The secretary of the Cabinet for Health and Family Services told state legislators Wednesday that if a federal judge rules against their Medicaid waiver program before its scheduled implementation on July 1, the Bevin administration will immediately evaluate rolling back Kentucky’s Medicaid expansion, which covers nearly 500,000 individuals in the state.
Sec. Adam Meier stated that without this waiver program, dubbed Kentucky HEALTH, the state cannot afford to cover the expanded Medicaid population.
The administration’s Medicaid waiver requiring “able-bodied” individuals to pay premiums and have a certain number of “community engagement” hours per week — including work, volunteering or training — was approved by the Trump administration in January.
However, this waiver approval was immediately challenged in federal court by 15 Medicaid recipients in Kentucky, who filed a lawsuit arguing that this violated federal law and would put the health care coverage of tens of thousands of Kentuckians at risk.
Bevin followed this lawsuit with an executive order directing his administration to end Medicaid expansion in Kentucky if any part of his waiver is blocked by a legal challenge in the court system.
The order stated that this expansion would be eliminated “no later than six months from the date on which all appeals of the judgment have been exhausted or waived, or otherwise as soon as legally practicable under the remaining terms” of the waiver plan, applicable statutes or regulations.
Meier told legislators that an adverse ruling by the judge in the federal lawsuit that impacts components of the waiver or the entire program would have immediate consequences, including the probable removal of dental and vision benefits from “able-bodied” Medicaid recipient. He added that they would also have to evaluate “whether or not we would be able to maintain the expansion.”
“Kentucky HEALTH is our way of maintaining expansion, maintaining coverage and maintaining access,” said Meier. “Without having the waiver approved, we lose our ability to do that effectively.”
Former Gov. Steve Beshear expanded Medicaid under the Affordable Care Act, leading to nearly 500,000 Kentuckians whose income was below 138 percent of the federal poverty level gaining coverage.
Bevin ran for governor on rolling back this expansion, arguing that the state could not afford to cover this additional population, but instead pushed forward with his waiver proposal that would maintain such eligibility while adding new requirements.
Bevin recently told reporters that he doesn’t know “nor do I really care” what the cost savings of the state would be under Kentucky HEALTH, as improving health outcomes is what really matters.
Meier told legislators on Wednesday that the administration “doesn’t have a firm figure at this point” on what the administrative costs of the program would be, as they monitor whether recipients are following through on the new requirements or should be locked out of coverage.
The original waiver submitted by the Bevin administration estimated that Kentucky’s Medicaid rolls would decrease by 95,000 individuals over the first five years, saving an estimated $2.2 billion.
Sen Ralph Alvarado, R-Winchester, told Meier that he is “excited” for the implementation of the Kentucky HEALTH program, stating that “I know that this is the opportunity for us to save our expansion. I think without this it’s not clear that we won’t be able to afford it.”
In the oral arguments of the federal lawsuit last week, Bevin’s attorneys stated that the process of ending the Medicaid expansion in the state would begin immediately after a negative ruling from the judge, citing the governor’s executive order from January.
U.S. District Court Judge James Boasberg noted last week that Bevin’s executive order referred to ending Medicaid expansion six months after all appeals processes are exhausted, but the governor’s deputy general counsel Matthew Kuhn said that he didn’t know if this would take that long.
Though acknowledging that the Bevin administration would have to submit an amendment to the state’s original expansion plan in order to accomplish a withdrawal, the hearing transcript also shows Kuhn repeatedly referring to the executive order as “self-executing” upon an adverse ruling by the courts.
“If your Honor were to strike down any aspect of Kentucky HEALTH and that were to be affirmed, it’s self-executing,” said Kuhn. “We’ve got our Cabinet for Health and Family Services secretary, it would be his job — the law of Kentucky then would be for him to unexpand.”
However, Meier told legislators on Wednesday that the administration is “confident” they’ll have a positive ruling on the Medicaid waiver in the case, which the judge said would be issued before July 1, when Kentucky HEALTH is scheduled to begin.
The implementation of the work requirement under the waiver program is staggered across the state, beginning with three northern Kentucky counties over the next three months, and then Jefferson County and 30 others on Oct. 1.
This story has been updated.