After a lengthy debate, the Trump administration agreed to exempt most Native Americans from the new policy, set to take effect next year.
Arizona has permission from the federal government to begin imposing work requirements next year on certain Medicaid beneficiaries in the state, but most Native Americans will be exempt, the Centers for Medicare & Medicaid Services announced Friday.
Arizona's waiver is the eighth of its kind, signaling that the Trump administration intends to continue pushing forward with Medicaid work requirements despite pending legal challenges in other states. This is the first waiver to exempt members of federally recognized tribes, resolving a major sticking point with Arizona's application.
State officials had asked CMS to exempt all Native Americans from the new requirement, but Trump administration lawyers said doing so would constitute illegal preferential treatment on the basis of race. The tribes contended, however, that the administration's position contradicted longstanding legal principles and Supreme Court precedent, as Politico reported.
"There were a lot of complex legal issues here," CMS Administrator Seema Verma told Politico's Rachana Pradhan. "I think that we were able to find a middle ground."
Arizona's work requirements apply to beneficiaries ages 19-49 and require at least 80 hours per month of approved community engagement activities, such as employment, education, community service, or job-search activity. Exemptions will be given to beneficiaries deemed medically frail, those who are actively receiving treatment for substance abuse disorders, those who are pregnant or have given birth within the past two months, and those in other circumstances outlined in the waiver.
Although each state's Medicaid work requirements waiver is different, Arizona's comes after similar programs were approved in Kentucky, Arkansas, Maine, New Hampshire, Wisconsin, Michigan, and Indiana. (The Kaiser Family Foundation has a handy tracker that compares key program attributes across the states.)
Kentucky's work requirements hit a major speed bump last summer, when a federal judge blocked their approval as arbitrary and capricious. After soliciting further comments on the proposal, the feds reapproved Kentucky's waiver last November.
Arkansas is facing a similar legal challenge over its Medicaid work requirements as well, with critics arguing the policy being peddled by the Trump administration is designed to cull the Medicaid rolls.
Steven Porter is an associate content manager and Strategy editor for HealthLeaders, a Simplify Compliance brand.