The Tenth Circuit Court of Appeals ruled that the Medicaid Act, 42 U.S.C. § 1396a(a)(8), which requires Medicaid benefits to be provided with reasonable promptness to all eligible individuals, did not provide Medicaid applicants who claimed they were wrongly denied benefits with an individually enforceable right of action against state Medicaid agencies under 42 U.S.C. § 1983. Lancaster v. Cartmell, No. 25-6000 (10th Cir. Dec. 23, 2025).
Max and Peggy Lancaster (the Lancasters) transferred $3.8 million in assets to a limited liability company (LLC) owned by their three adult children. The LLC executed a loan agreement, real estate mortgages, personal guarantees, and a promissory note in consideration for the Lancasters’ transfer of assets. Following the transfer, the Lancasters applied for Medicaid benefits. Their applications were denied because their financial resources exceeded Medicaid’s asset limit.
The Lancasters sued the directors of the Oklahoma Department of Human Services and the Oklahoma Health Care Authority (the Agencies) under 42 U.S.C. § 1983, alleging that they had violated the Medicaid Act, 42 U.S.C. § 1396a(a)(8), by failing to provide Medicaid benefits to them as eligible individuals with reasonable promptness. The Agencies moved to dismiss, arguing that the LLC’s promissory note payable to the Lancasters was a countable resource that caused their resources to exceed the threshold for Medicaid eligibility. The federal district court granted the motion. The Lancasters appealed to the Tenth Circuit Court of Appeals.
Before oral arguments, the United States Supreme Court decided Medina v. Planned Parenthood South Atlantic, 606 U.S. 357 (2025), holding that 42 U.S.C. § 1396a(a)(23)(A)—the “any-qualified-provider” provision of the Medicaid Act—did not clearly and unambiguously confer an individually enforceable right under section 1983. The Agencies filed a motion for summary disposition, arguing that Medina was a supervening change in the law that also applied to section 1396a(a)(8), which they argued did not clearly and unambiguously confer an individually enforceable right under section 1983. The Lancasters argued that section 1396a(a)(8) was distinguishable from the provision addressed in Medina, relying on Sabree v. Richman, 367 F.3d 180 (3d Cir. 2004), in which the Third Circuit held that section 1396a(a)(8) conferred a private right of action under section 1983. The Tenth Circuit denied summary disposition.
The Tenth Circuit ultimately ruled that the US Supreme Court’s ruling in Medina required it to conclude that section 1396a(a)(8) did not clearly and unambiguously confer an individually enforceable right under section 1983. Under Medina, the Supreme Court established a stringent and demanding test to determine whether a federal statute confers individually enforceable rights under section 1983: The plaintiff must show that the statute at issue clearly and unambiguously uses rights-creating terms, displaying an unmistakable focus on individuals such as the plaintiff. In Medina, the Supreme Court noted that the typical remedy for violations of the Medicaid Act, a spending-power statute that addresses a state’s obligations to the federal government, was for the federal government to terminate funds to the state; therefore, it was unlikely to confer a privately enforceable right under section 1983.
The Tenth Circuit, relying on Medina, held that, like section 1396a(a)(23)(A), section 1396a(a)(8) was part of a subsection of the Medicaid Act listing requirements that states must substantially comply with to receive Medicaid funding. Although section 1396a(a)(8) included more mandatory terms and directives for states to comply with, that alone did not establish an individually enforceable right of action. Thus, section 1396a(a)(8) was not a rare exception that conferred an individual right of action under a Medicaid provision enacted pursuant to Congress’s spending power. Consequently, those whose Medicaid applications are denied must instead rely on the administrative appeal processes provided within the Medicaid Act itself.
Further, the court rejected the Third Circuit’s analysis in Sabree v. Richman, holding that in Medina, the US Supreme Court had repudiated the reasoning in the case law the Third Circuit had relied upon in Sabree.
As a result, the Tenth Circuit affirmed the district court’s dismissal of the Lancasters’ suit.
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