U.S. Supreme Court
Public Health — medicaid
The federal anti-lien provision pre-empts a state’s irrebuttable statutory presumption that one-third of a tort recovery is attributable to medical expenses.
North Carolina’s law is pre-empted insofar as it would permit the State to take a portion of a Medicaid beneficiary’s tort judgment or settlement not designated for medical care. It directly conflicts with the federal Medicaid statute and therefore “must give way.” PLIVA, Inc. v. Mensing, 564 U. S. ___, ___. The state law has no process for determining what portion of a beneficiary’s tort recovery is attributable to medical expenses. Instead, the State has picked an arbitrary percentage and by statutory command labeled that portion of a beneficiary’s tort recovery as representing payment for medical care. A State may not evade pre-emption through creative statutory interpretation or description, “framing” its law in a way that is at odds with the statute’s intended operation and effect. National Meat Assn. v. Harris, 565 U. S. ___, ___. North Carolina’s argument, if accepted, would frustrate the Medicaid anti-lien provision in the context of tort recoveries. It lacks any limiting principle: If a State could arbitrarily designate one-third of any recovery as payment for medical expenses, it could arbitrarily designate half or all of the recovery in the same way. The State offers no evidence showing that its allocation is reasonable in the mine run of cases, and the law provides no mechanism for determining whether its allocation is reasonable in any particular case.
674 F. 3d 290, affirmed.
Kennedy, J.; Breyer, J., concurring; Roberts, C.J., dissenting.