Lamont Bailey v. E. Roob, Jr. ( 2009 )

In the
United States Court of Appeals
For the Seventh Circuit
No. 08-3592
L AM ONT G. B AILEY, et al.,
Plaintiff-Appellants,
v.
E. M ITCHELL R OOB, JR., et al.,
Defendants-Appellees.
Appeal from the United States District Court
for the Southern District of Indiana, Indianapolis Division.
No. 1:94-cv-00089-SEB-JMS—Sarah Evans Barker, Judge.
A RGUED M ARCH 31, 2009—D ECIDED JUNE 8, 2009
Before F LAUM, M ANION, and R OVNER, Circuit Judges.
F LAUM, Circuit Judge. Years ago, a group of plaintiffs
and the Indiana Medicaid program’s administrators
agreed to certain terms for the handling of applications to
the disability program in Indiana: most relevant for
present purposes was a concession that the program
would compile a complete twelve-month medical
history before reaching a decision on the application. Now,
several members of the affected class want to hold the
2 No. 08-3592
program administrators in civil contempt for violating
that portion of the consent decree. They claim that in too
many cases the program is relying on summary forms
rather than compiling an applicant’s complete medical
history.
The district court rejected the motion because the plain-
tiffs had not demonstrated by clear and convincing evi-
dence that the defendants were in violation of the terms
of the consent decree. Appellants now challenge that
ruling, citing three errors. First, they claim the district
court improperly tasked them with demonstrating that
the plaintiffs had not been reasonably diligent in
following the demands of the consent decree. Second, they
argue that the district court should have held that the
evidence proffered below was a clear and convincing
demonstration that the program administrators were
violating the decree. Third, they argue that the district
court erred as a matter of law by holding that 20 C.F.R.
§ 416.912(d), a provision of the regulations for the Sup-
plem en tal Security Incom e d isability program
incorporated by reference into the consent decree, did not
require a full collection of medical records.
For the following reasons, we affirm the district court’s
ruling.
I. Background
The Medicaid for the Disabled program in Indiana
provides medical coverage and benefits to individuals
who suffer from a qualifying disability. The present case
No. 08-3592 3
grew out of a class action lawsuit filed against the Indiana
Medicaid disability plan in the 1990s. That lawsuit was
settled by a consent decree requiring the administrators
of the plan to collect certain evidence before making a
decision on an application for disability benefits. The
consent decree required the Indiana plan to obtain and
evaluate evidence used for Medicaid eligibility in the
same way that the Code of Federal Regulations requires
the Supplemental Security Income administrators to
obtain and evaluate evidence. Specifically, the decree
provided that, “the State of Indiana must obtain and
evaluate evidence in determining Medicaid eligibility
in the same way that Supplemental Security Income
disability determinations are made under 20 C.F.R. 416.901
through 416.988.”
In fact, the consent decree simply incorporated 20 C.F.R.
§ 416.901-416.988 as regulations for how the Indiana
Medicaid program should go about collecting and evaluat-
ing applications. As the district court summarized it, the
consent decree required the Indiana Medicaid program
to do three things: First, obtain complete histories from a
Medicaid applicant’s treatment providers, covering at
least the twelve months prior to the application, before
making any determination about Medicaid eligibility;
second, obtain additional medical information from an
applicant’s treating physician or other medical source
when necessary; third, ensure that medical records are
complete and detailed enough to allow for a proper
determination regarding eligibility.
The Indiana Medicaid for the Disabled program is
supposed to follow a defined set of procedures when
4 No. 08-3592
making eligibility determinations. Applicants for
Medicaid for the Disabled first meet with an assigned
caseworker. The caseworker helps an applicant fill out
Form 251B, in which an applicant lists her medical condi-
tions and any information about treatments she’s re-
ceived in the last twelve months, including her treating
physicians. The caseworker is responsible for collecting
an applicant’s medical history based on the information
provided in Form 251B. If the caseworker is unable to
collect this information, he is supposed to note that in the
applicant’s file. After the caseworker has processed them,
applications are forwarded to the Medicaid Medical
Review Team (MMRT). The MMRT is responsible for
gathering any information that the caseworker has not
tracked down.
The Indiana Medicaid plan uses a Form 251A to collect
information from a physician about an applicant’s
medical history. The Form 251A includes a section asking
for information about the patient’s treatments, diagnostic
tests, and medications going back for at least twelve
months, a “Medical Evidence” section asking for infor-
mation on the patient’s physical systems, and a “Diagno-
sis/Prognosis” section asking for the doctor’s opinion
regarding the applicant’s reported impairment.
On April 13, 1999, plaintiffs filed a petition to hold the
defendants in civil contempt for violating the terms of the
consent decree. The parties settled by entering into a
second consent decree that included the same terms as the
original and allowed anyone who had been denied
Medicaid benefits in the preceding three years to
reapply for benefits.
No. 08-3592 5
Seven years later, on September 26, 2006, plaintiffs
filed a second petition to hold defendants in civil con-
tempt, alleging that the Indiana Medicaid program was
again in violation of the consent decree. In response to a
discovery request, the Medicaid administrators agreed
to produce a representative sample of disability benefit
applications. That sample consisted of twenty-six files
in all, representing every application from Marion
County, Indiana with an applicant whose last name
began with “C” and whose application was denied be-
tween September 1, 2006 and October 1, 2006.1 The
parties judged twelve of these applications to be com-
plete under any standard, but appellants contend that
the remaining fourteen are incomplete and demonstrate
the Indiana Medicaid program’s violation of the consent
decree.
Appellants contend that in some cases Indiana is improp-
erly using this form as a proxy for the “complete
medical history” required in 20 C.F.R. § 416.912. Appellees
contend that the consent decree does not always
require them to obtain copies of a physician’s medical
records and that Form 251A is a “complete” medical
history within the meaning of the decree.
The district court conducted its own review of the files.
It concluded that five of the fourteen allegedly incomplete
1
This procedure raises some obvious concerns about sample
size and concentration, but appellants contend that appellees
stipulated that they would not raise those issues in defense
of the action, and they have not.
6 No. 08-3592
files were complete under any standard. With respect to
the remaining nine, the district court found that “[f]our of
these nine applications are clearly less complete than
the other five,” and that the other five files contained only
the summary Form 251A, but did not find the admin-
istrators of Indiana Medicaid in contempt for violating
the consent decree. The crux of the district court opinion
is that the appellants had not met the burden for a civil
contempt petition: Neither side presented adequate
evidence on what constituted a “complete” medical
history, and thus neither the four arguably incomplete
applications nor the five applications containing only
the Form 251A was clear and convincing evidence that
the appellees violated the consent decree. The district
court invited the appellants to re-file their motion, asking
them to produce “[e]xpert testimony, or information on
how the agency charged with responsibility for com-
pliance with the Decree interprets the definition
Plaintiffs offer” and “factual explication of what precisely
the Medicaid system instructs physicians to do and take
account of in completing Form 251A.” The appellants
instead appealed the district court’s denial of their
motion to this court.
II. Discussion
We review the district court’s decision not to hold the
state in civil contempt deferentially. “It is well established
that the decision by a district court to enter a finding of
civil contempt is discretionary and we review it only to
determine if there was an abuse of discretion or its entry
No. 08-3592 7
was clearly erroneous.” Feltner v. Title Search Co., 283 F.3d
838, 841 (7th Cir. 2002). The case law on contempt
sanctions divides them into two categories: coercive and
remedial. See Jones v. Lincoln Elec. Co., 188 F.3d 709, 738
(7th Cir. 1999). Coercive sanctions induce a party’s com-
pliance with a court order in the future, while remedial
sanctions compensate an injured party for an opponent’s
past non-compliance. Id. The contempt petition here is
coercive; the appellants were seeking to enjoin the
Indiana Medicaid program to contract with an outside
auditor to review its decisions every three months, and
to record each and every instance in which a case-
worker requests medical information from an applicant’s
medical care provider.
Appellants argue that the district court made three
errors. First, it improperly placed upon them the burden
of demonstrating that Indiana had not been reasonably
diligent in carrying out the consent decree’s requirements.
They contend that reasonable diligence is an affirmative
defense on which Indiana bears the burden of proof.
Second, they argue that the district court abused its
discretion by not imposing civil contempt sanctions
because of the four applications that the district court
characterized as less than complete. Third, they argue
that the district court improperly declined to hold that
the consent decree requires that Indiana obtain actual
copies of a treating physician’s medical records and thus
that the five applications with only a Form 251A are
evidence of Indiana’s violation of a court order. We
take each claim in turn.
8 No. 08-3592
A. Whether the district court improperly allocated the
burden of proof
The appellants first contend that the district court abused
its discretion because it improperly placed on them the
burden of proving that the appellees were not “reasonably
diligent” in executing the consent decree. The district
court characterized the burden of proof as, “whether
Plaintiffs have shown, by clear and convincing evidence,
that Defendants have not been ‘reasonably diligent and
energetic in attempting to accomplish what was ordered’
in the Consent Decree.” They contend that this was an
error of law and necessarily an abuse of the district court’s
discretion. See United States v. Jaderany, 221 F.3d 989, 994
(7th Cir. 2000). Appellants contend that they need only
show a violation of the terms of the consent decree;
“reasonable diligence,” they contend, is an affirmative
defense on which the appellees’ bear the burden of pro-
duction.
Appellants cite United States v. Rylander, 460 U.S. 752(1983), which they argue squarely places the burden of
demonstrating reasonable diligence on the party
defending against the contempt petition. Rylander does
hold that a defendant in a contempt proceeding bears the
burden of producing evidence if he is asserting a present
inability to comply with the terms of a court order. Id. at
757. The defense that the Supreme Court discussed in
Rylander is different from any defense that the state would
present in the present case, however. In Rylander, the
respondent was subject to an IRS summons ordering him
to turn over certain corporate books and records to the
No. 08-3592 9
agency. Id. at 753. A prima facie case for contempt sanc-
tions in that case consisted of a showing that Rylander
had not satisfied the terms of the summons—that is, that
he had not turned over the books and records. The Court
held that Rylander could defend against a finding of civil
contempt by demonstrating “that compliance is now
factually impossible.” Id. at 757. Rylander thus places a
burden of proof on the defendant, but it does so when
the defendant is alleging that “compliance is impossible.”
Id.Rylander addressed a case where a party defending
against a civil contempt petition for violating a court
order requiring a one-time-only action on his part, but in
doing so it did not address what evidence a party seeking
sanctions must produce in the first instance. The parties
agree that this circuit’s case law requires the party
seeking sanctions to demonstrate that the opposing party
is in violation of a court order by clear and convincing
evidence. See, e.g., SEC v. Homa, 514 F.3d 661, 676 (7th Cir.
2008). They disagree over what evidence a party has to
produce to demonstrate an opponent’s violation of a
court order.
In Goluba v. School Dist. of Ripon, 45 F.3d 1035 (7th Cir.
1995), we noted when discussing civil contempt
sanctions that, “[t]he district court does not, however,
‘ordinarily have to find that the violation was “willful” ‘
and may find a party in civil contempt if that party ‘has not
been reasonably diligent and energetic in attempting to
accomplish what was ordered.’ ” Id. at 1037 (citing Stotler
and Co. v. Able, 870 F.2d 1158, 1163 (7th Cir. 1989)). Appel-
10 No. 08-3592
lees contend that this passage places the burden of
proof on this issue on the party seeking the contempt
sanction; the appellants contend that their burden of
proof is actually spelled out earlier in the same opinion,
where the court noted that in order to prevail, “a party
must prove ‘by clear and convincing evidence’ that the
opposing party violated a court order.” Id. (citing Stotler,
870 F.2d at 1163).
Goluba does not explicitly say which party bears the
burden of demonstrating “reasonable diligence” or the
absence thereof. Our discussion of “reasonable diligence”
in that case refers to what a court must find rather than
to what a party to the action must prove. However,
Goluba spelled out what evidence must be before the
court before it can impose sanctions: evidence that a party
has willfully refused to comply with a court order, or
evidence that a party was not “reasonably diligent”
in carrying out the terms of the court order. We have
subsequently used a test for civil contempt petitions that
explicitly requires a petitioner to demonstrate that the
alleged contemnor was not reasonably diligent. See
Prima Tek II, LLC v. Klerk’s Plastic Industries, B.V., 525
F.3d 533, 542 (7th Cir. 2008) (“To sustain its contempt
claim, PTII has the burden of proving all of the following
elements by clear and convincing evidence: (1) the Order
sets forth an unambiguous command; (2) Klerks violated
that command; (3) Klerks’s violation was significant,
meaning it did not substantially comply with the Order;
and (4) Klerks failed to take steps to reasonabl[y] and
diligently comply with the Order.”) (citing Goluba and
Stotler). Likewise, the Supreme Court has discussed the
No. 08-3592 11
prima facie case in a civil contempt proceeding as the
burden of showing a willful failure. See McPhaul v.
United States, 364 U.S. 372, 379 (1960) (“The Government’s
proof at the trial thus established a prima facie case of
willful failure to comply with the subpoena.”) (emphasis
added). At least one other circuit has used a similar
phrase in elaborating the contempt standard, requiring
that the evidence be sufficient to foreclose a finding of
reasonable diligence. See United States v. Local 1804-1, Int’l
Longshoreman’s Ass’n, AFL-CIO, 44 F.3d 1091, 1096 (2d Cir.
1995) (“In a civil contempt proceeding, like the present
case, a contempt holding will fall unless the order
violated by the contemnor is ‘clear and unambiguous,’ the
proof is ‘clear and convincing,’ and the contemnor was
not reasonably diligent in attempting to comply.”). Thus,
the district court did not commit a clear legal error by
requiring appellants to demonstrate Indiana’s lack of
reasonable diligence.
Furthermore, we could reject the contention that the
district court erred in stating the burden of proof because
it is not clear from reading the opinion that the district
court actually placed the burden of demonstrating the
lack of reasonable diligence on appellants. The statement
quoted above certainly suggests that the court required
as part of the prima facie case evidence that the appellants
had not been reasonably diligent. However, the district
court ultimately rejected the civil contempt petition
because one set of allegedly incomplete applications was
in fact complete, and “their completeness shows ‘reason-
able diligence’ on the part of Defendants to follow the
Court’s order and the regulations that support it.” With
12 No. 08-3592
respect to the other allegedly incomplete applications, the
court declined to impose civil contempt sanctions not
because appellants had not demonstrated an absence of
reasonable diligence but because “it remains unclear
what constitutes a ‘complete’ medical history” and conse-
quently appellants had “failed to meet their burden on
the remaining applications, because the standard for
contempt requires clear and convincing evidence that
Defendants violated the decree.” Appellants did not
prevail because they simply failed to produce clear and
convincing evidence that Indiana had violated the
consent decree. They have now latched onto a single
phrase from the opinion and insist that it mandates
reversal, but we think this is an uncharitable characteriza-
tion of the district court’s opinion and, at any rate, is
neither an error nor grounds for reversal.
B. Whether appellants produced sufficient evidence of
non-compliance
The burden of proof aside, appellants also contend
that the evidence they presented to the district court
adequately demonstrated Indiana Medicaid’s non-compli-
ance with the consent decree and justified civil contempt
sanctions. As the district court summarized it, appellants
made the following factual allegations in the contempt
proceeding, based on their random sampling of applica-
tions:
(1) In nine, or 35%, of the applications, Defendants
failed to request twelve-month medical histories;
(2) in seven, or 25%, of the applications, Defendants
No. 08-3592 13
failed to collect information that was “complete and
detailed enough” to make a disability determination;
(3) in three, or 12%, of the applications, Defendants
failed to collect a list of any medical facilities that
treated the applicant; (4) in eight, or 53%, of fifteen
applications, the county office forwarded the applica-
tion to the MMRT without any medical records; (5) in
four, or 27%, of fifteen applications, the Medicaid
application was denied on the same day that the
Medicaid Medical Review Team requested additional
information about the applicant; (6) in one of fifteen
applications, the only medical information included
in the application was gathered by a registered
nurse, rather than a doctor; (7) in none of the applica-
tions did the packet contain Form 2032, which is
supposed to be present any time an applicant was
asked to receive a physical examination; (8) in none
of the applications did the county caseworker make
a record of requests for medical information; and (9) in
neither of the two applications in which a physician
requested that the applicant receive further testing
was the testing actually performed before the ap-
plication was denied.
The district court conducted its own review of the files
and concluded that at least five of the allegedly incomplete
applications in fact contained detailed records. The
court did note that of the remaining nine applications,
“[f]our of these nine applications are clearly less com-
plete than the other five,” either because those files were
missing Form 251A altogether or because Form 251A was
missing pages or was otherwise incomplete. Appellants
14 No. 08-3592
claim that this statement regarding the four case files is
evidence of Indiana’s non-compliance with the consent
decree and a sufficient basis for holding the program’s
administrators in civil contempt.
Appellants cite case law from this and other circuits
establishing that Medicaid programs are subject to a
strict compliance standard with respect to regulatory
procedures and deadlines for reaching decisions on
individual applications. They rely heavily on Smith v.
Miller, 665 F.2d 172 (7th Cir. 1981), a case involving a
suit for injunctive relief against the Illinois Medicaid
program. Smith contained broad language that seems to
support appellants’ position: “It is uncontested that the
district court possessed the equitable power to enjoin the
Department’s violation of federal laws and regulations.
While a state’s participation in the Medicaid program
is purely voluntary and its acceptance of substantial
federal funds uncoerced, once electing to participate,
it must fully comply with federal statutes and regula-
tions in its administration of the program.” Id. at 175.
Appellants also cite case law from other circuits to
support a full compliance standard. See Withrow v.
Concannon, 942 F.2d 1385, 1387 (9th Cir. 1991) (finding that
“[t]he language of the federal regulations is
unequivocal . . .”); Alexander v. Hill, 707 F.2d 780, 784 (4th
Cir. 1983) (“[t]he law itself compels 100% compliance . . .”).
Indeed, appellants argue that even if this circuit
accepted some kind of de minimis amount of deviation
from regulatory or statutory requirements, the rates of non-
compliance in their sample would be sufficient to
require some kind of remedial action.
No. 08-3592 15
We are presented, then, with the question of how much
non-compliance is needed before a district court can
impose civil contempt sanctions. A few preliminary
points will sharpen our analysis on this issue. Other
courts have observed that in civil contempt proceedings,
“context is extremely important to appellate oversight . . .”
Langton v. Johnston, 928 F.2d 1206, 1220 (1st Cir. 1991). In
contempt proceedings between private parties, the
consent decree operates like a contract between the two
and a reviewing court has comparatively greater freedom
to revisit the district court’s interpretation of the decree.
Id. at 1220-21. When the consent decree involves a public
agency, however, “the district court’s construction of a
consent decree should be accorded considerable
deference, because broad leeway is often necessary to
secure complicated, sometimes conflicting, policy objec-
tives.” Id. at 1221.
The Supreme Court has also cautioned district courts
that in using their contempt powers against a public
agency they should select a remedy carefully tailored to the
proposed end. Spallone v. United States, 493 U.S. 265, 276
(1990); see also Missouri v. Jenkins, 495 U.S. 33, 51 (1990)
(“[O]ne of the most important considerations governing
the exercise of equitable power is a proper respect for
the integrity and function of local government institu-
tions.”). This warning recognizes that when a district
court uses its remedial powers (including the power to
enforce a consent decree) in the public law context, district
courts “typically play a proactive role—a role which can
have nearly endless permutations.” Langton, 928 F.2d at
1221. A district court in such circumstances can find
16 No. 08-3592
itself deeply entangled with the development and manage-
ment of a city or state agency. This circuit’s experience
with the remedial decree in the long-running case of
Gautreaux v. Chicago Housing Authority (of which 491
F.3d 649 (7th Cir. 2007) is only the most recent iteration
in a forty-year lawsuit) illustrates the many ways in
which such a decree can deepen a district court’s involve-
ment with a case and require it to resolve many sub-
sequent disputes between the parties, rather than termi-
nating it through the sort of one-shot transfer that a
consent decree between private parties often involves.
The present case is another example; it has twice been
settled through consent decrees and has been on the
docket of the Southern District of Indiana intermittently
since 1994. We can state the point of these observations
simply: We are sensitive to the district court’s need not
to extend its equitable powers too far and to require a
persuasive showing of contempt before taking such
serious action against a state administrative agency.
We conclude that the district court did not abuse its
discretion by ruling that appellants had not produced
clear and convincing evidence of Indiana’s violation of
the court order. The first problem for appellants is that
the district court did not make a factual finding that any
of the applications are incomplete and in violation of the
consent decree. The district court did note something
that appellants stress in their brief, which is that four of
the files are less complete than the others. However, due
to the inconclusive nature of the parties’ arguments
about what constitutes a “complete” medical history, the
district court was unable to make any factual findings
No. 08-3592 17
about whether the files were or were not in compliance
with the regulatory standard incorporated into the
consent decree. (The district court’s uncertainty about the
applicable regulatory standard is covered in the next
section.) Appellants urge us to read the district court’s
identification of four less-than-complete applications as
an implicit finding that Indiana Medicaid is not
collecting complete medical histories and is in violation
of the consent decree.2 We will not base a civil contempt
order on an implicit finding when the district court de-
clined to make that finding on the record or base a con-
tempt order upon it, however.
Second, with respect to the legal standard, the case law
that appellants cited occurred outside the civil contempt
context; those cases sought injunctive or equitable relief
for unsettled cases.3 They are thus swapping the
2
One problem complicating this categorization is that those
four files are all at various stages of incompleteness. One file,
designated File M, contains no medical history outside of a
copy of a prescription refill; File E contains a Form 251A that is
missing pages; File L contains only one incomplete Form 251A
and nothing from other medical providers; and File H was
denied on the same day that the MMRT requested additional
records which they apparently never received.
3
Withrow is a particularly problematic citation for appellants,
as the Ninth Circuit specifically distinguished between the
initial remedy and enforcement of that remedy in contempt
proceedings. Withrow, 942 F.2d at 1388 (“As with any program
of this size, a few inadvertent errors are inevitable, and we
(continued...)
18 No. 08-3592
standard for civil contempt with the standard for initial
injunctive relief. Appellants anticipate this objection, and
argue in a footnote in their brief that this court cannot
fairly subject motions seeking to enforce the consent
decree to a higher burden of proof than the lawsuit seeking
relief in the first instance. That argument conflates a
standard used to determine an injury with a standard
used to measure the efficacy of a remedy, however. The
appellants’ position is that the failure to follow
regulatory procedures inflicts an injury on them; to the
extent that their allegations are true, their injury does
entitle them to equitable relief. The existence of the
consent decree in this case, however, means that they
already have that relief. The issue at this stage is whether
we can hold the Indiana program in civil contempt for
not taking adequate steps to implement that remedy
and, for the reasons discussed above, a district court is
entitled to require clearer and more convincing evidence
of non-compliance before imposing coercive sanctions.
Thus, even if we did what appellants ask us to do and
took the four “less than complete” applications as an
implicit finding that Indiana fell short of the terms of the
consent decree in some cases, that finding would not
necessarily justify the civil contempt sanctions that ap-
3
(...continued)
are confident that the district court will not exercise its
equitable powers to hold the state in contempt for every
minor, inadvertent infraction of the Act if the court is satisfied
that the officials are complying with the Act as strictly as is
humanly possible.”).
No. 08-3592 19
pellants seek. We agree with the district court that, given
the present context, those sanctions are not warranted
based on the evidence presented.
C. Whether the district court erred by not interpreting
“complete medical history” as always requiring
copies of a treating physician’s records
Appellants’ final issue in this appeal is whether the
district court made an error of law by interpreting the
phrase “complete medical history” in the consent decree
to mean something less than copies of the medical
records of each treatment source of a given applicant. This
issue pertains to the five application files that contain
completed copies of Form 251A but do not contain copies
of the treating physician’s medical record. Appellants
argue now that the district court erred by not concluding
that those files do not contain the complete medical
history required by the regulations.
Once again, the consent decree requires that the admin-
istrators of Indiana Medicaid develop records used in
eligibility decisions in the same way that the SSI program
develops records for eligibility decisions. The Code of
Federal Regulations provisions for that program
promises applicants that, “we will develop your complete
medical history for at least the 12 months preceding the
month in which you file your application unless there is
a reason to believe that development of an earlier period
is necessary or unless you say that your disability began
less than 12 months before you filed your application.”
20 C.F.R. § 416.912(d). With respect to the phrase “com-
20 No. 08-3592
plete medical history,” the regulations define that as
follows:
By complete medical history, we mean the records of
your medical source(s) covering at least the 12 months
preceding the month in which you file your applica-
tion. If you say that your disability began less than
12 months before you filed your application, we will
develop your complete medical history beginning
with the month you say your disability began unless
we have reason to believe that your disability began
earlier.
20 C.F.R. § 416.912(d)(2). Appellants clearly believe that
the phrase “complete medical history” means physical
copies of the physician’s own records, going back at least
twelve months before the date of the application. Indiana
clearly operates under the incompatible belief that
Form 251A suffices as a complete medical history, since
it gathers information from each of the applicants’ treat-
ment providers for at least the previous twelve months.
The district court was unable to sort out this disagree-
ment based on the parties’ presentations. It invited appel-
lants to re-file their contempt petition along with evidence
elaborating on the meaning of “complete medical history.”
Specifically, the district court was interested in receiving
expert or other testimony on “whether the applications
that included only Form 251A, or the other applications
that were otherwise less comprehensive, are ‘complete’
enough to conform to the consent decree. Furthermore,
we require a factual explication of what precisely the
Medicaid system instructs physicians to do and take
account of in completing Form 251A.”
No. 08-3592 21
The appellants urge us to reverse this part of the deci-
sion, claiming that this interpretation of the consent decree
violates the plain meaning of the terms as well as the
decisions of courts that have reviewed the meaning of the
relevant C.F.R. provisions. They cite, among other things,
the dictionary definition of complete (meaning “having
all parts or elements; lacking nothing”), and two opinions
from the Second Circuit reversing an agency’s eligibility
determination because some medical records were miss-
ing. See Rosa v. Callahan, 168 F.3d 72 (2d Cir. 1999); Pratts v.
Chater, 94 F.3d 34 (2d Cir. 1996).
A court interprets the meaning of a consent decree in the
same way it interprets the meaning of a contract, and a
reviewing court examines that interpretation de novo.
Goluba, 45 F.3d at 1037-38. Of course, because these reg-
ulations were only grafted onto the Indiana Medicaid
program as part of a consent decree, no court has previ-
ously interpreted what “complete” means in this exact
context, and the district court obviously felt unable to
reach a conclusive interpretation based on the evidence
presented in the contempt petition. This circuit has not
read “complete” in the strict terms that the appellants do,
however. In past cases, where SSI applicants whose
application was denied by an ALJ claimed a violation of
the duty to develop a complete record, we have said that
our court “generally upholds the reasoned judgment of the
Commissioner on how much evidence to gather, even
when the claimant lacks representation.” Nelms v. Astrue,
553 F.3d 1093, 1098 (7th Cir. 2009); see also Luna v. Shalala,
22 F.3d 687, 692 (7th Cir. 1994) (“This court has com-
mented on the difficulty of having a ‘complete’ record as
22 No. 08-3592
‘one may always obtain another medical examination, seek
the views of one more consultant, wait six months to see
whether the claimant’s condition changes, and so on.’ ”).
The regulations also place at least part of the burden for
gathering the relevant medical records on the applicant
rather than on the agency. “In general, you have to prove
to us that you are blind or disabled. This means that you
must furnish medical and other evidence that we can use
to reach conclusions about your medical impairment(s).”
20 C.F.R. § 416.912(a). While the regulations task the
agency with the responsibility to develop an applicant’s
medical history, they discuss this in terms of a duty to
make a “reasonable effort” to do this. “We will make every
reasonable effort to help you get medical reports from your
own medical sources when you give us permission to
request the reports.” 20 C.F.R. § 416.912(d) (emphasis
added). Indiana, in reliance on these portions of the
regulations, interprets the consent decree much more
narrowly, and argues that by training case workers to
interview Medicaid applicants and requesting an appli-
cant’s medical history they fulfill their burden under
the regulations with respect to the collection of a physi-
cian’s records.
Appellants’ position that a Form 251A does not suffice as
an applicant’s “complete medical history” within the
meaning of 20 C.F.R. § 416.912(d)(2) is based on an as-
sumption that the document is deficient in some respect,
or that a physician’s records contain material informa-
No. 08-3592 23
tion not captured in Form 251A. 4 As the district court
noted, however, there is not enough information before
the court to reach a determination on that issue. The
regulations require both the applicant and the agency to
develop a record sufficient for the agency to make an
informed determination about the applicant’s disability.
Based on this record we are not prepared to hold categori-
cally that an agency can never use a summary form when
developing that record or that the absence of any docu-
ment from a physician within the last twelve months,
whatever its relevance, is a violation of the regulations.
While the case is simply underdeveloped on this point,
our ruling does not foreclose all future claims on this
issue from appellants. The district court indicated a
willingness to entertain further petitions and to engage
4
Appellants argue that a Form 251A is deficient because it is
not a “record” under Indiana law, because the Indiana Code
defines “medical records” as files “possessed” by health
care providers before they are turned over to the state. Ind.
Code. § 1-1-4-5(6). First, appellants do not explain why Indiana
law should inform the meaning of a term used in the federal
regulations. We understand that looking at the Indiana Code
may illuminate how the parties understood the term, but
appellants otherwise urge this court to adopt a strict reading
of the term as it is construed by courts interpreting the federal
regulations themselves. The Indiana Code would be of limited
value in that exercise. Second, appellants do not explain how
the fact of possession makes a substantive difference in the
completeness of an applicant’s file if, for instance, the file
contained a form completed by a health care provider con-
taining all of the relevant information in the provider’s files.
24 No. 08-3592
in greater fact-finding on the meaning of “complete
medical history” under the terms of the consent decree,
including gathering information about how thorough
health care providers have been when filling out Form
251A. This matter presently comes before us as a con-
tempt petition, however, where the salient issue is
whether appellants have presented sufficient evidence
that the Indiana Medicaid program has violated a court
order. We agree with the district court that they have
not satisfied that burden at this point.
III. Conclusion
For the foregoing reasons, we A FFIRM the decision of
the district court.
6-8-09