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No. 08 CV 0432(PAC) (S.D.N.Y.), filed January 17, 2008

Updated: January 5, 2009

Issue: Whether a letter sent to state officials by CMS in August 2007, in which the agency restricted states' rights to expand eligibility in their State Children's Health Insurance Programs (SCHIP) by establishing new and onerous standards, violates the SCHIP statute (title XXI of the Social Security Act) and the Administrative Procedure Act (APA), 5 USC §553 and §706.

Relief Sought: Declaratory and injunctive relief prohibiting application of the new standards to state eligibility conditions unless and until the standards comply with the SCHIP statute and the APA.

Status: After the complaint was filed, the defendant moved to dismiss on various jurisdictional grounds.  The plaintiffs have cross-moved for summary judgment.  The case is a companion to a similar case filed by New York and several other states challenging the CMS directive.

Before oral argument was held in November 2008, plaintiffs voluntarily dismissed their complaint. They took this action because the State of New York had implemented a program with state-only funds that restored the named plaintiffs' eligibility, thus rendering their claims moot.  (In the companion case brought by the State, the court ultimately dismissed the complaint on various jurisprudential grounds.  New York v. U.S. Dept. of Health and Human Services, 2008 WL 5211000 (S.D.N.Y., Dec. 15, 2008).)

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