Trump's health overhaul efforts hit legal roadblocks

Key aspects of President TrumpDonald John TrumpTrump's top adviser on Asia to serve as deputy national security adviser United Auto Workers strike against GM poised to head into eighth day Trump doubles down on call to investigate Biden after whistleblower complaint: 'That's the real story' MORE's health care agenda are struggling to overcome legal challenges in the courts.

The administration, unable to repeal ObamaCare or enact conservative changes through Congress, has used its regulatory authority to try to push through changes to the Medicaid program and private insurance.

Many of those efforts have fallen short when faced with legal challenges.

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The administration was dealt major blows this past week when two of Trump’s signature policies — Medicaid work requirements and association health plans — were struck down in separate rulings.

The rulings are a setback to the administration’s efforts to aggressively push ahead with conservative health policies. Combined with political opposition from Democrats in the House, they put the president’s health agenda in a precarious position heading into the 2020 election.

"The administration has tried to put certain policies in place that provide alternatives to the Affordable Care Act," said Chris Condeluci, a health care attorney and former Republican Senate Finance Committee counsel. "If the courts continue to rebuff those efforts, at the end of the day, the Trump administration will have very little to show for their changes to health policy."

On Wednesday, Judge James Boasberg ruled against new Medicaid work requirements in Kentucky and Arkansas.

Administration officials looking to reshape the Medicaid program have made approving work requirements a key priority. Trump’s fiscal 2020 budget proposal calls for sharp cuts to the program, elimination of ObamaCare’s Medicaid expansion and work requirements nationwide.

Boasberg, an Obama appointee, ruled that the projects in Kentucky and Arkansas didn’t consider "the 'core' objective of Medicaid: the provision of medical coverage to the needy."

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The judge has twice now blocked Kentucky’s work requirements, essentially because the administration did not take into consideration the amount of people who would lose benefits.

The administration suffered another blow the next day when Judge John Bates, a George W. Bush appointee, struck down the administration’s expansion of association health plans, which allow small businesses and other groups to band together to buy health insurance.

Both rulings show the pitfalls of the administration’s aggressiveness to change health care.

"There are some limits to what you can do. You actually have to follow the law," said Katie Keith, a health consultant and researcher at Georgetown University. "These policies were pushing the envelope. [The administration is] running into the very real limitation of what federal law says.”

In his Thursday ruling, Bates said the final rule on association health plans "is clearly an end-run around" ObamaCare and "does violence to" the law that governs employer health plans.

Association health plans did not need to follow all of ObamaCare’s coverage requirements, which Republicans argued made them more affordable. However, plans were required to meet state coverage laws, and many offered similar coverage to ObamaCare.

The expansion of association health plans was one of three priorities outlined in a 2017 executive order aimed at taking action on ObamaCare after Congress failed to repeal the law.

Trump described the order as "starting that process" to repeal ObamaCare. He said it was intended to be the "first steps to providing millions of Americans with ObamaCare relief."

That made Thursday’s ruling all the more significant.

"You even had a George W. Bush appointee saying it’s unlawful," Keith said.

Despite the court losses, the administration is vowing to push forward. On Friday, Utah received approval to impose work requirements, just days after the Kentucky and Arkansas rulings.

Justice Department officials are expected to appeal the Kentucky and Arkansas decisions, and experts said it will be a long time until the matter is resolved in the courts.

Alex Shekhdar, a consultant and founder of Sycamore Creek Healthcare Advisors, said administration officials know that lawsuits are "the cost of doing business" when trying to make policy through administrative action.

"It was all going to be judicial and regulatory. That was expected with the shift in Congress," Shekhdar said.

"[The Department of Health and Human Services] knows these regulations are vulnerable to these types of legal challenges," said Keith. "It’s just them pushing the envelope and knowing they’ll go to court."

One lawsuit where the administration has prevailed is the challenge by conservative state attorneys general in Texas.

In a shift this past week, the Justice Department said it agrees with the initial ruling that the entire ObamaCare law is unconstitutional and invalid.

That lawsuit has been heavily criticized, even by conservative legal experts, and it’s considered a long shot to succeed on appeal in the 5th Circuit.

Still, the surprise decision shows the administration won’t be deterred in its efforts to end ObamaCare.

"They’re prepared to continue down a path of trying to eliminate or curtail the Affordable Care Act," said Ed Leeds, a health care attorney at Ballard Spahr.