On Wednesday, March 27, 2019, a D.C. district judge ruled that the approval of Arkansas Works changes, including work and community engagement requirements, by the U.S. Department of Health and Human Services secretary was procedurally flawed. The judge found that the secretary’s approval failed to consider whether the state’s proposed changes would advance the core objective of Medicaid to “furnish medical assistance.”
The judge had previously ruled that approved changes to Kentucky’s Medicaid program, including work and community engagement requirements, suffered from the same procedural flaws. As a result, Kentucky officials sought to cure the flaws through a second federal review process in which potential coverage losses due to the work and community engagement requirements were estimated. In a companion decision on the same day as the Arkansas decision, however, the judge ruled that Kentucky’s second federal review process did not fix the flaws. The judge found that while the secretary in his second review did not ignore the potential coverage losses due to the work and community engagement requirements, he failed to adequately analyze how those coverage losses would advance the core objective of Medicaid. Consequently, the judge again vacated the secretary’s approval of Kentucky’s proposed changes.
Arkansas and Kentucky officials are encouraging federal officials to appeal the judge’s decisions against the U.S. Secretary of Health and Human Services. An alternative route would be for Congress to enact legislation that explicitly authorizes the establishment of work and community engagement requirements as a condition for continued Medicaid eligibility, as Congress has done with the Supplemental Nutritional Assistance Program.
In the meantime, Arkansas has halted implementation of its changes to the Arkansas Works program, which included restrictions on retroactive eligibility in addition to the work and community engagement requirements. Notably, the judge did not require Arkansas to reenroll individuals whose coverage was terminated due to the work and community engagement requirements, but Arkansas will not be permitted to terminate coverage for failing to comply with those requirements going forward.
