DHS Director expects Arkansas Works to go to Supreme Court, waiver redesign coming in 2020

Arkansas Department of Human Services director Cindy Gillespie expects the appeal of a court ruling on Arkansas Works to reach the U.S. Supreme Court, and during that process, the state could be knee-deep in a redesign of the waiver that allowed for the work requirement provision.

Appearing on this week’s edition of Talk Business & Politics, Gillespie made those two predictions and said that loss of the Medicaid expansion program would have significant ramifications for Arkansas.

“I think you have to realize that the appellate process in this case will probably go all the way to the Supreme Court, and there’s nothing rapid about that process,” she said, noting that federal officials would have to lead the legal effort. “This is not a policy that the federal government is going to walk away from easily, nor are we.”

Gillespie said the waiver that allowed Arkansas to depart from standard Medicaid expansion expires in 2021. She said DHS would begin redesigning that waiver for federal scrutiny in 2020.

“Our waiver, our current Arkansas Works waiver, ends at the end of 2021, and so somewhere in ’20, we will all be looking for the redesign of what the next version looks like anyway,” she said.

The DHS chief said that if legislators don’t fund Arkansas Works – a possibility if the work requirement is eventually eliminated after appeals – the results would be catastrophic for the 236,000 presently enrolled in the Medicaid expansion program.

“For most of those on the program right now, there is not an alternative. The ones above 100% of the federal poverty level would qualify for the exchange, as you know, the marketplace plans and the federal government giving them something. Currently, Arkansas’ only other category for individuals would be those who are parents and caretakers and have incomes below 32% of federal poverty level, so there would be a substantial group that would be sitting there in that middle and would not have another alternative,” Gillespie said.

“There would also be a very large budget impact on the state as well,” she said. “It’s not a simple program to change or to walk away from. It would have ramifications on the providers in the state. It would have ramifications.”

On Friday, 52 House members voted for the DHS appropriation that funds Arkansas Works. It fell short of the 75 members needed in the House, although it has cleared the Senate hurdle already. Legislative leaders and the governor said they will try to answer questions of House members and seek another vote this coming week.

Gillespie said she and other administration officials disagreed with the lower court ruling from U.S. District Judge James Boasberg on Wednesday (March 27) regarding Arkansas Works. The judge said the fed’s decision to grant Arkansas the work requirement waiver was “arbitrary and capricious because it did not address – despite receiving substantial comments on the matter – whether and how the project would implicate the ‘core’ objective of Medicaid: the provision of medical coverage to the needy.”

“We really do believe that work, community engagement, someone not being isolated and by themselves, all the studies show that is incredibly important to their health. It is a part of a healthy environment,” Gillespie said. “It’s one of the reasons why in some of our other Medicaid programs – we have programs for the developmentally disabled, for example, that support employment, right? Because why? It helps them have a healthier life.

“So, we feel like he got those pieces wrong… He develops the idea that if people lose Medicaid coverage, they are uninsured. No. I mean, the whole point of a lot of the efforts we have underway are to help people move out of poverty and up that income ladder. So, we have people all the time who become not covered by Medicaid because their income is higher and they’re now insured by an employer. That doesn’t mean because they lost coverage they are uninsured,” Gillespie added.

You can watch Gillespie’s full interview in the video below.