Azar, Sec. of H&HS v. Gresham

Whether the U.S. Court of Appeals for the District of Columbia Circuit erred in concluding that the secretary of health and human services may not authorize demonstration projects to test requirements that are designed to promote the provision of health-care coverage by means of facilitating the transition of Medicaid beneficiaries to commercial coverage and improving their health.

Arkansas applied for and received a demonstration waiver in accordance with 42 U.S.C. § 1315(a), which allows states to deviate from Medicaid’s minimum coverage requirements. Under that provision, the Secretary of Health and Human Services may approve “any experimental, pilot, or demonstration project which, in the judgment of the Secretary, is likely to assist in promoting the objectives” of Medicaid. A group of Arkansans, impacted by the various changes made as a result of the approval of Arkansas’s §1315(a) waiver, filed suit against the Secretary for declaratory and injunctive relief, which the district court granted. The D.C. Circuit approved the district court’s judgment vacating the Secretary’s approval. In this consolidated appeal, the Secretary argues that the court of appeals’ decisions invalidating the demonstration projects are incorrect for three primary reasons: first, because statutes give the Secretary broad authority to approve projects that, in his judgment, will likely assist to promote Medicaid's objectives; second, because the approved demonstration projects were properly approved, other requirements may allow States to stretch their Medicaid resources further; and third, because the lower court misconstrued the authority given to the Secretary under 42 U.S.C. 1315.