Arguments by President Donald Trump's administration that it should be allowed to reinstate Medicaid work requirements in Arkansas and Kentucky drew skeptical reactions from judges on a federal appeals court panel Friday.
The requirements were struck down by U.S. District Judge James Boasberg of Washington, D.C., in a pair of rulings on March 27 that the two states and federal government have appealed.
Boasberg, who was appointed by President Barrack Obama in 2011, found that federal Health and Human Services Secretary Alex Azar exceeded his authority in approving the requirements by failing to consider how they would affect the Medicaid program's goal of providing health coverage to needy people.
Questioning Justice Department attorney Alisa Klein during oral arguments on the appeal in Washington on Friday, appeals court Judge Harry Edwards asked why Boasberg's "very thorough and careful analysis in very usual administrative law terms is not imminently correct, principally based on the secretary's failure to consider the effects on coverage."
"It's a very long, thoughtful, thorough opinion," said Edwards, who was appointed to the U.S. Court of Appeals for the District of Columbia Circuit by President Jimmy Carter in 1980.
"Bottom line, he's saying you're not addressing something that's critical in this case -- the effects on coverage. And the effects on coverage are not hypothetical."
Klein responded that the requirements would "save finite state Medicaid resources" by encouraging recipients to find jobs and move off of public assistance. That would allow states to expand coverage to other populations, she said.
Both Arkansas and Kentucky expanded their Medicaid programs in 2014 as authorized under the 2010 Patient Protection and Affordable Care Act to cover adults with incomes of up to 138% of the poverty level.
Kentucky Gov. Matt Bevin has threatened to end Medicaid expansion in his state if the work requirement is disallowed.
"I don't want to give any short shrift to the idea that these states are struggling to make sure that their expansions are on a sound financial footing," Klein said.
Arkansas' requirement, the first to be added to a state Medicaid program, resulted in 18,164 people losing coverage during the nine months it was in effect.
To stay in compliance, enrollees had to spend 80 hours a month on work or other approved activities, such as volunteering or looking for a job, and report what they did using a state website. The state also added an option in December for enrollees to report their hours over the phone.
Those who failed to meet the requirement for three months during a year were kicked off the program and barred from re-enrolling for the rest of the year.
The requirement applied to Arkansans ages 19-49 covered under the expanded part of the Medicaid program, known as Arkansas Works.
Boasberg's rulings stopped Kentucky's requirement from taking effect and prevented as many as 5,492 more Arkansas enrollees from losing coverage.
The requirements were approved under Section 1115 of the Social Security Act, which authorizes waivers from federal Medicaid law that the Health and Human Services secretary determines are "likely to assist in promoting the objectives" of the program.
According to the San Francisco-based Kaiser Family Foundation, similar requirements have been approved in seven other states, including one in New Hampshire that was also blocked by a ruling by Boasberg.
Klein said the coverage losses in Arkansas illustrate the importance of using such waivers to test ideas. She described the bumpy start of the Medicare prescription drug benefit in 2006 as a "fiasco," showing what can happen when a program is implemented nationwide.
"Rollout problems are real and they are a distinct category, and that is part of the reason for this demonstration authority," Klein said.
Appeals court judge Judge Cornelia Pillard, appointed by President Barrack Obama in 2013, questioned Klein's assertion that the work requirement would prod recipients to find jobs.
"Where is the evidence that this kind of stick is even plausibly going to cause that effect?" she asked.
Klein responded it was "the same evidence" that prompted Congress to add work requirements to the welfare cash assistance and food stamp programs in the 1990s.
But appeals court Judge David Sentelle, appointed by President Ronald Reagan in 1987, noted that Congress didn't include a similar provision in the law governing Medicaid.
"If Congress put it where they thought it would work and didn't put it here, then Congress didn't think it would work here did they?" he said.
Klein noted that Congress did authorize states to link Medicaid benefits to work. A 1996 welfare overhaul law gave states the option to cut off Medicaid benefits to Temporary Assistance for Needy Families recipients who refuse to comply with that program's work mandate.
Attorney Ian Gershengorn of Washington, D.C., representing Medicaid recipients in Arkansas and Kentucky who successfully challenged the requirements, countered that the 1996 law didn't change Medicaid's purpose.
"We think that the secretary overall is really trying to fundamentally change the [Medicaid] act in a critical way," he said.
Metro on 10/12/2019