Changes for Pennsylvania special education practice

Bold prediction: special education disputes will lead to more litigation. Perhaps it is not so bold, after all. But if Pennsylvania finalizes the proposed changes to Chapter 14 of the Education Regulations and removes the second level of administrative hearing appeal, I believe the legal practice will undergo some significant changes.

Delving into some generalizations, the second level appellate review has been viewed as a low cost second chance. Most cases (but not all) proceed to that level. But, I think, most cases stopped after two runs through administrative review. This is especially so if both levels of administrative review yielded the same essential result. Most courts, we tend to think, would not want to second-guess two levels of administrative review.  In playing for the best-out-of-three, if the hearing officer and the appeal panel came to quite different results, the case is more likely to get to court.  And, finally, in those cases offering very mixed relief after two reviews, the parties seem to realize they are better off taking matters in to their own hands and settling the claims.

While lawyers on both sides may have their gripes about the appeal panels, the process probably, perhaps in a perverse way, resulted in less cases going to court. So what might happen without that second level of review?

·        Probably more court cases.

·        Hearings might look more like traditional discovery with the expectation that the hearing is only the first step, a precursor to court.

·        Related to this, given the short time lines for administrative hearings, court proceedings will look more like traditional litigation than the paper appeal that now usually occurs. The parties will be submitting more evidence and expert testimony in court, particularly as, once in court, the Federal Rules permit discovery opportunities and more time to develop a case. Indeed, in this situation, the lawyers probably have a duty to their clients to use all the available court-level tools.

·        And that case might likely be a more traditional de novo review without deference to the hearing officer. The “presumed expertise” of the hearing officer will be challenged. One of the main problems with the current system is that hearing officers are not always educational experts or at least are not trained in current practices like educators and psychologists. Thus, the losing party will argue that the court should give no deference to the decision. This, of course, fits well with offering additional evidence.

·        Whether the presumed expertise stands or not, given only one level of presumed expert review, administrative findings of fact are likely to be subject to reversal and modification than currently.

·        Additional evidence proceedings in court will become actual trials if the deference standard is not going to apply.

The experience in one-level review states, such as New Jersey, might be instructive to some extent. In that regard, it seems in the Third Circuit that more federal special education cases come from New Jersey than Pennsylvania. But still, it will probably be only somewhat instructive. As noted, in Pennsylvania we will be dealing with a sudden change, from a system that by fault or designed weeded out many cases, to a situation in which both sides will scramble for an advantage. 

In the end, the field will be of special education litigation, not special education hearings.

Medicaid reimbursement rule is now final

Today the Centers for Medicare and Medicaid Services ("CMS") published its final rule eliminating certain reimbursement to public schools.  The rule takes away reimbursement to schools providing transportation and administrative services to Medicaid eligible children with disabilities.  The final rule takes effect on February 28, 2008. 

I previously commented on the proposed rule change here and here.

The CMS received 1,240 public comments regarding the rule change, but found it should adopt the rule without any change.   Those comments, and CMS's response to them, reinforce what I previously said: that federal funding for special needs children needs to be rationalized.  The CMS response to comments demonstrate the lack of ultimate responsibility when federal funding is viewed as an agency-limited activity rather than a national need.

The CMS writes, "[t]he need for schools to obtain additional funding in itself does not justify continued Federal Medicaid reimbursement."  This and similar responses to comments shows that each agency will rightly limit itself to its statutory authority (we can question, of course, its interpretation of that statue).   The comments highlighting the federal failure to live up to its promised 40 percent special education funding, and the CMS responses, show that only Congress, which makes the promise and is authorized to allocate the money, is the only responsible party for this funding mess.

Another ill-gotten mandate for Pennsylvania public schools

In Lower Merion School District v. Doe, 2007 WL 2792927 (Pa.), through some unfortunate legal reasoning, the Pennsylvania Supreme Court has interpreted § 504 of the Rehabilitation Act, 29 U.S.C. § 794, to mean that a public school district must provide occupational services to a dual-enrolled private school student. In so doing, the court expands the dual enrollment and the Veschi decision mandates to provide public support for private schools. 

In this case, the district evaluated the student, found he was not eligible for special education and related services but was eligible as a protected handicapped student under § 504 and Chapter 15 of the Pennsylvania education regulations, 22 Pa. Code Chap. 15. The district therefore offered a program of appropriate supportive services in order for the student to access his public education. Parents rejected the offer, enrolled student in a private kindergarten, and dually enrolled student in the public school under § 502 of the Pennsylvania School Code, 24 P.S. § 5-502. 

The district argued that its § 504 requirement is limited to only providing equal access to its federally funded programs. Stated another way, one might say § 504 is not a mandate for a public school to intrude into a private school program and fix the private school’s “discrimination.” The Pennsylvania Supreme Court rejected the district’s argument based on some significant misunderstandings.

To begin with, the court was of the opinion that § 504 is “remedial legislation” to be interpreted broadly. But § 504 is legislation enacted under the Constitution’s spending clause. Barnes v. Gorman, 536 U.S. 181, 190 n.3 (2002). As such, the legislation is to be interpreted narrowly, that is, the funding mandate must be spelled out unequivocally to the recipient of federal funds. No case has come to my attention, and none is cited by the court, stating that the legislation gives a funding recipient clear notice that the recipient must address another entity’s lack of access or accommodations for disabled persons.

The court’s next mistake was in concluding the § 504 FAPE obligation applies to all persons living within the boundaries of the school district. In this regard, the court interpreted the federal regulatory phrase “in the recipient’s jurisdiction,” 34 CFR 104.33(a), out of context and law. The regulations cannot expand the scope of legislation, and § 504 itself applies for the benefit of persons participating in a program receiving federal funds. “Jurisdiction” here is a legal limitation and is not, as interpreted by the court, the equivalent of geographic boundaries. Indeed, in another regulatory passage, 34 CFR 104.32(a), cited by the court, the regulations specifically distinguish “residing” in the district’s jurisdiction (in the context of the district’s § 504 child find obligation), thus showing awareness by the regulators of the geographic and legal juridical distinction. Ironically, the court used this specific reference to support its general conclusion, thereby violating an elementary rule of construction.

To its credit, the court noted the state regulations are not intended to expand the federal § 504 requirement. But having already improperly expanded and confused the federal mandate, the point of the state regulations was lost.

In the end, however, the court’s errors regarding federal law are mooted where Pennsylvania’s dual enrollment mandate extends greater protections. Although the court offered no significant discussion of § 502 of the School Code, which permits dual enrollment, as the court noted, students “enrolled” in a district are entitled to services, regardless whether also attending a private school. 

To a practitioner familiar with this area of the law, the decision evidences misunderstanding of child find, FAPE, and various disabilities education mandates, particularly in misconstruing child find obligations to create a right to require the public to make a private school accessible.