What’s the big deal about Chevron (as it relates to Medicaid)?
By Brandy Davis / July 8, 2024
The recent Supreme Court decision to overrule their earlier decision in the 1984 case Chevron v. Natural Resources Defense Council has made national headlines. But why is the 35-page ruling written by Chief Justice John Roberts so important?
Though Chevron involves the EPA’s ability to compel states to adopt plans to reduce emissions, the analysis used in Chevron is routinely applied to whether other types of federal agencies can issue certain rules.
Ultimately, the decision made in Chevron allowed agencies, like Medicaid, to be able to issue rules (or interpretations) when Congress had not directly addressed a precise issue, and there was ambiguity, and the agency’s interpretation of the legislation was reasonable.
How does Medicaid issue rules?
Medicaid issues hundreds of rules annually that often clarify states’ ability to run their programs. After all, Medicaid is a State and Federal partnership. That is a lot of bureaucracy! There is generally a provisional rule, a public comment period, and the issuing of a final rule published in the federal register. These rules often allow Medicaid to communicate resolutions for really pressing issues.
This year, when children were being disenrolled from Medicaid in massive numbers, Medicaid issued a rule, “Medicaid Program; Streamlining the Medicaid, Children's Health Insurance Program, and Basic Health Program Application, Eligibility Determination, Enrollment, and Renewal Processes” that simplified the eligibility and enrollment processes for Medicaid, the Children's Health Insurance Program(CHIP), and the Basic Health Program (BHP). This rule also helped states keep Medicaid and CHIP coverage for eligible children.
According to Medicaid, this rule preserved coverage for children by:
Aligning enrollment and renewal requirements for most individuals in Medicaid;
Establishing beneficiary protections related to returned mail;
Creating timeliness requirements for redeterminations of eligibility;
Making transitions between programs easier;
Eliminating access barriers for children enrolled in CHIP by prohibiting premium lock-out periods, benefit limitations, and waiting periods; and
Modernizing recordkeeping requirements to ensure proper documentation of eligibility determinations.
As one might imagine, this rule was essential in helping eligible children keep access to care. In the future, to accomplish the same preservation of coverage and continuity of care, Medicaid will not be able to defer to the authority provided to them by Congress.
As will be the case for other federal agencies, in the future, the Medicaid program will need to follow an even more complicated process.
How will the Medicaid program work moving forward?
That is a big question. A lot has been said about the complexity involved in running the Medicaid program. The Supreme Court itself has described how complex the Medicaid program is, calling certain provisions “down right byzantine.” In Friedman, the Supreme Court said that “The Medicaid statute (as is true of other parts of the Social Security Act) is an aggravated assault on the English language, resistant to attempts to understand it. The statute is complicated and murky, not only difficult to administer and to interpret but a poor example to those who would like to use plain and simple expressions.”
However, in both cases, the Supreme Court’s decision reflected its understanding of the complexity of operating the Medicaid program.
Following this Supreme Court’s ruling in Loper Bright Enterprises v. Raimonda and Relentless, Inc. v. Department of Commerce, overturning Chevron, on June 28, 2024, the intricacies of how the Medicaid program should and will operate will occur through Congress and the courts. The operations of an already complex program will now become even more complex.