Section 1115 Medicaid demonstration waivers provide states an avenue to test new approaches in Medicaid that differ from federal program rules. Waivers can provide states considerable flexibility in how they operate their programs, beyond what is available under current law. Waivers generally reflect priorities identified by states and the Centers for Medicare and Medicaid Services (CMS). In November 2017, CMS posted revised criteria for Section 1115 waivers that no longer include the goal of increasing coverage. On January 11, 2018, CMS posted new guidance for state Section 1115 waiver proposals to condition Medicaid on meeting a work requirement and subsequently has approved the first waivers of that type in the history of the Medicaid program. Each administration has some discretion over which waivers to approve and encourage (see Appendix A) but that discretion is not unlimited. For example, in June 2018, the DC federal district court set aside the work requirement and other provisions that restrict eligibility and enrollment in the Kentucky HEALTH waiver approval and sent it back to HHS to reconsider. Section 1115 waiver activity is expected to continue both through administrative decisions and the courts. This brief provides basic information about the purpose and function of Section 1115 waivers, describes the current administration's waiver priorities, and discusses trends in recent state waiver requests and waiver decisions made by the Trump administration. The most current activity is contained in our Medicaid waiver tracker, which shows approved and pending waivers.
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