Government shutdown could snarl second lawsuit over Kentucky's Medicaid work requirements

Kentucky residents have once again sued Trump administration to block the state’s Medicaid work requirements—but the ongoing government shutdown could drag out the case.

In the latest lawsuit (PDF), which was filed on Monday, the Bluegrass State residents argue that CMS is overstepping its legal authority in approving the requirements, as they go against the central goal of the Medicaid program.

“Kentucky Health will harm Kentuckians across the state—custodians and cashiers, ministers and morticians, fast-food workers, musicians, students, caregivers and retired workers—who need a range of health services,” the complaint said.

However, the government shutdown could hold up the proceedings. The administration filed a motion (PDF) requesting a stay in the case on Tuesday, as funding to the Department of Justice has lapsed.

DOJ attorneys have been unable to work on the case since the shutdown began on Dec. 21, as many staffers in the department, are working without pay.

The Centers for Medicare & Medicaid Services approved a waiver allowing the state’s Kentucky Health program to implement the work requirements a year ago, but a federal judge struck them down in June, arguing that CMS “never adequately considered” if the revamped program would furnish care to enrollees.

The waiver was the first approval for work requirements in the U.S.

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But, despite the ruling, CMS reapproved the waiver in late November, leading the same slate of Kentucky beneficiaries to sue the administration for a second time. In the second approval, though Kentucky Health’s 2019 iteration looks much the same as it did in early 2018, CMS did go into greater detail on how the changes would continue to carry out the mission of Medicaid.

In addition, it opened the waiver for a court-mandated comment period in July.

CMS issued guidance on the matter in early January 2018, and Administrator Seema Verma argued that policy is aimed at “helping people achieve the American dream” and lift them out of poverty.

Kentucky Gov. Matt Bevin has argued that program would also save the state millions in Medicaid costs, and issued an executive order that would strike down its expansion within six months should the waiver not go through. Estimates suggest the requirements could impact 350,000 of the state’s 1.4 million Medicaid enrollees.