Korab v. Fink, No. 11-15132 (9th Cir. 2014)Annotate this Case
In enacting comprehensive welfare reform in 1996, Congress rendered various groups of aliens ineligible for federal benefits and also restricted states' ability to use their own funds to provide benefits to certain aliens. As a condition of receiving federal funds, Congress required states to limit eligibility for federal benefits, such as Medicaid, to citizens and certain aliens. Plaintiffs filed suit claiming that Basic Health Hawai'i violated the Equal Protection Clause of the Fourteenth Amendment because it provided less health coverage to nonimmigrant aliens residing in Hawai'i (COFA Residents) than the health coverage that Hawai'i provided to citizens and qualified aliens who are eligible for federal reimbursements through Medicaid. The court concluded that Congress has plenary power to regulate immigration and the conditions on which aliens remain in the United States, and Congress has authorized states to do exactly what Hawai'i had done here - determine the eligibility for, and terms of, state benefits for aliens in a narrow third category, with regard to whom Congress expressly gave states limited discretion. Hawai'i has no constitutional obligation to fill the gap left by Congress's withdrawal of federal funding for COFA Residents. Accordingly, the court vacated the district court's grant of a preliminary injunction preventing Hawai'i from reducing state-paid health benefits for COFA Residents because Hawai'i is not obligated to backfill the loss of federal funds with state funds and its decision not to do so was subject to rational-basis review.