United States District Court, District of Columbia
E. BOASBERG UNITED STATES DISTRICT JUDGE.
are sixteen Kentucky Medicaid enrollees who brought this
action under the Administrative Procedure Act, 5 U.S.C.
§§ 701-706, challenging the federal
government's approval of a new Kentucky Medicaid program,
Kentucky HEALTH. Defendants - the Department of Health and
Human Services, the Centers for Medicare and Medicaid
Services, and four officials - now move to transfer the case
to the Eastern District of Kentucky pursuant to 28 U.S.C.
§ 1404(a). Because the Court finds that convenience and
the interests of justice warrant keeping the matter in the
District of Columbia, it will deny the Motion.
1965 the federal government and the states have worked
together to provide medical care to certain vulnerable
populations under Title XIX of the Social Security Act,
colloquially known as Medicaid. See 42 U.S.C. §
1396-1. The Centers for Medicare and Medicaid Services (CMS),
a federal agency within the Department of Health and Human
Services (HHS), has primary responsibility for overseeing
Medicaid programs. Under the cooperative federal-state
arrangement, participating states submit their “plans
for medical assistance” and receive federal funding to
offset some of the costs if the plan is “approved by
the Secretary [of HHS].” Id. Currently, all
states have chosen to participate in the program.
Medicaid Act sets out certain parameters for states to
follow, but each state is free to administer its Medicaid
program as it wishes within those strictures. See 42
U.S.C. § 1396a. One such provision requires state plans
to “mak[e] medical assistance available” to
certain low-income individuals, including pregnant women,
children, and their families; former foster children under
the age of 26; the elderly; and people with certain
disabilities. Id. § 1396a(a)(10)(A);
see ECF No. 1 (Complaint), ¶ 44. In 2010,
Congress enacted the Patient Protection and Affordable Care
Act, Pub. L. No. 111-148, 124 Stat. 119 (2010), “to
increase the number of Americans covered by health
insurance.” Id., ¶ 45 (quoting
Nat'l Fed'n of Indep. Bus. v. Sebelius, 567
U.S. 519, 538 (2012)). Under the ACA, states can choose to
expand their Medicaid coverage to include low-income adults
under 65 who would not otherwise qualify. See 42
U.S.C. § 1396a(a)(10)(A)(i)(VIII). While generally a
state must cover all qualified individuals to receive any
Medicaid funding, id. § 1396a(a)(10)(B), it may
choose not to cover this “expansion
population.” Compl., ¶ 46; see NFIB, 567
U.S. at 587. If the state decides to cover the expansion
group, however, those individuals become part of the
state's mandatory population.
before and after the ACA, a state that wishes to deviate from
the Medicaid Act's requirements must obtain a Section
1115 waiver from the Secretary of HHS. See 42 U.S.C.
§ 1315. These waivers allow the Secretary to approve
“experimental, pilot, or demonstration
project[s]” in state medical plans outside of the
statutory parameters of the Medicaid Act, “which, in
the judgment of the Secretary, [are] likely to assist in
promoting the [Act's] objectives.” Id.
§ 1315(a). The ultimate decision whether to grant a
waiver rests with the Secretary, but his discretion is not
boundless. Before HHS can act on a waiver application, the
state “must provide at least a 30-day public notice and
comment period regarding” the proposed program and hold
at least two hearings at least 20 days before submitting the
application. See 42 C.F.R. §§
431.408(a)(1), (3). Once a state completes those
prerequisites, it then sends an application to CMS.
Id. § 431.412 (listing application
requirements). After the agency notifies the state that it
has received the waiver application, a federal 30-day
public-notice period commences, and the agency must wait at
least 45 days before rendering a final decision. Id.
§§ 431.416(b), (e)(1). Under very limited
circumstances - e.g., “natural disaster”
or “public health emergency” - CMS or the
Secretary may waive the federal or state public-comment
period. Id. § 431.416(g).
January 11, 2018, Brian Neale, Director of CMS, issued a
letter to state Medicaid Directors “announcing a new
policy designed to assist states in their efforts to improve
Medicaid enrollee health and well-being through incentivizing
work and community engagement among” certain adult
mandatory Medicaid groups. See Compl., Exh. D at 1.
The nine-page letter noted that work-requirement-based
eligibility for Medicaid “is a shift from prior agency
policy, ” id. at 3, but that the agency was
committed to “support state efforts to test incentives
that make participation in work or other community engagement
a requirement for continued Medicaid eligibility” and
encouraged states to apply for Section 1115 waivers for this
purpose. Id. at 1. It then “identified a
number of issues for states to consider as they
develop” work-requirement Medicaid programs.
Id. at 4-9. To date, ten states have applied for
such Medicaid waivers. See ECF No. 40 (Amicus Brief
of AARP, et al.) at 2 n.1.
like all other states and the District of Columbia,
participates in Medicaid. After the ACA went into effect, the
state broadened Medicaid to include the expansion population.
See Compl., ¶ 79. On August 24, 2016, Governor
Matt Bevin submitted an application to CMS requesting a
Section 1115 waiver to implement an experimental project,
Helping to Engage and Achieve Long Term Health, or Kentucky
HEALTH. See Compl., Exh. B. The project as approved
“transform[s]” the state's Medicaid program
to include “commercial market health insurance
features, ” id. at 7, including a deductible
account, an incentive and savings account, and a requirement
that enrollees pay premiums on a sliding scale. Id.
at 9-10. It also predicates Medicaid eligibility for most of
the expansion population on workforce participation or
community service. Id. at 15-16.
to submitting the application, Kentucky's Department for
Medicaid Services held three public hearings and conducted
two public-comment periods. See Compl., Exh. B.
Throughout this process, the state and CMS were engaged in
“continued negotiations” regarding the
program's terms. Id., Exh. A at 5 & Exh. C.
CMS also opened a federal public-comment period on Kentucky
HEALTH. Id., Exh. C at 7. On January 12, 2018, CMS
notified the Governor's office that the application had
been approved. Id. at 1.
weeks later, Plaintiffs brought this nine-count suit seeking
declaratory and injunctive relief on behalf of themselves and
a “statewide proposed class . . . of all residents of
Kentucky who are enrolled in the Kentucky Medicaid program on
or after January 12, 2018.” Compl., ¶ 33. The
Complaint alleges that Defendants violated the Constitution
and the Administrative Procedures Act by both sending the
January 11 letter to state Medicaid directors and by
approving Kentucky HEALTH. See Compl., ¶¶
339-408. Soon thereafter, Defendants filed this Motion to
Transfer, asking the Court to send the case to Kentucky,
specifically the Frankfort Docket of the Central Division of
the Eastern District of that state. See Mot. to
Transfer at 2 n.2. On March 30, 2018, the Court granted
Kentucky's Motion for Intervention. See Minute
a plaintiff has brought its case in a proper venue, a
district court may, “for the convenience of parties and
witnesses, in the interests of justice . . . transfer [it] .
. . to any other district or division where [the case] might
have been brought.” 28 U.S.C. § 1404(a). The only
textual limitation on the Court's power to transfer a
case under § 1404(a), then, is the requirement that the
case “might have been brought” in the forum to
which the defendant is seeking ...