More Than 22K Nebraskans Had Medicaid Coverage Unconstitutionally Terminated Without Adequate Notice, Class Action Claims

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A proposed class action lawsuit claims tens of thousands of Nebraskans have had their Medicaid coverage unconstitutionally terminated without adequate notice from the state’s Department of Health and Human Services (DHHS).

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The 16-page Medicaid lawsuit explains that under the Families First Coronavirus Response Act, which was signed into law as an early response to the COVID-19 pandemic, state Medicaid programs could receive increased federal funding as long as they maintained continuous enrollment for most participants from March 1, 2020 through March 31, 2023, among other stipulations.

On April 1, 2023, one day after the three-year continuous coverage period ended, the defendants—Steve Corsi, CEO of Nebraska’s DHHS, and Matt Ahern, interim director of the agency’s Medicaid and Long-Term Care division—began their first wave of monthly Medicaid disenrollments for individuals determined as no longer eligible, the filing says.

Since then, more than 22,000 Nebraskans have been issued identical notices from the DHHS proposing to end their Medicaid enrollment with the sole explanation that their “income exceeds standards,” the complaint relays.

“The department includes no other explanation of the reason on the income termination notices, such as the source of an enrollee’s income, the enrollee’s household size, a calculation of enrollee’s household income, or the applicable income limit for eligibility based on the enrollee’s household size,” the suit says.

Medicaid enrollees have the right to appeal determinations within 90 days of receiving notice of the decision, the case states. However, due to the vague and conclusory reasoning provided in the defendants’ income termination notices, recipients cannot adequately prepare a response to the proposal, the complaint stresses.

“Constitutional due process requires that a Medicaid enrollee be issued timely and adequate written notice detailing the reasons for a proposed termination, and an effective opportunity for a hearing before services are terminated,” the filing reads.

The plaintiff, a Nebraska resident living in a low-income household, says her Medicaid coverage ended on May 1, 2024, less than two weeks after she received a letter from the defendants proposing the termination merely because her “income exceeds standards.”

According to the case, the defendants were legally required to provide the plaintiff and other letter recipients with notices clearly stating the specific reasons for the proposed terminations and offering them an opportunity to contest the state’s actions. The filing also notes that, pursuant to federal law, these individuals are entitled to maintain Medicaid enrollment until they receive such notice.

“[The] plaintiff has relied on Medicaid health coverage to address multiple serious health concerns in the past,” the complaint says. “Since her Medicaid was terminated, [the] plaintiff has forgone or delayed necessary health care because it is unaffordable without health coverage.”

The case notes that Nebraska is still in the process of making eligibility determinations for thousands of other enrollees, many of whom are at risk of receiving an allegedly unlawful income termination notice.

The lawsuit looks to represent anyone who, since March 1, 2023, has been or will be issued a written notice from the defendants proposing to terminate their Nebraska Medicaid eligibility because their “income exceeds standards.”

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