Nebraska Supreme Court Rules In Favor Of Low-Income Parents Dropped from Medicaid

Last week Appleseed won a lawsuit in the Nebraska Supreme Court which restored Medicaid benefits to hundreds of low-income parents unlawfully dropped from the program by the Nebraska Department of Health and Human Services (HHS). In the suit, Davio v. HHS, 280 Neb 263 (2010), class members challenged HHS’ policy of terminating a person’s Medicaid benefits as the result of a sanction under the Aid to Dependent Children (ADC) program. The ADC program provides monthly cash assistance to very low-income families (a family of three earning about $9,000 per year). The vast majority of people participating in the ADC program must do a work activity for a set number of hours per month, usually an average of 120. If they do not do the activity, they lose the cash assistance. But HHS went one step further and took away the ADC’s recipients Medicaid as well.

On Friday, the Nebraska Supreme Court found that HHS “unlawfully enlarged upon authorizing statutes and violated the principles of separation of powers,” when it stripped poor families of vital Medicaid coverage by approving a policy that allows HHS to impose a harsher sanction than specified by state law.

This decision is good news for more than 6,000 low-income Nebraska parents that participate in the Employment First Program, which is intended to help families attain economic self sufficiency. Nebraska families that qualify for ADC depend on Medicaid coverage to access needed preventative and medical treatment. Indeed, providing consistent health care coverage allows families to be healthy, retain employment, and become self sufficient. The HHS policy of removing Medicaid only made it more difficult for families to work towards economic independence, contrary to the goals of ADC. In other words, economic independence and access to health care go hand-in-hand. The Legislature recognized this principle in setting its policy and the Davio decision maintains that policy. This means that today, those working hard towards self sufficiency can be assured they will have access to health care, a good thing for many Nebraskans in need.

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