Assn of Home Help Care Agencies v. Dept of Health & Human Services ( 2020 )

If this opinion indicates that it is “FOR PUBLICATION,” it is subject to
revision until final publication in the Michigan Appeals Reports.
STATE OF MICHIGAN
COURT OF APPEALS
ASSOCIATION OF HOME HELP CARE FOR PUBLICATION
AGENCIES, November 19, 2020
9:20 a.m.
Plaintiff-Appellant,
v No. 349405
Court of Claims
DEPARTMENT OF HEALTH AND HUMAN LC No. 18-000100-MZ
SERVICES and STATE OF MICHIGAN,
Defendants-Appellees.
Before: MARKEY, P.J., and METER and GADOLA, JJ.
PER CURIAM.
Plaintiff, Association of Home Help Care Agencies (AHHCA), appeals by right the order
of the Court of Claims granting summary disposition in favor of defendants, State of Michigan
and Department of Health and Human Services (DHHS), under MCR 2.116(C)(8) and (10). We
affirm.
I. BACKGROUND
This dispute concerns DHHS’s administration of the Home Help Program, which is a
Medicaid program that provides personal care services to individuals who require hands-on
assistance with the functions of daily living.1 DHHS is tasked with monitoring, regulating, and
1
In Hegadorn v Dep’t of Human Servs Dir, 503 Mich. 231, 245-246; 931 NW2d 571 (2019), our
Supreme Court summarized the general mechanics of Medicaid, observing:
The Medicaid program is governed by a complex web of interlocking
statutes, as well as regulations and interpretive documents published by state and
federal agencies. The program was created by Title XIX of the Social Security Act
of 1965, PL 89-97; 79 Stat 343, codified at 42 USC 1396 et seq. Medicaid is
generally a need-based assistance program for medical care that is funded and
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policing home health or help agencies2 in Michigan that provide care under the program. DHHS-
approved home help care agencies are eligible to join AHHCA.
A. STATUTORY FRAMEWORK FOR IMPLEMENTING STATE MEDICAID POLICIES
AND THE APPROVED STATE PLAN
As part of the Social Welfare Act, MCL 400.1 et seq., MCL 400.111a authorizes the
director of DHHS to implement policies governing the provision of services:
(1) The director of the department of community health, after appropriate
consultation with affected providers and the medical care advisory council
established according to federal regulations, may establish policies and procedures
that he or she considers appropriate, relating to the conditions of participation and
requirements for providers established by section 111b and to applicable federal
law and regulations, to assure that the implementation and enforcement of state and
federal laws are all of the following:
(a) Reasonable, fair, effective, and efficient.
(b) In conformance with law.
(c) In conformance with the state plan for medical assistance adopted under
section 10 and approved by the United States department of health and human
services.
(2) The consultation required by this section shall be conducted in
accordance with guidelines adopted by the state department of community health
administered jointly by the federal government and individual states. At the federal
level, the program is administered by the Secretary of Health and Human Services
through the Centers for Medicare & Medicaid Services (CMS). The State Medicaid
Manual is published by CMS to help guide states in their administration of the
program, including how to determine an applicant's eligibility for benefits. Each
participating State develops a plan containing reasonable standards for determining
eligibility for and the extent of medical assistance within boundaries set by the
Medicaid statute and Secretary of Health and Human Services. In formulating those
standards, States must provide for taking into account only such income and
resources as are, as determined in accordance with standards prescribed by the
Secretary, available to the applicant. [Citations, quotation marks, emphasis, and
ellipses omitted.]
2
Federal law refers to home “health” and state law refers to home “help,” and we shall use
whichever term is appropriate for the context of a particular discussion, although for purposes of
our analysis and holding, the terms are effectively interchangeable.
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according to section 24 of the administrative procedures act of 1969, 1969 PA 306,
MCL 24.224.
In May 1997, “[a]ll the statutory authority, powers, duties, functions and responsibilities of the
Home Help Program” stated in MCL 400.106, MCL 400.109, and MCL 400.109c were transferred
to the Department of Community Health, Executive Order No. 1997-5(III)(1); MCL 400.224,
which subsequently became DHHS in 2015 under Executive Order No. 2015-4.
The “consultation” requirement referenced in MCL 400.111a(1) and (2) incorporates the
procedure for adopting guidelines outlined in MCL 24.224 of the Administrative Procedures Act
of 1969 (APA), MCL 24.201 et seq., and MCL 24.224 provides:
(1) Before the adoption of a guideline, an agency shall give electronic notice
of the proposed guideline to the committee, the office of regulatory reform, and
each person who requested the agency in writing or electronically for advance
notice of proposed action that may affect the person. . . . The notice shall be given
by mail, in writing, or electronically transmitted to the last address specified by the
person requesting the agency for advanced notice of proposed action that may affect
that person. . . .
(2) The notice required by subsection (1) shall include all of the following:
(a) A statement of the terms or substance of the proposed guideline, a
description of the subjects and issues involved, and the proposed effective date of
the guideline.
(b) A statement that the addressee may express any views or arguments
regarding the proposed guideline or the guideline’s effect on a person.
(c) The address to which written comments may be sent and the date by
which comments shall be mailed or electronically transmitted, which date shall not
be less than 35 days from the date of the mailing or electronic transmittal of the
notice.
(d) A reference to the specific statutory provision about which the proposed
guideline states a policy.[3]
3
We note that the policies or bulletins at issue in this case are not APA guidelines. An APA
“guideline” is defined as “an agency statement or declaration of policy that the agency intends to
follow, that does not have the force or effect of law, and that binds the agency but does not bind
any other person.” Rather, MCL 400.111a authorizes the establishment of policies and procedures
that home help providers are required to follow, and it merely incorporates the “guideline”
procedure in the APA for purposes of explaining what must be done to satisfy the “consultation”
requirement of MCL 400.111a.
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The Social Security Act sets forth conditions for home health agencies’ participation in
Medicaid. 42 USC 1395bbb. Home health agencies must “use” home health aides who have
completed certain training requirements and who are “competent to provide” home health care, in
addition to conducting regular performance reviews and providing “regular in-service education”
to ensure the continued competence of home health aides. 42 USC 1395bbb(a)(3). Federal law
lists convictions that result in mandatory exclusion from participation in federal health care
programs, which include convictions for program-related crimes, patient abuse, healthcare fraud,
and controlled substance offenses. 42 USC 1320a-7(a). Federal law also lists convictions that
“may exclude” individuals from participation in a federal health care program, and those offenses,
amongst many, include misdemeanor convictions for fraud and financial misuse related to a
healthcare program. 42 USC 1320a-7(b). AHHCA refers to these categories as “mandatory” and
“permissive” convictions.
The federal government approved a State Plan for Michigan in August 2007. “The State
plan is a comprehensive written statement submitted by the agency describing the nature and scope
of its Medicaid program and giving assurance that it will be administered in conformity with
[federal law].” 42 CFR 430.10. The approved State Plan described the services available through
the Home Help Program, which—for one calendar month—are a maximum of five hours for
shopping, six hours for light housekeeping, seven hours for laundry, and 25 hours for meal
preparation. According to the State Plan, providers of home help services “shall be qualified
individuals or individuals who contract with or are employed by an agency.”
B. DHHS POLICIES GOVERNING HOME HELP AGENCIES IN MICHIGAN
In 2008, DHHS issued Medical Services Administration (MSA) Bulletin Number 08-28,
setting forth the wage rate for agency providers of home help services and indicating that future
wage increases for both individual and agency providers would occur concurrently and be based
on minimum-wage-law changes and legislative appropriations. An agency was eligible for DHHS
approval if it had a federal tax identification number and if it employed or subcontracted with two
or more persons to provide home help care. In 2015, DHHS issued MSA 15-13, requiring home
help agencies to employ workers directly, although it held this requirement in abeyance until
further notice for agencies approved before June 1, 2015. DHHS further allowed home help
agency workers who had permissive or non-mandatory convictions to provide services with the
consent of the beneficiary. In 2017, DHHS issued MSA 17-32, replacing all prior policies
governing agency rates and setting new rates.
DHHS subsequently provided notice of a proposed policy draft that became MSA 18-09,
updating the standards governing home help agencies. DHHS required agencies to employ
workers directly, and it suspended the ability of a beneficiary to consent to allowing an agency
employee with a criminal history to provide services. Agencies that did not comply with the
requirements of the policy could be removed from the Approved Agency List or disenrolled.
Agencies removed from the approved list would still be eligible for reimbursement but at the
individual provider rate. If an agency was disenrolled, DHHS would notify the agency of the
disenrollment determination within 10 days, and this decision could be appealed. An agency could
provide services while an appeal was pending if the agency accepted responsibility to repay funds
if the disenrollment determination was upheld.
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In response to DHHS’s solicitation of comments, one commenter disagreed with the
suspension of the availability of a beneficiary to consent to receive services from an agency
provider who had a criminal record, claiming that it would result in a shortage of eligible providers.
DHHS indicated that it did not have the capacity to monitor all the consent arrangements in order
to ensure the safety of beneficiaries although DHHS would still permit beneficiaries who knew
and trusted their provider to employ that person as an individual provider rather than through an
agency despite the criminal history. Another commenter disagreed with the direct employment
requirement because it would create a financial hardship for agencies. DHHS responded that it
was covering some of the taxes and costs for agencies and that agencies would also be paid a
higher rate of compensation in light of the added costs so that agencies could continue to confer
the same level of benefits on their employees. When DHHS issued MSA 18-09, it notified
agencies that the direct employment requirement would apply to all agencies.
AHHCA filed a complaint in the Court of Claims, challenging the validity of MSA 17-32
and MSA 18-09 on constitutional and statutory grounds. AHHCA also sought a temporary
restraining order and a preliminary injunction. The Court of Claims denied all injunctive relief
and AHHCA’s motion for reconsideration regarding injunctive relief. The parties subsequently
moved for summary disposition. The Court of Claims granted defendants’ motion for summary
disposition but denied AHHCA’s competing motion for summary disposition. The Court of
Claims subsequently denied AHHCA’s motion for reconsideration of the order summarily
dismissing its complaint.
II. ANALYSIS
A. SUMMARY DISPOSITION
1. STANDARD OF REVIEW
This Court reviews de novo a trial court's ruling on a motion for summary disposition.
Hoffner v Lanctoe, 492 Mich. 450, 459; 821 NW2d 88 (2012).4 We also review de novo matters
4
MCR 2.116(C)(8), which provides for summary disposition when a “party has failed to state a
claim on which relief can be granted,” tests the legal sufficiency of a complaint. Beaudrie v
Henderson, 465 Mich. 124, 129; 631 NW2d 308 (2001). The trial court may only consider the
pleadings in rendering its decision under MCR 2.116(C)(8). Id. All factual allegations in the
complaint are accepted as true. Dolan v Continental Airlines/Continental Express, 454 Mich. 373,
380-381, 563 NW2d 23 (1997). “The motion should be granted if no factual development could
possibly justify recovery.” Beaudrie, 465 Mich. at 130. In Pioneer State Mut Ins Co v Dells, 301
Mich. App. 368, 377; 836 NW2d 257 (2013), this Court set forth the framework regarding analysis
of a motion for summary disposition brought under MCR 2.116(C)(10), explaining:
In general, MCR 2.116(C)(10) provides for summary disposition when
there is no genuine issue regarding any material fact and the moving party is entitled
to judgment or partial judgment as a matter of law. A motion brought under MCR
2.116(C)(10) tests the factual support for a party's claim. A trial court may grant a
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of statutory interpretation. Estes v Titus, 481 Mich. 573, 578-579; 751 NW2d 493 (2008).5 This
Court likewise reviews de novo questions of constitutional law. Adair v Michigan, 497 Mich. 89,
99; 860 NW2d 93 (2014).
2. ALLEGED STATUTORY VIOLATIONS
States that choose to participate in Medicaid must follow federal requirements. In re Estate
of Rasmer, 501 Mich. 18, 25; 903 NW2d 800 (2017). “Medicaid is a program that uses a form of
cooperative federalism under which coordinated state and federal efforts coexist within a
complementary framework in regard to administration.” People v Kanaan, 278 Mich. App. 594,
612; 751 NW2d 57 (2008). Federal requirements for state participation in Medicaid do not deprive
a state of its own “authority to set parameters and controls relative to Medicaid.” Id. This Court
has described DHHS’s authority to implement and administer a Medicaid program:
Pursuant to the Social Welfare Act . . ., [DHHS] is responsible for
establishing and administering medical assistance programs in the state, including
the Medicaid program. See MCL 330.3101. Consistently with separation of powers
principles, and in light of the complex nature of the endeavor, the Legislature has
motion for summary disposition under MCR 2.116(C)(10) if the pleadings,
affidavits, and other documentary evidence, when viewed in a light most favorable
to the nonmovant, show that there is no genuine issue with respect to any material
fact. A genuine issue of material fact exists when the record, giving the benefit of
reasonable doubt to the opposing party, leaves open an issue upon which reasonable
minds might differ. The trial court is not permitted to assess credibility, weigh the
evidence, or resolve factual disputes, and if material evidence conflicts, it is not
appropriate to grant a motion for summary disposition under MCR 2.116(C)(10).
A court may only consider substantively admissible evidence actually proffered
relative to a motion for summary disposition under MCR 2.116(C)(10). [Citations
and quotation marks omitted.]
5
In Wayne Co v AFSCME Local 3317, 325 Mich. App. 614, 633-634; 928 NW2d 709 (2018), this
Court recited the rules of statutory construction:
The primary task in construing a statute is to discern and give effect to
the Legislature’s intent, and in doing so, we start with an examination of
the language of the statute, which constitutes the most reliable evidence of
legislative intent. When the language of a statutory provision is unambiguous, we
must conclude that the Legislature intended the meaning that was clearly
expressed, requiring enforcement of the statute as written, without any additional
judicial construction. Only when an ambiguity in a statute exists may a court go
beyond the statute’s words to ascertain legislative intent. We must give effect to
every word, phrase, and clause in a statute, avoiding a construction that would
render any part of the statute nugatory or surplusage. [Citations omitted.]
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delegated broad authority to [DHHS] to enable it to accomplish its statutory
responsibilities. . . . However, consonant with the delegation doctrine, such
authority is circumscribed by the addition of substantive standards, including, for
example, eligibility requirements, types of services provided, and the directive to
develop policies and procedures regarding the participation of, and reimbursement
to, health care service providers. See MCL 400.106, 400.109, 400.111a. . . .
Generally, then, [DHHS] has been delegated the responsibility of establishing and
administering health care programs . . . that most effectively meet the needs of
those persons eligible for Medicaid and state-funded services, using the state’s
limited resources in the most efficient manner possible. In the absence of a specific
legislative directive that modifies its authority, [DHHS] is obligated to fulfill its
statutory duties to establish, administer, and maintain the integrity of such
programs. [Pharm Research & Mfr of America v Dep’t of Community Health, 254
Mich. App. 397, 404-405; 657 NW2d 162 (2002).]
AHHCA argues that MSA 18-09’s direct employment mandate violates the approved State
Plan. And MCL 400.111a(1)(c) requires DHHS’s policies and procedures to be in conformance
with the State Plan adopted and approved under federal law. The State Plan declares that
“[p]roviders shall be qualified individuals or individuals who contract with or are employed by an
agency.” AHHCA construes this provision to mean that DHHS must allow provider agencies to
employ or contract with workers, but this interpretation adds a requirement that is not present in
the State Plan. The plain language of the State Plan simply dictates that qualified individuals,
individuals who contract with an agency, or individuals who are employed by an agency are the
only individuals permitted to act as providers relative to home help services; it does not mean that
DHHS must allow agencies to contract with workers. Therefore, AHHCA has not shown a
violation of the State Plan and MCL 400.111a.
AHHCA next argues that MSA 18-09’s exclusion of agency workers with permissive
convictions violates 42 USC 1320a-7(b) and MCL 333.20173a, which allow providers with
permissive convictions to provide home help services. As indicated earlier, 42 USC 1320a-7(b)
provides that individuals “may” be excluded from participating in a federal health care program
on the basis of enumerated convictions. “[T]he word ‘may’ typically reflects a permissive
condition, entrusting a particular choice to a party’s discretion.” In re Complaint of Mich Cable
Telecom Ass’n, 241 Mich. App. 344, 361; 615 NW2d 255 (2000). AHHCA’s interpretation that 42
USC 1320a-7(b) requires state agencies to allow these providers to participate in the program is
inconsistent with the plain language of the federal statute. Accordingly, we reject this argument.
Furthermore, MCL 333.20173a does not support AHHCA’s position. MCL 333.20173a(1)
provides that “a covered facility shall not employ, independently contract with, or grant clinical
privileges to an individual who regularly has direct access to or provides direct services to patients
or residents in the covered facility if the individual” has been convicted of certain crimes, including
those listed in 42 USC 1320a-7(a) (mandatory convictions). MCL 333.20173a does not contain a
provision that parallels 42 USC 1320a-7(b), which pertains to permissive convictions. AHHCA’s
citation of MCL 333.20173a, without any additional argument or explanation, does not support its
stance that defendants were not permitted to exclude workers with permissive convictions. MCL
333.20173a does not mandate that individuals with permissive convictions or convictions not
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enumerated in the statute are entitled to act as providers or that DHHS is not permitted to preclude
their participation as providers.
AHHCA next argues that the notice for proposed MSA 18-09—a draft of the policy—did
not satisfy the requirement in MCL 24.224(2)(d) to reference a specific statutory provision about
which MSA 18-09 stated a policy, which was necessary to establish the “consultation” requirement
in MCL 400.111a. The Court of Claims ruled, and defendants do not contest, that the notice for
MSA 18-09 did not contain a citation of the statutory provision implemented by the bulletin. The
Court of Claims, however, citing the substantial-compliance provision in MCL 24.227(1), ruled
that defendants had substantially complied with the notice requirements of MCL 24.224(2).
AHHCA maintains that defendants were “required to comply with all of the requirements in
issuing bulletins, not just some.” But AHHCA’s argument does not account for MCL 24.227(1),
which provides that “[a] guideline adopted after the effective date of this section is not valid unless
processed in substantial compliance with sections 24, 25, and 26.” (Emphasis added.) To the
extent that AHHCA argues that the omission of a statutory reference reflected the lack of statutory
authority underlying the policies affecting employment and providers with convictions, we reject
the contention. As this Court acknowledged in Pharma Research, 254 Mich. App. at 404-405, “the
Legislature has delegated broad authority to [DHHS] to enable it to accomplish its statutory
responsibilities,” including administration of the Home Help Program, which is amply supported
by state and federal statutes. AHHCA has not established that the Court of Claims erred by
rejecting its argument that MSA 18-09 was invalid because DHHS did not comply with MCL
24.224(2)(d).
3. PROCEDURAL DUE PROCESS
The United States and Michigan Constitutions prohibit the deprivation “of life, liberty, or
property, without due process of law.” US Const, Am XIV; Const 1963, art 1, § 17. A procedural
due process claim must identify a property or liberty interest interfered with by the challenged
state action and must show that the procedures leading to the deprivation of that interest were
constitutionally inadequate. Hinky Dinky Supermarket, Inc v Dep’t of Community Health, 261
Mich. App. 604, 606; 683 NW2d 759 (2004). In Mathews v Eldridge, 424 U.S. 319, 335; 96 S. Ct.
893; 47 L. Ed. 2d 18 (1976), the United States Supreme Court observed:
More precisely, our prior decisions indicate that identification of the
specific dictates of due process generally requires consideration of three distinct
factors: First, the private interest that will be affected by the official action; second,
the risk of an erroneous deprivation of such interest through the procedures used,
and the probable value, if any, of additional or substitute procedural safeguards;
and finally, the Government's interest, including the function involved and the
fiscal and administrative burdens that the additional or substitute procedural
requirement would entail.
“[P]rocedural due process requires that a party be provided notice of the nature of the proceedings
and an opportunity to be heard by an impartial decision maker at a meaningful time and in a
meaningful manner.” Mettler Walloon, LLC v Melrose Twp, 281 Mich. App. 184, 213-214; 761
NW2d 293 (2008).
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AHHCA argues that MSA 18-09 does not give providers constitutionally adequate notice
of violations of the policy and an opportunity to correct the violations or challenge them before
disenrollment. This claim is refuted by an examination of the enrollment and disenrollment
process for existing agencies, such as AHHCA’s member agencies, described in MSA 18-09.
MSA 18-09 requires “[a] current Medicare certified home health agency . . . to provide a letter of
intent and a copy of the current Medicare certification.” Among other information, a letter of
intent must state that the agency owner and managing employee “will ensure that the agency and
the agency’s caregivers and employees have read all current [DHHS] Home Help policies and
procedures and will provide services in compliance with those requirements.” Agencies must
“pass a criminal history screening.” MSA 18-09 provides that DHHS will notify a provider of
approval, denial, or the need for additional information. MSA 18-09 further states that “[t]he
[DHHS] Home Help Unit will audit employment documents for a sample of agencies each year.”
“An agency may be disenrolled if it fails to meet any of the requirements in” MSA 18-09. DHHS
will provide an agency of a disenrollment determination within 10 days of the decision. An agency
that does not meet the requirements of MSA 18-09 may also be removed from the Approved
Agency List, but such agencies “will be eligible to provide services at the individual rate for Home
Help.” Agencies who are removed from the Approved Agency List may seek reinstatement. The
bulletin provides that agencies “have the right to appeal any adverse action taken by [DHHS].”
(Emphasis added.)
For enrolled agencies, removal from the approved list and disenrollment are both options
for DHHS to take against an agency that does not meet the requirements of the bulletin, so it does
not follow that disenrollment is immediate and automatic for all agencies that do not comply with
the policies of MSA 18-09. Additionally, again, the removal of an agency from the approved list
does not require its complete shutdown because such agencies are eligible to receive the individual
provider rate. Therefore, AHHCA’s argument that agencies will be disenrolled without the
opportunity to take corrective action, although possible, is not the only procedure contemplated by
the bulletin.
AHHCA states that “pending payments will be lost resulting in a retroactive effect as
payments are made in arrears.” AHHCA cites no support for this assertion, nor does the bulletin
support this statement. MSA 18-09 indicates, as noted earlier, that a provider appealing a
disenrollment decision “may continue to provide services during the appeal period if the agency
provider accepts responsibility for the repayment of funds should the [DHHS] decision be upheld.”
This provision contemplates either continued or at least retroactive payment.
Moreover, AHHCA’s focus on the adequacy of the opportunity to challenge a
disenrollment determination fails to fully analyze the issue because it does not address the
Mathews balancing test. AHHCA emphasizes the disruption of services and payment without
addressing the risk of error resulting from the current procedure, the value added by providing an
opportunity for a hearing or to take corrective action before disenrollment, and defendants’
interests, including the administrative burden of providing agencies with an opportunity to be
heard or overseeing agencies’ efforts to take corrective action. The United States Court of Appeals
for the Second Circuit concluded that balancing a beneficiary’s interest in receiving home health
benefits with the “fiscal and administrative burden” to the state did not require the state to provide
a beneficiary with “a pre-deprivation review procedure” before reducing or terminating continued
home health services. Lutwin v Thompson, 361 F3d 146, 148, 158 (CA 2, 2004). Although
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nonbinding, see Jaqua v Canadian Nat’l R, Inc, 274 Mich. App. 540, 546; 734 NW2d 228 (2007),
the Second Circuit’s ruling highlights the insufficiency of AHHCA’s procedural due process claim
in this case. Given the overall framework of MSA 18-09, we do not accept AHHCA’s claim that
procedural due process requires notice before disenrollment and an opportunity to take corrective
action. If, for example, an agency commits fraud or violates a policy requirement, DHHS can
disenroll the agency, but timely notice of the disenrollment determination must then be given to
the agency, which determination would constitute an “adverse action,” thereby triggering a right
to an appeal before any permanent deprivation of an interest. And AHHCA has not persuaded us
of any due process right to take corrective action. In short, AHHCA fails to show that the existing
procedure under MSA 18-09 is constitutionally inadequate.6
4. EQUAL PROTECTION
AHHCA argues that MSA 18-09 violated equal protection by singling out home help care
agencies in imposing the direct employment requirement and in removing an agency’s ability to
obtain a beneficiary’s agreement to receive services from a worker with a permissive conviction.
“The Equal Protection Clauses of the United States and Michigan Constitutions provide that no
person shall be denied the equal protection of the law.” Wysocki v Kivi, 248 Mich. App. 346, 350;
639 NW2d 572 (2001). “This constitutional guarantee requires that persons similarly situated be
treated alike.” Rose v Stokely, 258 Mich. App. 283, 295-296; 673 NW2d 413 (2003). Different
levels of review apply depending on the basis of the classification scheme. Phillips v Mirac, Inc,
470 Mich. 415, 432-433; 685 NW2d 174 (2004). “In Michigan, courts have applied the rational
basis test principally to economic and social legislation.” Wysocki, 248 Mich. App. at 354. “Where
the proponent of an equal protection argument is not a member of a protected class, or does not
allege violation of a fundamental right, the equal protection claim is reviewed using the rational
basis test.” Houdek v Centerville Twp, 276 Mich. App. 568, 585-586; 741 NW2d 587 (2007).
“Under this test, a statute is constitutional if it furthers a legitimate governmental interest and if
the challenged statute is rationally related to achieving that interest.” Barrow v City of Detroit
Election Comm, 301 Mich. App. 404, 419-420; 836 NW2d 498 (2013). The party asserting an equal
protection violation must show that the policy “is arbitrary and wholly unrelated in a rational way
to the objective of the” policy. Wysocki, 248 Mich. App. at 354 (quotation marks and citation
omitted).
Like AHHCA’s procedural due process claim, its equal protection argument is devoid of
factual support and proper legal analysis. Central to an equal protection analysis is a comparison
of similarly-situated entities experiencing differential treatment. Shepherd Montessori Ctr Milan
v Ann Arbor Charter Twp, 486 Mich. 311, 328-329; 783 NW2d 695 (2010). That type of
comparison is absent from AHHCA’s equal protection argument. AHHCA is correct that MSA
18-09 applies to home help care agencies only, but introducing a policy bulletin that sets the
standards governing home help care agencies does not establish differential treatment in the
absence of documentation of policies governing other types of providers. AHHCA states that
6
AHHCA emphasizes the hardship resulting from the restructuring required to comply with MSA
18-09, but it has provided no facts to support its claim and has not conducted the necessary legal
analysis.
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“[a]ll other providers of home help care services, from all other Medicaid funded provider groups,
are allowed to continue the prior practices of contracting home help care workers including, for
example, hospice providers, community mental health providers, and state direct home help
workers.” AHHCA also claims that defendants “do not employ their home help care workers.”
AHHCA offers no factual support for these statements. Additionally, AHHCA does not describe
the types of services offered by the other providers as they compare to home help, and it is unclear
whether the other types of providers identified by AHHCA also provide home help care services
or other types of Medicaid-funded services more broadly. And AHHCA fails to describe the
circumstances of defendants’ use of home help care workers. In sum, AHHCA has not set forth a
foundation for its equal protection claim showing that home help care agencies are treated
differently from other similarly-situated groups.
Even assuming differential treatment, AHHCA has not shown that MSA 18-09 fails the
rational-basis test, which entails examination of the purpose of the policy. See Phillips, 470 Mich.
at 434-435. “A classification reviewed on this basis passes constitutional muster if the legislative
judgment is supported by any set of facts, either known or which could reasonably be assumed,
even if such facts may be debatable.” Harvey v Michigan, 469 Mich. 1, 7; 664 NW2d 767 (2003).
A policy is presumed valid, and the party asserting an equal protection violation has the burden of
proving otherwise. Shepherd Montessori, 486 Mich. at 318-319. DHHS produced the responses
to the comments received before it issued MSA 18-09, addressing the policies regarding direct
employment and permissive convictions. As to precluding beneficiary consent to a provider with
a criminal record, DHHS stated that it did “not have the capacity to sufficiently monitor agency
assignments to ensure the safety of beneficiaries who use a provider with a criminal history.” In
addition, DHHS acknowledged that beneficiaries could still agree to receive services from a known
and trusted individual provider with a criminal history. AHHCA has not countered DHHS’s stated
safety concern. In response to a commenter’s disagreement with the direct employment
requirement, DHHS stated that it paid “the employer’s share of federal taxes and unemployment”
and that “[a]gencies are paid at a higher rate so that all personal care staff who work for the agency
receive the same benefit.” That is, the direct employment requirement served to equalize treatment
of workers. AHHCA has not shown that DHHS lacked a rational basis for implementing the
policies; rather, AHHCA asserts that the policies are arbitrary because they did not exist before.
This argument fails to identify a shortcoming in DHHS’s explanations. AHHCA has not met its
burden of establishing that the policy had no rational basis and violated equal protection.
B. RECONSIDERATION
AHHCA argues that the Court of Claims erred by denying its motion for reconsideration,
raising issues that the Court of Claims had addressed and rejected in the motion for summary
disposition, and which we have now addressed and rejected in this opinion as part of our ruling
affirming the Court of Claims. Accordingly, there was no abuse of discretion in denying the
motion for reconsideration, and we affirm that ruling by the Court of Claims. MCR 2.119(F)(3);
Sanders v Perfecting Church, 303 Mich. App. 1, 8; 840 NW2d 401 (2013).
C. PRELIMINARY INJUNCTION
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Finally, AHHCA challenges the denial of injunctive relief. This issue is now moot. “An
issue is moot if an event has occurred that renders it impossible for the court to grant relief.” Gen
Motors Corp v Dep’t of Treasury, 290 Mich. App. 355, 386; 803 NW2d 698 (2010). Because we
have affirmed summary dismissal of AHHCA’s claims in this lawsuit, which claims provided the
support for the request for injunctive relief, the issue of injunctive relief has been rendered moot.
We affirm. Having fully prevailed on appeal, defendants may tax costs under MCR 7.219.
/s/ Jane E. Markey
/s/ Patrick M. Meter
/s/ Michael F. Gadola
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