Dive Brief:
- The Supreme Court on Monday tossed out two cases challenging work requirements in Medicaid that had been pending at the court for more than a year.
- The cases contended Trump administration-approved rules for Arkansas and New Hampshire linking eligibility for the safety-net insurance coverage to requirements that beneficiaries work, attend school or volunteer for a certain number of hours. Critics of the policies said they would significantly pare back insurance coverage for low-income Americans, inconsistent with the objective of Medicaid.
- Over its tenure, the Trump administration granted 12 states federal approval to test work requirements. No such programs were active when President Joe Biden assumed office in 2021, having run into numerous legal and administrative challenges even before COVID-19. Nevertheless, the Biden administration quickly rolled back the policy and revoked existing prior approvals for the work requirements, resulting in the Supreme Court pausing oral arguments in the cases.
Dive Insight:
The lawsuits challenging Medicaid work requirements have been on hold since the nation's highest court previously canceled arguments planned for March 2021.
On Monday, the Supreme Court said the requirements were now moot, given the Biden administration's dismissal of the policies, and sent them back to the trial court, instructing that court to dismiss its prior judgments.
Republicans saw instituting work requirements as a way to incentivize work, while eventually shifting Medicaid beneficiaries to more comprehensive private coverage and hopefully saving states money. In 2018, Trump's HHS greenlit the first pilot programs for Arkansas and New Hampshire.
Arkansas was the only state that actually began disenrolling people based on not meeting work requirements, before pausing the program in early 2019 after about a quarter of beneficiaries subject to the policy lost coverage in its first five months alone.
After a series of litigation, a federal appeals court unanimously struck down Arkansas' work requirement that same year, citing the drastic loss of coverage. In late 2020, the Supreme Court agreed to hear an appeal made by the Trump administration to review the ruling, joining Arkansas' suit with one brought by New Hampshire.
With the arrival of the Biden administration, however, proponents of work requirements lost federal backing for the controversial programs. The HHS in 2021 notified both Arkansas and New Hampshire, along with other states with previously approved demonstration projects, that the requirements would no longer be allowed.
Liberals generally view work requirements as a strategy to surreptitiously shrink Medicaid rolls, but the programs have also faced severe criticism from policy experts, patient advocates, hospitals and even government watchdogs.
Research has found work requirements would likely weaken hospital finances, cost state taxpayers hundreds of millions to implement despite few administrative guardrails or oversight, and would kick millions of low-income Americans off coverage not because they don't meet hourly requirements, but because of a lack of access to technology to report their hours.
The Kaiser Family Foundation estimated that if work requirements were scaled nationwide, between 1.4 million and 4 million people would lose coverage.
Work requirements are still being litigated in lower courts, however. Earlier this year, Georgia sued the CMS over its decision to revoke approval for the state's planned work requirements, calling it a "bait and switch of unprecedented magnitude."
