Judge plans to rule on Kentucky Medicaid work requirement case this month

A federal judge said Friday he will rule by the end of June on whether HHS has the authority to approve states' requests to impose work requirements on people receiving Medicaid coverage.

After an hour-long hearing, U.S. District Judge James Boasberg said he would issue his ruling before Kentucky's Medicaid waiver that includes controversial provisions like a work requirement, premium payments and cost-sharing goes into effect on July 1.

The National Health Law Program (NHeLP), the Kentucky Equal Justice Center and the Southern Poverty Law Center sued HHS in January, alleging HHS doesn't have the legal authority to approve state waivers with these requirements.

During Friday's hearing, Ian Gershengorn, an attorney representing NHelP, argued that HHS violated the law when it approved Kentucky's request because it did not support the Medicaid Act's purpose of furnishing medical assistance.

"Unlike some other public assistance programs, Medicaid is not a jobs-training program, and the administration does not have the authority to turn it into one," Gershengorn said. "The rule of law requires that the president adhere to and uphold federal law, not subvert it."

Attorneys for Kentucky argued that the waiver met Medicaid standards because Republican Gov. Matt Bevin has vowed to eliminate the state's Medicaid expansion if the work requirements aren't put in place, according to Hannah Katch, a senior policy analyst at the Center on Budget and Policy Priorities who was present during the oral arguments. By implementing the work requirements and other waiver provisions, more people will maintain Medicaid coverage than if the expansion is repealed.

The state's lawyers also argued that Kentucky's waiver expanded access to substance abuse treatment, and the waiver as a whole promotes Medicaid's objectives even if some beneficiaries lose coverage because they don't comply with the work requirements, Katch said.

Judge Boasberg, an Obama appointee, did not appear to agree with HHS' assertion that Medicaid's aim is to serve the health and well-being of low-income individuals by improving their quality of life and possibly moving them out of poverty, according to Eliot Fishman, senior director at Families USA.

The agency has said studies show that higher earnings positively correlate with longer lifespans and unemployment is generally harmful to health, and is linked to higher mortality, poorer general health and poorer mental health.

Judge Boasberg didn't ask questions about those assertions, Fishman noted.

"The fact the judge didn't engage was encouraging," said Fishman, who oversaw 1115 waiver demonstrations for the Obama administration. "If there was a debate about whether employment was good for health or not, I would be a lot more discouraged."

The outcome of the case could affect the fate of similar Medicaid work requirements approved by the CMS in Arkansas, Indiana and New Hampshire. Arizona, Maine, Mississippi, Michigan, Utah and Wisconsin are seeking similar waivers.