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DOJ Asks for Clean Slate or Clarity in Medicaid Work Rule Fight

March 22, 2021, 9:03 PM

If the Supreme Court ultimately decides to hear the dispute over work requirements for Medicaid beneficiaries, the Biden administration wants a ruling that gives the government broad authority to test new policies for the program in the future.

The court should clarify in any ruling on the merits that the Health and Human Services Secretary can allow states to try out new measures—like alternative ways to deliver care—that indirectly advance Medicaid’s main goal of providing low-income people health insurance, the Justice Department said in a brief Monday.

But the federal government is hoping the court will altogether scrap the cases that dispute the Trump administration’s approval of Arkansas’ and New Hampshire’s work rules in exchange for benefits.

The DOJ asked the court Feb. 22 to toss out the appeals court rulings striking down the work requirements and send the matter back to the HHS. Though the court canceled oral arguments, originally scheduled for March 29, it has yet to rule on the DOJ’s unusual request.

The Biden administration is opposed to rules that force adult Medicaid recipients to work, go to school, or volunteer to remain in the program, but it still wants the appeals court rulings wiped off the books even though they invalidated the Trump administration’s approvals.

In Arkansas’s case, the U.S. Court of Appeals for the District of Columbia Circuit said Medicaid’s one primary purpose is health-care coverage and “objectives of better health outcomes and beneficiary independence are not consistent with Medicaid.”

The DOJ argues that decision could limit the secretary’s authority in the future.

“Read literally, the court’s statement could be understood to bar the Secretary from considering the beneficial indirect effects that certain measures—such as provisions that improve care coordination—may have on the ultimate objective of providing health-care coverage,” the DOJ said in its brief Monday.

Issue Not Moot

Arkansas also filed an additional brief Monday urging the justices to put the cases back on the court’s argument calendar and reverse the appeals court ruling.

“Even if the secretary could only consider coverage, the judgment below still couldn’t stand because Arkansas’s community-engagement requirements will promote coverage by transitioning able bodied adults to other, non-Medicaid coverage and making Medicaid sustainable,” Arkansas Attorney General Leslie Rutledge and attorneys in her office argued in their brief.

The HHS notified Arkansas and New Hampshire March 17 that it was withdrawing the prior approvals for each state’s work rules, citing the pandemic and early evidence showing work rules rapidly cause beneficiaries to lose their health-care coverage as its justifications.

Arkansas noted those decisions aren’t in effect until April 16 and can still be appealed.

“Whether community engagement requirements are permissible is a threshold question that will need to be resolved before courts can decide whether the Government reasonably exercised its discretion in rescinding them, and these cases squarely present that question, with the benefit of full briefing focused solely on that issue,” the state said in its brief.

The case is Cochran v. Gresham, U.S., No. 20-37.

To contact the reporter on this story: Lydia Wheeler in Washington at lwheeler@bloomberglaw.com

To contact the editors responsible for this story: Fawn Johnson at fjohnson@bloombergindustry.com; Alexis Kramer at akramer@bloomberglaw.com

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