Opinion
No. 2:06-cv-0435-MCE-KJM.
May 19, 2006
MEMORANDUM AND ORDER
Through the present motion, Plaintiffs seek to enjoin implementation of the Medicare Prescription Drug, Modernization and Improvement Act of 2003, 42 U.S.C. § 1395w-101, et seq. ("MMA") to the extent that changes in prescription drug coverage available to individuals who are both eligible for benefits under Medicare and Medicaid (so-called "dual eligibles") are unconstitutional. Plaintiffs argue they will suffer irreparable harm unless this Court issues a mandatory injunction preventing implementation of the MMA, which became effective on January 1, 2006. They seek an order requiring the State's Medicaid program to continue to provide prescription drug coverage to dual eligibles as if the MMA had never been enacted. Finally, Plaintiffs argue that the copayment provisions for drugs dispensed to dual eligibles under the MMA must also be enjoined.
Plaintiffs include the Independent Living Center of Southern California, Inc. ("ILC"), an independent living center established under the auspices of California Welfare and Institutions Code § 19801 to provide services to disabled persons, as well as eight individuals who qualify as dual eligibles and who claim to have been impacted by implementation of the MMA. While Defendants argue that these Plaintiffs lack standing to bring the present action, the Court is not persuaded on the basis of the record before it that standing is entirely absent. Accordingly it will proceed to deciding this matter on the merits.
For the reasons outlined below, Plaintiffs' Motion for Preliminary Injunction is denied.
STATUTORY FRAMEWORK
Title XVIII of the Social Security Act, commonly known as the Medicare Act, establishes a program of federally subsidized health insurance for the elderly and disabled. 42 U.S.C. §§ 1395,et seq. Coverage available under Medicare includes hospital inpatient and related care (Part A), supplemental coverage for outpatient services (Part B), and a managed-care alternative to Part B (known as Part C). Through enactment of the MMA, Congress provided Medicare coverage for drugs under what is now referred to as Part D of the Medicare program. As indicated above, Part D became effective on January 1, 2006.Another portion of the Social Security Act, Title XIX, establishes a separate federal-state program providing medical assistance for categorically low-income persons. 42 U.S.C. §§ 1396, et seq. This coverage, known as Medicaid, or MediCal in California, is administered by the states and funded in part through federal aid so long as each state's program complies with applicable Medicaid laws and regulations. See Alexander v. Choate, 469 U.S. 287, 289 n.l (1985).
About 6 million dual eligibles qualify for both Medicare and Medicaid benefits. For those individuals, Medicare generally pays first and Medicaid provides protection for services not covered under Medicare. Prior to enactment of the MMA, Medicaid paid for dual eligibles' prescription drugs. In addition to receiving a fifty percent contribution from the federal government for benefits provided under Medicaid, including prescription drugs, the Medicaid Act also required pharmaceutical companies to make substantial rebate payments in return for dispensing their products under Medicaid.
Exclusive provision of prescription drugs through Medicaid has changed with the advent of the MMA. Under Part D, Medicare becomes the primary payer for dual eligibles as to all drugs covered under Medicare. The Medicaid Act was consequently amended to provide that Medicaid is not available for such drugs. 42 U.S.C. § 1396u-5(d)(1). The State of California similarly enacted Welfare and Institutions Code § 14133.23, which eliminated the provision of drug benefits under MediCal to dualeligible beneficiaries that would otherwise now be covered under Medicare, Part D.
The Enrollment Clause of the MMA requires that all dual eligibles be automatically enrolled into private-entity prescription drug plans on a random basis, with MediCal drug coverage to cease on enrollment. 42 U.S.C. § 1395w-101(b)(1)(C). The formularies for such plans are to be approved by the Secretary of the U.S. Department of Health and Human Services ("Secretary"). 42 U.S.C. § 1395w-111(e)(1). Each drug plan must include drugs within each therapeutic category and class of covered Part D drugs, although not necessarily all drugs with such categories or classes. 42 U.S.C. § 1395w-104(b)(3)(C)(i). If a particular drug is not covered under the assigned formulary and a prescription is accordingly denied, a dissatisfied enrollee can request review by an independent, outside entity. 42 U.S.C. § 1395w-22(g)(4).
In essence, the MMA shifts the cost of providing prescription drugs to dual eligibles from Medicaid at Title XIX to Medicare at Title XVIII. In exchange for assuming this obligation, under the so-called "clawback" provision of the MMA, the states must reimburse the federal government for fifty percent of the cost of providing dual eligibles prescription drugs, which mirrors the fact that prior to the enactment of the MMA the states were required to provide such drugs, with a fifty percent contribution from the federal government. 42 U.S.C. §§ 1396u- 5(c)(1)-(2). Under the MMA, unlike Medicaid, pharmaceutical companies no longer are required to make rebate payments. In addition, under Part D, even dual eligibles with incomes not exceeding the poverty level must make a modest co-payment for needed drugs, ranging from $1 for generic medicines to $3 for name brands.
This is a change from prior coverage available to dual eligibles under Medicaid, which provided that no services would be denied on account of a beneficiary's "inability to pay a deduction, cost sharing, or similar charge . . ." 42 U.S.C. § 1396o(e).
Because certain drugs that had been covered under MediCal are not included under Medicare Part D, states may continue to provide Medicaid coverage for such drugs, and California has so elected. The federal government has approved this extension. (Decl. of Teresa Miller, ¶ 9)
In order to ease transition difficulties between drug payment under MediCare and reassignment of dual eligibles to coverage under Medicare Part D, the California Legislature enacted legislation on an emergency basis to pay for Part D drugs. California Welfare and Institutions Code § 14133.23(f). That emergency legislation was subsequently extended until May 16, 2006.
On February 16, 2006, the federal government notified the State of California that it would provide reimbursement for payments made under the emergency program enumerated above. Id. at ¶ 7.
In addition to California's provision of drugs on an emergency basis under Medicaid, Part D also incorporates a "first fill" policy designed to ensure that during the first three months of Part D coverage, all drug plans must pay on a one-time basis for any medications unavailable under the assigned Medicare formulary but previously available under Medicaid. (Culotta Decl., ¶ 17).
FACTUAL BACKGROUND
Plaintiffs contend that transfer of dual eligibles' prescription drug coverage to Medicare has created a "dire situation" rife with the potential for irreparable harm given potential damage to dual eligibles' health if needed medications cannot be obtained. Plaintiffs contend that formularies assigned by Medicare are less comprehensive than the drug benefits formerly available under MediCal.
Although they concede that dual eligibles can apply for a waiver/exception if drugs not on the formulary are determined to be necessary, Plaintiffs contend that because the pharmacy cannot represent the dual eligible in obtaining such a waiver/exception, the process is too cumbersome inasmuch as treating physicians simply will not take the time necessary to make such an appeal. Plaintiff contends that this creates an "extraordinary barrier" for dual eligibles to obtain necessary medicine.
Plaintiffs further contend that many dual eligibles have not in fact been automatically enrolled into a drug formulary under Medicare, which also poses a significant obstacle in obtaining needed drugs. Plaintiffs have provided declarations from two pharmacists indicating that as many as 20-25 percent of dual eligibles were not auto enrolled during the two weeks following January 13, 2006 (See Declarations of Boo Nam Shin, R.Ph, and Armen Tatevossian, R.Ph, ¶ 14), but have provided little evidence that any widespread problem in this regard has persisted throughout the transition period.
Finally, Plaintiffs argue that the co-payment requirement imposed by Part D (whether $1 or $3) is impermissible because many dual eligibles simply cannot afford any co-payment.
According to Plaintiffs, the State emergency legislation which provides for payments to be made under MediCal pending the transition to Medicare is simply a "band-aid" measure that does not provide any lasting solution.
Defendants respond to these concerns by pointing out that any transition of the scope contemplated by the MMA will necessarily include certain "glitches." They argue that the emergency provisions provided under both state and federal law, as enumerated above, are designed to minimize any disruption to dual eligible beneficiaries. They further contend that requiring minimal co-payments, for purposes of fostering patient involvement in the system, is not constitutionally impermissible. Finally, they point out that Medicare's reimbursement arrangements are overwhelmingly automated, and that ordering any change at this point in the transition process would cause substantial systems revisions and result in vast confusion — an outcome antithetical to the access issues Plaintiffs presumably seek to address through their lawsuit. (See Culotta Decl., ¶ 19). Defendants state that Plaintiffs themselves have not suggested any mechanism superior to what has already been implemented, other than to advocate a wholesale return to the previous status quo. See id.
STANDARD
A preliminary injunction is an extraordinary remedy, and the moving party has the burden of proving the propriety of such a remedy by clear and convincing evidence. See Granny Goose Foods, Inc. v. Teamsters, 415 U.S. 423, 442 (1974). In order to warrant issuance of a preliminary injunction, under the so-called "traditional" criteria the moving party must show (1) a strong likelihood of success on the merits; 2) the possibility of irreparable harm if relief is not granted; 3) that the balance of hardship weights in its favor; and 4) an advancement of the public interest in certain cases. Johnson v. State Bd. of Accountancy, 72 F.3d 1427, 1430 (9th Cir. 1995). Alternatively, a party seeking injunctive relief may also demonstrate either: 1) a combination of probable success on the merits and the possibility of irreparable injury; or 2) that serious questions are raised and the balance of hardships tips sharply in favor of granting the requested injunction. See LGS Architects, Inc. v. Concordia Homes of Nevada, 434 F.3d 1150, 1155 (9th Cir. 2006); Stuhlbarg Int'l Sales Co., Inc. v. John D. Brush Co., Inc., 240 F.3d 832, 839-40 (9th Cir. 2001). Both analytical frameworks "represent `extremes of a single continuum,' rather than two separate tests." Clear Channel Outdoor, Inc. v. City of Los Angeles, 340 F.3d 810 (9th Cir. 2003). Under either formulation, however, the moving party must show that it is likely to prevail on the merits. Ashcroft v. Am. Civil Liberties Union, 542 U.S. 656, 666 (2004). While certainty in this regard is not required, at an irreducible minimum at least a "fair chance of success on the merits" has to be demonstrated. Johnson v. State Bd. Of Accountancy, 72 F.3d at 1429.A preliminary injunction, in general, is considered an extraordinary remedy that should not be granted unless the moving party clearly establishes its entitlement to relief. Mazurek v. Armstrong, 520 U.S. 968, 972 (1997). Here, Plaintiffs seek a mandatory injunction because they ask for judicial intervention to actually change the status quo by returning to an earlier state of affairs (the pre-MMA framework) rather than simply asking that the status quo be maintained pending resolution of the case. Courts should be extremely cautious about granting such a preliminary injunction (Martin v. Int'l Olympic Comm., 740 F.2d 670, 675 (9th Cir. 1984)), with mandatory injunctive relief considered "particularly disfavored" and warranted only where the facts and law clearly favor the moving party. Anderson v. U.S., 612 F.2d 1112, 1114 (9th Cir. 1980).
ANALYSIS
A. Likelihood of Success on the Merits
As indicated above, the starting point in analyzing the propriety of preliminary injunctive relief in this matter involves an assessment of whether Plaintiffs can establish a likelihood that they will prevail on the merits. Examination of the legal bases upon which Plaintiffs' claims are premised show that no such likelihood of success is present. Each of the primary legal bases for the relief sought by Plaintiff will now be addressed.
1. Tenth Amendment Concerns. Plaintiffs assert, in their First Claim, that by shifting the provision of prescription medications away from the states, the federal government has interfered with state sovereignty over administration of states' own poverty drug programs for its poorest citizens. Plaintiffs contend that such conduct runs afoul of the Tenth Amendment's reservation, to the states, of powers not delegated to the United States by the Constitution. Plaintiffs specifically contend that the MMA's clawback provision, in requiring state participation in payment for Part D Medicare costs incurred for dual eligibles, is impermissible. Plaintiffs argue that the federal government has no power to command such an involuntary payment from the states, despite the fact as indicated above that the switch from Medicaid to Medicare appears to have simply entailed a change from states' direct responsibility under Medicaid for fifty percent of expenditures to a new system whereby, in exchange for federal assumption of payment responsibility, the state simply pays the federal government the same fifty percent it would otherwise have had to incur.
Plaintiffs also make a related argument that the same conduct violates the Necessary and Proper Clause of Article I, section 8 of the Constitution, on grounds that the Constitution permits Congress only to make laws as "necessary and proper" to effectuate the powers granted to the federal government by the Constitution. Plaintiffs appear to assert that because the care of the poor is reserved to the states under the Tenth Amendment, federal enactment of laws intruding on such sovereignty is also impermissible under the Necessary and Proper Clause.
Defendants oppose Plaintiffs' Tenth Amendment challenge primarily on grounds that private individuals like Plaintiffs herein simply lack standing to raise any question under the Tenth Amendment, pursuant to well-established precedent dating back toTenn. Elec. Power Co. v. TVA, ("TVA") 306 U.S. 118, 144 (1939). While Plaintiffs do not dispute the import of the TVA holding in this regard, they argue that it has been overruled by a subsequent Supreme Court decision, N.Y. v. U.S., 505 U.S. 144 (1992). In passing, the Court's N.Y. decision noted that "the Constitution divides authority between federal and state governments for the protection of individuals" (Id. at 181), and while one Seventh Circuit decision has deemed that pronouncement to have effectively overruled TVA (see Gillespie v. City of Indianapolis, 185 F.3d 693, 700-03 (7th Cir. 1999), other courts have concluded just the opposite, reasoning that because the N.Y. decision does not even mention TVA, it cannot be construed as effectively overruling it. See Medeiros v. Vincent, 431 F.3d 25, 34 (1st Cir. 2005). In Artichoke Joe's California Grand Casino v. Norton, 278 F. Supp. 2d 1174, 1181 (E.D. Cal. 2003), the court found that the Supreme Court has not overruled its TVA holding while noting other cases, including the Seventh's Circuit's Gillespie opinion, that reached the opposite conclusion.
In addition, because N.Y. involved only a claim asserted by the State of New York, the question of private party standing under the Tenth Amendment was simply not an issue in that case, and the word standing was never even mentioned in the N.Y. decision. Id.
It is well-recognized that only the Supreme Court itself has the prerogative of overruling its own decisions. City of Roseville v. Norton, 219 F. Supp. 2d 130, 147-48 (D.D.C. 2002). The N.Y. decision is not sufficient to overrule a long-established lack of standing on the part of private litigants to enforce sovereignty issues under the Tenth Amendment. As the government points out, California has ample resources to object to the provisions of the MMA should it choose to do so.
Even aside from standing, which the Court believes is fatal to Plaintiffs' Tenth Amendment claims in this case, Congress has in any event authority under the Tax and Spending Clause to urge states to adopt legislative programs consistent with federal interests. N.Y., 505 U.S. at 166-67. See also S.D. v. Dole, 483 U.S. 203, 207 (1987) (condition imposed on receipt of federal funding upheld against Tenth Amendment challenge). Congress thus has the "power to fix the terms upon which its money allotments to states shall be disbursed." Mayweathers v. Newland, 314 F.3d 1062, 1069 (9th Cir. 2002).
By providing services to states' citizens under Medicare that formerly were provided by the states, the federal government simply is asking that monies the state formerly paid be transferred to it. The government hence links its provision of prescription drug coverage to such payment. While the states could presumably elect to continue to provide such coverage with no contribution whatsoever from the federal government, government funding is linked to its recoupment of a portion of its expenses from the states. This appears to be permissible under the Tenth Amendment under the above-cited cases. 2. Unlawful Delegation of Legislative Powers. Plaintiffs allege, in their Second Claim, that the MMA's delegation of responsibility, to the Secretary, for approval of drug formularies amounts to an abdication of its own legislative responsibility. According to Plaintiffs, this violates the so called non-delegation doctrine identified by the Supreme Court inPanama Refining Co. v. Ryan, 293 U.S. 388, 421-22 (1935).
This argument is patently untenable. It has long been settled that to burden Congress with all federal rulemaking would defeat the concept of a workable national government. Loving v. U.S., 517 U.S. 748, 758 (1996). Hence Congress passes constitutional muster by legislating in broad terms and leaving a certain degree of discretion to executive or judicial actors. Touby v. U.S., 500 U.S. 160, 165 (1991). To survive a challenge under the non-delegation doctrine, Congress only has lay down an intelligible principle pursuant to which a person authorized to act must conform. Whitman v. Am. Trucking Ass'ns, 531 U.S. 457, 474-75 (2001).
Here, while Congress has given the Secretary discretion to approve Part D private drug formularies, it has directed that each formulary include drugs within each therapeutic category and class of covered Part D drugs, although not necessarily all drugs with such categories or classes. 42 U.S.C. § 1395w-104(b)(3)(C)(i). Hence the Secretary has been given broad guidelines from which to exercise his discretion in approving such formularies. In addition, in disapproving drug plans, Congress has indicated that there must be some evidence that the plan's practices discourage enrollment, and that this discouragement will likely have a substantial effect on certain Medicare beneficiaries. 42 U.S.C. § 1395w-111(e)(2)(D)(I). All of this provides enough direction to the Director to survive challenge under the non-delegation doctrine.
3. Violations of Fifth Amendment Rights. Plaintiffs contend that their due process rights as protected by the Fifth Amendment are violated by the MMA's requirement that dual eligibles make nominal co-payments for needed prescriptions. Plaintiffs appear to argue that requiring such payments is not only unjustifiable and in derogation of Fifth Amendment due process but also amounts to discrimination against the poor in violation of equal protection concerns also guaranteed by the Fifth Amendment.
It has long been held that the due process clauses of both the Fifth and Fourteenth Amendments are intended to prevent governmental abuse of power, and "generally confer no affirmative right to governmental aid". DeShaney v. Winnebago County Dep't of Soc. Servs., 489 U.S. 189, 196 (1989). Moreover, with respect to equal protection, the constitutionality of the co-payment provision must be judged under a rational basis standard, since poverty alone is not a suspect classification demanding strict scrutiny. See Harris v. McCrae, 448 U.S. 297, 323 (1980). Consequently the government need only show a rational relationship between its requirement of co-payments and a legitimate governmental purpose. Bd. Of Trs. Of Univ. Of Ala. v. Garrett, 531 U.S. 356, 367 (2001).
Here, the government can show a rational relationship between allocating limited aid dollars and fostering investment by dual eligibles in the efficiency of their own medical care through demanding small co-payments as a demonstration of accountability.
Plaintiffs also appear to argue that their due process rights are infringed by the delegation to privately administered drug formularies of control over their ultimate drug benefits, and by participants' random assignment to such formularies. Plaintiff ILC, for example, contends that some drug plans are more comprehensive than others, and some authorize fewer drugs than would have previously available under MediCal. Plaintiffs also assert that to the extent dual eligibles are enrolled in a "bottom" plan, their Fifth Amendment rights are violated. Plaintiffs ignore the fact, however, that all drug formularies must include medications across the therapeutic spectrum. See 42 U.S.C. § 1395w-104(b)(3)(C)(i). In addition, participants who still claim that they need a particular drug not on the formulary can apply for a waiver through the appeal process. These safeguards adequately protect participants' rights. Plaintiffs are not entitled to optimal coverage so long as the coverage they are afforded is adequate, as the Court believes to be the case here. As indicated above, due process rights are not impinged simply because of limitations in governmental aid implicit in coverage that falls short of offering unrestricted access to all prescription drugs.
4. Automatic Enrollment Provision. For a Third Claim, Plaintiffs appear to assert that dual eligibles who for whatever reason have not successfully enrolled in Medicare Part D coverage, despite the automatic enrollment provisions of the MMA, should be permitted to retain coverage under MediCal on an indefinite basis if no enrollment occurs. This argument is disingenuous in light of the stopgap measures provided by both California and the federal government in paying claims temporarily under MediCal (on the state's part) and in allowing dual eligibles the right to at receive refills of their medications on a one-time basis even if not yet effectively enrolled in Medicare (through the federal government).
5. Eleventh Amendment Immunity. Defendant Sandra Shewry, as Director of the California Department of Health Services, is named as a Defendant in this action, as is California State Controller Steve Westly. Defendant Shewry's focus in opposing this motion is that state immunity under the Eleventh Amendment bars this action in the first instance. Defendant Shewry position appears to be correct.
Although Steve Westly has not submitted any direct opposition to Plaintiff's Motion, and while Plaintiffs try to make much of that omission, as the person directly responsible for administering California's MediCal program it would appear that Ms. Shewry is in fact the proper party to advance California's interest in this matter.
The Eleventh Amendments bars federal courts for exercising jurisdiction over a suit brought against a state in federal court by its own citizens. A state is immune from such an action.Papasan v. Allain, 478 U.S. 265, 276 (1986). In addition, naming a state official rather than the state itself does not save a lawsuit from the bar imposed by the Eleventh Amendment if the state is deemed the real party in interest. Idaho v. Coeur d'Alene Tribe, 521 U.S. 261, 277-78 (1997). Where a lawsuit seeks relief that must be paid by the state treasury, the state is deemed the real party in interest even though individual officials are denominated as nominal defendants. Ford Motor Co. v. Dep't of Treasury, 323 U.S. 459, 464 (1945).
The State of California argues that this lawsuit effectively seeks monetary relief because Plaintiff seek reversion to the previous system under which dual eligibles received prescription drugs under MediCal, a program funded in part by state dollars. They argue that such a result would unquestionably impact the state treasury, and could have an even more pronounced result than the previously administered MediCal system for two reasons. First, with the dismantling of the Medicaid drug reimbursement system, the State argues that rebates previously required from pharmaceutical companies might no longer available. Secondly, if California were to pay for dual eligible provisions in contravention of Part D Medicare, it might no longer be entitled to the matching federal funds it had previously received under the old system. Both these factors could well make exclusive state payment for prescriptions considerably more expensive.
Plaintiffs try to avoid the import of these concerns by arguing that this case falls within the limited exception to Eleventh Amendment preclusion established by Ex Parte Young, 209 U.S. 123 (1908). In that case, suit against a state was permitted where only prospective equitable relief was sought as opposed to any form of money damages or other legal relief. Plaintiffs here argue that the relief requested is prospective and equitable only despite the obvious fiscal impact as well as the fact that individual Plaintiffs would appear to seek the equivalent of money damages in the form of co-pay recoupment.
In determining whether the Ex Parte Young exception applies, courts should look to the substance rather than the form of the relief sought. Papasan, 478 U.S. at 278-79. As the State points out, the primary purpose driving this lawsuit is State payment for prescription drugs. That goes beyond mere equitable relief, as does the Plaintiffs' demand that no co-payments be required.
If any doubt remained as to the propriety of maintaining this action under Ex Parte Young on the basis of the relief sought, that doubt is put to rest by the additional requirement of theYoung doctrine that "the underlying authorization upon which the named official acts is asserted to be illegal." Id. at 277. Here there can be no doubt that the Director acted legally in coordinating California's MediCal system with the changes authorized by Congress in enacting Medicare's new Part D provision for providing prescription drugs. Plaintiffs cannot dispute this, and consequently Plaintiffs cannot show any likelihood of success as to their claims against the State of California.
It should also be noted that even aside from Eleventh Amendment concerns, granting the relief sought by Plaintiffs would amount to a mandate that the State of California reinstate MediCal coverage to dual eligibles when it has already, in the wake of MMA, enacted legislation withdrawing such coverage. See California Welfare and Institutions Code § 14133.23(a) and (b)(1). This court cannot issue a mandate to compel fiscal appropriations; only the state legislature can authorize such expenditures. Hopkins v. Saunders, 93 F.3d 522, 527 (8th Cir. 1996).
B. Irreparable Harm
The irreparable harm alleged by Plaintiffs in this case is premised almost entirely on speculation as to what could happen if certain Plaintiffs cannot obtain needed medicines, or what could occur if other individuals qualifying as dual eligibles are not in fact enrolled in Medicare Part D prescription coverage. Irreparable injury for purposes of qualifying for injunctive relief, however, cannot be based on sheer speculation. Goldie's Bookstore, Inc. v. Super. Ct. Of State of Cal., 739 F.2d 466, 472 (9th Cir. 1984).
To the extent that any Plaintiff (or other dual eligible for that matter) needs medication not included within his or her assigned formulary, an "exception" or appeal from a denial of coverage as to the non-included drug may be filed. This assumes that generic or other drugs that are available on any given formulary do not meet patient needs. No Plaintiff has shown that they have exercised such appeal options unsuccessfully, and consequently no irreparable injury beyond impermissible speculation has been demonstrated.
In some 90 percent of cases a doctor can successfully prescribe a different drug that is on a plan formulary. (See Decl. of Paul Lofholm, ¶ 8).
While the Court recognizes that Defendants also claim that Plaintiffs' failure to exhaust their administrative remedies in this regard is yet another bar to this lawsuit, the Court does not believe that argument is dispositive in ruling on the present motion for injunctive relief and consequently will not address it here except insofar as it bears on the irreparable harm issue as discussed in this section.
Plaintiffs' additional contention that minimal co-payments constitute irreparable harm also cannot be sustained given the fact that an attack on the propriety of such payments amounts, in essence, to a challenge to amounts awarded in governmental aid. As indicated above, there is generally no constitutional right to governmental aid. DeShaney, 489 U.S. at 196. Moreover, because any equal protection argument in this case requires scrutiny only under a rational basis, and because requiring such co-payments withstands such analysis, there can be no irreparable harm founded on an equal protection analysis, either.
Finally, Plaintiffs' challenges to the automatic enrollment provisions are unpersuasive. While Plaintiffs have produced evidence to show that automatic enrollment had not been completed within the first two weeks after implementation of the new Medicare Part D program, they have presented no competent evidence of ongoing failure during the remaining transition process that would constitute irreparable harm, particularly given the assistance provided by both the state and federal governments to aid that process as discussed above.
C. Balance of Hardships
Any new legislation with the sweep of the MMA inevitably requires adjustment. As discussed above, provisions have been made to ease that adjustment process, and Plaintiffs have failed to produce convincing evidence that measures undertaken have been ineffective. Plaintiffs would advocate throwing the entire Medicare Part D program into jeopardy because of alleged inconvenience to a small portion of the 42 million Americans entitled to the new prescription drug coverage. Practical difficulties in trying to return to the old Medicaid system not now that the Medicare drug program is in operation would be immense. (See Culotta Decl., ¶ 18-19). The balance of hardship tips overwhelmingly in favor of continuation of the Medicare drug-benefit program without interruption.
Only about 6 million of the 42 million individuals who qualify for coverage under Medicare Part D are dual eligibles. (See Federal Defs.' Opp'n, pp. 1-2).
CONCLUSION
The dispositive issue in denying injunctive relief rests in this case with the fact that Plaintiffs have not shown any likelihood of success on the merits. Plaintiffs lack standing to pursue any constitutional challenge to the MMA premised on the Tenth Amendment. In addition, Plaintiffs are wrong in claiming that discretion given under the MMA to the Secretary in approving drug plans violates the non-delegation doctrine. Plaintiffs similarly have not established viable Fifth Amendment due process/equal protection claims stemming either from co-payment provisions or from operation of drug plans/formularies under Part D of Medicare.Moreover, with respect to the injunctive relief sought, Plaintiff's demand that the State of California continue providing prescription drug coverage under MediCal is barred by the Eleventh Amendment. Furthermore, and in any event, this Court lacks power to compel a state to make what amounts to fiscal appropriations necessary to fund a reversion to the old MediCal system. Only the California legislature may make such appropriations. Hopkins v. Saunders, 93 F.3d at 527.
For all these reasons, the likelihood of Plaintiffs' prevailing on the merits here is slim. In addition, the irreparable injury identified by Plaintiffs is largely speculative, and the balance of hardships tip squarely against granting preliminary injunctive relief. Because Plaintiffs in essence seeks a reversion to the pre-MMA state of affairs, the mandatory injunction they seek is particularly disfavored and must be denied unless both the facts and law clearly favor the moving party. Stanley v. Univ. of S. Cal., 13 F.3d 1313, 1320 (9th Cir. 1996). Here that high threshold has not been met.
Much of the potential harm identified by Plaintiff consists of transition difficulties that both the state and federal governments have attempted to remedy through emergency and/or short term legislation. Mechanisms are in place that allow flexibility in drug formularies which are already designed to encompass the therapeutic spectrum. On the other hand, disrupting the transition to Medicare at this point could entail enormous logistical challenges and throw the entire system into disarray once again, as opposed to allowing transition issues to simply resolve with the passage of additional time post-enactment of Part D.
For all the foregoing reasons, Plaintiffs' Motion for Preliminary Injunction is DENIED.
IT IS SO ORDERED.