Becerra v. Gresham (formerly Cochran v. Gresham) (formerly Gresham v. Azar)

Issue: Was the HHS Secretary’s approval of Arkansas’s Section 1115 demonstration, which conditioned Medicaid eligibility on meeting a work reporting requirement, arbitrary and capricious? 

Background: Medicaid enrollees sued to challenge the HHS Secretary’s approval of Arkansas’s Section 1115 demonstration waiver, which conditioned Medicaid eligibility on meeting a work reporting requirement. The district court vacated the approval, finding that the Secretary’s decision was arbitrary and capricious and therefore violated the Administrative Procedure Act (APA) because he failed to consider the demonstration’s impact on Medicaid’s core purpose of providing health coverage to low-income people. Upon appeal, the D.C. Circuit affirmed. The Trump Administration then appealed to the U.S. Supreme Court. Subsequently, the Biden Administration notified the Court that it preliminarily had determined that the work requirements approved by the Trump Administration did not further Medicaid program objectives and therefore was initiating a process to determine whether to withdraw demonstration approval. As a result, the Supreme Court vacated the lower courts’ judgments and dismissed the appeal as moot.

Current Status: Final decision issued. 

Supreme Court Amicus Brief, Feb. 21, 2021* 

*Combined with Philbrick v. Azar

Amici: 73 public health deans and scholars

Argument Summary: Congress enacted Section 1115 to permit states to test new approaches to expand access, provide better services, and strengthen social programs. Early Section 1115 demonstrations heeded congressional intent that experiments strengthen Medicaid. Since 1965, Congress has added important protections to ensure demonstrations promote Medicaid’s purpose. The Secretary cannot use Section 1115 as a shortcut for reversing the Affordable Care Act’s Medicaid expansion. The Secretary’s approvals of eligibility restriction experiments in Arkansas and New Hampshire violated research norms by lacking a basis in evidence and by failing to ensure states conduct adequate demonstration evaluations. HHS consistently sidestepped evaluation principles contained in their own Section 1115 guidance.

Medicaid expansion’s remarkable achievements in providing medical assistance to uninsured adults made the impact of imposing work requirements, coverage lock-outs and limited retroactive eligibility even more catastrophic. Expansion in Arkansas and New Hampshire achieved dramatic reductions in total uninsured adults. Extensive commentary in the administrative record made clear the risks created by work requirements and coverage restrictions. There is no realistic expectation that those leaving Medicaid for work will find alternative sources of health insurance. 

D.C. Circuit Court of Appeals Amicus Brief, June 27, 2019*

*Combined with Stewart v. Azar

Amici: 63 public health deans and scholars

Argument Summary: Congress enacted Section 1115 to permit states to test new approaches to expand access, provide better services, and strengthen social programs. Early Section 1115 demonstrations heeded congressional intent that experiments strengthen Medicaid. Since 1965, Congress has added important protections to ensure demonstrations promote Medicaid’s purpose. The Secretary cannot use Section 1115 as a shortcut for reversing the Affordable Care Act’s Medicaid expansion. The Secretary’s approvals of eligibility restriction experiments in Arkansas and Kentucky violated research norms by lacking a basis in evidence and by failing to ensure states conduct adequate demonstration evaluations. HHS consistently sidestepped evaluation principles contained in their own Section 1115 guidance.

Medicaid expansion’s remarkable achievements in providing medical assistance to uninsured adults made the impact of imposing work requirements, coverage lock-outs and limited retroactive eligibility even more catastrophic. Expansion in Arkansas and Kentucky achieved dramatic reductions in total uninsured adults. Extensive commentary in the administrative record made clear the risks created by work requirements and coverage restrictions. There is no realistic expectation that those leaving Medicaid for work will find alternative sources of health insurance. 

District Court Amicus Brief, Nov. 7, 2018

Amici: 39 public health deans and scholars

Argument Summary: The purpose of Section 1115 demonstrations is to improve the Medicaid program through expanded coverage access, better services, and strengthened social programs—not to remove thousands of eligible people. Early Section 1115 demonstrations have heeded this congressional intent, and since 1965 Congress has added important protections to ensure demonstrations promote Medicaid’s purpose. The administrative record shows that approval of the Arkansas Works Amendment was arbitrary and capricious and contrary to federal law. Section 1115 cannot be a pretext to restrict Medicaid eligibility or coverage. Arkansas’s remarkable achievements in providing medical assistance to uninsured adults make the impact of imposing work requirements, coverage lock-outs and limited retroactive eligibility even more catastrophic. The Arkansas Works amendment will impact access to healthcare community-wide.

Outside Counsel: Feldesman Tucker Leifer Fidell LLP

Citations:

Our brief was cited twice by the district court:

"Here, numerous commenters predicted that substantial coverage loss would occur; a table cataloguing the relevant comments is included at the end of this Opinion in an Appendix. See, e.g., AR 1269 (Arkansas Advocates noting that requirement “will increase the rate of uninsured Arkansans”); AR 1277 (American Congress Obstetricians and Gynecologists explaining that “[t]he experience of the TANF program . . .demonstrates that imposing work requirements on Medicaid beneficiaries would . . . lead to the loss of health care coverage for substantial numbers of people who are unable to work or face major barriers to finding and retaining employment.”); see also ECF No. 33 (Amicus Brief of Deans, Chairs, and Scholars) at 14." Slip opin. at 19.

"Indeed, one amicus points out that the Secretary approved this project without “a proposed evaluation design.” See Amicus Brief of Deans, Chairs, and Scholars at 19–20." Slip opin. at 30.

Gresham v. Azar, No. 18-1900-JEB, Memorandum Opinion (March 27, 2019), https://affordablecareactlitigation.com/wp-content/uploads/2019/03/5938326-0-16674.pdf

Related Resources:

GW Media Relations. Medicaid compelled work experiments represent an abuse of research authority, have stripped thousands of eligible people of coverage. March 11, 2021. https://mediarelations.gwu.edu/medicaid-compelled-work-experiments-represent-abuse-research-authority-have-stripped-thousands

Rosenbaum S. Medicaid work requirement experiments at the Supreme Court: what happens now? To the Point (blog). Commonwealth Fund. Jan. 12, 2021. https://doi.org/10.26099/vyxm-wa81

Somodevilla A, Rosenbaum S. Inside the D.C. Circuit’s Opinion In Gresham v Azar. Health Affairs Forefront. February 20, 2020. https://www.healthaffairs.org/content/forefront/inside-d-c-circuit-s-opinion-i-gresham-v-azar-i

Rosenbaum S. Why the court once again struck down federal approval of Medicaid work experiments. To the Point (blog). Commonwealth Fund. March 29, 2019. https://doi.org/10.26099/md1n-ya31