Trump Loses Big Court Decision on Medicaid Work Requirement

Trump’s Medicaid-Medicare chief, Seema Verma. Photo: J Scott Applewhite/AP/Shutterstock

The decision came down from only the second-highest court of the land, the D.C. Circuit Court of Appeals (the appeals venue for much litigation involving federal regulatory powers), but it was a big deal nonetheless, as the Washington Post reports:

A federal appeals court on Friday struck down the Trump administration’s decision to allow states to compel some Medicaid recipients to work or prepare for a job in exchange for their health benefits.

In a unanimous decision that blocks the first state that had imposed work requirements, a three-judge panel of the U.S. Court of Appeals for the D.C. Circuit ruled that President Trump’s health officials had been “arbitrary and capricious” in allowing Arkansas to launch a Medicaid program called “Arkansas Works” two years ago.

The D.C. Circuit affirmed a district court ruling that had put Arkansas’s “experiment” on hold, and kept a number of other Republican-governed states on pause as they awaited judicial guidance. And the reasoning for the rejection was pretty simple: Whatever the work requirement did or did not accomplish in terms of improving or damaging the economic prospects of Medicaid beneficiaries, it reduced the number of people receiving health care, and that is the only statutorily sanctioned function of Medicaid:

“Failure to consider whether the project will result in coverage loss is arbitrary and capricious,” the opinion said. The ruling noted that during the five months that Arkansas Works was in effect before it was blocked by a judge, more than 18,000 Medicaid recipients were dropped from the program.

So if the administration wants to pursue this sort of redirected rationale for Medicaid, it has to get a law passed in Congress instead of end-running around the law by abusing its waiver authority.

Yes, the administration could appeal the decision to the Supreme Court, but it’s unlikely SCOTUS conservatives hostile to federal agency discretion will be able to bring themselves to approve this measure no matter how they feel about its policy merits.

The decision could also indicate the likely disposition of future litigation on Team Trump’s even more audacious efforts to turn Medicaid into a block grant via state waivers. Republicans have been trying legislatively to eliminate Medicaid’s status as a personal entitlement quite literally since the Reagan administration. So it seems unlikely the courts will let them accomplish this atavistic goal by a waiver under the guise of “state flexibility.”

On the other hand, all the noise about work requirements and other crackdowns on Medicaid will be soul-satisfying to certain MAGA folk who are convinced those people are living the good life on their tax dollars, and that may have been the whole point of the exercise.

Trump Loses Big Court Decision on Medicaid Work Requirement