Bailey v. Montana Dept. of Health & Human Services

Bailey v. Montana Dept. of Health & Human Svcs., 2015 MT 37 (Feb. 10, 2015) (McKinnon, J.) (5-0, aff’d)

Issue: Whether an administrative rule excluding from Medicaid coverage all invasive procedures undertaken for the purpose of weight reduction, including gastric bypass, is unreasonable and contrary to federal law.

Short Answer: No.


Facts: Bailey is a 51-year-old mother. She is about 5’3” and 445 pounds, and is considered morbidly obese. She qualifies for Montana Medicaid because she is legally blind. In 1990 Bailey was in a car that was hit by a train, causing long-term injuries to her ribs, knees, and back. In 2000, she broke both legs in a fall, and had pins and screws put into her legs. She underwent spinal surgery in 2012. She has hypertension, Type 2 diabetes, edema, venous insufficiency, arthritis, chest pain, asthma, sleep apnea, hypothyroidism and restless leg syndrome.

She has tried to lose weight, but her ability to exercise is limited by her injuries. Her three doctors have written to DPHHS saying Bailey is a good candidate for gastric bypass, and that surgery would help her other medical problems. They did not say surgery was necessary, or that it is the only means by which her condition can improve. 

Procedural Posture & Holding: Dr. Richards asked DPHHS to authorize gastric bypass surgery for Bailey. It denied the request because the surgery is not covered under the Department’s administrative rules. Bailed requested a hearing at which she argued the blanket exclusion is unreasonable and contrary to federal law. The hearing officer determined the rule was rational and reasonable, as it was based on fiscal necessity. Bailey sought judicial review in the district court, which affirmed. She now appeals, and the Supreme Court affirms.

Reasoning: Exclusions for Medicaid coverage may not discriminate on the basis of diagnosis, type of illness, or condition. DPHHS rules exclude “all invasive medical procedures undertaken for the purposes of weight reduction,” as well as dietician services, nutritional services, and dietary supplements. Bailey contends the effect of these rules is to exclude all obesity treatments, thereby discriminating on the basis of diagnosis. Without expert testimony in the record, the Court cannot make a determination on that issue.

Bailey does not show that the surgery she seeks is “medically necessary” under the Department’s definition, and she has not challenged the reasonableness of the definition. The Court holds that state funding priorities are a valid basis for excluding weight-loss surgery from Medicaid coverage.