Appeals Court delivers another blow to Arkansas’s Medicaid work reporting requirement

Will it finally be abandoned?

On Friday, Feb. 14, a three-judge panel of the United States Court of Appeals for the D.C. Circuit unanimously upheld the District Court’s decision to strike down Arkansas’s addition of work-reporting requirements to its Medicaid expansion program.

That means health coverage under the Arkansas Works program can continue without the work-reporting requirement, at least for now.

Today’s decision comes after consideration of the arguments by the federal government and from several Arkansas (Plaintiffs) who were represented by our partners at Legal Aid of Arkansas, the National Health Law Program (NHeLP) and the Southern Poverty Law Center. Thanks to the hard work of these organizations, health coverage under the Arkansas Works program can continue without the work-reporting requirement, at least for now.

The Appeals Court decision was written by Judge David B. Sentelle, who was appointed by President Reagan. In affirming the District Court’s decision, the Court of Appeals criticized Secretary Alex Azar’s approval of Arkansas’s work-reporting requirement on Medicaid. “The intent of Congress is clear” that Medicaid’s objective is to provide health care coverage, and, as a result, the Secretary “must give effect to [that] unambiguously expressed intent of Congress.” The ruling states that Medicaid’s purpose is to provide health care to populations that otherwise could not afford it, so any proposals that fail to do so run against Congress’s intent.

The decision also critiques Arkansas for, to an extent, misinterpreting Secretary Azar’s letter to approve Arkansas Works – the state’s Medicaid expansion program. In the letter, Secretary Azar lists three health outcomes that “assist in promoting the objectives of Medicaid.” As today’s decision states – none of these outcomes include transitioning beneficiaries away from benefits as a way to assist in providing health care to populations who could not otherwise afford it, like happened in Arkansas when 18,000 lost health insurance coverage because of the work requirements implementation.

Judge Sentelle’s decision responds to HHS’s argument during the October hearing that compared Medicaid to programs like Temporary Action for Needy Families (TANF) and the Supplemental Nutrition Assistance Program (SNAP). At some point, both SNAP and TANF have included a work requirement. “The fact that Congress did not amend Medicaid to add a work requirement for all recipients demonstrates that Congress did not intend to incorporate a work requirement into Medicaid.”

Perhaps this ruling will create pause for Arkansas’s Elected Officials, who pursued this waiver despite concerns about the work-reporting requirements taking away health care coverage for populations that cannot otherwise afford it. State Officials have already expressed support for the newest guidance from HHS – “block grants” – which like these work-reporting requirements, will likely result in Arkansas spending millions of dollars for implementation and subsequent litigation, but only taking away Medicaid coverage for more Arkansans who need it. Until the next step is revealed, however, Arkansans can celebrate today’s decision, which confirmed that taking away the healthcare of low-income Arkansans is unlawful.

Given today’s ruling, the federal government can now appeal the decision to the full D.C. Circuit Court of Appeals or ask that the case be reviewed by the United States Supreme Court. Governor Hutchinson expressed hope that the U.S. Supreme Court would hear the case after the ruling was announced, though after two heavy blows by the District Court and the Court of Appeals, it is unclear if that will be the case.

At this stage, it is time that Arkansas returns to the “one primary objective of Medicaid” and focus on covering those populations who are eligible (cannot afford health care coverage). By doing this, our state can save millions on litigation and protect the health care of thousands of Arkansans throughout the state – as was intended when Medicaid was expanded in 2014.

**For a detailed look at the harmful impact of the work-reporting requirements on Arkansas’s Medicaid population, check out our three-part series: An Early Look at the Impact, Losing Coverage, and Final Verdict, as well as the original blog on today’s case.