Key Take-Aways. On June 29, 2018, the DC federal district court issued a decision in Stewart v. Azar, the lawsuit brought by a group of Medicaid enrollees challenging the Health and Human Services (HHS) Secretary's approval of the Kentucky HEALTH Section 1115 waiver program, which includes a work requirement, premiums, coverage lockouts, and other provisions that the state estimated would lead 95,000 people to lose coverage. Key rulings by the court include that: (1) The plaintiffs have the ability to bring the lawsuit; (2) The court has the ability to review the waiver approval; (3) The Secretary's waiver approval violates the Administrative Procedure Act; (4) The Kentucky HEALTH waiver is vacated and remanded to HHS; and (5) The separate "institution for mental disease" substance use disorder payment waiver continues. While this decision may not be last word on such waivers, given the potential for an appeal in this case as well as possible similar challenges in other states, the court's decision is notable for its affirmation of Medicaid's status as a health insurance program and the program's equal treatment of all groups covered by the statute.
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