Maintenance of Effort (MOE) Stays Strong in Affordable Care Act

Health

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This morning, June 8th, the United States Supreme Court denied cert. (certiorari) in the Mayhew v. Burwell case. The case came from the governor of Maine who challenged the requirement to cover 19- and 20-year-olds under Medicaid Early and Periodic Screening, Diagnostic, and Treatment (EPSDT) requirements because of the Maintenance of Effort (MOE) in the Affordable Care Act (ACA). After providing Medicaid coverage for over 20 years for 19- and 20-year-old children whose families met low-income requirements, the Maine Department of Health and Human Services sought in 2012 to drop that coverage by proposing an amendment to its Medicaid state plan. The federal Department of Health and Human Services Secretary disapproved the amendment, stating that it plainly violates part of the ACA.

I reviewed U.S. Solicitor General Donald Verrilli’s brief in response to the petition and copied some of the key arguments below.

From the Solicitor General’s brief:

The MOE requirement “applies to the long-standing provision of care to 19- and 20-year olds.” Unlike the adult eligibility expansion, therefore, the MOE requirement “is not a new program” or a fundamental change in the nature of Medicaid. To the contrary, it simply requires States to continue providing the same coverage to children who are already receiving it. The court therefore concluded that the MOE requirement “falls comfortably within Congress’s express reservation of power to ‘alter’ or ‘amend’ the terms of the Medicaid statute in its coverage of previously covered groups.”

For similar reasons, the court of appeals rejected petitioner’s contention that the MOE requirement constituted an impermissible “retroactive” condition on federal funds. In 2009, before the Affordable Care Act was enacted, Congress had offered stimulus funds to States that agreed to “maintain their Medicaid eligibility criteria at July 1, 2008 levels until December 31, 2010.” Maine had accepted those funds, and petitioner contended that by requiring States to maintain their March 2010 eligibility standards for children through October 2019, the Affordable Care Act “‘changed the deal’ [Congress] offered to Maine in 2009.” The court of appeals agreed with petitioner that “if Congress intends to impose a condition on the grant of federal moneys, it must do so unambiguously” and that Congress may not “surprise participating States with post acceptance or ‘retroactive’ conditions.” But the court held that the Affordable Care Act “did not ‘surprise’ Maine with a retroactive condition” because the “modest change” made by the MOE requirement—which is a condition on Medicaid funding received after that provision’s enactment—falls within Congress’s express reservation of authority in 42 U.S.C. 1304 to alter or amend the Medicaid program.

Finally, the court of appeals rejected petitioner’s contention that the MOE requirement denies Maine equal sovereignty. The court concluded that petitioner’s argument “failed at every step of the analysis.” Petitioner relied on Shelby County v. Holder, which invalided the provision of the Voting Rights Act of 1965 (VRA), requiring certain States to obtain preclearance from the Attorney General or a federal court before changing their election laws. First, the court explained that unlike the coverage formula challenged in Shelby County, the MOE requirement does not “single out certain states for disparate treatment” because it applies to every State. Second, the court noted that Shelby County’s scrutiny of the coverage formula was premised on this Court’s conclusion that the VRA’s preclearance requirement “marked an ‘extraordinary’ departure from basic principles of federalism” and “intruded into a realm that has traditionally been the exclusive province of the states.” The MOE requirement, in contrast “does not intrude on an area of traditional state concern,” but rather simply requires an extension of certain prior choices by States under a federal-state cooperative program. Finally, the court held that the MOE requirement withstands scrutiny even if Shelby County requires a showing that the requirement is ‘sufficiently related’ to its targeted problems,” because MOE requirements provide protection during times of transition and are common features of federal spending programs.

It’s good news to see that the MOE is still strong and will, hopefully, be applied through its authorization in 2019.


Supreme Court declines to hear case to deny Medicaid coverage to young adults: bit.ly/1QjfnA5 v/ @First_Focus pic.twitter.com/oRZvoN2DLG

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