempt to bar schools from providing programs and services beyond the bare minimum to non-at-risk students, but he did give clear direction that the schools must reorder their priorities to assure that all students (even those at-risk) receive the constitutionally guaranteed "sound basic education." For now, state leaders appear unwilling to face the fact that fundamental change will be necessary for North Carolina to meet the Supreme Court's constitutional mandate.
Court of Appeals Upholds Residency Restriction
The N.C. Court of Appeals has rejected an effort by a low-income Davidson County teenager to challenge her denial of enrollment in the public schools based on lack of domicile. The young woman had moved from Illinois to Davidson County to reside with an uncle at the direction of her mother after having been the victim of an attempted sexual assault. When she attempted to enroll in school, she was denied admission because -- it was determined -- she was not domiciled in the school district (her mother had remained in Illinois). The school district took the narrow view that "domicile" could not be read to include a situation in which a child resided with an adult caretaker both with the consent of the parent and with the intent of the parent that the child remain indefinitely. Both the trial court and the Court of Appeals agreed with the narrow interpretation of the statute and the Constitution. The case, Graham v. Mock, No. COA00-549, May 1, 2001, was handled by Central Carolina Legal Services attorney Stan Sprague, who intends to seek review by the state Supreme Court.
Education and Law Project Pushes Testing Reform; Attacks the Achievement Gap
In response to the state's headfirst plunge into high stakes, elementary and secondary school testing, the Justice Center's Education and Law Project and its allies are urging state legislators to improve the process so that children and their families are not unfairly affected. Several of the most important bills currently under consideration in the General Assembly are described below. Action on all will take place prior to adjournment this summer.
Senate Bill 762 and House Bill 1150 -- Ensure Fairness in Testing
These identical bills would:
Senate Bill 512 and House Bill 988 -- Moratorium on Student Standards
These identical bills would suspend the Student Accountability Standards and high stakes testing of students until the legislature finds that schools have adequate resources to ensure that all students have a fair opportunity to meet the standards.
Senate Bill 201 and House Bill 624 -- Close the Achievement Gap
These identical bills would:
Hurricane Floyd Relief Process to be Improved; Money Removed from the Budget Knife
Gov. Mike Easley announced plans to speed payments to victims of Hurricane Floyd, saying the existing relief effort has been bogged down by bureaucracy and red tape. Speaking at the annual conference of the N.C. Low-Income Housing Coalition, he said he will reorganize the relief effort, consolidating state operations and providing more help to local governments. "For 18 months, the rules in place have not worked," he said. "The most important rule now is to take care of the people in need -- get them back in their homes, do it quickly and do it right." About a third of an $836 million state aid package has been spent so far. Of $464 million designated for housing aid, only $66 million has been spent. Easley blamed the slow pace on permit and inspection rules, as well as local government officials overwhelmed by the task of completing the transactions needed to get people into new homes. The main goal of his plan is to complete the recovery effort within the next 24 months. He said more than 4,000 families and individuals are still waiting for help.
The governor's actions come on the heels of his announcement last month that unspent Hurricane Floyd relief funds will not be used to address the state's burgeoning budget crisis. This announcement took place just days after the North Carolina Low Income Housing Coalition and the North Carolina Association of CDC's held a joint press conference to call for protection of the earmarked money. Low-income housing advocates have argued forcefully for greater resources to assist renters victimized by Floyd.
Ninth Circuit Strikes Down HUD's "One-Strike" Regulations; Agency Issues Interpretation
The Ninth Circuit Court of Appeals has issued an opinion that strikes down HUD's policy for terminating tenancies due to criminal activity. The decision in Rucker v. Davis, 98-16322, ___F.3rd __ (9th Cir. Jan. 24, 2001 -- en banc) invalidates HUD's one-strike regulations because, as applied to innocent tenants, they are inconsistent with the authorizing statute. The court upheld the district court's decision to preliminarily enjoin the Oakland (CA) Public Housing Authority from evicting four residents pursuant to those regulations. The decision reverses an earlier 2-1 panel decision of the same court, reported at 203 F.3d 627. Unfortunately, the decision only formally affects the Ninth Circuit.
Subsequent to the issuance of the opinion, the Office of Public and Indian Housing issued a special notice advising Housing Authorities in the affected states and territories to disregard previous HUD interpretations of the relevant laws. The Monitor will keep readers apprised of further developments. Additional information can be obtained from the National Housing Law Project at www.nhlp.org.
Advocates should be aware that the Rucker decision actually comports with North Carolina law. The federal statute at 42 U.S.C. 1437d(1)(5) defines lease requirements for housing authorities seeking to evict families for criminal activities. On its face, the statute may appear to allow eviction of the entire family if a household member or guest commits a crime. According to the NC Court of Appeals, however, Congressional legislative intent was to not allow eviction of innocent heads of household and family members when the tenant was not personally at fault for a household member’s criminal act. In Charlotte Housing Authority v. Patterson, 120 N.C. App. 552, 464 S.E.2d 68 (1995), the tenant’s son left the apartment, borrowed a gun and shot a child in another part of the housing authority property - all without the knowledge of the tenant. The court held that since the tenant was not at fault, there was no good cause to evict her and the remaining children. The court also mentioned that there was similar legislative intent regarding eviction of innocent Section 8 tenants.
Section 8 Homeownership Rules
Housing advocates should take note -- if they haven't already -- of HUD final rules issued late last year that permit the use of Section 8 voucher assistance for homeownership purposes. Under the regulation, public housing authorities may allow Section 8 voucher holders to use federal assistance to purchase a single family home, manufactured home, condominium, or interest in a cooperative. Since HUD will not provide any additional funding for this program, PHA's are not required to offer this assistance to voucher holders. In certain "hot" rental markets, however, the Section 8 Homeownership Program may provide some relief for tenants who can no longer afford high rents but can still afford a mortgage payment. For areas faced with an increasing lack of landlord participation in the Section 8 program (and therefore a decline in rental units), homeownership programs can also create a larger selection of housing units from which Section 8 recipients can choose. As a practical matter, the program offers some lower-income families another meaningful opportunity, on a voluntary level, to achieve their homeownership dream. Additional information can be obtained from the National Housing Law Project at www.nhlp.org.
General Assembly Wrestles with Payday Loans, Consumer Finance
As the 2001 General Assembly enters its fourth month, consumer advocates are fighting a three-front war against high cost lenders.
On the payday lending (i.e., delayed deposit check-cashing) front, the legislature must decide whether or not to reauthorize the practice that was first regulated four years ago. Payday lending is a practice whereby consumers post-date personal checks for (typically) a week or two in exchange for immediate cash -- less a flat 15% fee. While such transactions could theoretically benefit a consumer who used it one time to escape an emergency, experience indicates that typical North Carolina consumers are using payday loans more than a dozen times per year.
Under the terms of the 1997 law, authority to engage in the business will "sunset" July 31. In light of this potentially dramatic development, consumer advocates are pushing legislators to demand industry acceptance of fundamental reforms as a price for reauthorization. To date, five bills containing various types of reforms have been introduced but none has yet to be considered in committee. The two bills advanced by industry (SB 862 and HB 1071) offer little in the way of real reform and have been rejected out of hand by consumer advocates. On May 2, state Treasurer Richard Moore endorsed the position of the Coalition for Responsible Lending that the industry should simply be allowed to sunset if real reform cannot be achieved.
On the consumer finance front, lenders are engaged in an all-out push to raise interest rates and fees that may be charged. Terms of the industry proposal can be found in House Bill 599, which passed the House in late April and now resides in the Senate Judiciary I Committee. Under the terms of the bill, the cost of the average consumer finance loan would rise as much as 15-20% and North Carolina borrowers could pay as much as $40 million more per year. Consumer advocates are urging Senators to reject the bill unless fundamental amendments are made to reduce the price increases and include consumer protection provisions.
On the mortgage lending front, the battle revolves around efforts to advance mortgage broker licensing legislation. While the industry and the Banking Commissioner appear willing to accept licensing they are unwilling to accept provisions that would a) attack predatory practices like the use of "yield spread premiums" (whereby brokers steer borrowers to higher cost loans and receive a bonus for doing so) and b) provide for meaningful recovery for borrowers who are injured by unscrupulous practices. At present the bills under consideration are in the House Financial Institutions Committee and should be taken up this month.
Court of Appeals Hears Dispute on N.C. Class Action Rules
The state Court of Appeals heard arguments last month in the case of Pitts v. American Security Insurance Company, a case that could have a significant impact on the future of class actions in the state. Pitts was a Business Court case that challenged the sale of "forced place" automobile insurance. Class certification was sought on the theory that thousands of consumers had been harmed through overcharges and wrongful acts. In a lengthy opinion, Judge Tennille declined to certify the class and plaintiffs appealed. Among the issues before the Court of Appeals: whether Tennille mistakenly applied stricter federal class certification rules rather than North Carolina's more liberal standards; whether he improperly found the named plaintiff to be an inadequate class representative because(among other things) she did not initiate the complaint herself and had responded to a form letter from plaintiffs' attorneys; whether he improperly declined to certify only some aspects of the case for class certification. The panel of Judges McGee, Greene and Walker are expected to render a decision within the next few months.
Utilities Commission Considers Public Benefits Fund; Looks at High Gas Prices
Two proceedings before the state Utilities Commission in recent weeks have addressed matters of importance to low-income households. In the first, the Commission has established a formal docket to consider a request from the Legislative Study Commission on the Future of Electric Service (a.k.a., the "Study Commission on Restructuring") on the topic of a Public Benefits Fund and a Green Pricing Program. Of particular note to low-income people in this proceeding is a proposal to establish a multi-purpose public benefit fund that would generate additional resources for low-income ratepayer assistance, energy efficiency and renewable energy research. The Justice Center filed comments in this proceeding on behalf of a broad consumer/environmental coalition that endorsed establishment of such a fund via a small, mandatory per kilowatt hour charge on all state sales of electricity. It is hoped that such a fund could -- among other things -- supplement the meager amounts currently spent by the state to help make bills of low-income families more affordable via direct subsidies and, also, improved efficiency. The Utilities Commission will likely report back to the General Assembly this summer.
The second proceeding involved a less formal investigation into the issue of the exploding natural gas prices that plagued consumers during the winter. Here, the Commissioners' attention focused primarily on the issue of "hedging" -- a technique whereby gas distribution companies could essentially purchase insurance against dramatic price spikes via the use of longer term contracts with suppliers. While experts expressed doubt that such policies would lower gas bills over time, they did offer support for the use of hedging to protect consumers against rapid and unexpected price escalations.
Don't Forget about Lifeline/Link-Up
Advocates should not forget that the Justice Center and the Attorney General's Office of Consumer Protection -- (919) 716-6000 -- continue to have several thousand English/Spanish brochures describing the Lifeline and Link-Up telephone subsidy programs, including eligibility criteria and how to obtain service. These remain available in bulk on a first come, first served basis. You can also obtain a copy (english) (click here for Spanish) on-line at the Justice Center's web site.
Marriage Statutes Amended
The General Assembly and the Governor have given final approval to a bill (House Bill 142) that amends several provisions of North Carolina's marriage statutes. The measure: broadens the list of those authorized to solemnize marriages, adds language requiring judicial approval for certain underage marriages, limits the register of deeds' responsibility in issuing marriage licenses to verifying objective requirements, provides a procedure to apply for a marriage license without appearing in person, expands the geographical scope of marriage licenses, makes inclusion of race on the license optional, and makes other changes as well.
Child Support Legislation Advances
House Bill 377, a proposal that makes numerous changes to North Carolina Child Support laws (ranging from non-substantive technical corrections, to making the law better reflect current practice or realities, to real substantive changes) appears poised to receive final approval from the General Assembly in the near future. Among the changes included in the bill:
Family Law Case Updates
As is usually the situation, recent appellate court decisions in the field of family law have focused on the subjects of custody and visitation, equitable distribution, alimony and post-separation support issues, and termination of parental rights. Here are some recent decisions that may be of interest to poverty law advocates:
In the Matter of Stumbo -- Decided on May 15, this case involves a review of the laws governing DSS access to children who are the subject of an abuse and neglect investigation. The facts of the case showed that the parents in question refused to allow DSS to enter their home and to interview the children. At the trial court, it was concluded that the parents violated statutory prohibitions against interference with a child protective services investigation. The parents contested the trial court's ruling on the grounds that the proposed investigation was a search and seizure without probable cause. Writing for herself and Judge McCullough, Judge Hudson distinguished between the investigation contemplated by DSS and a Fourth Amendment search and seizure. In dissent, Judge Greene argued that the investigation ordered in the case and mandated by G.S. 7B-302 does constitute a search within the meaning of the Fourth amendment.
Petty v. Petty -- The Court of Appeals, in an unpublished opinion issued in April, upheld a District Court decision awarding custody to the mother and visitation to the father in contravention of an effort by grandparents to obtain custody. Since there was no evidence in the record that the children were neglected or abused in any way, the "best interest" standard was not applicable to the intervening grandparents, said the court, and the interest of parents must prevail.
Burch v. Gaston County ex rel. Burch -- In another unpublished opinion last month, the Court of Appeals allowed a District Court judge's "temporary suspension" of a father's child support obligation to stand while the mother was under a show cause order to explain why she should not be held in contempt for removing the children from North Carolina without authorization. The Court cited the "clean hands"doctrine as grounds for making an exception to the general rule that "the duty to pay child support is wholly independent of the non-custodial parent's right to visitation."
Williamson v. Williamson -- On April 3, the Court of Appeals affirmed the trial court's order disallowing alimony or post-separation support from the time the estranged spouse began cohabiting with a new partner. "In cases in which the dependant spouse receives alimony or post separation support pursuant to a judgment or court order, cohabitation or remarriage terminates that spouse's right to receive payments. G.S. § 50-16.1. This is not to say that a supporting spouse can automatically cease paying the dependant spouse without a court order. The supporting spouse must first file a motion with the trial court, notify the dependant spouse, and obtain a court order authorizing termination of payments as of a date certain."
Hendrick v. Sanks -- On May 15, the Court of Appeals upheld a narrow exception to the general rule that a child support obligation may be ended when a child over 18 is not making progress toward secondary school graduation. In this case the child in question has Downs Syndrome and is making progress toward his own "special" graduation. The court ruled that this was sufficient to meet the general requirements of G.S. 50-13.4. The court remanded the case on the other assignment of error -- which was that the trial court had merely cut the support obligation in half upon ending the support obligation of a second child -- who was indisputably over age. The court ruled that the trial court should have applied the child support guidelines to ascertain the appropriate support level.
Parents Win First Round in Suit Over Inadequate Dental Care
Parents challenging the state's Medicaid dental program received a boost last month when U.S. District Judge Howard of the Eastern District denied the state's motion to dismiss. The four parents named in the suit brought the action on behalf of their children, who do not have adequate access to Medicaid dental services because the state does not offer sufficient reimbursements to attract an adequate number of providers. The lack of access to basic dental care, such as regular cleanings and early screenings, results in loss of teeth, later painful and extensive dental work, and serious infections.
While the state moved to dismiss the suit on a variety of grounds, all but one such argument were rejected by the court. In other states, similar suits have been resolved overwhelmingly for the plaintiffs, parents, and children. "These parents welcome the chance to have their stories heard in court," said Cal Adams, attorney for Womble Carlyle Sandridge & Rice. "We're one step closer to getting these children the care they need." The plaintiffs are being represented by attorneys with Womble Carlyle Sandridge & Rice, the National Health Law Program -- a national public interest law firm, and the Justice Center. Despite efforts by plaintiff attorneys to seek settlement of the dispute, the state has sought review of the matter in the Fourth Circuit -- taking the extreme position that the state is actually immune from such suits on constitutional grounds.
A copy of the original class action complaint can be found on the Justice Center's web site.
The 1999 North Carolina Institute of Medicine's Task Force on Dental Care Access report can be obtained at: www.nciom.org/dentalrpt.pdf
A January 2001 letter from Federal Dept. of Health and Human Services to State Medicaid Directors detailing the importance of dental access, adequate reimbursement rates, and the number of lawsuits in which plaintiffs have prevailed on the issue can be accessed at: www.hcfa.gov/medicaid/smd118a1.pdf
Report on Medicaid: Structural Changes Save More than Benefit Reductions
A report prepared for the General Assembly by national firm known as the Lewin Consulting Group offers several key recommendations regarding the state's Medicaid program. The report is considered particularly important in light of the state's current dire fiscal picture and the huge role that growing Medicaid expenses have played in abetting the budget crisis. While consumer health advocates reacted cautiously to some of the report's conclusions, they lauded the report's central finding that North Carolina's woes are (as most poverty law advocates would have surmised) not the result of an overly generous benefit package. Here are summaries of some of the key points from the report.
1. Benefits: NC Medicaid offers a minivan plan, NOT a Cadillac plan. Lewin criticizes characterization of the Medicaid plan as having a "Cadillac" benefit package by making two important points. First, federal law mandates that all state Medicaid plans offer certain services that exceed the benefits available in private insurance programs such as comprehensive pediatric health screening. Second, Lewin notes that "…the poverty and disability status of many Medicaid beneficiaries necessitates including services that are not needed by a generally healthier and wealthier population in a private insurance plan." Rather than wholesale slashing of benefits, Lewin recommends a wide variety of structural changes to the program, from better valuating the benefits of new services to better communications between Medicaid managers. These recommendations can save money while improving the services available to the poor and disabled people Medicaid serves. Lewin does not recommend termination of any benefits, but rather suggests looking at the costs of three specific benefits:
Lewin estimates the savings from elimination of chiropractic and podiatry services at only $2.4 million however - 20 times smaller than the savings from their top recommendation.
2. Use more generic prescription drugs - save $50 million. Lewin's top recommendation to contain costs is to create a "prior authorization" program in order to encourage use of generic drugs for eight expensive and often-prescribed brand-name drugs. Savings: Over $50 million total, including $16.3 million in state expenditures. Consumer advocates praised this suggestion.
3. Consider reducing physician fees. The other significant cost reduction recommended in the report is to reduce the amount Medicaid pays physicians for taking care of Medicaid patients. A 9% fee reduction would save $50.9 million in total funds and $16.5 million in state funds. Lewin argues that North Carolina Medicaid pays physicians more than Medicaid programs in surrounding states and that reducing fees won't hurt access. Advocates voiced some skepticism about this recommendation and noted that Lewin doesn't seem aware of the dismal effect low fees for dental providers have had on the ability of children and others on Medicaid to access services in North Carolina. "Providing health care means paying providers a reasonable amount for doing all the work," said Adam Searing, head of the Justice Center's Health Access Coalition.
Poverty law advocates -- especially those active in the Public Benefits area -- should stay tuned for further developments as the General Assembly budget process proceeds.
U.S. Supreme Court Limits State Employees
In a decision rendered on February 21, the U.S. Supreme Court ruled 5-4 in the case Board of Trustees of the University of Alabama v. Patricia Garrett that state employees who suffer discrimination because of a disability cannot sue their employers under the Americans With Disabilities Act. In an opinion written by Chief Justice William H. Rehnquist and joined by Justices Sandra Day O'Connor, Antonin Scalia, Anthony Kennedy, and Clarence Thomas, the conservative majority of the Court said that Congress had exceeded its authority by making states financially liable under the federal ADA. The ruling is the latest of several recent Supreme Court decisions that have limited federal power. Worker and plaintiff advocates say that Congress could try again to pass legislation allowing state employees to sue their employers for disability-related discrimination, but that legislators would have to prove the law is essential to prevent abuse. Legislation is under consideration in the North Carolina General Assembly that would affirmatively grant state employees the right to sue under a number of federal protective statutes.
National Employment Law Project Issues U.I. Study
A recent National Employment Law Project report (Beyond Boom and Bust: Financing Unemployment Insurance in a Changing Economy) is part of a series of studies by the National Employment Law Project (NELP) addressing the current state of unemployment insurance (UI) in America. While most of the NELP studies have focused on eligibility and benefit issues, this report calls attention to the structure and outcome of UI benefits financing at the state level. It is intended to spark interest in improving the functioning of UI finance, highlight opportunities to improve access to benefits, and provide a primer for those who are unfamiliar with the complex world of UI finance. It calls into question the level of preparedness among the states as the US economy shows signs of slowing. The report can be obtained at www.nelp.org.
· contact us · back to Poverty Law Litigation · back to Justice Center