Trump Administration Sued Over Medicaid Overhaul (Audio)

first work mandate for Medicaid. Twelve days later, advocacy groups file the first lawsuit to stop Kentucky's changes, alleging the administration's efforts to overhaul Medicaid are illegal and go beyond the president's authority. A lot of first said, in light of the fact that ten other states have asked Washington to let them make similar changes, the implications of this first legal class are significant. My guest is Sydney Watson,

Professor at St. Louis University School of Law. Sydney, please describe Kentucky's changes to Medicaid um well. Governor Blooden's was elected on a platform to repeal the Medicaid expansion, and when that didn't seem to be politically possible he shifted to requesting this waiver, and the waiver really dramatically changes Medicaid for the people who got coverage through the Affordable Care Act Medicaid expansion for low income, working working adults.

It would impose work requirements. It imposes high premiums even for those who were without any income. It includes laws of coverage and lockout for six months for failure to file paperwork, and it cuts a lot of critical services like transportation to and from medical services. It's a real transformation of Medicaid. It creates tremendous barriers to care. And it's estimated that about of these working age adults who now have Medicaid coverage in Kentucky would lose coverage over

five years. What are the claims in the lawsuit challenging Kentucky's waiver UM. It's a series of claims. Some of them are based on the Administrative Procedure Act that the waiver approval itself was an abusive discretion and not in

accordance with law UM. There are other claims that it violates provisions of the Medicaid Act and the Social Security Act, and there's also a constitutional claim that it violates to take care clause that requires the President and the executive branch too, and I quote take care that the laws

be faithfully executed. It's a constitutional claim that the Trump administration is explicitly and willfully trying to undermine the Affordable Care Act, trying to undermine the purposes of Medicaid through approving this waiver. Now, the administration has not responded to this lawsuit yet, but there's been so much talk about this Medicaid waiver. What are likely to be some of

the legal responses to the lawsuit. Well, of course, the government, you know, has time to file their complaint and then we'll we'll see the briefing. I think one of the key issues is going to be the agency's authority to impose this work requirement, to impose these premiums UH, to

impose these paperwork requirements UM. And those claims turn partly on language in the Medicaid Act, but also language about Section eleven fifteen waivers, which are a way for states to have additional flexibility and Medicaid to implement one experimental programs to that promote the objectives of the Medicaid Act. And I think what we're going to hear a lot about is whether these new provisions promote the objectives of

the Medicaid Act. Um. The plaintiffs statement is that the purposes of the Medicaid Act is to provide health insurance and health coverage. UM. The vision of Kentucky and of CMS is that Medicaid has suddenly become a program for work, to promote work, to force work. Now, something that I found a little odd is that the governor, Matt Bevans signed an executive order directing state officials to strip Medicaid coverage from nearly half a million Kentuckians if a court

strikes down any portion of Kentucky's waiver application. So if the court says his action is illegal, he'll pull healthcare coverage from residents of his state. Is that a not so veiled threat to connect those two? I think you're absolutely correct. It's very interesting political posturing that the threat is if you sew me, I'm going to take away these benefits. And can he do that? Um? I don't know.

I mean what was interesting is he did run his gubernatorial campaign saying he was going to repeal this Affordable Care Act expansion. Once he was in office, I think he realized there were political consequences to that, and that you know, and for many Kentuckians is a crucial way to get healthcare coverage. And instead of going through with that threat, we see the waiver. So I don't know. I think it's public and political posturing. We'll see what

happens as the lawsuit goes forward. Will this case have any impact beyond Kentucky? Oh? Absolutely. As you mentioned earlier, ten other states have in requests for waivers um that include work requirements. Many of them also include these high

premiums and other um, other barriers to care. Uh. So this is I think a fundamental legal issue as we move into the second year of the Trump administration of what the Constitutional Administrative Procedure Act and statutory parameters that define the Medicaid program um, And does c ms and states have the authority to create these barriers to care? Is this in some way asking courts to decide the philosophical divide between conservatives and liberals over medicaid or is

it strictly based on the statutes? Um. I think this is both a constitutional challenge and a statutory challenge, but very much this is a legal challenge um, rather than merely a political challenge. UM. The Medicaid Act was passed in nineteen sixty five, and many of the provisions in the Act make it different from traditional private insurance. Medicaid is a safety net program for the poorest Americans and

it's structured in a way to meet their needs. UM And over the last fifty years, while medicators had rocky moments and been underfunded at times by states, it has really helped promote health and help care follow income populations. And I think the fundamental statutory constitutional issue here is does the agency do states have the authority to flaunt that protection and create a program that is really designed to set up a sense a wall of baarrier between

people and that health insurance program. Sydney, about thirty seconds left here. Who has the better side of the argument in your view? UM always seen as the complaints so far, I don't think anyone who follows Medicaid was surprised that this complaint was going to be filed. There's been a lot of talk about these legal theories. We'll see what happens with the briefings. Thank you for being here. That's Sydney Wattson. She's a professor at St. Louis University's School

of Law. A Brazilian appeals court unanimously upheld a graph sentence against former president Louis and Nacio Lula da Silva and added two and a half years to his jail sentence. Hours later, Lula accepted his party's nomination as its presidential candidate. In an act of defiance, his lawyers vowed to take the case to brazil Supreme Court. Learning me from Brazilia is rae call it Bloomberg News Brazilian Bureau chief ray.

What did the appeals court find? Well, essentially, they said that contrary to what Lula's defense lawyers said, that this was all fabricated, that it was a you know, a political move, the poem out of the race. There, they said that essentially there was sufficient evidence to conclude that Lula not only participated in the scheme, he helped UH forge it, if you will, by appointing um key personnel and staff to um State companies, who then walked away

with millions of dollars in there and their pockets. And he also personally benefited, They argued, he received a beach side apartment, or really at least an upgrade to it. UM in exchange for favors for for a construction company. And of course the verdict was three to zero, which left little doubt that Lula Lula's defence lawyers were hoping for split vote, which would have given them more more chance for an appeal. But but there it is, and

and and that's the that's the final verdict. He's been leading the polls for October's presidential election and since the conviction his poll numbers improved a little. Can you explain the loyalty he inspires despite the charges and the conviction. Yes, absolutely, he's somewhere north of thirty three is the voter intention that he has in in the polls. Lula is one of those historic figures. I mean, he's he's larger than life.

He's he's pulled millions of people out of poverty. He's probably the first first president that comes from UM, from a rather humble background UM. And people don't don't forget that. And of course we have to remember that when he was in off As, those were the boom days. That's where you know that the commodity boom was going on. Brazilva's exporting soybeans, iron ore, all sorts of things, and things were going well, um, and so there's a bit of reminiscing going on as well. Well, if we had

Lula back, things would be good again. Um. But let's not forget there are more people who don't want him president than there are people who do. Um. So that's something to to bear in mind. Not everybody wants him back. The Silva still has several avenues of appeal. Is there likely to be a lot months of uncertainty ahead of

the vote. That's absolutely right. It's gonna be a long legal battle, um, finding legal loopholes, and unfortunately that's the worst scenario for investors, for citizens, especially if they're very damaging. Epis shout of years of crisis, of doubts of our democracy the people that actually want dictatorship back has has gone up. And that's the worrying part. You know, people want a clean, fair election. The lasting Brazil needs right now is doubts over who can run, why this person

can or cannot run. Hopefully all that will be settled before the election in October seven. And I've read some politicians saying that if he is not in the election, there will be those kinds of doubts about it. Well again, I mean that's what they're alleging, that this is a political move to pull him out of the race. We do have to keep in mind he's not the only

one being sentenced. As a matter of fact, this whole car wash operation that's been going on for for years has put dozens of people behind bars from different political parties. Lula is not the only one. And the same court that upheld his conviction yesterday has up up pulled more than two dozen similar convictions. So I think that puts it a bit into into into perspective that this perhaps isn't quite the political persecution that Lula would would have

it be. He's seventy two years old. Why did the court add two and a half years to his jail sentence to make a ten Well, look, I'm afraid, my my, my legal expertise there comes to an end. They simply looked at the facts and if he found guilty of certain charges, then they you know, got out the calculator and find you know, found that that that that that deserved more than twelve years. But I think the psychological impact of that is just that it was all the

more of a blow. You know, they wanted him to you know, uh, they split vote at least maybe get him off the hook. But no, on the contrary, it got worse. So, you know, a big blow for Lulah that day. And what are the I know you're not legal expert on this, but are there are people saying that they has a chance on appeal? Um, the chances very small. I mean, frankly, there's a there's a law in Brazil that clearly states anybody who's been convicted UM

in an appeals court, criminally convicted, cannot run. So they're going to the motion. They're gonna look for all legal loopholes, but frankly, the chances are small. There is a law. Um. What what needs to happen is that justice needs to be done quickly. Again, as I said, so the Brazilians

can have a fear fair and clean election. When I was reading about the amount of security yesterday around the courthouse, it was really it's sort of was like a something that you see in a movie because it was just so overpowering. Describe what what the setup was like, Yes, particularly for for Brazilian standards, there were sharpshooters on the roof. There were even Navy patrol ships on a river that's ports in the southern The southern city is close to

the ocean, but this was a river. The navy patrol ships. They closed down part of the the airspace above the courthouse, so quite quite you know, tight security measures, um, which are a bit unusual for for Brazil. I think the concern was because tens of thousands of supporters of Lula were busted into the city. UM that the conditions for safe trial we're not given. Hence the the extra security measures.

And it's not entirely I mean, we had a couple of months ago last year, um, the agriculture ministry here in Brazilia was set on fire, for example, during during a protest. UM. So I think they were just trying to be on the safe side and ensure that you know, violence and interruption of this trial would have would have been worse yet than than any sort of outcome. UM. So I think it was part of the wise thing to do, all right, And thank you so much for

being here. Ray, that's Ray College. He's a Bloomberg News Brazilian bureau chie. Thanks for listening to the Bloomberg Law podcast. As you can subscribe and listen to the show on Apple Podcasts, SoundCloud, and on Bloomberg dot com slash podcast. I'm June Brosso. This is Bloomberg h