States likely to stay the course on Medicaid work requirements despite judge’s ruling, experts say

Gavel court room lawsuit judge
Other states seeking work requirements are likely to stay the course, at least for now, experts say. (Pixabay)

A federal judge’s ruling Wednesday that blocked Medicaid work requirements in Kentucky and Arkansas has limited implications in states where similar programs have also been approved—at least, for now. 

District of Columbia Judge James Boasberg said in a pair of opinions on the two state programs that in approving them the Trump administration had failed to consider if work requirements would meet the goal of Medicaid—namely, to provide insurance coverage to low-income people.

Under the ruling, the Department of Health and Human Services will have to reconsider the waiver approvals, and make a compelling case for why work requirements meet Medicaid’s goals should they be approved again.

RELATED: Azar says HHS talking with states interested in Medicaid block grants 

Patricia Boozang, senior managing director at Manatt Health, told FierceHealthcare that it’s crucial to consider, however, that these rulings only apply in Arkansas and Kentucky, so the seven other states where these waivers have been approved will be able to still roll out such programs. 

“You might think that the administration would consider slowing down its approvals, but I don’t think that’s going to happen, to be honest,” she said. “Even [CMS Administrator] Seema Verma’’s comments following the approvals sort of made clear that CMS still stands behind its policy.”

A legal challenge is pending in New Hampshire, and that case will also be heard by Boasberg, so his opinion Wednesday does paint a picture of how he may respond to that lawsuit as well, Boozang said.

Policy experts also noted that neither of Boasberg’s opinions prohibited HHS or the Centers for Medicare & Medicaid Services from approving waivers in additional states.

RELATED: National Health Law Program—Medicaid work requirements are bad policy disguised as flexibility 

Andy Schneider, a research professor at the Georgetown University McCort School of Public Policy, told FierceHealthcare that Boasberg made clear it would not be impossible for the administration to make a case for approving these waivers—they just had failed to do so to this point.

Any future requests that are approved must consider the impact of work requirements on coverage for Boasberg, or another judge who shares his view, to let them stand, Schneider said.

Several states, including Alabama, Mississippi and Utah, have pending waiver requests, and the rulings could cause some states to reconsider, he said. But the Trump administration is still free to approve them.

“Those approvals, however, will be subject to the same Administrative Procedure Act standards as the Arkansas and Kentucky waivers were," Schneider said. "And as yesterday's ruling in the Kentucky case demonstrates, the Secretary and CMS are having a hard time getting it right, having already failed twice."

Sally Pipes, CEO of the Pacific Research Institute, a free market think tank, told FierceHealthcare that she expects most states that have already applied for a waiver to continue with that process, despite Boasberg’s ruling. 

This is especially true in states that have expanded Medicaid, she said, though it should be noted that many of those awaiting a response to their waiver applications are non-expansion states. 

“Given the staggering cost of Medicaid, it’s reasonable, in my view, to ask those who are able to work to do so as a condition of receiving Medicaid coverage,” Pipes said. “Work requirements can help ensure that Medicaid is reserved for the truly needy.”