MEDICAID RULE UNDER ATTACK

A lawsuit was filed today in the federal court for the District of Columbia challenging Arkansas’s work requirement for many Medicaid recipients.

The suit, with three plaintiffs — Charles Gresham of Harrison and Cesar Ardon and Marisol Ardon of Siloam Springs — names Health and Human Services Secretary Alex Azar, Medicare/Medicaid Administrator Seema Verma, the Department of Health and Human Services and the Center for Medicare and Medicaid Services.

It is filed in the same court that has ruled a waiver the government allowed for a Kentucky work rule was illegal. This suit, too, wants to enjoin enforcement of the rule as a violation of federal law and Constitution.

The National Health Law Program, Arkansas Legal Aid and the Southern Poverty Law Center have worked on the lawsuit, long anticipated. They argue that restrictions on medical coverage aren’t allowed by the Medicaid law. It is a health program, not a work program, they argue. From an Arkansas Legal Aid release:

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“The Arkansas waiver plan has it all backwards. Cutting people’s health care and making them jump through administrative hoops will make it harder for our clients to work and make a better life, not easier,” said Legal Aid of Arkansas Attorney Kevin De Liban.

“Almost 60 percent of people covered by Medicaid expansion in
the state already work, and nearly all the rest either have a disability or look after family. These work requirements and the online-only reporting system threaten everyone’s care” 

Gov. Asa Hutchinson added the work rule to make the Medicaid expansion more palatable to Republican legislators. It took effect in June. The work rule applies to people aged 30 to 49, but will add those 19-29 next year. You must work 80 hours a month, including volunteer activity. The work must be reported online. Failure to meet the requirement for three months in a calendar year locks a participant out of coverage for the rest of that calendar year. About 7,000 failed to substantiate employment in the first month. A July report will be out tomorrow.  Some exemptions apply.

In addition, we’ve reported Arkansas has already reduced Medicaid roles by some 60,000, for reasons not entirely clear.

Kentucky is attempting to alter its rule to make it acceptable. The lawsuit opening is a sweeping condemnation of what’s afoot:

This case challenges the ongoing efforts of the Executive Branch to bypass the legislative process and act unilaterally to “comprehensively transform” Medicaid, the cornerstone of the social safety net. Purporting to invoke a narrow statutory waiver authority that allows experimental projects “likely to assist in promoting the objectives” of Medicaid, the Executive Branch has instead effectively rewritten the statute, ignoring congressional restrictions, overturning a half century of administrative practice, and threatening irreparable harm to the health and welfare of the poorest and most vulnerable in our country.

Here’s the lawsuit.

The lawsuit notes that the feds changed course on allowing work rules with the Trump administration.

The Secretary’s issuance of the letter to State Medicaid Directors and approval of Arkansas’ request sharply deviate from the congressionally established requirements of the Medicaid program and vastly exceed any lawful exercise of the Secretary’s limited waiver authority. This Amendment will harm Arkansans across the state who need a range of health services, including check-ups, diabetes treatment, mental health services, non-emergency medical transportation, and vision and dental care. The letter and approval of Arkansas’ application are unauthorized attempts to re-write the Medicaid Act, and the use of the Social Security Act’s waiver authority to “transform” Medicaid is an abuse of that authority. The Defendants’ actions here thus violate both the Administrative Procedure Act and the Constitution, and they cannot survive.

Once Arkansas decided to participate in the expanded Medicaid coverage for working poor, the coverage for that population became mandatory, the suit said. It may not cover only subsets, such as only those working unless explicitly allowed by federal law. The Medicaid law makes no reference to work rules.

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The Medicaid expansion has provided coverage for hundreds of thousands of people and produced positive health benefits, the lawsuit said.

The lawsuit also challenges the state’s decision to limit retroactive coverage.

The state contends the new rule is an incentive to work and enhance personal responsibility.

The suit also details the difficulties arising from the state’s decision to allow compliance only online, rather than in person or by phone.

The suit notes what the law requires for waivers from Medicaid rules. They should

1. increase and strengthen overall coverage of low-income individuals in the state;
2. increase access to, stabilize, and strengthen providers and provider networks available
to serve Medicaid and low-income populations in the state;
3. improve health outcomes for Medicaid and other low-income populations in the state;
or
4. increase the efficiency and quality of care for Medicaid and other low-income populations through initiatives to transform service delivery networks. 

Until Trump’s election, the federal agency said a work rule in Arkansas wouldn’t meet these criteria. Then:

The current HHS abruptly reversed course to revise its use of the Section 1115 waiver authority and to authorize work requirements in Medicaid as part of President Trump’s vow to “explode” the ACA and its Medicaid expansion. 

The suit argues that the executive action pre-empts powers of Congress.

The Executive Branch has repeatedly expressed its hostility to the Affordable Care Act and its desire to undermine its operation. An effort to undermine the Affordable Care Act by undoing the extension of Medicaid to the expansion population is at odds with the President’s duty to take care that the laws be faithfully executed. 

The suit continues that the online reporting requirement will be difficult for the plaintiffs to meet.

Instead of simplifying the Medicaid system for individuals, the Secretary’s approval to disregard these ACA requirements for the primary purpose of making things simpler and cheaper for Arkansas, results in harm to those who rely on Arkansas Works for health coverage. 

The shortening of retroactive coverage for those who become eligible from three months to one month also draws criticism.

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If a Plaintiff loses coverage and then reapplies, the Plaintiff will not have retroactive coverage for health services received during the gap in coverage. Plaintiffs who lose coverage after three months of non-compliance with the work requirement and then re-enroll the following year will lose two months of retroactive coverage they would have otherwise had during the gap in coverage.

Continuous and adequate health insurance coverage is fundamental for each Plaintiff’s ability to stay as healthy as possible and to work.

The plaintiffs” situation: Gresham has had difficulty holding jobs because of seizures. He can work but needs to have flexible schedules to receive medical care. He’s been able to work with Human Services offices, but isn’t comfortable with computers. Cesar Ardon is a self-employed handyman whose ability to get work fluctuates. He, too, has had medical problems and problems with online access. Mrs. Ardon has numerous health problems, some stemming from the removal of a 25-pound tumor, and has been unable to get work in June and July. She’d been a telephone worker in the past. She’s been unable to use the online portal.

Comment from Arkansas Advocates for Children and Families on the policy and the lawsuit:

It has been touted as a way to ensure Arkansans are working, but in reality it only creates costly bureaucratic red tape and new barriers to coverage. As we’ve pointed out in the past, most enrollees are already working or will be exempt from the requirement. It unnecessarily puts people at risk of accidentally losing their insurance simply because they do not understand the complicated reporting process, or they cannot report online through the required portal because they lack internet access

The lawsuit aims to overturn this cumbersome policy, which is the first experiment of this kind to be implemented in the nation. The policy started in June, and since that time, we’ve seen that thousands of enrollees failed to report during the first month. This shouldn’t come as a surprise since enrollees must use the online portal even though Arkansas ranks 46th in the nation for internet access. Enrollees lose coverage after failing to report for three months in a calendar year. It’s important to note that those three months do not have to be consecutive.

AACF stands in support of the individuals who were willing to speak up and be a voice for all families that will be harmed by this policy. Instead of taking away health insurance, which helps ensure that people are healthy enough to work, we should be focused on creating access to more job opportunities. In fact, national research shows that Medicaid expansion itself leads to increased labor force participation, increased employment, and more volunteerism – all without a punitive work-reporting policy. We think it’s time for leaders in our state to take a closer look at what Arkansans need in order to take care of their families.