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Elizabeth Blackwell Health Center for Women v. Knoll

filed: July 25, 1995; As Amended August 3, 1995.

ELIZABETH BLACKWELL HEALTH CENTER FOR WOMEN; GREATER PHILADELPHIA WOMEN'S MEDICAL FUND; CHOICE, ON BEHALF OF THEMSELVES AND THE MEDICAID-ELIGIBLE WOMEN OF THE COMMONWEALTH OF PENNSYLVANIA TO WHOM THEY PROVIDE FINANCIAL, HEALTH CARE AND COUNSELING SERVICES
v.
CATHERINE BAKER KNOLL, TREASURER OF THE COMMONWEALTH OF PENNSYLVANIA, IN HER OFFICIAL CAPACITY; KAREN F. SNIDER, SECRETARY OF PUBLIC WELFARE OF THE COMMONWEALTH OF PENNSYLVANIA, IN HER OFFICIAL CAPACITY; SHERRY KNOWLTON, DEPUTY SECRETARY OF THE OFFICE OF MEDICAL ASSISTANCE OF THE COMMONWEALTH OF PENNSYLVANIA, IN HER OFFICIAL CAPACITY; ROBERT P. CASEY, GOVERNOR OF THE COMMONWEALTH OF PENNSYLVANIA, IN HIS OFFICIAL CAPACITY, AND THEIR SUCCESSORS CATHERINE BAKER KNOLL, KAREN F. SNIDER, SHERRY KNOWLTON AND ROBERT P. CASEY, APPELLANTS



On Appeal from the United States District Court for the Eastern District of Pennsylvania. (D.C. No. 94-cv-00169).

Before: Cowen, Nygaard and Alito, Circuit Judges.

Author: Cowen

COWEN, Circuit Judge.

The Elizabeth Blackwell Health Center for Women, a comprehensive reproductive health care facility that provides first-trimester abortions, the Greater Women's Medical Fund, a non-profit agency that provides financial assistance to low-income women in order to obtain abortions, and CHOICE, a telephone hot-line which provides information and referrals to its callers on many issues, including family planning and abortion (collectively, the "Providers"), ask this Court to declare invalid and enjoin the enforcement of sections 3215(c) and 3215(j) of the Pennsylvania Abortion Control Act, 18 Pa. Cons. Stat. Ann. §§ 3201-3220 (1983 & Supp. 1994), Pennsylvania's reporting and physician certification requirements for publicly-funded abortions under the Medicaid program. The Governor of Pennsylvania, the State Treasurer, the Secretary of the Pennsylvania Department of Public Welfare, and the Deputy Secretary for Medical Assistance (collectively, "the Commonwealth") appeal from the order of the district court granting the Providers' motion for summary judgment. The district court based its holding on the Providers' claim that the Pennsylvania statute is preempted by the Hyde Amendment.

We conclude that the Secretary of Health and Human Services is owed deference regarding her interpretation of the Hyde Amendment mandates. Because the Secretary has determined that reporting requirements are permissible under the Medicaid Act, as modified by the Hyde Amendment, only if they contain a waiver provision, and since the Pennsylvania Abortion Control Act contains no such provision, we find § 3215(j) of the Pennsylvania statute directly in conflict with federal law, and thus, invalid to the extent that it conflicts with the Secretary's interpretation. Furthermore, because the second-physician certification requirement pursuant to § 3215(c) is contrary to a federal regulation, it is also invalid to the extent that it goes beyond the scope of that regulation.

I.

This action concerns Title XIX of the Social Security Act, commonly known as the Medicaid program, 42 U.S.C. §§ 1396-1396u (1988 & Supp. V 1993). The purpose of the Medicaid program is to help provide medical treatment for low-income people. Under the program, the state receives federal financial assistance in return for administering a Medicaid program that the state develops within parameters established by federal law and regulations. 42 C.F.R. § 430.0 (1994).

Establishment of a Medicaid program is voluntary on the part of each state. While states are not obligated to participate in the Medicaid program, each state that chooses to do so is required to develop its own state plan which must be approved by the Secretary. In order to receive federal funds, a state's plan must conform, both on its face and as applied, with various federal requirements. 42 U.S.C. § 1396a, 1396c; see Harris v. McRae, 448 U.S. 297, 301, 100 S. Ct. 2671, 2680, 65 L. Ed. 2d 784 (1980); New Jersey v. Department of Health and Human Services, 670 F.2d 1284, 1286 (3d Cir.), cert. denied, 459 U.S. 824, 103 S. Ct. 56, 74 L. Ed. 2d 60 (1982).

Under Title XIX, certain categories of medical care are mandatory, and must be provided by every state Medicaid plan, while other categories of care are optional, and each state has the discretion to cover the service. See 42 U.S.C. § 1396a(a)(10). By law, states are required to fund medically necessary physician services. 42 U.S.C. §§ 1396a(a)(10)(A), 1396d(a). Participating states must establish eligibility requirements that are "consistent with the objectives" of Title XIX. 42 U.S.C. § 1396a(a)(17). "Title XIX's broadly stated primary objective [is] to enable each State, as far as practicable, to furnish medical assistance to individuals whose income and resources are insufficient to meet the costs of necessary medical services." Beal v. Doe, 432 U.S. 438, 444, 97 S. Ct. 2366, 2371, 53 L. Ed. 2d 464 (1977) (citing 42 U.S.C. §§ 1396, 1396a(a)(10)). "A further objective is that policies governing eligibility be in the 'best interests' of the recipient." Hodgson v. Board of County Commissioners, County of Hennepin, 614 F.2d 601, 607 (8th Cir. 1980) (citing 42 U.S.C. § 1396a(a)(19); 45 C.F.R. § 206.10(a)(11)). The state must also provide safeguards to assure that its Medicaid plan will be administered "in a manner consistent with simplicity of administration." 42 U.S.C. § 1396a(a)(19). On the other hand, the state must "provide such methods and procedures relating to the utilization of, and the payment for, care and services available under the plan . . . as may be necessary to safeguard against unnecessary utilization." 42 U.S.C. § 1396a(a)(30)(A).

In addition, federal regulations require that each covered service be "sufficient in amount, duration, and scope to reasonably achieve its purpose," 42 C.F.R. § 440.230(b) (1994), and mandate that states "may not arbitrarily deny or reduce the amount, duration, or scope of a required service . . . to an otherwise eligible recipient solely because of the diagnosis, type of illness, or condition." 42 C.F.R. § 440.230(c).

If, after a hearing, the Secretary finds that an approved state plan no longer complies with the provisions of the Medicaid Act, or that the state had failed to comply substantially with any applicable federal requirement, the Secretary may notify the state that federal financial participation will be withheld or limited. 42 U.S.C. § 1396c.

In 1976, Congress passed what is commonly called the Hyde Amendment, which prohibits federal reimbursement for abortions except in the narrow circumstances that Congress deems to be medically necessary. Since 1976, Congress has added the Hyde Amendment to annual appropriations bills for the U.S. Department of Health and Human Services ("HHS"). While its provisions have varied to some degree from year to year, the effect of the Hyde Amendment has been to withdraw federal funding under Medicaid for most abortions.*fn1

The Hyde Amendment for fiscal year 1994 permitted, for the first time since 1981, expenditure of federal funds for abortions when "the pregnancy is the result of an act of rape or incest" as well as when "necessary to save the life of the mother." Pub. L. No. 103-112, § 509, 107 Stat. 1082, 1113 (1993). The full version of the 1994 Hyde Amendment provides:

None of the funds appropriated under this Act shall be expended for any abortion except when it is made known to the Federal entity or official to which funds are appropriated under this Act that such procedure is necessary to save the life of the mother or that the pregnancy is the result of an act of rape or incest.

Id.*fn2

This Court has previously held that the Medicaid statute, as modified by the Hyde Amendment, requires participating states to fund those abortions for which federal reimbursement is available. Roe v. Casey, 623 F.2d 829, 836-37 (3d Cir. 1980). See also Hodgson, 614 F.2d at 605; Preterm, Inc. v. Dukakis, 591 F.2d 121, 134 (1st Cir.), cert. denied, 441 U.S. 952, 99 S. Ct. 2182 (1979). We are bound by that precedent here. Accordingly, under Medicaid, funding for rape and incest abortions is mandatory for participating states.

The 1994 Hyde Amendment was reported out of committee with a provision requiring women seeking reimbursement for rape and incest abortions to report the crimes to the appropriate law enforcement officials. 139 Cong. Rec. H4304 (daily ed. June 30, 1993) ( § 207). However, a point of order was raised that the Hyde Amendment language violated parliamentary procedure of the House of Representatives, which prohibits attempts to "legislate" on an appropriations bill. The point of order was conceded and the entire amendment stricken from the bill. 139 Cong. Rec. H4307-08.

The Secretary of HHS has delegated her authority to oversee and enforce the Medicaid program to the Health Care Financing Administration ("HCFA"). 49 Fed. Reg. 35,247, 35,249 (1984). HCFA has promulgated a regulation that provides:

[Federal funding] is available in expenditures for an abortion when a physician has found, and certified in writing to the Medicaid agency, that on the basis of his professional judgment, the life of the mother would be endangered if the fetus were carried to term.

42 C.F.R. § 441.203 (1994).

In addition, on December 28, 1993, HCFA issued a directive to state Medicaid directors, explaining:

The purpose of this letter is to notify [state Medicaid directors] about a recent Congressionally enacted revision to the "Hyde Amendment" which affects the Medicaid program and to tell you how this revision in the law is to be implemented.

As with all other mandatory medical services for which Federal funding is available, States are required to cover abortions that are medically necessary. By definition, abortions that are necessary to save the life of the mother are medically necessary. In addition, Congress this year added abortions for pregnancies resulting from rape and incest to the category of medically necessary abortions for which funding is provided. Based on the language of this year's Hyde Amendment and on the history of Congressional debate about the circumstances of victims of rape and incest, we believe that this change in the text of the Hyde Amendment signifies Congressional intent that abortions of pregnancies resulting from rape or incest are medically necessary in light of both medical and psychological health factors. Therefore, abortions resulting from rape or incest should be considered to fall within the scope of services that are medically necessary.

The definition of rape and incest should be determined in accordance with each State's own law. States may impose reasonable reporting or documentation requirements on recipients or providers, as may be necessary to assure themselves that an abortion was for the purpose of terminating a pregnancy caused by an act of rape or incest. States may not impose reporting or documentation requirements that deny or impede coverage for abortions where pregnancies result from rape or incest. To insure that reporting requirements do not prevent or impede coverage for covered abortions, any such reporting requirement must be waived and the procedure considered to be reimbursable if the treating physician certifies that in his or her professional opinion, the patient was unable, for physical or psychological reasons, to comply with the requirement.

By March 31, 1994, all States must ensure that their State Plans do not contain language that precludes [federal funding] for abortions that are performed to save the life of the mother or to terminate pregnancies resulting from rape or incest.

Letter, from Sally K. Richardson, Director, Medicaid Bureau, to All State Medicaid Directors (Dec. 28, 1993) (emphasis added), App. at 92-93.*fn3

However, under the Pennsylvania Abortion Control Act, no federal or state funds can be provided for the termination of pregnancies caused by rape or incest unless the state agency: (1) obtains a statement from the physician performing the abortion that the woman was a victim of rape or incest and that she personally reported the crime to the appropriate law enforcement agency together with the name of the offender; (2) obtains from the physician the woman's signed statement to that effect; and (3) verifies the reporting of the crime with the appropriate law-enforcement agency. 18 Pa. Cons. Stat. Ann. § 3215(j) (Supp. 1994).*fn4 The Pennsylvania Abortion Control Act does not contain a waiver provision.

In addition, in cases where carrying the fetus to term would endanger the life of the mother, the Pennsylvania Act provides that no state or federal funds can be expended unless the danger is certified by a physician who is not the physician who will perform the abortion and who has no financial interest in the procedure. 18 Pa. Cons. Stat. Ann. § 3215(c) (Supp. 1994).*fn5

The Providers commenced this challenge to sections 3215(c) and 3215(j) of the Pennsylvania Abortion Control Act, on their own behalf and on behalf of Medicaid-eligible rape and incest victims and Medicaid-eligible women whose lives are endangered but who cannot obtain second-physician certification. The Providers argued in the district court that the Commonwealth's reporting and certification requirements are inconsistent with the Hyde Amendment, and therefore invalid under the Supremacy Clause of the United Stated Constitution.*fn6

The district court granted the Providers' motion for summary judgment on the Supremacy Clause claim. Elizabeth Blackwell Health Center for Women v. Knoll, No. 94-0169, slip op. at 5, (E.D. Pa. Sept. 15, 1994). Relying on our decision in Roe v. Casey, 623 F.2d 829 (3d Cir. 1980), the district court first acknowledged that Pennsylvania must cover all abortions for which federal reimbursement is provided under the Hyde Amendment. The court then reasoned:

whereas the Hyde Amendment restricts abortion funding to cases of rape or incest, or where continuation of the pregnancy would endanger the life of the mother, the Pennsylvania statute imposes additional limitations. To the extent of these additional limitations, therefore, the Pennsylvania statute is invalid, under familiar pre-emption principles.

Id. at 3.

The district court also found support for its holding in the fact that "the same kinds of reporting and certification requirements set forth in the Pennsylvania statute had appeared in earlier versions of the Hyde Amendment. They were removed in the current version, and efforts by abortion opponents to include them were rejected by Congress." Id. at 4 (citation omitted). The district court thus concluded that the legislative history indicates congressional intent to eliminate the reporting requirements. Id. at 5. Further, the district court also held that the crime-fighting and other interests advanced by the Commonwealth to justify the challenged provisions were inconsistent with the purposes of the Medicaid Act and were therefore impermissible. Id. at 4.

The district court enjoined the Commonwealth from enforcing sections 3215(c) and 3215(j) of the Pennsylvania Abortion Control Act. This appeal followed. This Court granted the Commonwealth's motion to stay the order of the district court pending appeal, and the Providers' request to expedite this appeal. We requested the Secretary of HHS to address as amicus the issue of the extent to which a state can require reporting and second-physician certification under the Medicaid Act and the Hyde Amendment in order for a woman to be entitled to an abortion.

II. REPORTING REQUIREMENTS FOR RAPE OR INCEST

The Secretary of HHS, who administers the Medicaid program, has interpreted the Medicaid statute as modified by the 1994 Hyde Amendment, to provide that, absent a waiver provision, reporting requirements for rape or incest abortions unduly impede or deter a woman's exercise of her right to the medically necessary procedure. Letter, (Dec. 28, 1993), App. at 93; Letter, (Mar. 25, 1994), App. at 117. The Secretary does not regard reporting requirements as per se invalid. Id. If this judgment is a reasonable exercise of the Secretary's discretion, it is entitled to due deference. Our inquiry is therefore focused upon whether the Secretary's interpretation warrants our deference.

A.

The Commonwealth disputes both the Secretary's and the district court's interpretations of the Hyde Amendment mandates regarding reporting requirements. The Commonwealth maintains that its requirements are valid and should be upheld in their entirety.

The Commonwealth acknowledges that under the Medicaid program, states are free to participate or not as they see fit, but if a state does elect to participate, it must comply with the conditions that Congress has set. The Commonwealth, however, citing Pennhurst State School and Hospital v. Halderman, 451 U.S. 1, 17, 101 S. Ct. 1531, 1540, 67 L. Ed. 2d 694 (1981), argues that in setting those conditions, "Congress [must] speak with a clear voice." It contends that a program like Medicaid:

is much in the nature of a contract: in return for federal funds, the States agree to comply with federally imposed conditions . . . . There can, of course, be no knowing acceptance if a State is unaware of the conditions or is unable to ascertain what is expected of it. Accordingly, if Congress intends to impose a condition on the grant of federal moneys, it must do so unambiguously. [Pennhurst, 451 U.S. at 17, 101 S. Ct. 1540 (citation and footnote omitted).]

The Commonwealth maintains that on its face, the 1994 Hyde Amendment is a simple prohibition on the use of federal money for certain specified purposes. It sets neither requirements nor prohibitions on the states; it says nothing explicit about reporting or certification procedures. The Commonwealth concludes that the principles articulated in Pennhurst, when applied to this case, require that the district court's holding be reversed because it cannot reasonably be said that Congress has "unambiguously" forbidden reporting and certification requirements such as those contained in the Pennsylvania law.

The Commonwealth's reliance on Pennhurst is misplaced. Pennhurst involved the obligations of states under the federal Developmentally Disabled Assistance and Bill of Rights Act, 42 U.S.C. §§ 6000-6081 ("DDABRA"). In reversing our holding that the "bill of rights" provision of the DDABRA created enforceable rights and obligations, the Supreme Court found no evidence that Congress intended to condition the grant of federal funds on the states' "assuming the high cost of providing 'appropriate treatment' in the 'least restrictive environment' to their mentally retarded citizens." 451 U.S. at 18, 101 S. Ct. at 1540. The Court reasoned that because Congress failed to speak clearly regarding the state's obligations, it could not "fairly say that the State could make an informed choice" about participation in the joint program. Id. at 25, 101 S. Ct. at 1544.

Here, the Medicaid Act by its terms requires state Medicaid plans to cover all medically necessary services that fall within the mandatory areas of care. See 42 U.S.C. § 1396a(a)(10)(A). Moreover, nearly fifteen years ago, we made clear in Roe v. Casey, that states participating in the Medicaid program must provide the abortion services that are enumerated in the Hyde Amendment. 623 F.2d at 836-37. The 1994 Hyde Amendment plainly puts participating states on notice of their obligations to fund abortions where necessary to save a woman's life or where the pregnancy is the result of rape or incest. Accordingly, the Commonwealth was given clear notice that, if it elected to continue to participate in the Medicaid program, it was obligated to provide funding for such abortions. Furthermore, any participating state should have realized that reporting requirements could be so onerous as to defeat Congress' intent that Medicaid funding be provided for the categories of abortions in question. Unlike the claims of the defendants in Pennhurst, the Commonwealth cannot reasonably claim that it was unaware of its obligations under the Medicaid Act, as modified by the Hyde Amendment and its implementing regulations. As such, the Secretary is reasonable in interpreting the Hyde Amendment to prohibit reporting requirements that operate as additional coverage requirements to deny or impede some women from receiving the mandated abortion services.

The Commonwealth further maintains that other provisions of Title XIX authorize the challenged provisions. Participating states are required to adopt "reasonable standards . . . for determining eligibility for and the extent of medical assistance." 42 U.S.C. § 1396a(a)(17). States are likewise required to adopt "such safeguards as may be necessary to assure that eligibility for care and services under the plan will be determined, and such care and services will be provided, in a manner consistent with simplicity of administration and the best interests of the recipients." 42 U.S.C. § 1396a(a)(19). Additionally, states must "provide such methods and procedures relating to the utilization of, and the payment for, care and services available under the plan . . . as may be necessary to safeguard against unnecessary utilization." 42 U.S.C. § 1396a(a)(30)(A). Moreover, the current version of the Hyde Amendment requires states to "make known" to the Secretary that the abortion for which funding is sought is one in which the life of the mother is endangered or where the pregnancy resulted from rape or incest. The Commonwealth argues that Pennsylvania's reporting and certification procedures further these statutory mandates.

In her amicus brief, the Secretary acknowledges that Congress intended that states be allowed flexibility in developing procedures for administering their statutory obligations under the Medicaid statute and their state plans. Amicus Brief at 20 (citing Schweiker v. Hogan, 457 U.S. 569, 590-93, 102 S. Ct. 2597, 2610-11, 73 L. Ed. 2d 227 (1982) (a state has the option to provide partial benefits to the medically needy); Mississippi Hospital Ass'n, Inc. v. Heckler, 701 F.2d 511, 515 (5th Cir. 1983) (Congress intended states to be free to experiment with methods and standards of payment under their Medicaid plans)). The Secretary's regulations have long recognized that states have discretion to impose reasonable coverage limits, consistent with the objectives of the Act, on the amount, duration, and scope of services, particularly with respect to ensuring "utilization control." 42 C.F.R. § 440.230(b), (d). Indeed, the Secretary acknowledges that while states are not required to adopt reporting requirements, properly tailored reporting requirements can serve the purposes of the Medicaid Act and the Hyde Amendment.

However, in reconciling these eligibility requirements of the Medicaid statute with the language and history of the Hyde Amendment, and with the other purposes of the Medicaid program, the Secretary maintains that state-established reporting requirements "may not serve as an additional coverage requirement to deny or impede payment for abortions where pregnancies result from rape or incest." Letter, (Mar. 25, 1994), App. at 117. The Secretary has thus concluded that reasonable reporting requirements are valid only if they contain a waiver provision.

B.

The Providers argue that the district court correctly held that the Supremacy Clause requires the invalidation of Pennsylvania's reporting and second-physician certification requirements because they directly conflict with federal law. The Supremacy Clause requires invalidation of any state constitutional or statutory provision that conflicts with federal law, see Reynolds v. Sims, 377 U.S. 533, 584, 84 S. Ct. 1362, 1393, 12 L. Ed. 2d 506 (1964), and compels compliance by participants in Title XIX federal aid programs with federal law and regulations. King v. Smith, 392 U.S. 309, 316-17, 88 S. Ct. 2128, 2133, 20 L. Ed. 2d 1118 (1968); Roe v. Casey, 623 F.2d at 837.

The Providers maintain that the district court properly relied on Roe v. Casey in holding that all state Medicaid programs must fund all abortions for which federal funds are available. In Roe v. Casey, we invalidated an earlier version of Pennsylvania's Medicaid funding restriction that proscribed coverage of abortions except when necessary to save the life of the pregnant woman. The then-applicable Hyde Amendment, like the 1994 Hyde Amendment, permitted the expenditure of funds for abortion where a pregnancy resulted from rape or incest, as well as in life-threatening circumstances. We reasoned:

Title XIX, as now modified [by the current Hyde Amendment], requires the states to fund abortions in two categories: where the mother is endangered and where the pregnancy was the result of rape or incest. Pennsylvania . . . would not fund the second category. Because Pennsylvania's statutes are not consistent with the modified Title XIX it is clear that, as written, they cannot stand.

Id. at 836-37.

The Providers argue that the district court correctly concluded that Pennsylvania's effort to restrict its Medicaid coverage of abortion to cases of reported rape and incest and dually-certified life endangerment runs directly contrary to Roe v. Casey 's mandate that Pennsylvania must fund all abortions for which federal funds are available. According to the Providers, the Pennsylvania ...


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