- Judge James Boasberg of the U.S. District Court for the District of Columbia nixed New Hampshire's proposal to impose work requirements on a significant number of the state's Medicaid recipients. The judge vacated HHS' approval of the Medicaid waiver tying program eligibility to work requirements because HHS failed to properly evaluate how the restriction would affect Medicaid coverage.
- The ruling means New Hampshire's proposed community engagement requirements of 100 monthly hours or other qualified activities for non-disabled Medicaid beneficiaries aged 19-64 will not be implemented.
- This is the third time Boasberg has shot down such demonstration projects, having stopped similar plans in Arkansas and Kentucky on identical grounds. Those cases are on appeal to the the U.S. Court of Appeals for the D.C. Circuit, but no oral argument date has been set.
The Trump administration's push to allow more states to tie Medicaid benefits to work requirements is running into judicial hurdles as courts are refusing to allow HHS unbridled discretion in approving state Medicaid waivers.
A recent Kaiser Family Foundation report predicted 1.4 million to 4 million people would lose health coverage if work requirements were scaled nationally to the Medicaid program. The weighty challenge interested states and the federal government face is demonstrating work requirements won't cause a significant loss of coverage to beneficiaries.
New Hampshire, like many states, expanded Medicaid under the Affordable Care Act to adults whose income was 138% of the federal poverty line or less. Last year, it proposed to amend its demonstration project, called Granite Advantage, to add work and community engagement requirements. Four state residents sued over CMS' approval of the demonstration project, arguing, among other things, it ran afoul of the Administrative Procedure Act.
Boasberg agreed. "While the ultimate decision whether to grant a Section 1115 approval rests with the Secretary, his discretion is not boundless," the judge wrote in his decision.
New Hampshire's requirements were even more expansive than those of earlier projects in Arkansas and Kentucky that the judge vacated as failing to take into account detrimental effects on Medicaid coverage. New Hampshire's program presents greater coverage-loss concerns than Kentucky's and Arkansas's, given the hours requirement and the age range to whom it applies, Boasberg said.
HHS can only approve demonstration projects that are likely to promote the Medicaid Act's core objectives. But, in the case of New Hampshire, as with the Arkansas and Kentucky programs, the HHS secretary failed to address the risk beneficiaries would lose their Medicaid coverage. Because Medicaid's core objective is to furnish medical assistance to people who could not otherwise afford it, the secretary was required to evaluate the demonstration's likely effects on coverage, the court said.
"The Secretary's failure to consider an objective of Medicaid is a 'major shortcoming; going to the 'heart' of his decisions," the court wrote. Alluding to his finding the government's approvals of the state demonstration projects in the prior Arkansas and Kentucky cases deficient, Boasberg said, "we have all seen this movie before."
While HHS doesn't have to "provide a precise numeric estimate of coverage loss," the judge wrote, the agency has to address the magnitude of the loss. Because it failed to do so, the approval of the waiver fell short, he said.
A status conference in the case is set for Aug. 28.
The ruling comes days after CMS ruled out another Medicaid restriction some states had considered as they expanding their programs. The agency said this weekend it will no longer approve federal funding for partial expansion as it denied such a bid from Utah.