Health Care

Federal judges question value of Medicaid work requirements

A three judge panel of the U.S. Court of Appeals for the District of Columbia Friday sharply questioned the federal government’s approval of Kentucky and Arkansas’ plan requiring Medicaid recipients to work in order to maintain their health care coverage.

“People are going to lose coverage … and you haven’t addressed that,” Judge Harry Edwards said during oral arguments.

The government argued that in order for states to maintain a certain level of quality of coverage for everyone, states can compel able-bodied adults that are covered by Medicaid under the Affordable Care Act to work for a certain amount of time each month to promote general physical health and financial stability.

Medicaid is a government program that grants money to states to pay for some medical costs of eligible low income individuals. In 2014, states were allowed to elect to participate in the Medicaid Affordable Care Act expansion, which made more people eligible for coverage.

Alisa B. Klein, arguing for the Department of Health and Human Services, argued that the states are giving these people “reasonable means to get the skills they need to transition to financial independence.”

“If you keep borderline populations out of Medicaid, that frees up funds for others,” she said, arguing that current Medicaid recipients who start to work may be able to gain commercial healthcare coverage through their jobs.

Edwards pushed back, asking the government about the objective of Medicaid and the Affordable Care Act, and whether it is to ensure more people have health care coverage, or whether it is to help people ease into commercial healthcare markets.

“You’re looking for objectives that are not in the statute,” he said.

Klein also suggested that these requirements would not only transition people from Medicaid to private health care coverage, but it would also save these states money that HHS alleges they are struggling to come up with.

“You have these states who have voluntarily chosen to participate in an [ACA] expansion [of Medicaid]. These states are struggling to make sure their expansions are on sound financial footing,” Klein said.

Lawyers representing the people at risk of losing coverage if these work requirements are permitted argued that these requirements would not necessarily result in people transitioning to another form of health care coverage, but would certainly cause massive losses in coverage.

“Cutting costs by reducing coverage is not acceptable,” said Ian Gershengorn an attorney from Jenner & Block and the National Health Law Program, a health rights advocacy group.

He also brought up the objective of the ACA — to provide health care coverage for more people, he said, as he argued that this provision doesn’t follow that objective.

“Promoting financial independence is not a goal of the [ACA],” he said.

Klein on the other hand, argued that, “These [provisions] are a means of achieving the goals of the statute.”

“If the health of Medicaid recipients improves [from working], that makes the Medicaid program more effective and less costly,” Klein said, referring to HHS’ hope that getting able-bodied people to meet work requirements would also promote their general physical health.

But, Gershengorn argued, health care coverage should not be conditioned on someone’s physical well-being or their job status, which he alleged was what Klein was saying.

Klein also compared Arkansas and Kentucky’s work requirement provisions to those in assistance programs like the Supplemental Nutrition Assistance Program (SNAP) and Temporary Assistance for Needy Families (TANF).

Judge David Sentelle challenged her assertion, saying that Congress approved work requirements in TANF and SNAP and that they could have done so for the ACA if they deemed it appropriate when it approved the law in 2010.

Gershengorn echoed Sentelle’s sentiments. “The government really is trying to blur SNAP, TANF and AFDC [Assistance for Families with Dependent Children] on one hand and Medicaid on the other hand,” he said

There is no set date for a judges’ ruling on the case, but the Justice Department has asked for an expedited decision. Depending on the decision, the suing Kentucky and Arkansas residents or HHS will have the option to appeal the case to the entire D.C. Circuit Court of Appeals or directly to the Supreme Court.

At issue is a federal waiver HHS issued in November that approved changes to Kentucky’s Medicaid program.

The provisions, championed by Republican Gov. Matt Bevin, imposed work requirements, mandatory monthly premiums, coverage lockouts and more to the state’s Medicaid plan.

This and other healthcare legislation signed by Bevin, who is up for re-election next month, has been attacked by state Attorney General Andy Beshear, Bevin’s Democratic opponent for governor.

In order to enact these types of changes to Kentucky’s Medicaid program, Bevin had to ask for a waiver from HHS, which they initially approved in January 2018.

At that point, was Kentucky was poised to become the first state in the nation to require Medicaid recipients to work or volunteer to qualify for healthcare coverage.

The state predicted that 95,000 people would be forced off of Medicaid in Kentucky if Bevin’s plan went into effect.

Later in January 2018, 15 Kentucky plaintiffs filed a class action lawsuit, Stewart v. Azar, in federal court against HHS, claiming that the waiver put them at risk of losing their health care coverage.

In June 2018, the U.S. District Court of the District of Columbia sided with the residents, nullifying the federal government’s approval. In his decision, Judge James Boasberg called the approval of the waiver “arbitrary and capricious.” He sent the decision back to HHS for re-evaluation.

In November 2018, HHS approved another waiver for changes to Kentucky’s Medicaid plan, whose main provisions were virtually the same as the first one.

The National Health Law Program predicts that this plan will cause hundreds of thousands of Kentuckians to lose their health care. They, along with the Southern Poverty Law Center, the Kentucky Equal Justice Center and the law firm Jenner & Block, represent more than 15 residents who are plaintiffs in a new lawsuit, again named Stewart v. Azar, who would lose health care coverage if the plan was approved.

In March, Boasberg, who presided over the case a second time, again sided with the Kentucky residents and sent the approval of the waiver back down to HHS for another reevaluation. This time, HHS appealed the decision to the three judge panel of the U.S. Court of Appeals for the D.C. circuit that heard oral arguments Friday.

Alexandra Marquez is based in Washington, D.C. and is a student at the University of Maryland, College Park. She is an intern working for the McClatchy D.C. Bureau and the Fort Worth Star-Telegram.