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Judge OKs Settlement for Idaho’s Disabled

BOISE, Idaho (CN) — A federal judge has signed off on a preliminary settlement that would force the Idaho Department of Health and Welfare to design a new way of figuring budgets for care of the disabled.

Under the settlement, Idaho will use a third party to help design a budget plan with input from the public.

"The settlement proposes to design a new budget tool with the assistance of an outside consultant and input from class members, among others," U.S. District Judge B. Lynn Winmill wrote in the Oct. 20 order. "While the new budget tool is being developed — a process that might take two years — existing budgets will remain in place for all class members.

"The settlement also includes approval of a new budget notice that better explains any budget changes, includes the written health and safety criteria, directs class members to free training about handling appeals, and allows class members to identify a suitable representative to help them with an appeal."

More than a dozen plaintiffs filed class action lawsuits in 2012, challenging budget cuts of more than 50 percent for individuals.

The Developmental Disabilities Waiver program provides Medicaid services for people with home-based care, including "residential habitation services, chore services, supported employment, non-medical transportation, specialized medical equipment, home delivered meals and skilled nursing."

In 2011, the state agency changed how it determines the benefits, drastically reducing the benchmark budget of $54,965 to $24,476 - nearly 55 percent. The cuts left many adults with developmental disabilities unable to get the care they needed, and blocked some from receiving any care at all, according to the 2012 lawsuits.

The cuts also meant possible institutionalization for many disabled people, a practice that for many years has been a last resort for care.

A March 2014 consolidated complaint claims the Department of Health and Welfare sent notices of the budget cuts without giving recipients adequate time to prepare appeals: which is required by state and federal laws.

The class also claimed the agency refused to disclose a "secret" mathematical algorithm it used to determine each person's benefits plan and budget, in violation of the Due Process Clause and the fair hearing requirement of the Medicaid Act.

The Ninth Circuit affirmed in 2015 that Idaho cannot cut benefits to residents with disabilities by more than 50 percent. That 5 ruling affirmed a federal court order that expanded a preliminary injunction preventing Idaho's Department of Health and Welfare from cutting benefits to residents with disabilities without adequate notice or explanation.

Attorneys for the plaintiffs, Richard Eppink and Zoe Palitz, were not available for comment Wednesday.

Citing In re Syncor ERISA Litig., 516 F.3d 1095, 1101 (9th Cir. 2008), Winmill wrote: "The Ninth Circuit maintains a 'strong judicial policy' that favors settlements particularly where complex class action litigation is concerned" and that the court's task is to decide whether the preliminary approval falls "within the range of possible approval."

Winmill said the provisions in the preliminary settlement meet that criteria.

"This settlement comes after four years of zealous litigation where every issue was contested," Winmill wrote in the order. "There is no collusion here, and the settlement has no obvious deficiencies. Moreover, it does not grant preferential treatment to any segment of the class. The court concludes that it falls within the range of possible approval and hence will grant preliminary approval."

Winmill did have a caveat: "The court will deny the motion to the extent it seeks final approval for the revised budget notice on the ground that it is intertwined with the class settlement and that class members must have an opportunity to comment on the revised budget notice before it can be finally approved."

A final approval hearing is set for Jan. 12, 2017.

Eppink is with the American Civil Liberties Union of Idaho in Boise. Palitz with Altshuler & Berzon in San Francisco.

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