The Deficit Reduction Act of 2005 - reducing the number of recipients and applicants eligible to receive Medicaid benefits: a statutory analysis of the citizenship documentation requirements and proposed amendments to ease the burden on individuals and states.

• Author: Contini, Christal

1. INTRODUCTION II. THE HISTORY AND CITIZENSHIP REQUIREMENTS OF THE DEFICIT REDUCTION ACT OF 2005 A. The Hierarchy of Citizenship Documentation Accepted. B. Exemptions and Extra Documentation Options III. THE ADVERSE IMPACT OF THE ACT ON STATES IV. THE ADVERSE IMPACT OF THE ACT ON INDIVIDUALS V. THE ACT VIOLATES THE FIFTH AMENDMENT OF THE CONSTITUTION BECAUSE IT TREATS CITIZEN APPLICANTS WORSE THAN QUALIFIED IMMIGRANT APPLICANTS A. The Medicaid Statute Should Be Amended to Remedy the Unequal Treatment of Citizen and Immigrant Applicants B. Congress Should Apply the Reasonable Opportunity Language to Citizen Applicants in a Manner Consistent With the Current Statutory Framework VI. THE CODE OF FEDERAL REGULATIONS SHOULD BE AMENDED TO EXEMPT STATES FROM DOCUMENTING FOSTER CHILDREN BECAUSE NOT DOING SO Is AGAINST CONGRESSIONAL INTENT AND IS BAD PUBLIC POLICY VII. THE HIERARCHY IS PROBLEMATIC BECAUSE IT FAILS TO CREATE A LAST RESORT OPTION AND IS UNNECESSARILY COMPLICATED A. The Code of Federal Regulations Should Be Amended To Require States To Assist All Applicants Obtain Citizenship Documentation and To Provide a Last Resort Option for Establishing Citizenship B. The Hierarchy Structure Should Be Simplified To Alleviate the Unnecessary Burdens Imposed on Individuals and States VIII. CONCLUSION I. INTRODUCTION

   George "has had two strokes and cannot swallow or communicate verbally." (1) Since he cannot care for himself, George resides in a nursing home and relies on Medicaid health coverage to pay for his nursing home care and other healthcare costs. (2) George "does not have any relatives to care for him," and as a result fellow church member Art Huenkemeir is his Trustee and has his Power of Attorney. (3) George declared his citizenship "in writing, under penalty of perjury" (4) to fulfill the requirements to become eligible to receive Medicaid. (5) Congress, however, changed the Medicaid requirements by enacting the Deficit Reduction Act of 2005 ("Act"), which requires states to obtain documentary evidence of United States citizenship for certain Medicaid applicants and recipients as a condition for receiving federal funding. (6) This citizenship documentation requirement is "an administrative requirement if a state wants to get federal financial participation"; it is not an eligibility requirement, but has the effect of being one. (7)

   George was born in the United States on July 31, 1926, but does not have a United States passport, birth certificate, government photo identification card, or any other document that would satisfy the citizenship documentation requirements. (8) His Trustee, Huenkemeier, examined all of George's paperwork taken from his home when George moved into the nursing home, but he was unable to find any citizenship documentation. (9) Because of his health problems, George is incapable of assisting in any way to secure the documentation required by the Act. (10) Upon redetermination of George's eligibility to receive Medicaid, George will be unable to provide citizenship documentation verification, (11) and his benefits will likely be terminated by the state for fear it will lose federal financial participation. (12)

   Medically impaired individuals such as George, as well as disaster victims, mentally handicapped persons, homeless persons, and foster children, will be adversely affected by the new citizenship documentation requirements imposed upon the states by the Act. (13) States will also be adversely affected by the increased administrative costs of implementing the Act's requirements. (14) This note asserts that aspects of the citizenship verification requirements treat citizen applicants worse than immigrant applicants, which violates the Due Process Clause of the Fifth Amendment. (15) Amendments should be made to the United States Code and the Code of Federal Regulations to ease the burden on individuals and states, while maintaining safeguards against giving benefits to fraudulent applicants and recipients.

   Part II of this note explains the history and the new citizenship documentation requirements of the Deficit Reduction Act of 2005. Part III examines the adverse impact the Act will have on the states, while part IV examines the adverse impact the Act will have upon applicants and recipients. Part V asserts that aspects of the citizenship documentation requirements are unconstitutional and advocates for an amendment that will remedy the constitutional violation. Amendments to the Code of Federal Regulations to exempt children who receive foster care benefits are examined in part VI, and the abolishment of the documentation hierarchy, as well as the creation of a last resort option, is discussed in part VII. Finally, concluding remarks can be found in part VIII.

2. THE HISTORY AND CITIZENSHIP REQUIREMENTS OF THE DEFICIT REDUCTION ACT OF 2005

   Prior to implementation of the Act, the United States Code required an individual to declare citizenship "in writing, under penalty of perjury" in order to establish eligibility for Medicaid. (16) If there was a reason for a state to question the applicant's written declaration of citizenship, most state policies would then require documentation of citizenship. (17) Two Republican representatives from Georgia, Charlie Norwood and Nathan Deal, noted that this declaration procedure exposes Medicaid to fraudulent enrollment of undocumented immigrants. (18) This vulnerability motivated the representatives to request that a citizenship documentation requirement be included in the Act. (19) Although an estimation of the amount of undocumented immigrants fraudulently enrolled in Medicaid has not been studied, (20) the Department of Health and Human Services ("Health and Human Services") conducted a survey which found that "by their nature, self-declaration policies have inherent vulnerabilities in that they can allow applicants to provide false statements of citizenship. As such, it is vital to have protections in place to prevent such practices." (21) This survey and the pressure from the two Republican representatives foreshadowed an inevitable citizenship documentation requirement, which was made a part of the Act. (22)

   On February 8, 2006, President Bush signed the Act into law, (23) effectively amending the Public Health and Welfare section of the United States Code that deals with Medicaid benefits ("Medicaid statute"). (24) The Congressional Budget Office estimates that the Act will "reduce direct spending by about $39 billion over the 2006 to 2010 period." (25) A Medicaid advocacy group argues that the most significant aspect of the Act "is that a large portion of the reductions in spending are attributable to provisions that make people ineligible for Medicaid or limit the benefits that are available to them through the program." (26) This note will discuss only the effects of the citizenship documentation requirements; any other provisions are outside the scope of this note.

   One way the Act proposes to reduce the deficit is by refusing to provide federal financial participation to a state unless it obtains documentary citizenship evidence for individuals who declare themselves to be citizens. (27) The citizenship documentation requirement is an administrative requirement that a state must fulfill in order to receive the federal government's half of Medicaid. (28) Because the state does not want to lose federal funding, it requires the individual to supply the citizenship documentation to satisfy the state's obligation. (29) Failure to supply the documentation will force the state to deny or terminate the individual's Medicaid benefits. (30) This administrative requirement imposed upon the states is shifted onto the individual. The state does not want to lose federal funding; therefore, it requires the individual to supply the citizenship documentation to satisfy the state's obligation. Failure to supply the documentation will force the state to deny or terminate the individual's Medicaid benefits. In effect, the Act's citizenship documentation requirement is not just a state administrative requirement but an eligibility requirement imposed upon individual applicants/recipients as a condition to receive Medicaid. (31)

   1. The Hierarchy of Citizenship Documentation Accepted

      In order to fulfill the documentation requirements, a state must obtain proof of both citizenship and identity for all Medicaid applicants (32) and current Medicaid recipients "at the time of first redetermination of eligibility that occurs on or after July 1, 2006." (33) Centers for Medicare and Medicaid Services ("Medicare and Medicaid Services") (34) have made it clear that they will audit the states to ensure that the most reliable evidence is being used to satisfy the Act's requirements. (35)

      The Code of Federal Regulations authorizes a hierarchy of documentation that must be used to establish citizenship. (36) The hierarchy is set up into four separate tiers: primary evidence, secondary evidence, third level evidence, and fourth level evidence. (37) The Code of Federal Regulations also specifies that the states must first require citizens to submit primary documents from the first tier and then can move to each subsequent tier when the immediately preceding tier has been exhausted. (38) Thus, an applicant/recipient must first try to submit primary evidence, but if primary evidence is unavailable, the Act requires the applicant/recipient to provide secondary evidence. (39) The third tier can be used only when "primary evidence cannot be obtained within the State's reasonable opportunity period, secondary evidence does not exist or cannot be obtained, and the applicant or recipient alleges being born in the [United States]." (40) The fourth tier "should only be used in the rarest of circumstances...[,] only when ordinary primary evidence is not available, both secondary and third level evidence do not exist or cannot be obtained within the State's...