Korab v. Fink

A state does not commit a violation of the Equal Protection Clause of the Fourteenth Amendment by not filling the gap left “by Congress’s withdrawal of federal funding for Compact of Free Association with the United States residents.”

“Tony Korab, Tojio Clanton and Keben Enoch (collectively ‘Korab’)” filed a class action suit on the behalf of “nonimmigrant aliens residing in Hawai‘i under a Compact of Free Association with the United States, known as COFA residents.” COFA residents were “eligible for federal Medicaid subsidies” and medical services “through Hawai‘i’s state-sponsored managed care plans,” but the Welfare Reform Act took their eligibility away. Initially, Hawai‘i continued to cover COFA residents under its “state health insurance plans at the same level of coverage as individuals eligible for federal reimbursement under Medicaid.” After a decline in revenues, “Hawai‘i dropped COFA residents from its general health insurance plans and created a new plan with more limited coverage.” Korab claimed that the new health plan was a violation of “the Equal Protection Clause of the Fourteenth Amendment because it provides less health coverage to COFA residents than the health coverage that Hawai‘i provides to citizens and qualified aliens who are eligible for federal reimbursements through Medicaid.” The district court ruled in Korab’s favor and granted a preliminary injunction, which prevented the reduction of “state-paid health benefits for COFA residents.” On appeal the panel noted that, “Congress has the plenary power to regulate immigration and the conditions on which aliens remain in the United States.” Additionally, the Welfare Reform Act restricted “public benefits for aliens” and Congress has authorized states to “make their own eligibility determinations” for aliens like the COFA residents. The panel also noted that “states cannot be forced to replace the federal funding Congress has removed” if the federal program was constitutional as it was in this case. Thus, the panel held that Hawai‘i does not have a “constitutional obligation to fill the gap left by Congress’s withdrawal of federal funding for COFA residents.” VACATED AND REMANDED.