Maine Sues for Expedited Review of Medicaid Amendment

The state of Maine has filed a lawsuit in federal court to force the Centers for Medicare and Medicaid Services (CMS) to take action on the state’s proposed State Plan Amendment (SPA) to its Medicaid program. The SPA, if approved, would modify eligibility requirements for MaineCare, Maine’s Medicaid program, effectively dropping thousands of residents from its rolls. When the state submitted the SPA to CMS, it had requested expedited review and a decision by September 1, 2012, so that it could implement the amendments by October 1, 2012 to balance its budget as mandated by the state’s Constitution. CMS issued a letter denying an expedited process on August 31, 2012; Maine filed suit with the First Circuit Court of Appeals on September 4th.

PPACA & Proposed Amendments

Up until the U.S. Supreme Court’s June ruling on the health care reform law, the Patient Protection and Affordable Care Act (PPACA) (P.L. 111-148), states were mandated to expand their Medicaid programs to cover individuals who make less than 133 percent of the federal poverty line, which would increase Medicaid coverage nationwide to a projected 17 million people. However, the Supreme Court held that the federal government would be overreaching the power granted to it by the U.S. Constitution to not allow states to opt out of the expansion. The remainder of PPACA’s provisions were left intact by the Court.

Maine Governor Paul LePage and other state officials have taken a very broad interpretation of June’s decision as stated by the governor’s spokesperson, Adrienne Bennett, who said, “Maine believes the Supreme Court decision confirms that states have the flexibility to manage their Medicaid program without risking the loss of federal funds.” The supporting rationale is that PPACA’s “maintenance of effort” provision, which penalizes states for tightening eligibility requirements beyond what they were in 2010, is also unconstitutional based on the Court’s reasoning regarding Medicaid expansion.

The Congressional Research Service, after reviewing the Court’s decision, concluded that the ruling did not alter the enforceability of the “maintenance of effort” provision; however, their opinion is not legally binding. The Obama administration, likewise, has stated that this decision does not enable states to implement stricter eligibility requirements.