Armstrong v. Exceptional Child Center, Inc.

Supreme Court of the United States · 2015 · Federal Courts

Federal CourtsSupremacy ClauseEquitable ReliefMedicaidSupremacy ClauseEx parte Youngequityimplied preclusion

Facts

Medicaid is a Spending Clause program under which States receive federal funds in exchange for complying with federal conditions. Idaho adopted a federally approved Medicaid plan that included habilitation services, and providers of those services were reimbursed by Idaho's Department of Health and Welfare. Section 30(A) requires state Medicaid plans to use payment methods consistent with efficiency, economy, and quality of care and sufficient to enlist enough providers. Respondent providers alleged Idaho's reimbursement rates for habilitation services were too low under § 30(A) and sought an injunction compelling state officials to raise them.

Issue

Can Medicaid providers sue Idaho officials in federal court to enforce § 30(A) of the Medicaid Act, either through the Supremacy Clause, through equitable relief, or through an implied cause of action in the Medicaid Act itself?

Rule

The Supremacy Clause creates a rule of decision, not a source of federal rights or a cause of action. Although federal courts may in some circumstances grant equitable relief against unlawful executive action, that relief is unavailable when Congress has expressly or impliedly foreclosed it; § 30(A) of the Medicaid Act is implicitly foreclosed from private enforcement because the Act provides the Secretary's withholding of funds as the enforcement mechanism and § 30(A)'s broad, judgment-laden standard is judicially unadministrable. Section 30(A) also lacks rights-creating language and therefore does not itself create a private right of action.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

Oregon participates in a federal housing-assistance program created under the Spending Clause. A group of landlords in Portland sue the director of the state housing office in federal court, alleging an Oregon rent-cap regulation conflicts with a federal funding condition and asserting that the Supremacy Clause itself gives them a cause of action for an injunction.

What is the strongest argument that the landlords' suit cannot proceed on the theory they advance?

Explanation. The majority held that the Supremacy Clause instructs courts to give federal law priority over conflicting state law, but it does not itself create federal rights or a cause of action. So plaintiffs cannot rely on the Clause alone as the basis for suing state officials. That conclusion does not mean preemption can never be raised; it means the Clause is not itself the source of the lawsuit.