Lawsuit aims to block Medicaid requirement

A law set to take effect July 1 requiring Americans to prove their citizenship for Medicaid is under fire from consumer advocacy groups that aim to overturn the new requirement in court.

The Sargent Shriver National Center on Poverty Law filed a proposed class-action lawsuit Wednesday in federal district court in Chicago challenging the validity of the law that will require 50 million low-income and disabled Americans to prove their U.S. citizenship when applying or re-applying for Medicaid.

The Shriver center, in Chicago, is seeking a hearing to enjoin the new law from taking effect.

The lawsuit names Mike Leavitt as the defendant. Leavitt is secretary of Health and Human Services, the federal agency that handed down guidelines June 9 on which documents are acceptable for Americans to present to caseworkers at hospitals and medical clinics as proof of citizenship.

Critics say the requirement will cause delays and denials in Medicaid coverage for citizens who don’t have the documents for a variety of reasons, along with piling more rules and paperwork on caseworkers. Many elderly people were not born in hospitals and therefore don’t have birth certificates, others have never had a need for a passport, and victims of fires, hurricanes or other disasters may have lost the required records.

Acceptable documents are U.S. passports and birth certificates, certificates of naturalization or citizenship, U.S. identification cards or other documents ranked in priority. If none of those documents are available, Medicaid applicants can submit a written affidavit from two citizens who attest that the applicant is a citizen. The affidavit avenue is permitted in rare circumstances, according to the federal guidelines.

Likewise, states must provide individuals with “reasonable opportunity” to comply with the document requirements and caseworkers will be charged with offering assistance on case-by-case bases to the homeless, nursing home residents, and those with physical or mental disabilities who may have the most difficulty.

Despite some flexibility for compliance, the Shriver center and other plaintiff groups in the lawsuit say the nation’s most vulnerable citizens are being unfairly penalized. The National Senior Citizens Law Center and Health & Disability Advocates are plaintiffs in the federal complaint.

“Under the new law, American citizens are about to have their health coverage denied for unconstitutional reasons,” John Bouman, an attorney with the Shriver center, said in a prepared statement. “The new law will cause enormous harm to people who can’t produce the special documents, even though there is no doubt that they are American citizens.”

The Center on Budget and Policy Priorities estimates Medicaid coverage could be in jeopardy for 3 million to 5 million citizens based on a telephone survey finding in January that one in 12 low-income adult citizens don’t have passports or birth certificates.

The intent of the law is to halt illegal immigrants from fraudulently claiming citizenship to qualify for Medicaid but critics say that has not been a problem. They point to 2005 findings by the Inspector General for HHS that back up their assertion. The Inspector General’s office suggested tightening controls to make sure Medicaid coverage isn’t extended to those who don’t qualify but didn’t recommend citizen documentation be required.

Medicaid is restricted to U.S. citizens or qualified aliens and states have been using a signed self-declaration form for the past decade.

The new documentation requirement will convey a message that Medicaid recipients have to or will lie to qualify, Bouman, with the Shriver center, said in a recent position paper.

“The (documentation) process is both unnecessary and insulting because it starts with the presumption that the Medicaid recipients and applicants have lied or surely will lie about citizenship,” he said.

The new law does not affect Medicaid coverage to undocumented aliens in emergencies or to pregnant women, and it does affect access to medical care in hospital emergency rooms that is available to anyone regardless of ability to pay.

Steve Weinman, vice president of Collier Health Services Inc., which has 11 programs and clinics primarily serving the needy, said he is relieved emergency Medicaid and coverage for pregnant women won’t be affected. At the same time, the documentation requirement for regular Medicaid is unnecessary.

“There are very few people on Medicaid who are illegal,” he said. “I don’t think there is a problem. I think this will be a barrier for people to qualify for Medicaid.”

Low-income and needy citizens will lose their coverage but clinics, such as those run by CHSI, will continue treating them and won’t be reimbursed by Medicaid, which is jointly funded by states and the federal government. More than one-third of 21,000 clients with CHSI are on Medicaid.

“This could be a huge problem; we just don’t know how big,” Weinman said. “I would like no better (than) to have it reversed by some court. I would hope the National Association for Community Health Centers would join (the lawsuit).”

The Lee Memorial Health System in Lee County likewise anticipates patients will lose their Medicaid coverage and hospitals will face reimbursement losses. Lee Memorial received $50 million in Medicaid reimbursement in 2005, and if 10 percent of the Medicaid eligible population cannot continue to qualify, that could mean a $5 million hit to the hospital system.

“I’m not sure who wins here,” said Billie Jo DeBolt, system director for business services at Lee Memorial. “I think it will be burdensome, more difficult for caseworkers trying to get people eligible and more difficult for people trying to qualify and it will be harder for hospitals. Often our only form of reimbursement is Medicaid on bills.”

The NCH Healthcare System in Collier County is not as critical since the federal guidelines say individuals already enrolled in Medicaid will not lose coverage if they demonstrate a good-faith effort to come up with the necessary documents.

“It would appear (the federal government) is trying to be reasonably accommodating,” said Edward Morton, chief executive officer of NCH.

Caseworkers at NCH are getting trained now in the particulars of the documentation law.

“We are in the midst of doing that right now,” he said, adding that it will not prompt hiring more staff members. “It will place upon us the responsibility to follow the guidelines and ask for identification.”

States are responsible for compliance and California and Ohio already have said they cannot, which could mean losing their shares of federal Medicaid money. One fear is that some states will lean toward denying coverage to applicants rather than risk loss of federal dollars when audits are done.

Officials with the state Department of Children and Families in Tallahassee say some of the documentation may already be in the files of individuals already enrolled in Medicaid.