CMS Ignores Federal Judge Ruling To Approve Medicaid Work Rules in Utah

Less than 48 hours after a federal judge struck down Medicaid work requirements, the Centers for Medicare & Medicaid Services on Friday gave Utah permission to use those mandates.

CMS Administrator Seema Verma said in her approval letter that requiring Medicaid enrollees to work was allowed because it helps make them healthier.

“Therefore we believe an objective of the Medicaid program, in addition to paying for services, is to advance the health and wellness needs of its beneficiaries, and that it is appropriate for the state to structure its demonstration project in a manner that prioritizes meeting those needs,” she wrote.

Verma’s stance runs directly counter to U.S. District Court Judge James Boasberg, who in twin rulings Wednesday said work requirements in Arkansas and Kentucky are illegal under the 1965 Medicaid law. Boasberg said several times that promoting health was not the objective of Medicaid, despite that opinion from Verma and Health and Human Services Secretary Alex Azar.

In his Kentucky ruling, Boasberg wrote that using health as an objective would be “arbitrary and capricious.”

Promoting health, he added, is “far afield of the basic purpose of Medicaid: ‘reimbursing certain costs of medical treatment for needy persons.’”

Verma noted that Utah is structuring its program somewhat differently than other states.

Sara Rosenbaum, professor of health law and policy at George Washington University in Washington, D.C., said the Trump administration is “doubling down” by allowing a state to add work requirements.

“This is such a remarkable example of sticking a finger in the eye of the court,” Rosenbaum said. “We will see what happens. Because when you disrespect a court, it can backfire.”

CMS’ approval also allows Utah to cap enrollment if the state runs out of money.

Health experts said Utah’s letter clearly shows that the Trump administration plans to appeal Boasberg’s decision.

In addition to Kentucky, Arkansas and Utah, CMA has approved Medicaid work requirements in Arizona, Indiana, Michigan, New Hampshire, Ohio and Wisconsin.

Verma’s approval was for an application that Utah made in 2018. It will partly expand Medicaid to cover all adults under the poverty level ($ 12,490 for an individual this year). Enrollees will be asked to make some job searches but they will not be required to report a certain number of hours of work.

In November, Utah voters approved a ballot measure calling for the expansion to 138 percent of the federal poverty level (about $ 17,200) as allowed under the Affordable Care Act.

State officials expect about 90,000 people to gain coverage under the expansion approved Friday. About 150,000 people would have been covered under the plan approved by voters.

The plan approved Friday will require Utah to pay a bigger portion of the costs for the new enrollees because they will enter Medicaid under the traditional program and the state will get a 70 percent contribution from the federal government to cover their care. If the state had expanded to 138 percent of poverty, the federal government would have paid 90 percent of the costs.

November’s vote raised concerns among state officials, who have opposed Medicaid expansion for years. They have opted instead to prepare another request to CMS that seeks the full 90 percent funding for the new enrollees. But to secure that, Utah is offering to accept unprecedented annual limits on federal and state spending.

Allison Hoffman, a law professor at the University of Pennsylvania, said getting a federal judge to accept the premise that Medicaid is improving health is vital to getting work requirements through the courts. Federal officials “need a judge to buy that,” Hoffman said. “They are going to fish for a different jurisdiction to push this opinion.”

What’s most compelling about the Utah approval, Hoffman said, is how the state legislature ignored the will of voters who approved the referendum. “The legislature is blocking what people voted for … and it appears to be an anti-democratic move.”

Kaiser Health News


Federal Judge Again Blocks Medicaid Work Requirements

For a second time in nine months, the same federal judge has struck down the Trump administration’s plan to force some Medicaid recipients to work to maintain benefits.

The ruling Wednesday by U.S. District Judge James Boasberg blocks Kentucky from implementing the work requirements and Arkansas from continuing is program. More than 18,000 Arkansas enrollees have lost Medicaid coverage since the state began the mandate last summer.

Boasberg said that the approval of work requirements by the Department of Health and Human Services “is arbitrary and capricious because it did not address … how the project would implicate the ‘core’ objective of Medicaid: the provision of medical coverage to the needy.”

The decision could have repercussions nationally. The Trump administration has approved a total of eight states for work requirements, and seven more states are pending.

Still, health experts say it’s likely the decision won’t stop the administration or conservative states from moving forward. Many predict the issue will ultimately be decided by the Supreme Court.

Kentucky Gov. Matt Bevin, a Republican, has threatened to scrap the Medicaid expansion unless his state is allowed to proceed with the new rules, a move that would drop more than 400,000 new enrollees. He said the work requirement will help move some adults off the program so the state has enough money to help other enrollees.

Bevin, who is running for re-election this fall, had threatened to end the Medicaid expansion during his last campaign but backed off that pledge after his victory.

Kentucky had been slated to begin its work requirement next Monday, but current provisions will instead stay in place, according to Adam Meier, who heads up the state’s Medicaid program. He said officials there believe they have “an excellent record for appeal and are currently considering next steps.”

Arkansas Gov. Asa Hutchinson said he was disappointed with the decision. He added that he would read review the opinion overnight and announce Thursday how the state would respond.

In his decision on Kentucky, Boasberg criticized HHS officials for approving the state’s second effort to institute work requirements partly because Bevin threatened to end the Medicaid expansion without it.

Under this reasoning, he said, states could threaten to end their expansion or do away with Medicaid “if the Secretary does not approve whatever waiver of whatever Medicaid requirements they wish to obtain. The Secretary could then always approve those waivers, no matter how few people remain on Medicaid thereafter because any waiver would be coverage promoting compared to a world in which the state offers no coverage at all.”

In a statement, Seema Verma, the head of the Centers for Medicare &  Medicaid Services, suggested the rulings would not dissuade her efforts to approve work requirements in other states. The administration wants “to give states greater flexibility to help low income Americans rise out of poverty,” she said and will “vigorously support their innovative, state-driven efforts to develop and test reforms that will advance the objectives of the Medicaid program.”

The decision by federal officials in 2018 to link work or other activities such as schooling or caregiving to eligibility for benefits is a historic change for Medicaid, which is designed to provide safety-net care for low-income individuals.

Top Trump administration officials have promoted work requirements, saying they incentivize beneficiaries to lead healthier lives. Democrats and advocates for the poor decry the effort as a way to curtail enrollment in the state-federal health insurance entitlement program that covers 72 million Americans.

Despite the full-court press by conservatives, most Medicaid enrollees already work, are seeking work or go to school or care for a loved one, studies show.

Critics of the work policy hailed the latest ruling, which many expected since Boasberg last June stopped Kentucky from moving ahead with an earlier plan for work requirements. The judge then also blasted HHS Secretary Alex Azar for failing to adequately consider the effects the policy.

“This is a historic decision and a major victory for Medicaid beneficiaries,” said Joan Alker, executive director for the Georgetown University Center for Children and Families. “The message to other states considering work requirements is clear — they are not compatible with the objectives of the Medicaid program.”

Sally Pipes, president of the conservative San Francisco-based Pacific Research Institute, called the ruling “a major blow” to the Trump administration but said this won’t end its efforts. “The Department of Health and Human Services is very committed to work requirements under Medicaid,” she said.

“It is my feeling that those who are on Medicaid who are capable of working should be required to work, volunteer, or take classes to help them become qualified to work,” Pipes said. “Then there will be more funding available for those who truly need the program and less pressure on state budgets.”

Several states, including Virginia and Kentucky, have used the prospect of work rules to build support among conservatives to support Medicaid expansion, which was one of the key provisions of the Affordable Care Act. That expansion has added more than 15 million adults to the program since 2014.

Previously the program mainly covered children, parents and the disabled.

Particularly irksome to advocates for the poor: Some states, including Alabama, which didn’t expand Medicaid, are seeking work requirements in the traditional Medicaid program for parents with incomes as low as $ 4,000 a year.

The legal battle centers on two issues — whether the requirements are permissible under the Medicaid program and whether the administration overstepped its authority on allowing states to test new ways of operating the program.

Alker said that state requests for Medicare waivers in the past have involved experiments that would expand coverage or make the program more efficient. The work requirements mark the first time a waiver explicitly let states reduce the number of people covered by the program.

States such as Kentucky have predicted its new work requirement would lead to tens of thousands of enrollees losing Medicaid benefits, though states argued some of them would get coverage from new jobs.

Under the work requirements — which vary among the states in terms of what age groups are exempt and how many hours are needed — enrollees generally have to prove they have a job, go to school or are volunteers. There are exceptions for people who are ill or taking care of a family member.

In Arkansas, thousands of adults failed to tell the state their work status for three consecutive months, which led to disenrollment. For the first several months last year, Arkansas allowed Medicaid recipients to report their work hours only online. Advocates for the poor said the state’s website was confusing to navigate, particularly for people with limited computer skills.

While the administration said it wanted to test the work requirements, none of the states that have been cleared to begin have a plan to track whether enrollees find jobs or improve their health — the key goals of the program, according to a story in the Los Angeles Times.

Craig Wilson, director of health policy at the Arkansas Center for Health Improvement, a nonpartisan health research group, said he believes policymakers will appeal court rulings all the way to the Supreme Court.

“As long as they hold on to hope that some judge will rule in their favor, states will continue to pursue work requirements,” he said.

Kaiser Health News


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Utah Voters Approved Medicaid Expansion, But State Lawmakers Are Balking

[UPDATED at 4:30 p.m. ET]

Utah residents may have thought they were done fighting about Medicaid expansion last November. But when Utah lawmakers opened a new legislative session in late January, they began pushing through a bill to roll back the scope and impact of an expansion that voters approved in a ballot measure.

That scaled-back version of Medicaid expansion passed the Utah House on Friday by a 56-19 vote.

The activists who pushed the ballot measure are not pleased.

“We were very clear about what we wanted,” said Andrew Roberts, a spokesman for Utah Decides, the group that organized the Medicaid expansion referendum, known as Proposition 3. “We are frustrated, and I think Utahns are frustrated.”

That frustration led his group to hire a billboard truck to drive in circles around the Capitol building and through the snowy streets of Salt Lake City and its suburbs. Signs on the sides of the truck flash phrases in LED lights, including “Support democracy. Support Utah’s vote.” A looping video advertisement urges residents to call lawmakers “who don’t respect the will of the people.”

After six years of talking about Medicaid expansion, voters approved the ballot measure on Nov. 6, with 53 percent in favor. If implemented fully, 150,000 Utahns would gain coverage. The skinny expansion — which the state Senate and governor support — will also need federal approval.

Similar legislative efforts to curtail expansion are also happening in Idaho, where voters passed a Medicaid expansion initiative in November. Sixty-one percent of voters were in favor. Idaho lawmakers are considering ways to scale that program back.

In politically and fiscally conservative Utah, legislators argue the 0.15 percent non-food sales tax that voters approved won’t be enough to pay for Medicaid expansion. So they’ll pass an expansion, but only a very limited one.

Voters “wanted Medicaid expansion, and that’s what we’re doing,” said Republican state Sen. Allen Christensen. But, he added, the voters “didn’t fill in the proper blanks. We are filling in those blanks for them. They are not obligated to balance the budget. We are.”

Christensen is leading the rollback effort in Utah. His alternative proposal, SB 96, would cap the number of individuals who would qualify for Medicaid, add work requirements and lower the annual income limit. Proposition 3 supporters had wanted the coverage available for people who made up to 138 percent of the federal poverty level, or nearly $ 17,000 a year. But Christensen’s bill would offer Medicaid coverage only to people who made less than 100 percent of the federal poverty level, or about $ 12,000 for an individual.

Making those changes would require the state of Utah to get approval for two federal waivers from the federal Centers for Medicare & Medicaid Services. Proposition 3 supporters point out that similar requests from other states have been denied.

“From the perspective of voters, I think voters have a right to be furious right now,” said Matt Slonaker, executive director of the Utah Health Policy Project, another group that has supported Medicaid expansion.

Slonaker said changing the scope of Proposition 3 would mean fewer people getting health coverage, and the state would receive less money from the federal government. He also fears it could make voters feel disillusioned.

“Why would voters ever want to pursue ballot initiatives and direct democracy if the legislature’s just going to repeal it anyway?” Slonaker asked.

While some Utah lawmakers, such as Christensen, describe being “philosophically opposed” to Medicaid expansion, much of the political debate in Utah is about how much expansion will cost, and whether the new sales tax will pay for it. Supporters point to the fiscal experience of other states.

“You should think of Medicaid expansion as no different than if you said, ‘Oh, hey, somebody’s going to go open up a factory,’” said Bryce Ward, an economist at the University of Montana, in Missoula. “And that factory is going to bring, in the case of Montana, $ 600 million of outside money into the state that we’re going to pay to workers here.”

Ward recently published a report on the economic impacts of Medicaid expansion in Montana during the first two years of that program. He said it brought in about $ 600 million dollars in new funds to the state per year. That money supported about 6,000 jobs, he added, or about $ 350 million in additional income for residents.

Ward said states like his also can take advantage of savings, because Medicaid expansion makes providing health care to certain groups, like prisoners, more affordable. While states do have to pay 10 percent of the cost of expanded Medicaid (the federal government covers 90 percent — a more generous “match” than traditional Medicaid), the combination of savings and economic growth meant that, in the case of Montana, the program basically pays for itself, Ward said.

“The benefits that people in Utah have is that people like me in other states have done the work trying to figure this out,” he said. “Or at least get some ballpark estimates of it.”

So far, Utah lawmakers remain unconvinced by studies like Ward’s. The bill to restrict Medicaid expansion is moving fast, and could reach the governor’s desk as soon as next week.

This story is part of a partnership that includes KUERNPR and Kaiser Health News.

Kaiser Health News