Virginia’s plan to expand health-care coverage for more of its poorest residents — requiring some to work for benefits — is still on track despite a similar plan being blocked in Kentucky by a federal judge.
But could the situation in Kentucky mean a future legal challenge of Virginia’s Medicaid work requirements?
Officials say it’s early to tell and that they will stay the course as they prepare to expand Medicaid, estimated to deliver subsidized health care to at least 300,000 additional low-income residents.
Down the road, the federal judge’s decision could mean a win-win situation for Democrats in Virginia, who have long wanted Medicaid expansion without any work requirements. For Republicans, it could mean the loss of a reform that sold them on Medicaid expansion.
Virginia’s Department of Medical Assistance Services (DMAS) is still developing a plan — formally known as a waiver — to send to the federal government for approval. This is required because the state wants to modify traditional Medicaid with work requirements, just like Kentucky and a number of other states.
“We remain focused on the work necessary to ensure that new health coverage for Virginia adults is available beginning on January 1, 2019,” said Dr. Jennifer Lee, director of DMAS, in a statement. “Developing a waiver is a separate and ongoing process, as described in the final state budget. Virginia officials will continue our dialogue with the Centers for Medicare and Medicaid Services related to the expanded coverage as well as the waiver. Virginians are counting on us to ensure a smooth process for enrollment of approximately 400,000 adults, and that effort remains our top priority.”
Gov. Ralph Northam’s office would not comment beyond saying that they are analyzing the Kentucky case.
Parker Slaybaugh, spokesman for Speaker of the House Kirk Cox — a key Republican who supported reformed Medicaid expansion — said they “fully expect these reforms, including work requirements, to be included when the plan is fully implemented. He added that majorities in both the House and Senate agreed to the conservative reforms.
Regardless of what the federal government decides, people who are now eligible for Medicaid will be able to sign up for benefits no later than Jan. 1, 2019, said Christina Nuckols, a spokeswoman for DMAS. The state will get a federal reimbursement to help pay for the expansion of benefits, which is possible through the federal Affordable Care Act. That is separate from the Trump administration’s decision on a plan with work requirements, based on how Virginia wrote its Medicaid bill.
Officials said it’s early to know exactly what the Kentucky case means for Virginia.
Senate Majority Leader Thomas K. “Tommy” Norment Jr., R-James City County, was one of several Republicans who opposed expansion. Norment said his opposition was not political, rather a financial concern for the state. He raised questions of what would happen if the federal government decided not to reimburse the state for 90 percent of the cost to extend health-care benefits — or the possibility that someone could sue over the work requirements.
That is what happened in Kentucky.
“So I think the potential impact of that decision is pretty significant,” Norment said in a recent interview. “I think it clearly is suggested that while there’s going to be additional judicial review, that in the meantime, a federal court has said it is unenforceable, it is inconsistent with delivery of health care to the poor.”
What happened in Kentucky?
As Virginia lawmakers battled again this year over Medicaid expansion, the state of Kentucky was following a lawsuit over its own program.
The lawsuit was filed by a group of Medicaid beneficiaries who challenged the legality of Kentucky requiring certain people to work for Medicaid benefits, specifically calling out U.S. Secretary of Health and Human Services Alex M. Azar and his approval of those work requirements. Kentucky’s plan required “able bodied” adults to work or be working toward job skills to qualify for subsidized health care.
Kentucky had expanded Medicaid to more of its low-income residents in 2014. But when Republican Gov. Mark Bevin took over in 2015, he wanted to reform the plan with work requirements. Kentucky got the approval it needed from the Trump administration this January, and the lawsuit came two weeks later.
In the meantime, Virginia lawmakers voted to expand Medicaid with those same kinds of work requirements. This became the selling point for Republicans — whose votes were key to the passage of the bill — but the concession was a hard pill to swallow for many Democrats.
On June 29, a U.S. District Court judge in Washington, D.C. blocked Kentucky’s work requirements. In his ruling, the judge said Azar did not properly consider how Kentucky’s work requirements would help the state provide coverage to the poor and that he didn’t consider how many people would lose coverage under the plan.
The Trump administration will likely appeal the decision, which will probably set off a months-long legal battle and could possibly mean the administration reconsiders its decision. In the meantime, Bevin has cut off vision and dental benefits for up to 460,000 people who got coverage under expansion, saying he has no legal mechanism to continue their benefits.
A win-win situation for Democrats?
House Minority Leader Del. David Toscano, D-Charlottesville, said it’s possible to see a repeat of Kentucky in Virginia — meaning, an advocacy group could file a legal challenge against the work requirements in Virginia, if the federal government approves them.
That could mean a few outcomes: a federal judge could block the requirements for some reason or rule in favor of the federal government. Either way, Medicaid expansion would still exist in this state — in one form, without any work requirements. Toscano said it’s probably too early to make definitive conclusions, but he senses no threat.
“Democrats wanted straight Medicaid expansion without work requirements,” Toscano said. “If it ends up that way, we’ll feel pretty good about it, but we ultimately voted for a budget with work requirements.”
Expansion without those work requirements is much less likely because it was key in gaining support in the House of Delegates, said Stephen Farnsworth, professor of political science at the University of Mary Washington. It is also a concept the Trump administration has strongly backed.
Medicaid expansion was part of a bitter, five-year battle in Virginia. This year, lawmakers blew their deadline to pass a state budget by almost three months because of the Medicaid debate.
In order to gain Republican support, Democrats reluctantly agreed to requiring certain Medicaid enrollees either to work or be working toward job skills.
Norment warned his colleagues of the possible implications of expanding Medicaid, down to the minutes before the Senate passed the bill. To him, the legal decision over Kentucky’s plan for work requirements could mean that the financial component — the reimbursement for health care — could be in the air, too. It’s anyone’s guess, he said.
“It really just is a legislative mirage,” Norment said in a recent interview. “The people, the champions of Medicaid expansion, I think, were willing to overreach on any plausible or implausible argument that they could make to get that through.”
But while Bevin cut off vision and dental benefits for up to 460,000 people in Kentucky, that’s not likely to happen in Virginia’s political climate, said Quentin Kidd, director of Christopher Newport University’s Wason Center for Public Policy. That’s not a move that Virginia Gov. Ralph Northam — who campaigned heavily on Medicaid expansion — or even a future Republican governor would have the support for in Virginia, Kidd said.
He thought something else is more likely, based on how the state’s political climate is looking.
“I do think that if Democrats manage to take over the House and/or the Senate in the next round of elections in 2019, it could very well be possible that Democrats simply drop the work requirement from the law,” Kidd said.
It’s early, but it’s important to remember that there are an “awful lot of people in both parties that want this to work,” Farnsworth said. So, there could be last-minute adjustments to the Medicaid plan that will eventually be submitted to the Trump administration.
“Medicaid expansion has had bigger hurdles than this,” Farnsworth said.
Amin can be reached by phone at 757-247-4890.