350 Holding Health Insurance Marketplaces Accountable 2015
with the detailed procedural and substantive requirements of the Act.101
This has resulted in certain recurring problems with notice and hearing systems, enrollment practices, and the availability of medical services.102 In response to the shift to managed care, advocates began a new wave of litigation to enforce the same rights that had previously been secured in the
traditional Medicaid model in this new privatized setting.103 Courts have
been very willing to treat managed care companies as state actors for purposes of statutory and constitutional enforcement,104 in large part because
the Act requires that each state have a “single state agency” responsible for
administering the Medicaid program.105 The Fourth Circuit recently held
that “the vesting of responsibility over a state’s Medicaid program in a single agency safeguards against the possibility that a state might seek to
evade federal Medicaid requirements by passing the buck to other agencies
that take a less generous view of a particular obligation.”106 That is, state
Medicaid agencies are still liable for the failures of MCOs and MCOs are
therefore accountable to the same standards as a state agency.107 Because of
the single state agency requirement, private enforcement is still viable in the
Medicaid context despite the increased delegation of authority to private entities.
4. The Direct Impact of Private Enforcement on the Medicaid Program
There is little comprehensive evidence about the outcome of Medicaid
cases, although many commenters believe the litigation is essential to en-
101. See SOMERS & GRUSIN, supra note 72, at 1 (“Statutes and regulations impose detailed requirements on these entities, governing outreach and enrollment, services, network
adequacy, and notice and hearing. Beneficiaries and providers have sued state Medicaid
agencies and, on occasion, the managed care entities themselves, alleging that these requirements have been violated. Certain issues recur regularly, particularly problems with
notice and hearing systems, enrollment, and services.”).
103. See id. (noting that beneficiaries and providers have sued state Medicaid agencies
and occasionally the managed care organizations themselves).
104. SARA ROSENBAUM ET AL., ISSUE BRIEF #14, AN OVERVIEW OF LEGAL
DEVELOPMENTS IN MANAGED CARE CASELAW AND SELECTED CASE STUDIES OF LEGAL
DEVELOPMENTS IN STATE CONTRACTING FOR MANAGED BEHAVIORAL HEALTH SERVICES,
GEO. WASH. U. MED. CTR. FOR HEALTH SERV’S. RES. & POL’Y 5 (2001) [hereinafter
ROSENBAUM, ISSUE BRIEF 14], available at https://publichealth.gwu.edu/departments/
105. 42 U.S. C. A. § 1396a(a)(5) (West, WestlawNext through P.L. 113-174).
106. K. C. ex rel. Africa H. v. Shipman, 716 F.3d 107, 112 (4th Cir. 2013).
107. Id at 112-13; see also ROSENBAUM, ISSUE BRIEF 14, supra note 104, at 6
(“Courts are willing to hold states accountable to beneficiaries for the substandard health
care access performance of their managed care contractors, at least in those cases in which a
state has acknowledged its obligations pursuant to a consent decree to oversee contractor