Structure of the Medicaid Program

“Each participating State develops a plan containing reasonable standards . . . for determining eligibility for and the extent of medical assistance” within boundaries set by the Medicaid statute and the Secretary of Health and Human Services.” Wis. Dep’t of Health & Family Servs v. Blumer, 534 U.S. 473 (2002) (quoting Schweiker v. Gray Panthers, 453 U.S. 34, 36-37 (1981)); see also ABC Home Health Servs. v. Ga. Dep’t of Medical Assistance, 211 Ga. App. 461, 462 (1993). Although States must comply with federal law, each State has significant power to customize its Medicaid program within those parameters. Where federal law is silent, State law can generally fill the interstices so long as States do not violate federal statutes, regulations or rules. See Blumer, supra, at 496 (“we have not been reluctant to leave a range of permissible choices to the States, at least where the superintending federal agency has concluded that such latitude is consistent with the statute’s aims”). Nonetheless, the case law makes it clear that States often go beyond filling the gaps, ignoring federal law, in their efforts to expand collections.

Each State participating in the Medicaid program must develop a State Plan. 42 U.S.C. § 1396a. Among other requirements, the State plan must:

1. Be effective throughout the State; Section 1396a(a)(1);
2. Provide for fair hearings when eligibility is denied or not acted upon with reasonable promptness; Section 1396a(a)(3);
3. Be administered by a single State agency; Section 1396a(a)(5); and
4. Comply with the provisions of Section 1396p with respect to liens, adjustments and recoveries of medical assistance correctly paid, transfers of assets and treatment of certain trusts. Section 1396a(a)(18).