Donald Trump lacks authority to change Medicaid law, lawsuit says

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What Bevin says are his next steps are if his proposed overhaul of the federal-state health plan should be struck down in court.
Mary Ann Gerth/Louisville Courier Journal

Calling Medicaid “the cornerstone of the social safety net,” health law advocates filed a federal lawsuit Wednesday aimed at blocking work requirements and other changes to Medicaid that Kentucky’s governor plans to enact.

The lawsuit, filed in U.S. District Court in Washington, challenges what it alleges is President Donald Trump’s unlawful attempt to rewrite the nation’s Medicaid law to dismantle the Affordable Care Act, also known as Obamacare.

It comes as at least nine other states — Arizona, Arkansas, Indiana, Kansas, Maine, New Hampshire, North Carolina, Utah and Wisconsin — are seeking approval for changes similar to Kentucky’s including “community engagement” requirements for some people on Medicaid to either work or volunteer or lose health coverage.

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“The president lacks the authority to rewrite congressional statutes or to direct federal officers or agencies to effectively amend the statutes he is constitutionally required to execute,” said the lawsuit from the National Health Law Program in Washington; the Kentucky Equal Justice Center in Lexington and Louisville, Ky.; and the Southern Poverty Law Center in Montgomery, Ala.

Kentucky is the first state to win approval from the Trump administration for work requirements and other changes to its Medicaid program, changes aimed largely at those added through an expansion of Medicaid authorized in the Affordable Care Act.

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The press release called Bevin’s plan “an innovative approach that will put Kentuckians on a path to better health.”

The lawsuit comes 12 days after Bevin announced Kentucky had become the first state to win federal approval from Centers for Medicare and Medicaid Services for its changes, known as a waiver.

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While Medicaid covers about 1.4 million people in Kentucky, Bevin’s changes are aimed largely at the 480,000 people added under the 2010 federal health law that allowed states to expand it to add more low-income people.

Medicaid was previously a health plan mainly for very poor pregnant women, children, disabled people and low-income elderly in nursing homes. The Obamacare expansion allowed states to include anyone up to 133% of the federal poverty level, an annual income of about $16,400 a year.

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It cites a litany of health problems among the 15 plaintiffs as well as part-time or fluctuating work hours that would make it difficult, if not impossible, for people to keep up with regular reporting requirements about their employment and work hours to remain eligible for health coverage.

Some don’t own cars and have difficulty getting to work, let alone getting to state offices to report any change in work status as required in the Bevin plan, it said. While the plan would allow people to make some changes online, not all Kentuckians own a computer or have access to one.

Among the plaintiffs:

• A young woman in eastern Kentucky who “is looking for a job outside the home, though without a license to drive and no public transportation available in Floyd County, the prospects are difficult.”

• A church administrator in Berea, Ky., and his wife, a freelance writer, who earn about $22,500 a year, working part time so they can home-school their two sons. They fear they could lose health coverage through Medicaid if they aren’t able to maintain and verify the 20-hour a week work requirement under the Bevin plan.

• A Lexington man who retired at 62 because of significant health problems. He is unable to work full time and fears losing his health coverage through Medicaid that covers costs of treatment for his diabetes, arthritis and high blood pressure.

The lawsuit further alleges Kentucky’s plan violates the law authorizing such waivers because they are meant to be pilot projects to expand or enhance health care under Medicaid.

Bevin’s plan projects it will cut Medicaid enrollment in Kentucky by about 95,000 people over the five-year life of the waiver. The governor has indicated he may simply pull the plug on Medicaid coverage for such individuals if his plan fails to win federal approval or loses a legal challenge.

In a recent executive order, he directed state health officials to strip Medicaid coverage from nearly half a million Kentuckians should his proposed overhaul of the federal-state health plan be struck down in court.

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The order Bevin filed Friday directs the secretary of the Cabinet for Health and Family Services and the Medicaid commissioner to “take necessary steps to terminate Kentucky’s Medicaid expansion” if any part of his plan is struck down in court and all appeals are exhausted.

That prompted a retort from one of the lawyers involved in the legal challenge,

“Is the governor of Kentucky saying that if he is caught doing something illegal, he will take health care away from hundreds of thousands of Kentuckians who have done nothing wrong?” asked Leonardo Cuello, director of health policy for the National Health Law Program.

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As a candidate, the Republican governor initially said he would scrap the expansion authorized by his predecessor, Gov. Steve Beshear, a Democrat. After Bevin was elected governor in 2015, he instead announced that he would seek federal approval to change the program to instill more personal accountability in some people on Medicaid and move those not working toward employment. 

He has said that he would end the expansion if he did not receive federal approval for the changes, a stance a Bevin spokesman underscored last week.

“Governor Bevin has consistently said … that these are the terms under which Kentucky will maintain expanded Medicaid,” Woody Maglinger said.

Follow Deborah Yetter on Twitter: @d_yetter

Kentucky Medicaid waiver lawsuit

Kentucky HEALTH waiver application