Justia Public Benefits Opinion Summaries

Articles Posted in US Court of Appeals for the Seventh Circuit
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About 50 businesses that offer live adult entertainment (nude or nearly nude dancing) sought loans under the second round of the Paycheck Protection Program enacted to address the economic disruption caused by the Covid-19 pandemic. Congress excluded plaintiffs and other categories of businesses from the second round of the Program, 15 U.S.C. 636(a)(37)(A)(iv)(III)(aa), incorporating 13 C.F.R. 120.110. Plaintiffs asserted that their exclusion violated their rights under the Free Speech Clause of the First Amendment.The district court issued a preliminary injunction, prohibiting the Small Business Administration (SBA) from denying the plaintiffs eligibility for the loan program based on the statutory exclusion. The Seventh Circuit granted the government’s stay of the preliminary injunction and expedited briefing on the merits of the appeal. The SBA satisfied the demanding standard for a stay of an injunction pending appeal, having shown a strong likelihood of success on the merits. Congress is not trying to regulate or suppress plaintiffs’ adult entertainment. It has simply chosen not to subsidize it. Such selective, categorical exclusions from a government subsidy do not offend the First Amendment. Plaintiffs were not singled out for this exclusion, even among businesses primarily engaged in activity protected by the First Amendment. Congress also excluded businesses “primarily engaged in political or lobbying activities.” View "Camelot Banquet Rooms, Inc. v. United States Small Business Administration" on Justia Law

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Molina Healthcare contracted with the Illinois Medicaid program to provide multiple tiers of medical-service plans with scaled capitation rates (fixed per-patient fees that cover all services within the plan’s scope). The Nursing Facility plan required Molina to provide Skilled Nursing Facility (SNF) services. Molina subcontracted with GenMed to cover that obligation. Molina received a general capitation payment from the state, out of which it was to pay GenMed for the SNF component. Molina breached its contract with GenMed. GenMed terminated the contract. After GenMed quit, Molina continued to collect money from the state for the SNF services, but it was neither providing those services itself nor making them available through any third party. Molina never revealed this breakdown, nor did it seek a replacement service provider.Prose, the founder of GenMed, brought this qui tam action under both the state and federal False Claims Acts, 31 U.S.C. 3729, alleging that Molina submitted fraudulent claims for payments from government funds. The district court dismissed the case. The Seventh Circuit reversed. The complaint plausibly alleges that as a sophisticated player in the medical-services industry, Molina was aware that these kinds of nursing facility services play a material role in the delivery of Medicaid benefits. View "Prose v. Molina Healthcare of Illinois," on Justia Law

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A False Claims Act, 31 U.S.C. 3729(a)(1)(A), “qui tam” lawsuit against SuperValu claimed that SuperValu knowingly filed false reports of its pharmacies’ “usual and customary” (U&C) drug prices when it sought reimbursements under Medicare and Medicaid. SuperValu listed its retail cash prices as its U&C drug prices rather than the lower, price-matched amounts that it charged qualifying customers under its discount program. Medicaid regulations define “usual and customary price” as the price charged to the general public. The district court held that SuperValu’s discounted prices fell within the definition of U&C price and that SuperValu should have reported them but held that SuperValu did not act with scienter.The Seventh Circuit affirmed, joining other circuits in holding that the Supreme Court’s 2007 “Safeco” interpretation of the Fair Credit Reporting Act’s scienter provision applies with equal force to the False Claims Act’s scienter provision. There is no statutory indication that Congress meant its usage of “knowingly,” or the scienter definitions it encompasses, to bear a different meaning than its common-law definition. SuperValu did not act with the requisite knowledge. SuperValu’s interpretation of “usual and customary price” was objectively reasonable under Safeco. View "Yarberry v. Supervalu Inc." on Justia Law

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Disabled children are entitled to benefits from the Social Security Administration, 42 U.S.C. 1382c(a)(3)(C). While benefits for an adult depend on a work history plus current inability to perform a job, administrative officials ask whether the child’s limitations meet one of the many listed categories of disability or are functionally equivalent to one of them. When determining whether a child’s impairment is functionally equivalent to a listing, the issue is whether it produces a marked limitation in at least two—or an extreme limitation in one—of six “domains of functioning.”McCavic argued that his son, N., is disabled by attention deficit hyperactivity disorder, intellectual limitations (an IQ near 70), oppositional defiant disorder, and nocturnal enuresis. He claimed that these conditions meet, or are functionally equivalent to certain listings. An ALJ found that N. did not meet any of the listings and has a marked limitation in only one functional category, “acquiring and using information.” A district judge affirmed. The ALJ was entitled to credit the views of a special-education teacher, who knew N well and had a good grasp of gradations among children with intellectual shortcomings. While N. may have met the standards of the old version of the regulations, but not the new one, the change applies “to claims that are pending on or after the effective date.” View "McCavitt v. Kijakazi" on Justia Law

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Butler, age 51, worked in the past as a millwright and machine repair maintenance worker. He stopped working, claiming he was disabled as of November 4, 2015, because of severe impairments stemming from a stroke, seizures, and heart disease and that he is unable to perform his prior occupation. Butler’s claim for disability insurance benefits under the Social Security Act, 42 U.S.C. 401–433, was denied by the Administrative Law Judge (ALJ) following a hearing. The Appeals Council declined to review the denial.The Seventh Circuit affirmed, upholding the ALJ’s determination that Butler was capable of doing light work with some restrictions, and that a sufficient number of such jobs existed that he could perform. Butler has limitations that precluded a determination that he could either perform all light work or perform none. The ALJ clearly recognized that Butler was in the category of persons closely approaching advanced age and appropriately considered that factor as well as Butler’s exertional and non-exertional residual capacity in consulting a vocational expert. View "Butler v. Kijakazi" on Justia Law

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Kaplarevic filed for disability insurance benefits in 2012, alleging that he became disabled on August 1, 2012. His “date last insured” was December 31, 2014, meaning that if his disability arose any later than that, he would not be eligible for benefits.The Seventh Circuit affirmed the denial of benefits, rejecting Kaplarevic’s arguments that an ALJ improperly considered his own observations of Kaplarevic’s physical condition and ability to perform certain physical tasks at a 2018 hearing. Kaplarevic sought an open-ended period of disability so he needed to show that he became disabled before his date last insured and that he was still disabled. The court noted the ALJ’s 15-page opinion, which evaluated extensive medical and behavioral evidence. It was Kaplarevic’s burden to show disability, and if he wanted to do so, he should have accepted the ALJ’s invitation “to identify the portions of the medical records that he believed supported various of [his] allegations.” Vague references to the “totality of the evidence” are not helpful. The ALJ’s opinion did not rely on the failure to seek treatment as a factor demonstrating lack of disability; the record showed that Kaplarevic did not comply with prescribed therapy and that his pain complaints were not consistent with objective medical findings. View "Kaplarevic v. Saul" on Justia Law

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Prosser, a 37-year-old Medicare recipient, suffers from glioblastoma, which causes brain tumors. The five-year survival rate hovers around 5%. Though not curative, Prosser benefits from tumor treating fields therapy (TTF), approved by the FDA in 2011. For most of the day, patients use a device that attaches to the head via adhesive patches that connect to a mobile power supply. The device emits electrical fields to the tumor, which disrupt the division of cancer cells. Early studies show that the device holds promise in prolonging life. TTF therapy is available through a single supplier, Novocure, which rents the device on a monthly basis. The therapy is expensive. Prosser must file a Medicare benefits claim for each period she uses the device. Medicare denied coverage for the treatment period January-April 2018. Though Prosser received the therapy and owed nothing, the denial left Novocure with the bill. Prosser challenged this denial through Medicare’s appeals process before filing suit.The Seventh Circuit affirmed the dismissal of Prosser’s claim for Medicare Part B coverage, holding that she has suffered no injury-in-fact sufficient to satisfy Article III’s standing requirement. Prosser received—and continues to receive—the TTF therapy. She faces no financial liability for the treatment period Medicare denied coverage. Any future financial risk is too attenuated from the denial of the past coverage and far too speculative to establish standing. View "Prosser v. Becerra" on Justia Law

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Gedatus, born in 1976, sought social security disability benefits, alleging many medical conditions, including lumbar degenerative disc disease, sciatica, leg pain, knee pain, wrist difficulties, tremors, and residual effects from a head hemorrhage. She graduated from high school. By 2003, she worked at a bar. Over the years, she underwent multiple surgeries and other treatments.After a hearing, the Administrative Law Judge agreed with Gedatus about several issues, but concluded she could perform light work with some limits, so she was not disabled. No doctor opined she needed more limits than the ALJ determined. The district judge affirmed. The Seventh Circuit affirmed the denial as supported by substantial evidence, rejecting claims that errors permeated the ALJ’s symptom evaluation and that the ALJ erred by not setting forth an assessment of her limited sitting tolerance or tremors. View "Gedatus v. Saul" on Justia Law

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MAO-MSO acquired rights to collect conditional payments that Medicare Advantage Organizations (MAOs) made if a primary insurer (such as automobile insurance carriers) has not promptly paid medical expenses. MAO-MSO sued those primary payers. The district court proof of required actual injury. Specifically, MAO-MSO needed to identify an “illustrative beneficiary”— a concrete example of a conditional payment that State Farm, the relevant primary payer, failed to reimburse to the pertinent MAO. MAO-MSO alleged that “O.D.” suffered injuries in a car accident and that State Farm “failed to adequately pay or reimburse” the appropriate MAO. The district court determined that these allegations sufficed for pleading purposes to establish standing.As limited discovery progressed, MAO-MSO struggled to identify evidence supporting the complaint. One dispute centered on whether O.D.’s MAO made payments related to medical care stemming from a car accident before State Farm reached its limit under O.D.’s auto policy so that State Farm should have reimbursed the MAO. The payment in question was to a physical therapist. State Farm argued that the physical therapy services had no connection to O.D.’s car accident and related only to her prior knee surgery.The district court determined no reasonable jury could find that the payment related to O.D.’s car accident, meaning that MAO-MSO lacked standing. The Seventh Circuit affirmed the dismissal. The Medicare Act may authorize the lawsuit but MAO-MSO fail to establish subject matter jurisdiction by establishing an injury in fact. View "MAO-MSO Recovery II, LLC v. State Farm Mutual Automobile Ins. Co." on Justia Law

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The Seventh Circuit affirmed the ALJ's determination that plaintiff has the capacity to perform light work and is therefore not entitled to disability benefits. Plaintiff claimed that the ALJ committed reversible error when determining her residual functional capacity (RFC) by selectively reviewing evidence of cervical and lumbar degenerative disc disease (back problems); incorrectly discounting plaintiff's credibility regarding her description of the intensity, persistence, and limiting effects of her symptoms; and not including any manipulative limitations in the RFC assessment.The court found plaintiff's arguments unpersuasive and concluded that substantial evidence supports the ALJ's denial of benefits where the ALJ did not ignore a line of evidence contradicting her decision; the ALJ's assessment of plaintiff's symptoms was not patently wrong; and the ALJ did not fail to note any supported manipulative limitations. View "Deborah M. v. Saul" on Justia Law