A federal judge on Friday rejected the Trump administration’s approval of Kentucky’s Medicaid restructuring plan, days before the controversial policy was set to go into effect.
In his ruling, U.S. District of Columbia District Judge James Boasberg described the Health and Human Services Department’s approval of Republican Kentucky Gov. Matt Bevin’s plan to require Medicaid recipients to work or volunteer in order to qualify for healthcare coverage as “arbitrary and capricious.” Instead, he wrote that that HHS Secretary Alex Azar “never adequately considered whether Kentucky...would in fact help the state furnish medical assistance to its citizens, a central objective of Medicaid” when approving the proposal.
Under Boasberg’s ruling, Bevin’s Medicaid plan has been remanded back to HHS for reconsideration. It would otherwise have gone into effect on July 1.
The case was initially brought by fifteen current recipients of Kentucky’s Medicaid program who, according to Boasberg, were worried the new policy would “relegate them to second-class status within Medicaid, putting them and others ‘in danger of losing’ their health insurance altogether.”
Earlier this year Kentucky became the first state to receive HHS approval for its Medicaid restructuring plan under the Trump administration’s anti-Obamacare effort. It was followed by Indiana, Arkansas, and New Hampshire. Kansas, Mississippi, Arizona, Maine, Ohio, Wisconsin, and Utah all currently have proposals under consideration.
Bevin had framed his Medicaid restructuring—and the work requirement portion specifically—as an employment boon to his state, saying “there is dignity associated with earning the value of something you receive” when he announced the proposal in January.
As Vox pointed out, however, lawyers for Kentucky had essentially threatened to hold hundreds of thousands of Medicaid recipients hostage, claiming that if the court rejected the work requirements and all other legal options were exhausted, the state would boot some 400,000 people who had been added to the program under President Obama’s Affordable Care Act expansion.
Bevin’s office has not yet responded to Friday’s ruling, although Kentucky is likely to appeal.